Wall Street analysts are divided on the oil market outlook after a US-Iran deal to reopen the Strait of Hormuz, while auto repair shops globally face persistent motor oil shortages that may extend into 2027, according to multiple reports.
Morgan Stanley lowered its oil price forecasts for the rest of 2026, expecting Brent crude to average $84 a barrel in Q3 (previously $90) and $80 in Q4 (previously $85). The bank cited eased geopolitical risk premiums and improved supply flows. Goldman Sachs took a more optimistic stance, projecting Persian Gulf exports could return to pre-war levels by late July and trimming its Q4 Brent outlook to $80 from $90. The split underscores uncertainty in energy markets.
Meanwhile, the Strait's closure had severely disrupted supplies of petroleum-derived products like motor oil, paint thinner, and diesel exhaust fluid. Tokyo auto shops, as reported by Reuters, are struggling with critical shortages. Shin Etsu Denso’s director said oil supplies were “almost completely wiped out” since April. In Detroit, dealerships face longer repair wait times and rationing. Industry executives warn that even with the deal, supply chains remain snarled, and prices may not ease until mid-2027 as inventories rebuild.
Oil prices dipped, with Brent slipping below $83 and WTI near $80, reflecting relief over the Hormuz reopening. However, analysts caution that logistical challenges and insurance costs could slow recovery, keeping volatility high.
