As global markets closely monitor energy trends, Citi Group has released a new research report significantly raising its short-term baseline forecast for Brent crude to $110–$120 per barrel. This revision reflects a reassessment of current geopolitical dynamics and supply-demand fundamentals.
Geopolitical Risk Premium Set to Ease
The report highlights that while recent Middle East hostilities have caused market volatility, tensions are expected to notably subside by mid-to-late April. With diplomatic efforts progressing and major oil producers maintaining stable output, concerns over supply disruptions are likely to diminish.
Rebalancing Supply and Demand Lifts Price Floor
- Seasonal uptick in global refining demand, driven by strong Asian purchases
- Approaching summer driving season in Western economies boosts gasoline outlook
- OPEC+ production discipline continues to support price fundamentals
Citi analysts suggest that current prices have already priced in much of the geopolitical risk premium. Should the situation stabilize as anticipated, crude could enter a phase of high-range consolidation. Market participants should closely watch upcoming inventory reports and producer signals for further clues.