Brent crude prices to remain at $70 per barrel in FY26 despite Israel-Iran conflict: Report
New Delhi: Despite recent volatility and rising conflicts between Israel and Iran, Brent crude oil prices are expected to average around $70 per barrel in FY26, according to a report by Emkay Research.
The report stated that the oil markets remain fundamentally well supplied, with rising production levels from both OPEC+ and non-OPEC+ countries.
It said "we continue to assume Brent price at USD70/bbl for FY26. Fundamentally, oil markets are well supplied with rising production." This steady supply is expected to help stabilise prices in the coming weeks, even though geopolitical risks may cause short-term volatility.
The report noted that Israel's attack on Iranian nuclear sites and personnel had initially triggered a sharp 12-13 per cent jump in oil prices, with Brent reaching close to USD 80/bbl.
Since then, prices have settled around USD 75/bbl, despite ongoing attacks from both sides. Iran has responded by hitting Israeli cities with missiles, and Israel has intensified its strikes on Iran. Signals from the US administration regarding a ceasefire remain unclear.
According to the report, unless there is lasting damage to oil and gas infrastructure, similar to earlier patterns seen during the Russia-Ukraine conflict, oil prices are likely to stabilise. A ceasefire could even bring Brent prices down below USD 70/bbl.
The report also highlighted that Iran has partially shut its South Pars gas field following Israeli attacks. A major fuel depot and a gas refinery were hit, but the impact seems limited to domestic markets. Israel has suspended operations in two of its gas fields that export to Egypt and Jordan.
As a result, spot LNG prices have increased to around USD 13.5/mmbtu, compared to USD 12/mmbtu before the conflict.
The report further noted that oil markets in 2025 have remained well supplied with rising inventories. Although near-term volatility may continue, the average Brent crude price for the year is still expected to be around USD 70/bbl.
At this price level, both upstream oil players and oil marketing companies (OMCs) are in a safe zone.
However, the report believed OMCs offer a more attractive valuation and better risk-reward profile.
The report also flagged concerns over the gas market, as the early onset of monsoons has impacted demand, making the gas outlook uncertain.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Times of Oman
8 minutes ago
- Times of Oman
India must boost production capacity for military-grade drones: Defence Secretary
New Delhi: Highlighting the role of Unmanned Aerial Vehicles (UAVs) in modern warfare, Defence Secretary Rajesh Kumar Singh has said that India must boost its production capacity for military-grade drones. He noted that the Centre wants to cut the defence procurement cycle to a maximum of two years and the government will come up with a new Defence Acquisition Procedure (DAP 2025) in six months. "I would say that India has a significant manufacturing ecosystem for drones, but a lot of it is really for civilian drones. Military-grade drones, not so much. There are, I would say, three to four, five manufacturers who have some capacity in that area. It's something we'll have to build up quickly," Singh told ANI in an interview. "And to the extent that, like all military purchases, it's a monopsony. The government is the only buyer. And I guess the government will have to use its buying power to provide the resources and give visibility in terms of orders to that sort of small ecosystem, which hopefully will gradually become a large ecosystem of military-grade drone manufacturers," he added. He said that military-grade drone production in the country needs some transfer of technology, as a lot of the technology may not be available domestically. "I would say that we are looking at least three to four manufacturers who are coming up with this type of capacity in terms of military grade drones. We will encourage them through orders and through tenders so that they can start investing in this area even more, including tying up with a lot of the technologies from outside," he said. "The volume that we can generate in terms of the size of the orders that can be bigger than the combined turnover of all the other civilian drone manufacturers in the country. That type of ensuring that they have a full order book if they make investments for inter-military grade drones, we will try to ensure by speeding up procurement and by giving them visibility in terms of orders," he added. The Defence Secretary said he would like to see a situation where the maximum time taken for any procurement, even the most complex ones, should not exceed about two years. "Defence Acquisition Procedure 2020 is a very bulky book. It's a bible for the defence industry. We need to make it simpler. A lot of redundant steps can be avoided. A lot of things can be done concurrently rather than sequentially. And a lot of simplification in terms of the kind of companies that can bid, where we've put in some unnecessary conditionalities, all those have to be removed," he said. "So, for that, we have a committee now working. The target date is six months from today. So you'll have a new DAP. It will be DAP-25 rather than DAP-20," he added.
Times of Oman
8 minutes ago
- Times of Oman
India's petroleum consumption to surge 5.37% annually till 2030: PHDCCI Report
New Delhi: According to a recent report by the PHD Chamber of Commerce and Industry (PHDCCI), India's petroleum product demand is forecast to increase by a CAGR of 5.37 per cent between 2025 and 2030, largely propelled by the manufacturing and transportation sectors. Diesel, petrol, Aviation Turbine Fuel (ATF), and petroleum coke are expected to lead this surge. India's economy is projected to grow at over 6 per cent annually, with primary energy demand increasing at a compound annual growth rate (CAGR) of 5.4 per cent. This robust economic expansion will inevitably fuel higher energy consumption. Additionally, Natural gas consumption is also projected to see substantial growth, with a nearly 60per cent increase (37 bcm/year) by 2030, reaching 103 bcm/year. The City Gas Distribution (CGD) sector, along with heavy industrial and manufacturing sectors, are anticipated to drive this demand. Despite this rising demand, India faces inherent vulnerabilities as over 85per cent of its crude oil needs are met through imports, positioning it as the world's third-largest oil importer. Furthermore, geopolitical instabilities, particularly in crucial chokepoints like the Hormuz Strait and Suez Canal, pose consistent threats to crude supply and pricing. On the price front, Brent crude prices are forecast to decline from an average of USD 81/barrel in 2024 to USD 74/barrel in 2025 and further to USD 66/barrel in 2026. This decline is attributed to a global expansion in petroleum production outside OPEC+ and a more moderate demand growth. Domestically, India's crude oil production is expected to increase over the short term, reaching 48.5 Million Metric Tonnes (MMT) by FY 2026-27, before a projected decline to 45.5 MMT by FY 2029-30 due to maturing oil fields and limited new discoveries. In contrast, natural gas production is anticipated to rise significantly, reaching 54.7 Billion Cubic Meters (BCM) by FY 2029-30.
Times of Oman
an hour ago
- Times of Oman
Oman continues diplomatic push for peaceful resolution in region
Muscat: The Sultanate of Oman continues its intensive diplomatic efforts to encourage the international community to adopt all peaceful means to halt the Israeli aggression against the Islamic Republic of Iran. Oman views the escalation as a blatant violation of international, humanitarian, and moral law, and a serious obstruction to dialogue and negotiation efforts aimed at securing a fair U.S.–Iran agreement to prevent nuclear proliferation. In this context, Oman, alongside the Arab Republic of Egypt and several Arab and Islamic countries, issued a joint statement condemning Israeli attacks since June 13, 2025. The statement affirmed their rejection of military escalation, called for respect for state sovereignty, and urged the peaceful resolution of conflicts. The statement also expressed deep concern over the consequences of continued escalation, calling for an end to hostilities, the removal of nuclear weapons and weapons of mass destruction from the region, and emphasised the need to protect nuclear facilities and resume negotiations as the only viable path to resolving the crisis while upholding the freedom of international navigation.
