Citi Predicts Brent Crude Oil Prices Could Reach $120 per Barrel

Citi has forecasted that Brent crude oil prices may reach $120 per barrel in the short term, warning that the oil market is underestimating the risks of prolonged supply disruptions. According to Jin10, if the Strait of Hormuz only gradually reopens in the third quarter, prices could even surge to $150 per barrel. A notable prediction in the report is that global oil inventories are expected to decrease by 1 billion barrels this year. This rapid consumption rate is narrowing the buffer between current supply levels and a genuine 'physical shortage.' The market's ability to absorb further supply disruptions without causing price spikes is diminishing with each passing week. In Citi's 'mid-scenario' forecast for 2027, Brent crude oil prices are expected to remain in the $80 to $90 per barrel range. This projection assumes that Iran will eventually regain control over the shipping routes of the Strait of Hormuz and align crude oil exports with anticipated demand growth, suggesting that once supply normalizes, oil prices could face significant downward adjustments.