Oil Traders Lock In $81-Plus as the New Floor Through Mid-2027, Survey Shows

A Bloomberg Intelligence survey of 126 asset managers and energy specialists, released Thursday, found market participants have anchored Brent crude between $81 and $100 per barrel for the next 12 months — and nearly two-thirds expect a $5-$15 war premium to persist for years. The findings reflect how thoroughly traders have repriced geopolitical risk from a temporary spike to an embedded cost. The Strait of Hormuz has been effectively closed since late February despite a fragile ceasefire announced April 8, with tanker traffic through the waterway running at roughly seven vessels a day against a pre-war norm of 125-140. Few survey respondents expect the premium to exceed $20 per barrel. Brent settled Thursday at $106.81, up 0.95%, while WTI gained 1.36% to $100.47. Both remain well above the $73 pre-war baseline but far below April's $138 peak, the highest since June 2022. The conflict, now in its 12th week since fighting began February 28, has removed an estimated 3-7 million barrels per day of supply. Demand destruction is the mechanism most participants expect to rebalance the market, cited by 40% of respondents. Trade rerouting came second at 21%, followed by OPEC+ output adjustments at 13%. The market has proved acutely sensitive to headline risk. Brent dropped 5.97% to $104.64 on Tuesday after President Trump described U.S.-Iran negotiations as being in the "final stages," only to claw back above $105 on Wednesday when optimism faded. ING commodity strategists Warren Patterson and Ewa Manthey flagged the pattern Thursday, noting implied volatility has averaged 78% since the conflict began, versus below 30% pre-war. Physical markets confirm the tightness. Brent's front-month contract traded at roughly a $20 premium over six-month forwards as of Monday — down from a $35 peak but still historically wide. U.S. crude inventories fell 7.9 million barrels in the week ending May 15 to 445.0 million barrels, now 2% below the five-year seasonal average. A 9.9 million-barrel Strategic Petroleum Reserve draw pushed SPR stocks to 374.2 million barrels, the lowest since July 2024. Inventories remain up 26 million barrels year-to-date, however. Retail markets are absorbing the pressure. U.S. gasoline prices topped $4.50 per gallon for the first time since July 2022. Heating oil futures settled Tuesday at $3.88, up 0.73%. JPMorgan sees Brent staying above $100 through the second quarter before easing in the second half. Eurasia Group is more cautious, placing an $80 floor on prices for the rest of the year regardless of how the conflict resolves. The UAE's May 1 exit from OPEC removes 3.6 million barrels per day from quota discipline, creating the potential for a sharp correction once Hormuz shipping resumes — though infrastructure damage means full normalization will take months even under an optimistic scenario. Satellite tanker tracking through Hormuz will be the first signal of whether the ceasefire is holding. China, as Iran's largest oil buyer, gives the upcoming Trump-Xi summit outsized market relevance. A breakdown in negotiations likely pushes Brent back toward $120; a credible reopening tests the mid-$90s.