Brent crude to fall to an average US$71 per barrel in 2027 – Fitch Solutions
According to Fitch Solutions, these dynamics will push global supply above demand – even accounting for global restocking needs – lowering prices through the year.
Fitch Solutions predicts Brent crude will fall to an average of US$71 per barrel in 2027, according to a recent article. This drop comes as the Strait of Hormuz reopens, Middle East production normalizes, and OPEC+ unwinds its remaining production cuts. The global supply is expected to exceed demand, driving prices lower through 2027.
This will lead to a gradual easing of headline inflation across Sub-Saharan Africa (SSA) markets, as falling fuel prices reduce transport costs and generate disinflationary effects. Most SSA central banks are expected to resume monetary easing in 2027. Despite the US-Iran conflict, inflation remains contained compared to the 2022 energy price shock.
Inflation in the region has been smaller than the 3.2 percentage points rise following Russia's invasion of Ukraine in 2022. This can be attributed to greater FX stability across SSA, supported by positive real rates that sustain demand for regional assets and high prices for commodities like gold, copper, aluminium, coffee, and cocoa.
The firm highlights that adequate foreign exchange liquidity has prevented a sharp rise in imported price pressures, which typically have a significant impact on inflation due to the region's shallow manufacturing base. Currently, Brent crude is trading at US$114.6 per barrel on the global market.
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