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(Reuters) – UBS on Thursday cut its Brent crude forecasts to $85 a barrel for end-September and end-December, from $105 and $95 respectively, and said a recovery in oil production from the Iran war was likely to be slower than the market expects.
An interim deal last week to end the U.S.-Israeli war on Iran, which began on February 28, has allowed traffic through the vital Strait of Hormuz shipping route to resume.
- U.S. Energy Secretary Chris Wright told a forum that flows through the strait were close to pre-war levels. Shipments through the narrow waterway along Iran’s coast had been curtailed for months.
- Oil prices fell on Thursday to levels last seen before the war began as expectations of rising Middle East supply outweighed demand concerns.
- UBS expects Brent to trade at $80 a barrel at end-March and end-June 2027.
- “We continue to expect the production recovery process to be slower than the market expects, leading to higher prices than current levels,” UBS added.
- Front-month Brent crude futures were trading around $72 a barrel.
- On Wednesday, J.P. Morgan cut its forecast for Brent prices in the second half of 2026, citing weaker-than-expected OECD inventory draws and softer demand.
Reporting by Ashitha Shivaprasad and Noel John in Bengaluru. Editing by Louise Heavens and Mark Potter
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