Why Bank of America Raised Its Brent Oil Outlook to $95—and Still Sees a $150 Risk

Bank of America’s higher Brent outlook reflects a more durable Middle East supply-risk premium. The bank raised its second-half 2026 forecast from $83 to $95 a barrel as continued disruption around the Strait of Hormuz made a quick restoration of Gulf oil flows less certain. That is materially different from forecasting a lasting $150 oil market: the latter is an escalation scenario, contingent on a broader conflict and serious infrastructure damage. 2

Why a disrupted Hormuz route changes the price outlook

The Strait of Hormuz is central to the flow of Gulf crude and petroleum products. Shipping estimates pointed to a large, though unevenly measured, loss of regional supplies. Goldman Sachs estimated total Gulf exports—including less-visible “dark” crossings—at roughly 15 million to 16 million barrels per day, or about two-thirds of pre-war volumes. Vortexa put August Gulf exports at about 15 million bpd, roughly 10 million bpd below pre-war levels. 6

That scale of disruption is why BofA’s outlook moved higher. A market that expects shipping to normalize quickly can absorb a short-lived interruption more easily. A market facing persistent constraints must price a longer period of tighter physical supply, inventory drawdowns and greater vulnerability to any additional outage.

The problem is not limited to Hormuz. Risks to Red Sea routes and attacks on Saudi energy infrastructure add to uncertainty over how much crude can reach buyers and which export routes remain dependable. In particular, disruption to Saudi Arabia’s East-West pipeline matters because it is an alternative export route that avoids Hormuz. 19

Why Brent did not remain well above $100

Oil prices also reflect expectations of what happens next, not simply the volume missing today. In late September, two mitigating signals emerged.

First, Saudi exports showed a partial recovery. Saudi Aramco loaded about 14 million barrels onto seven very large crude carriers on September 21, according to TankerTrackers.com data cited by Reuters. Vortexa estimated Saudi Gulf crude loadings had averaged about 3.7 million bpd since September 12. 7

Other shipping estimates likewise suggested improvement, although not a return to normal. Kpler data showed Saudi exports at just over 4 million bpd so far in September, following 2.4 million bpd in August. JPMorgan’s satellite-data estimate put Saudi oil moving through Hormuz at 2.9 million bpd over the prior six days, up from roughly 700,000 bpd in August. 10

Second, investors saw a possible diplomatic opening around United Nations meetings. Brent’s November contract settled at $100.34 a barrel on September 21, down 3.4% on the day, as traders weighed hopes for U.S.-Iran diplomacy alongside recovering Saudi shipments. 9

The recovery should not be mistaken for full normalization. Only 12 commodity vessels transited Hormuz over that Saturday and Sunday, compared with 35 the previous weekend. 10 The market was therefore pricing a reduced probability of the worst immediate outcome, not an all-clear for Gulf supply.

BofA’s pathway toward roughly $100 oil

BofA’s higher $95 forecast is consistent with a situation in which oil flows remain impaired but the conflict does not expand into prolonged, widespread destruction of export infrastructure. In this more contained outcome, diplomatic progress or a de-escalation would allow Hormuz traffic to improve gradually, while Saudi export capacity remains usable.

The bank said that if skirmishes limiting oil flows persist through year-end, Brent could trade in a $95-to-$120 range. 2 That range captures a continuing supply shock without assuming the sustained loss of major infrastructure.

For consumers and businesses, this distinction matters: a Brent price near $100 reflects expensive crude and continued volatility, but it does not necessarily imply the extreme shortage conditions associated with a $150 spike.

What could drive a front-month Brent spike above $150

BofA’s $150-plus case is explicitly conditional. The bank has said a broader conflict that causes significant damage to energy infrastructure could push prices to that level. 2 A prolonged war, deeper disruption across Gulf and Red Sea routes, or more permanent damage to strategic facilities would make a severe supply shock more likely.

The East-West pipeline is especially important in this risk analysis because it offers Saudi Arabia an outlet beyond Hormuz. Reuters reported that attacks on the pipeline had disrupted shipments through that route, while Saudi Arabia increased Gulf-terminal loadings afterward. 79

A front-month price above $150 would not necessarily represent BofA’s longer-run equilibrium view. It would be an acute scarcity signal: prices rising high enough to curb consumption, weaken economic activity and reduce demand. That demand destruction is also why a super-spike can be self-limiting rather than a stable price level.

The key variables to watch

The outlook hinges less on a single daily Brent settlement than on evidence about physical flows and conflict scope:

• Hormuz vessel transits and shipment volumes: a sustained recovery would ease the supply-risk premium; renewed declines would increase it. 610
• Saudi export capacity and loadings: stronger Gulf loadings can offset part of the interruption, while further damage to alternative routes would remove a crucial buffer. 79
• Diplomatic developments: credible U.S.-Iran de-escalation could reduce the chance of a long disruption, as markets indicated when Brent fell toward $100. 9
• Infrastructure damage: the escalation case becomes more plausible if attacks broaden or cause lasting damage to critical energy assets. 2

BofA’s forecast revision is therefore best understood as a probability shift. Persistent disruption has made a $95 second-half Brent environment more plausible; a gradual restoration of shipping and diplomacy could keep prices near that range. A move above $150 would require the more damaging conflict path, where supply losses deepen enough that high prices themselves are needed to force demand lower. 26