UBS Cuts 2026-2027 Oil Price Forecast on Rising Hormuz Strait Supply

According to Jin10, on July 2, UBS cut its 2026-2027 oil price expectations due to increased energy shipments through the Strait of Hormuz. The bank now forecasts Brent crude at $84 per barrel for 2026, down $9 from previous expectations, and revised 2027 forecasts to $75 per barrel from $85. UBS attributed the downward revision to reduced geopolitical risks and faster-than-expected supply recovery. The bank expects oil prices to rebound modestly to $80 per barrel in the second half of 2026 as floating reserves in the Gulf region normalize. UBS estimated the required inventory rebuilding at a smaller scale than its prior projection of 1 billion barrels.
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