ANZ Group Holdings Ltd. has increased its Brent oil price forecast for year-end to $105 a barrel from $95, citing tighter market conditions after the Middle East conflict. The forecast assumes no further escalation in hostilities and relies on existing constraints in Middle Eastern exports, shipping, and refined-product markets.
Oil traders expect potential price spikes after the US midterm elections on November 3, especially if military action against Iran resumes. Brent reached a six-month high above $117 as signs emerged of possible US strikes.
Shipping through the Strait of Hormuz is now operating at around 60% of pre-war levels, limiting the ability to rebuild inventories despite improved flows. Strategic stockpiles have been depleted, and demand may be stronger than previously thought, with global spare crude inventory cover dropping to 41 days from 45 earlier this year.
ANZ strategists Daniel Hynes and Soni Kumari warn the market’s buffers have been weakened over eight months of disrupted supply, making it vulnerable to further shocks. The outlook remains uncomfortable as supply improvements could unlock pent-up demand.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing