UBS Raises Brent Crude Forecast to $110 Per Barrel
UBS increased its Brent crude oil price forecasts due to Middle East supply volatility, record ship attacks, and surging freight rates.
Financial services firm UBS raised its Brent crude oil price forecasts, now expecting prices to remain near $110 a barrel by the end of 2026. The firm also adjusted its 2027 outlook upward, predicting prices between $85 and $95 per barrel through September 2027.
Strategist Giovanni Staunovo attributed the increase to falling global visible oil inventories and volatile supply in the Middle East. Despite crude flows recovering to approximately 18.8 million barrels per day in early October, the region experienced a record 30 attacks on ships in and around the Strait of Hormuz during the same month.
These security risks have driven up insurance costs and forced an increase in ship-to-ship transfers, which absorb available tanker capacity. Consequently, tanker freight rates from the Middle East to China have surged to $30 to $40 a barrel, a sharp increase from the $1 to $3 average recorded over the previous decade.
