Brent Crude Above $104/Bbl | Iran Reportedly Working With Oman On Hormuz Toll Framework | CNBC TV18

Added: 2026-05-25

[00:00:08]Welcome back. Let's talk commodities as promised. Manisha is now joining in.

[00:00:11]Manisha, what are you looking at? Well, I'm looking at the crude oil prices. It continues to be quite volatile, choppy for the whole of this week. Overnight, we've seen 2% of a decline come in. And for this week, with that decline, we're down by nearly 4% for the Brent crude prices. For this year though, we're still 70% on the higher side there in.

[00:00:26]The US Secretary of State Marco Marco Rubio has said that there were some encouraging signs on a possible deal with Iran. That is what the markets are dealing with. But in the meanwhile, you also have statements from Iran reportedly working with Oman on framework for permanent toll system at Strait of Hormuz. This is something that the US does not like, and most of the oil producers also would not want this.

[00:00:48]So, this is where the markets seem to be stuck at this point in time. Also, in addition to that, it is going to be the OPEC plus meeting on 7th of June. That is what the street will watch out for.

[00:00:57]The seven OPEC plus countries may hike output yet again for the month of July.

[00:01:01]Though without the UAE, what are those numbers looking like? And this spare capacity that the OPEC holds is something that the markets will be doing maths about. And then, there's an estimated 8.5 million barrels per day of global inventory decline that the street is now putting out. We have a similar statement coming in from Goldman Sachs, from JP Morgan as well, suggesting that the decline in global inventories is quite sharp, especially when you look at the average numbers for the month of May. If the transit through Hormuz resumes in third quarter, then the prices are expected to slide below $95 a barrel. The street is also anticipating that by the fourth quarter, there would be some normalization back into the street as well. And that could look at the Brent forecast at around 80 to $89 a barrel there in.

[00:01:44]But even with that, it does stay above 80 no matter what. IEA in the meanwhile also cut the 2026 demand forecast by nearly 420,000 barrels per day there in.

[00:01:54]So, the demand growth for 2026 almost cut to as as low as half a million barrels perhaps, and that would continue to weigh on to the markets therein. For the prices itself, when you look at the second quarter, the current quarter that we are in, the Brent is averaging at around $106 a barrel, and that's exactly what the markets do believe that we could be looking at the crude prices going forward as well. So, when you look at all of those forecasts coming in, take a look at the EIA suggesting that $96 a barrel is where they see the crude prices averaging for the rest of 2026.

[00:02:26]Now, you have Goldman Sachs talking about $85 a barrel off an average, $100 is what Barclays has put out. Zanlist talks about a range between 95 to 105 is where the crude prices perhaps will stabilize going forward in this and the next quarter as well. World Bank also has upped its average for 2026 for Brent at $86, and JP Morgan talks about 96.

[00:02:48]So, that forecast or those prices of 60s and 70s that we saw before West Asia conflict perhaps are absolutely done away with. Most average forecast coming in anywhere between 85 to 105 on the higher side. All right, Manisha, thank you very much for that.