The prolonged conflict between the United States and Iran is significantly impacting the global energy market, leading analysts to predict that oil prices will likely stay near record levels for an extended period.
Market participants anticipate that the average price of Brent crude oil will range between $81 and $100 per barrel over the next year. Nearly two-thirds of respondents in a recent survey believe that geopolitical risks will maintain an additional “risk premium” of $5 to $15 per barrel for the foreseeable future.
According to analysts at Bloomberg Intelligence, while the market does not foresee a complete breakdown of the traditional pricing model, it does expect the current instability to persist.
The Strait of Hormuz, a crucial oil supply route, is facing significant threats due to the ongoing conflict surrounding Iran, which has now lasted for 12 weeks. This situation has led to concerns over attacks and shipping restrictions, resulting in a notable decrease in global energy supplies and raising the risk of renewed inflation.
Market estimates suggest that disruptions in global oil supplies could range from 3 to 7 million barrels per day. Some experts warn that oil flows through the Strait of Hormuz may remain below normal levels for an extended time.
In light of these escalating risks, traders are shifting their focus from speculative investments to strategies aimed at protecting against price volatility. Hedge funds have begun to reduce their large bets on further oil price increases, while the market is increasingly adopting risk management strategies.
Meanwhile, in the United States, production of shale oil is expected to rise. The U.S. Energy Information Administration projects that domestic production could reach a record high of 14.1 million barrels per day by 2027.
The ongoing U.S.-Iran conflict continues to affect global oil prices, with analysts forecasting sustained high prices and potential supply disruptions. As traders adapt to the instability, U.S. shale oil production is expected to increase significantly in the coming years.