Citigroup has revised upward its third-quarter Brent crude price forecast to $80 per barrel, up from a prior estimate of $75, citing the prolonged U.S.-Iran conflict and the persistent failure of diplomatic efforts to restore normal oil flows through the Strait of Hormuz. The revision, reported by OilPrice.com on August 7, 2026, marks another notable retreat from the bank's aggressively bearish stance adopted earlier in the summer. Despite the near-term upgrade, Citi maintained its fourth-quarter Brent forecast at $70 per barrel and held firm on its expectation that the benchmark crude will average $65 in 2027.
The bank continues to believe the U.S.-Iran conflict will ultimately be resolved, but acknowledges that the five-month war has lasted considerably longer than initially anticipated, sustaining elevated geopolitical risk premiums in crude prices. At the time of publication, Brent futures were trading at $83.11 per barrel, up $0.62 on the session, while West Texas Intermediate gained $0.51 to $77.80 per barrel. Brent had briefly dipped below $80 earlier in the week on renewed hopes for a Hormuz agreement before recovering as concerns over the pace and credibility of U.S.-Iran negotiations resurfaced.
The latest revision follows a series of recalibrations by Citi. In early July, the bank had recommended selling summer rallies and forecast that Brent would fall to a range of $60 to $65 by year-end, predicated on the assumption that Hormuz traffic would normalize and that Washington and Tehran were converging on a broader diplomatic agreement. Neither assumption has materialized.
Shipping through Hormuz remains heavily constrained, Middle East oil production continues to trade well below pre-war levels, and attacks on commercial vessels have persisted even as negotiators discuss possible arrangements for the strategic waterway. Citi's bearish scenario from last December had Brent averaging just $62 for all of 2026, with a downside case of $50 and a bullish scenario of $75 if geopolitical disruptions actually materialized. The disruptions did materialize.
Brent spent much of the second quarter well above those projected levels after the conflict removed millions of barrels per day from the global market. Goldman Sachs holds a less pessimistic view on the near-term trajectory. The bank said earlier this week that Brent should remain in a range of $80 to $90 until markets receive either confirmation of a U.S.-Iran agreement or a significant escalation in hostilities.
Goldman Sachs also flagged the possibility of Brent reaching as high as $120 per barrel should the Strait of Hormuz remain closed for an extended period. Citi's $70 fourth-quarter target now rests on the same foundational assumption that underpinned its July forecast: a meaningful increase in the volume of barrels transiting through Hormuz. With the waterway still severely constrained, the path to that outcome remains uncertain.
Source: OilPrice.com, Julianne Geiger, August 7, 2026.
Source: oilprice.com