(BOE Report) – Citi said on Thursday it expects oil prices to trend lower over the next six to 12 months, to $60 to $65 per barrel by the first quarter of 2027 as flows through the Strait of Hormuz normalize following the signing of a U.S.-Iran MoU to end their conflict.
Oil tankers sailed through the strait and the United States said it lifted its blockade on Iran on Thursday as an interim deal to end the war took effect, though key issues are still unresolved between the two countries.
The bank added that the resumption and normalization of Strait of Hormuz flows would over time in the bank’s estimation “re-anchor oil prices to weaker underlying fundamentals.”
Oil prices dropped to their lowest level on Thursday since the war began on February 28, as analysts said exports through the strait, which handles about one-fifth of global oil supply, could return to normal in the coming months.
(Reporting by Ishaan Arora; Editing by Sanjeev Miglani)
