Bank of America Warns of Extreme Oil Rally as Brent Forecast Raised to $95

Bank of America has raised its Brent crude oil price forecast for the second half of 2026 to $95 per barrel, up from $83, citing prolonged supply disruptions in the Persian Gulf. The bank warns that an extreme scenario could push prices above $150 per barrel. The analysts now assume geopolitical tensions will persist through year-end, with Strait of Hormuz disruptions slow to resolve. While alternative routes and escorted tankers have offset some losses, damaged infrastructure makes rapid normalization unlikely. Saudi Arabia's shipments through the strait have recovered to 2.9 million barrels daily in late September, up from 700,000 in August. The conflict has also spread to the Bab el-Mandeb strait, where Houthi attacks have disrupted pipelines. For 2027, the bank forecasts an average Brent price of $80 per barrel, though it warns that if disruptions continue into spring, prices could exceed $150, potentially curbing global demand.