Macquarie: Even if the Middle East situation eases, oil prices remain at the bottom in the $85 to $90 range.

Hot Topics

            Watchlist
Data Center
Market Center
Capital Flow
Simulated Trading
        

        Client

Financial News Agency, March 24 (Editor: Zhou Ziyi) Amid the ongoing war in the Middle East, Brent crude oil prices have risen over 60% this month. Concerns about the escalating conflict between the U.S., Israel, and Iran may trigger a global energy crisis and drive up inflation.

This conflict has essentially disrupted cargo transport through the Strait of Hormuz, forcing oil producers in the Gulf region to cut daily production by millions of barrels.

Currently, the total amount of oil transported through the Strait is expected to be 1.5 million barrels per day, far below the normal level of 15 million barrels per day, indicating a supply gap of 13.5 million barrels daily.

Compared to crude oil, refined products such as diesel and jet fuel have seen even greater price increases, putting more pressure on both consumers and governments.

Regarding the current situation, according to Macquarie, if the Strait of Hormuz remains closed until the end of April, Brent crude oil prices could still reach $150 per barrel.

Macquarie also stated, “Even if tensions may ease (referring to President Trump’s statement on Monday), we still expect oil prices to bottom out at $85 to $90 per barrel and quickly rise back to the $110 range until the Strait of Hormuz fully reopens.”

Will tensions ease?

On Monday (March 23), Trump announced that he had ordered a temporary halt to plans for an attack on Iranian power plants, noting that the U.S. had engaged in productive talks with Iranian officials, reaching a “significant consensus.”

This statement briefly eased the currently tense situation in the Middle East and caused significant fluctuations in the commodity market—especially in the crude oil sector—resulting in a more than 10% drop in oil prices that day.

However, Iran immediately denied any signs of negotiations with the U.S., pointing out that Israel continues its military operations. Iranian Vice Chairman Ali Nikzad also stated that the Strait of Hormuz will not return to normal operations and ruled out the possibility of negotiations with Washington.

Brent crude futures prices subsequently surged to $104 per barrel, and the U.S. benchmark West Texas Intermediate crude oil price rebounded nearly 4%.

Anindya Banerjee, head of commodities and currency research at Kotak Securities, believes, “Currently, Brent crude prices in the spot market may fluctuate between $95 and $110. A price drop below $95 would confirm a return to a bearish market trend.”

Banerjee also pointed out that it is still too early to draw conclusions and that one cannot fully factor in the sustained upward trend triggered by the crisis into pricing considerations.

 Sina Cooperative Large Platform Futures Account Opening Safe and Fast Guaranteed

A wealth of information and precise interpretations, all in the Sina Finance APP

Editor: Li Tiemin