Fitch Anticipates Oil Glut to Return Following Strait of Hormuz Reopening

Deep News06-08

Fitch Ratings believes the current surge in oil prices reflects a "temporary logistical supply shock" rather than a permanent loss of production capacity.

In a report, Fitch stated: "We assume the Strait will reopen around the end of July and expect Brent crude prices to fall sharply from their March-July highs."

Its base case scenario, which assumes the Strait of Hormuz reopens before the end of July, projects the average Brent crude price for 2026 at $87 per barrel.

Fitch anticipates oil prices will decline after the Strait reopens, with the market quickly returning to a surplus state. It forecasts a supply surplus of approximately 4 million barrels per day in the fourth quarter, contingent on OPEC policy.

ICE Brent crude rose 3.7% to $96.60 per barrel.

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