SKN | Barclays Maintains $100 Brent Oil Forecast for 2026 as Middle East Supply Risks Intensify

Key Takeaways:

• Barclays maintained its 2026 average Brent crude oil forecast at $100 per barrel, while warning that risks remain tilted to the upside.
• The bank estimates that the ongoing Middle East conflict has removed approximately 14 million barrels per day, or roughly 14% of global oil supply, from the market.
• Barclays believes historically low global inventories and resilient oil demand could support elevated crude prices even if the Strait of Hormuz reopens in the near term.

Barclays has reaffirmed its forecast that Brent crude oil will average $100 per barrel in 2026, while cautioning that geopolitical developments continue to create meaningful upside risks for energy markets. The bank’s outlook comes as Brent crude trades above $105 per barrel, supported by ongoing uncertainty surrounding U.S.-Iran peace negotiations and the continued disruption of oil shipments through the Strait of Hormuz.

Supply Disruptions Continue to Tighten Global Markets

According to Barclays, the closure of the Strait of Hormuz has significantly tightened global energy supplies. Before the conflict, approximately 20% of the world’s oil shipments passed through the strategic waterway, making it one of the most critical energy transit routes globally.

The bank estimates that around 14 million barrels per day of oil production, representing approximately 14% of global supply, has been removed from international markets. The disruptions affect major oil-producing countries including Saudi Arabia, Iraq, the United Arab Emirates, and Kuwait, reducing available exports and placing additional pressure on already constrained inventories.

These supply interruptions have been a key driver behind recent gains in Brent crude prices as traders continue to assess the duration of the disruption and the timeline for restoring normal shipping operations.

Historically Low Inventories Support Prices

Barclays noted that inventory conditions remain exceptionally tight despite the possibility of improved geopolitical conditions.

The bank estimates that global oil markets are currently experiencing a supply deficit of approximately 6 to 8 million barrels per day, with U.S. crude inventories approaching their lowest levels since 2020. Even under an optimistic scenario in which the Strait of Hormuz reopens immediately, Barclays believes inventories would still begin from levels roughly 20 million barrels below the tightest inventory conditions previously recorded.

This limited inventory buffer reduces the market’s ability to absorb further supply disruptions, increasing the likelihood that oil prices could remain elevated if geopolitical risks persist.

Demand Remains Resilient

While concerns over industrial activity have weighed on portions of global energy demand, Barclays believes overall consumption remains relatively resilient.

The bank expects that any temporary weakness in industrial-related oil demand could recover quickly if supply conditions normalize. As a result, the combination of stable consumption and constrained production continues to provide support for higher crude prices over the medium term.

This outlook reinforces Barclays’ decision to maintain its 2026 Brent forecast while acknowledging that current market conditions present greater upside than downside risks.

Market Focus Remains on Geopolitical Developments

Investors continue to monitor negotiations between the United States and Iran, as well as developments affecting maritime security in the Gulf region.

Any sustained reopening of the Strait of Hormuz would likely improve supply flows and ease some pressure on inventories. However, Barclays cautions that rebuilding global stockpiles could take considerable time, meaning oil prices may remain supported even after transportation routes resume normal operations.

The pace of inventory replenishment, combined with global demand trends and production decisions from major exporting countries, is expected to remain a central driver of crude oil prices throughout 2026.

Closing Insights

Barclays’ decision to maintain its $100 Brent crude forecast for 2026 reflects confidence that structural supply constraints and geopolitical uncertainty will continue supporting elevated oil prices. Although a resolution to regional tensions could gradually improve market balance, historically low inventories and resilient global demand suggest energy markets may remain vulnerable to additional supply shocks. For investors and energy market participants, monitoring geopolitical developments alongside inventory trends will remain essential in assessing the outlook for oil prices over the coming year.

For a confidential discussion regarding energy market strategy, commodity price risk management, global macroeconomic developments, cross-border investment opportunities, or institutional portfolio positioning, contact our senior advisory team.