Oil markets are increasingly converging on a view that crude prices will remain capped near $100 a barrel over the next year, as supply disruptions linked to the US-Iran war collide with expectations of slower demand growth and offsetting market adjustments, according to a report by Bloomberg.
A Bloomberg Intelligence survey of 126 asset managers and energy market participants shows a broad consensus forming around Brent crude averaging between $81 and $100 over the next 12 months. The findings suggest investors see elevated geopolitical risk as persistent, but not enough to permanently reset the long-term oil price regime.
The 12-week conflict in Iran has significantly constrained shipping through the Strait of Hormuz, tightening global energy flows and contributing to higher prices and inflationary pressure. However, despite physical supply stress, benchmark crude prices have remained relatively contained, reflecting a market increasingly focused on balancing mechanisms rather than sustained price spikes.
Most respondents expect the supply shortfall – estimated at three million to seven million barrels per day of disruption – to be offset primarily through demand destruction, followed by rerouted trade flows, OPEC+ production adjustments and potential strategic reserve releases. Very few expect extreme outages exceeding 10 million barrels per day.
The survey also indicates that investors see a lasting geopolitical risk premium of $5 to $15 per barrel embedded in prices, with limited expectations for it to exceed $20 over the longer term. Analysts at Bloomberg Intelligence said this points to “persistent but not regime-shifting” risk, with markets ultimately expecting supply and demand to gradually rebalance.
Sentiment across derivatives markets reinforces that view. Options pricing shows reduced appetite for upside exposure, with call skew for both Brent and West Texas Intermediate falling to its lowest level since before the conflict began. At the same time, hedge funds have cut bullish positions to their weakest levels since the start of the war.
The data suggests traders are shifting away from directional bets and toward volatility management and hedging strategies, with about a quarter of respondents expecting increased risk management activity in the months ahead.
On the supply side, US shale production is still expected to grow, though not at a pace sufficient to materially offset global disruptions. The US Energy Information Administration forecasts domestic output could rise to a record 14.1 million barrels per day by 2027, but many investors expect only moderate increases in the near term.
