Oil Prices Stay High as War Keeps Supply Tight Into 2027
OilPrice.com · Irina Slav ·
Oil prices are expected to remain elevated well into 2027, with Brent futures reflecting persistent supply risks from the prolonged Iran war.
During the first three months or so of the U.S. and Israeli war with Iran, the dominant mood on oil markets was that the conflict would end any day now. The brief June ceasefire reinforced that optimism, so it took a while longer for facts to be faced: the war would not end any day now. It might even extend into next year—and this means higher prices for a longer time.
The ICE Brent crude futures contract for January 2027 is trading at $102.59 per barrel. The June 2027 contract is only slightly lower, at $92.71 per barrel, and the December 2027 contract is trading at $84.75 per barrel. For context, in December 2025, Brent crude was trading at less than $70 per barrel. Back in March, most oil market observers and players seemed to expect prices to retreat from their war-fueled highs fast. Now, those who use oil seem to expect supply to remain tight, and they are hedging their future consumption at higher prices.
Even the multiple reports of oil flows out of the Persian Gulf recovering to pre-war levels—and even topping pre-war levels—did not help bring prices down for very long. That is, first, because there is a crisis of trust in the official figures reported, and second, because the recovery in flows, such as it is, depends on costly maneuvers such as ship-to-ship transfers that have tightened the tanker market, led to surging freight costs, and forced Gulf producers to discount their crude to keep demand steady. Meanwhile, Iran is striking tankers in the Strait of Hormuz on an almost daily basis. The war premium on oil remains very much in place. Related: Global Gas Crunch Makes Europe’s Remaining Coal Plants Profitable
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