Oil: Tight market keeps Brent elevated – TD Securities

TD Securities’ commodity strategy team maintains a bullish view on Oil, citing persistent tightness and Strait of Hormuz tensions. They do not expect the market to normalize before December 2026 and forecast Brent trading well above current levels in the next three months, with a strong chance of triple-digit prices as global crude deficits and low product inventories persist.

Supply deficits and geopolitical risk

"Our analysis reveals an annual global crude oil deficit of 1.6-2.0 million b/d in 2026, as at least 5-6 million b/d of production capacity remains offline."

"We also expect upside risk for petroleum products to continue, due to alarmingly low inventory levels and firm demand."

"TD Commodity Strategy does not expect the oil market to return to normal until December at the earliest, and remains at the upper end of the consensus range with our price forecasts."

"We continue to expect Brent to trade $5-10/bbl above the current $90/bbl level over the next three months, with a strong possibility that the world will once again see triple-digit prices."