Citi Forecasts Brent Crude Drop to $60 as Hormuz Tensions Ease

Key Facts

As geopolitical premiums begin to erode, Citi's commodity research team expects Brent Crude prices to plunge to a range of $60-$65 per barrel by the end of the year. The bank attributes this bearish outlook to the normalization of shipping flows in the Strait of Hormuz and the potential for a diplomatic breakthrough between the United States and Iran. Analysts noted that market fundamentals are reasserting themselves as physical disruptions fade and Chinese demand remains lackluster.

This forecast aligns with a broader cautious sentiment among major institutions; Goldman Sachs recently lowered its 2025 Brent price forecast to $76, citing a potential supply surplus (per Reuters reports). Compared to previous quarters, slowing global manufacturing growth is weighing on refining margins, a trend supported by recent market data showing China's Manufacturing PMI at 50.6 for June 2026.

Key catalysts to watch include the upcoming U.S. JOLTs Job Openings and CB Consumer Confidence data, which will serve as critical barometers for the health of the world's largest economy and its subsequent impact on global oil consumption.