Brent crude to fall to an average US$81 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.
According to Fitch Solutions, Brent crude is projected to fall to an average of US$81 per barrel in 2027. This decline is expected due to the reopening of the Strait of Hormuz, normalization of Middle East production, and OPEC+'s unwinding of remaining production cuts. These factors will push global supply above demand, resulting in lower prices despite the need for global restocking.
Fitch Solutions' analysis, outlined in their article "Sub-Saharan Africa Weathers US-Iran Price Shock Due To FX Resilience, But 2027 Risks Are Building", predicts that falling fuel prices will ease transport costs in Sub-Saharan Africa (SSA), leading to disinflationary second-round effects. Consequently, the vast majority of SSA central banks are anticipated to resume monetary easing in 2027.
Despite the ongoing US-Iran conflict, inflationary pressures remain contained in the region. Fitch Solutions attributes this to greater foreign exchange stability in SSA, rather than increased fiscal intervention. This stability, driven by positive real rates and sustained demand for regional assets, has helped SSA avoid a sharp rise in imported price pressures. These pressures are typically more damaging to headline inflation in the region due to its shallow manufacturing base.
Currently, Brent crude is trading at US$114.6 per barrel on the global market.
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