Morgan Stanley slashes oil forecast again as Hormuz flows rebound

Morgan Stanley ↘ 1.78% slashed its Brent crude oil forecast for the second time in roughly two weeks, lowering its third-quarter 2026 projection to $75 a barrel as tanker traffic through the Strait of Hormuz rebounds more quickly than analysts anticipated. The bank now expects prices to fall further to $70 by the third quarter of 2027, citing a market that has swung from acute shortage back into surplus territory.cryptobriefing+1

From $100 to $75 in Two Weeks

The latest cut marks a dramatic reversal for the bank's commodity team, led by analyst Martijn Rats, which in mid-June reduced its Q3 Brent forecast from $100 to $90 after the U.S. and Iran signed a preliminary agreement to reopen the strait. That first revision, announced June 15, also took the Q4 forecast down by $15 to $80 a barrel.sahmcapital+3

Now, just two weeks later, Morgan Stanley has cut another $15 from the Q3 outlook, pointing to a faster-than-expected recovery in Persian Gulf shipping, rising U.S. supply, and persistently weak Chinese demand. The bank had previously warned in May that Brent could reach $130 to $150 if the Hormuz blockade persisted.cnbctv18+1

Tanker Traffic Returns to Pre-Conflict Range

The recovery in tanker flows has accelerated since the U.S.-Iran deal was struck. On June 23, Reuters reported that three stranded tankers carrying five million barrels of crude exited the strait, while U.S. Energy Secretary Chris Wright said roughly 20 million barrels departed in a single 24-hour period that week. CNBC reported that at least 20 oil tankers carrying 35 million barrels had departed since the agreement.cnbc+2

Traffic through the strait has risen to approximately 4.8 million barrels daily, the highest level since the U.S. and Israel struck Iran on February 28, according to trade data firm Kpler. However, the recovery has not been seamless — a U.N. maritime agency paused its ship evacuation plan on June 25 after a vessel was reportedly hit by a projectile off Oman's coast.apnews+1

Wall Street Turns Bearish in Unison

Goldman Sachs The Goldman Sachs Group, Inc. ↘ 0.23% had already cut its Q4 2026 Brent forecast to $80 from $90 and its 2027 average to $75 on June 16. JPMorgan ↘ 0.86% followed on June 23, projecting Brent at $86 in Q3 and $80 in Q4, exiting the year at $78. Citi Citigroup Inc. ↘ 5.60% has been the most bearish, forecasting just $65 a barrel for 2027.investing+2

Some analysts have urged caution. ING has noted that much of the recent increase in Hormuz traffic reflects previously stranded vessels leaving the Gulf rather than new inbound tankers entering to load fresh cargoes — a distinction that could make the pace of the supply recovery appear faster than it actually is. The U.N. evacuation pause underscores that security risks in the waterway have not fully dissipated.audacy+1