Economists Agree: 2026 Oil price forecasts lowered as Strait of Hormuz shipping improves – Reuters poll

§ 01 Executive Snapshot

• What: Economists have lowered their 2026 oil price forecasts for the first time since the onset of the Iran war.
• Who: 31 economists and analysts participated in the Reuters poll.
• Why it matters: Improved shipping through the Strait of Hormuz is easing concerns over prolonged supply disruptions, which can significantly influence global oil prices.

§ 02 Key Developments

• Brent crude is expected to average $84.50 per barrel in 2026, down from $90.44 forecasted in May.
• US benchmark WTI crude is projected to average $79.49 per barrel, compared to $84.63 forecasted last month.
• Analysts expect global oil demand growth in 2026 to slow to roughly 1.0 million to 2.0 million barrels per day.

§ 03 Strategic Context

• The lowering of forecasts comes as shipping through the Strait of Hormuz improves, which is historically a critical chokepoint for oil transport and has faced disruptions during geopolitical tensions.
• The broader narrative includes the impact of global economic conditions, particularly weaker consumption in China, on oil demand and pricing dynamics.

§ 04 Strategic Implications

• Immediate implications include potential volatility in oil prices as market participants adjust to the new forecasts and the evolving geopolitical landscape.
• Long-term, the lowered demand outlook could influence investment and production strategies among oil-producing nations and companies.

§ 05 Risks & Constraints

• Potential risks include ongoing geopolitical tensions that could still disrupt oil supply routes, impacting price stability.
• Competition from alternative energy sources and changes in global consumption patterns could further constrain demand for oil.

§ 06 Watchlist / Forward Signals

• Key forward signals include the upcoming quarterly oil inventory reports from the API and EIA, which could indicate shifts in supply and demand dynamics.
• Market reactions to OPEC's production decisions and any geopolitical developments in the region will be crucial to watch in the coming months.