Brent: Supply risks keep prices elevated – ING

ING analysts Ewa Manthey and Warren Patterson report that ICE Brent is trading just below $90 per barrel, influenced by Middle East tensions and vessel attacks in the Strait of Hormuz. Bullish speculation on Brent and WTI is on the rise, along with increased US drilling activity and higher crude output forecasts for 2026 and 2027.

Prices have been bolstered by fresh fighting in Lebanon and vessel attacks in the Strait of Hormuz, heightening worries over potential supply disruptions and hampering hopes for a US-Iran agreement. Recent vessel attacks, including those involving Abu Dhabi National Oil Co., have added to these concerns. Speculative positioning in Brent has become more bullish, with money managers boosting their long positions by 76,026 lots to 240,748 lots.

This surge in bullish sentiment is driven by fresh long entries, as gross longs have increased by 51,818 lots week-over-week. Simultaneously, US drilling activity is expanding, with the US oil rig count rising by one to 455 active rigs last week, marking the third consecutive weekly increase. This count is now 43 rigs higher than a year ago and at its peak since May 2025.

This heightened drilling activity follows the onset of the US-Iran conflict in late February. The Energy Information Administration (EIA) predicts US crude oil production to average 13.8 million barrels per day in 2026, up from 13.6 million barrels per day in 2025, and further climb to 14.2 million barrels per day in 2027.