While the IEA warns of historically serious supply shortages in the oil market, investment banks are responding with upward revisions to their price forecasts.
• International Energy Agency warns of oil supply bottlenecks
• Economic pressure due to supply interruptions
• Banks adjust oil price forecasts upwards
IEA warns of supply bottleneck: global oil market under pressure
The current Oil Market Report (OMR) from the International Energy Agency (IEA) paints a dramatic picture of global energy supplies: The war in the Middle East has triggered the most serious supply disruptions in the history of the oil market. Since tanker traffic through the strategically essential Strait of Hormuz has come to an almost complete standstill, the global market is currently missing around 20 million barrels of crude oil and oil products every day. As a result of blocked export routes and overfilled storage capacities, the Gulf states have already massively reduced their production by at least 10 million barrels per day. The situation remains particularly critical for refined products such as diesel and kerosene, as capacities of over 3 million barrels per day have already been shut down in the region.
Although production increases in non-OPEC+ countries such as Kazakhstan and Russia are partially cushioning the shortfalls, global supply remains highly at risk. To avert an economic shock, IEA member states decided on March 11 to release an unprecedented 400 million barrels from their emergency reserves. This measure is based on record global inventories of over 8.2 billion barrels (as of January 2021). Despite these buffer solutions, the markets reacted extremely volatile: Brent prices temporarily shot up to almost 120 US dollars per barrel after the air strikes on February 28th.
At the same time, high prices and war-related disruptions to air traffic are dampening global demand for oil. The IEA revised its forecast for demand growth in 2026 significantly downwards to 640,000 barrels per day. While the coordinated emergency reserves act as a protective shield for the time being, the IEA emphasizes that a sustainable stabilization of the markets absolutely depends on the rapid securing of shipping routes and a diplomatic solution to the conflict. Any further delay in resuming traffic through the Strait of Hormuz is likely to exacerbate supply shortages and economic pressures worldwide.
Goldman Sachs raises oil price forecasts again
For the second time in less than two weeks, Goldman Sachs recently revised its oil price forecasts significantly upwards. The investment bank is responding to the ongoing blockage of the Strait of Hormuz and a fundamental reassessment of global supply risks, according to investing.com. Analysts now expect shipping traffic through the strategic strait to remain at just 5 percent of normal levels for six weeks before a slow, month-long recovery begins. According to Daan Struyven, head of Goldman’s commodities research, this massive disruption is leading to new market dynamics: The high concentration of production and spare capacity in the Middle East will require a permanently higher risk premium and the build-up of larger strategic inventories in the future.
For March and April, Goldman Sachs now expects an average Brent price of $110 per barrel – a significant jump from the previous estimate of $98. “Prices are expected to continue rising until the market becomes certain that a prolonged shutdown is unlikely,” said Struyven. The long-term outlook was also raised: the forecast for 2026 rose from $77 to $85 for Brent and to $79 for WTI.
Looking ahead to 2027, the bank forecasts an average Brent price of $80, but warns of extreme upside scenarios. If deliveries through the Strait of Hormuz remain severely restricted for a longer period of time, daily prices could even exceed the historic record set in 2008, according to Goldman Sachs. Even in a less dramatic but still “extremely unfavorable” course with ongoing defaults in the Middle East, the bank sees the Brent price at a stable level of around $115 until the end of 2026.
Experts react to ongoing Middle East conflict
However, the escalation in the Middle East is also forcing other major banks to significantly increase their oil price forecasts. According to investing.com, UBS’s team of experts now expects an average Brent price of $86 per barrel for the current year, compared to the previous $72 per barrel. “This is based on the assumption that the conflict will continue for another 2-3 weeks into early April and that supplies through the Strait of Hormuz remain severely restricted, which could briefly push prices above $120 per barrel,” analysts said.
In particular, attacks on critical infrastructure, such as the Qatari Ras Laffan gas field, are fueling fears of long-term supply bottlenecks and rising inflation.
At the same time, Standard Chartered predicts in a base scenario (70 percent probability) that if the conflict eases quickly, oil prices could reach their peak within the next three to four weeks. The duration of high energy prices remains the crucial variable: rapid normalization would give the US Federal Reserve the necessary leeway to cut interest rates in the second half of 2026. However, if oil remains expensive for months (30 percent probability), there is a risk of persistent inflation, which would force a fundamental revaluation of all asset classes.
Evelyn Schmal, editorial team at finanzen.net
