Crude oil prices are likely to remain elevated in the final quarter of 2026 as tensions between the US and Iran, risks to shipping through the Strait of Hormuz and disruptions to production in the Gulf of Mexico keep supply concerns in focus.
While some banks and brokerages expect prices to ease in 2027, the near-term outlook remains uncertain, with several factors threatening to push prices higher.
Brent crude rose as much as 5.5% in the previous session, briefly crossing $105 a barrel, before easing to around $103-$104 a barrel. Prices declined after US President Donald Trump indicated that Washington was open to productive discussions with Iran and would refrain from attacking the country before the US midterm elections on November 3.
However, the possibility of a diplomatic breakthrough has done little to ease concerns over oil supplies. The US has also imposed fresh sanctions on Iranian individuals, companies, petrochemicals and other products, adding to the pressure on Tehran’s ability to export crude.
Bank and brokerage forecasts point to relatively high crude oil prices in the final quarter of 2026, followed by a potential moderation in 2027.
Estimates for the fourth quarter of 2026 range from around $89 to $100 a barrel, while projections for 2027 are generally lower, ranging from $80 to $90 a barrel.
| Firm | Q4 2026 | 2027 |
|---|---|---|
| EIA | $98 | $84 |
| Standard Chartered | $92 | $89.50 |
| Bank of America | $95 | $80 |
| Morgan Stanley | $100 | $90-95 |
| UBS | $95 | $80-90 |
| HSBC | $90 | $85 |
| Barclays | $96 | $85 |
The US has imposed fresh sanctions on Iran, targeting individuals, companies, petrochemical products, and 17 vessels. Currently, 1,220 million barrels of crude remain outside the US blockade on Iranian ports, headed to Asian countries. Once these shipments conclude, Iran will be unable to load or export additional crude oil.
Geopolitical risks are further compounded by escalating maritime threats. Reports indicate 12 attacks on LNG, LPG, oil, and gas tankers in the Strait of Hormuz—the highest frequency since the conflict between the US and Iran began on February 28—adding a risk premium to prices.
On the weather front, markets anticipate an active hurricane season stretching into January. Ahead of Isaias, the first hurricane of the 2026 Atlantic season expected to make landfall at the Gulf of Mexico, onshore and offshore production has been restrained.
Nearly 25% of crude oil and 16% of natural gas production in the Gulf of Mexico is currently shut.
Amid these disruptions, commodity trader Vitol warned that crude oil prices could double to $200 a barrel if ship-to-ship transfers involving Saudi Arabia or Iran are disrupted. The firm noted that freight costs have already surged from $2 to $35 per barrel, alongside higher container and demurrage expenses.
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Crude oil prices may stay elevated in Q4 2026 as Iran tensions, supply risks persist