International investment banks are forecasting further declines in oil prices—from around $70 per barrel today—citing growing concerns over global oversupply. Citigroup has issued a report predicting Brent crude could fall as low as $60 per barrel by year-end, a level last seen in January. This outlook comes amid easing tensions between the U.S. and Iran, progress in peace talks, and the gradual restoration of shipping through the Strait of Hormuz.
Strait of Hormuz Traffic Rebounds
Maritime traffic through the Strait of Hormuz has more than quadrupled recently, with approximately eight tankers now passing through daily—up from just one or two per day over the past month. According to data from last week, this surge reflects renewed confidence among shipowners following the 60-day U.S.-Iran ceasefire agreement.
Brent crude has already dropped sharply—from $126 per barrel at the end of April to $72 this morning (July 3, 2026), erasing all gains accumulated since the outbreak of conflict in Iran. Citigroup analysts note that tanker cargo flows are stabilizing, Chinese buyers remain largely absent, and heavy oil markets have slumped abruptly. Meanwhile, inventory drawdowns have been far smaller than expected.
Russia Expands Export Reach
Russia, benefiting from the partial lifting of sanctions, is broadening its customer base, increasing exports—and revenues—by charging higher prices while simultaneously reducing its reliance on its two largest buyers: India and China.
Iranian oil is also re-entering global markets at a premium of around 20%, further contributing to supply pressures as U.S. sanctions wind down and exports rise.
Oversupply Warnings Multiply
Goldman Sachs Group has similarly warned that the global oil market is poised to return to oversupply as the impact of the Iran conflict fades and Strait of Hormuz traffic recovers. Morgan Stanley has cut its oil price forecasts twice in recent weeks, citing mounting oversupply risks.
Still, geopolitical uncertainty remains. A renewed escalation in hostilities—or a return to blockades in the Strait of Hormuz—could push Brent crude above $100 per barrel. Analysts caution, however, that such a spike would likely be short-lived.