Energy Experts Raise Oil Price Predictions Amid Global Tensions

Financial analysts have increased their oil price forecasts for 2026 due to international tensions, particularly involving Iran and the U.S. However, market oversupply concerns continue to limit how high prices might climb.

Energy market specialists have revised their oil price predictions upward for the coming year as international tensions create uncertainty in global supply chains, though surplus concerns may prevent dramatic price increases.

A February survey of 34 financial experts and economists now projects Brent crude oil will reach an average of $63.85 per barrel throughout 2026, representing an increase from January’s prediction of $62.02.

American crude oil is anticipated to reach $60.38 per barrel on average, higher than the previous month’s estimate of $58.72. Current year-to-date averages show the benchmarks trading at $70.48 and $65.01 respectively.

Norbert Rucker, who leads economics and next generation research at Julius Baer, explained the current market dynamics: “Oil prices are bloated with a decent geopolitical risk premium.”

Rucker added: “That said, Iran tensions should prove temporary and once the attention span exhausts, the focus should return on the supply glut and the lasting pressure on prices.”

Earlier this year, market watchers had predicted Brent and WTI would average $74.63 and $70.66 during 2025, while actual prices reached $68.19 and $64.73 respectively throughout the year.

Market experts indicate that worries about potential military conflict between America and Iran have added a risk premium of $4 to $10 per barrel to current oil costs. President Donald Trump referenced possible military action during his recent State of the Union address.

Nevertheless, expectations of market oversupply will likely become the primary factor influencing prices as the year progresses, according to industry watchers. Projected surplus estimates vary widely from 0.8 million to 3.5 million barrels daily, with outcomes partially dependent on China’s stockpiling activities.

Cyrus De La Rubia, chief economist at Hamburg Commercial Bank, noted China’s significant impact on global markets: “A slowdown in China’s strategic stockpiling would further increase the oversupply, as China has recently added around 1 million barrels per day to its reserves, effectively removing part of the surplus from the market.”

The OPEC+ alliance remains a key factor in market dynamics, with the organization reportedly considering a production increase of 137,000 barrels per day for April, according to three knowledgeable sources who spoke with Reuters.

This potential increase would end a three-month freeze on production growth as the group prepares for higher summer demand periods.

Eight OPEC+ member nations are scheduled to convene this Sunday for discussions.

Zain Vawda, an analyst with MarketPulse by OANDA, suggested the timing could be significant: “If the geopolitical risk premium remains in play by then, this may further embolden (OPEC) to resume output hikes.”

Most industry observers anticipate American oil production will either remain steady or decrease slightly in 2026. Simultaneously, analysts project oil demand will grow between 0.5 and 1.1 million barrels daily.

Surabhi Menon, a research analyst at the Economist Intelligence Unit, identified several factors that could limit demand growth: “High prices, an economic slowdown due to trade uncertainties and a higher adoption of EVs will add downward pressure to that growth.”