No one in their right mind would dare to sit short oil over the coming weekend.
That’s what Skandinaviska Enskilda Banken AB (SEB) Chief Commodities Analyst Bjarne Schieldrop stated in a SEB report sent to Rigzone on Friday, adding that “oil is thus set to close the week at a very strong note today”.
Schieldrop warned in the report that the “big, big risk” for the weekend is that oil infrastructure could be damaged.
“For example, Iran’s Kharg island which is Iran’s major oil export hub,” Schieldrop highlighted.
“If damaged, we would have a longer lasting loss of supply stretching way beyond Trump’s announced ‘two more weeks’. It will make the spot price spike higher and it will lift the curve,” he added.
“Brent crude 2027 swap would jump above $80 per barrel immediately. An attack on Kharg island would naturally lead Iran to strike back at other oil infrastructures in the Gulf,” he continued.
“An attack on Kharg island would not just lead to a lasting outage of supply from Iran until it would be repaired. It would immediately endanger other oil infrastructure in the region as well and additional lasting loss of supply,” Schieldrop warned.
In the report, Schieldrop highlighted that Brent crude gained 9.2 percent yesterday.
“The trading range was limited to $95.2-101.85 per barrel, with a close at $100.46 per barrel … higher than the Monday close of $98.96 per barrel,” he said.
“This morning Brent is up two percent to $102.4 per barrel and is trading at the highest intraday level since Monday when it high an intraday high of $119.5 per barrel,” he added.
In a BMI report sent to Rigzone by the Fitch Group late Thursday, analysts at BMI, a unit of Fitch Solutions, noted that Brent crude oil prices have “fluctuated dramatically” since the start of the U.S.-Iran war on February 28, “ranging from around $75-120 per barrel during intraday trading”.
“At the extreme, on March 9, the front-month contract swung by around $35 per barrel in a single day, illustrating the wide-ranging uncertainties investors now face,” the analysts added.
“While prices will remain volatile, Brent appears to be settling into a new and higher trading range broadly aligned with our mid-case scenario for the market,” the analysts continued.
“Transit through the Strait of Hormuz has slowed to a trickle and Iran continues to concentrate its attacks on regional oil and gas infrastructure and shipping in the Gulf,” they went on to state.
The BMI analysts highlighted in the report that they are raising their 2026 annual average price forecast for Brent crude from $67 per barrel to $70 per barrel.
In the report, the BMI analysts pointed out that oil markets are “habitually choppy” but warned we are now in a situation where an end of month price of $75 per barrel or $130 per barrel “are more or less equally plausible”.
“Everything hinges on the conflict’s duration, and the messaging on this has been muddled,” the analysts said.
An analysis piece sent to Rigzone by the S&P Global team on Thursday, which was penned by Jim Burkhard – who heads S&P Global Energy crude oil research – and the S&P Global Energy Crude Oil Markets team, noted that S&P Global Energy has updated its base case outlook with the expectation for Dated Brent prices ranging between $70-$100 on a monthly average basis for the remainder of 2026.
“This outlook assumes secure tanker flows via the Hormuz resume in coming weeks,” the analysis piece said.
“However, the potential for exceptional volatility remains due to the uncertainty of the situation. If the Strait of Hormuz were to be closed for a couple of months (instead of weeks), crude oil prices would likely hit new record highs,” the piece warned.
Rigzone has contacted the White House and the Iranian Ministry of Foreign Affairs for comment on the SEB and BMI reports and the S&P Global analysis piece. At the time of writing, neither has responded to Rigzone’s request.
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