Oil Price Forecast: Crude Above $90 as Middle East Conflict Escalates — Is $150 Oil Next?
Key Takeaways
- Middle East conflict disrupted energy supplies and shipping routes across the Gulf
- Brent crude rose above $90 per barrel amid threats to energy infrastructure
- Author expects further crude price gains in coming weeks due to geopolitical supply changes
Middle East oil disruptions
Brent crude oil surged above $90 a barrel as the conflict in the Middle East shifted from a geopolitical risk to a real supply disruption.
“Oil prices surged as the conflict in the Middle East started to disrupt energy supply and shipping routes across the Gulf”
The article says Iranian attacks on energy facilities forced Qatar to shut down its liquefied natural gas production.
It also says those attacks forced Saudi Arabia to suspend operations at its largest oil refinery.
The piece reports rising shipping risks from Iranian drones, missiles and fast attack boats, sharply higher charter rates and a near-blockage of the Strait of Hormuz, which it identifies as the primary export route for the region.
The Wall Street Journal is cited saying the United Arab Emirates and Kuwait began to curb oil production.
Abu Dhabi National Oil Co. said it is managing offshore production levels, and Kuwait Petroleum Corp. cut output.
Kuwait started to reduce output by some 100,000 barrels per day early Saturday and the reduction was nearly triple on Sunday.
The reports imply cuts may be up to around 300,000 barrels per day or higher depending on storage levels and the situation around Hormuz.
The article gives January production figures of about 2.57 million barrels per day for Kuwait and more than 3.5 million barrels per day for the UAE.
It notes the UAE can bypass Hormuz via a 1.5 million barrel per day pipeline to Fujairah.
Oil shock and inflation
Asian refiners are reporting shortages as shipments from the Gulf slow, reducing available cargoes and forcing refiners to scale down operations or seek other supplies.
The article warns the crude surge raises the risk of higher global inflation and supports this with recent activity indicators: ISM Manufacturing PMI at 52.4%, the manufacturing prices paid index at 70.5%, and ISM Services PMI at 56.1% (the highest since July 2022).
It cites a New York Fed survey showing average health insurance costs rising 14.2% for manufacturers and 12.9% for service firms, arguing higher operating costs make businesses more sensitive to energy price increases.
The article also invokes historical precedents — the 1973 Yom Kippur War (CPI to 12.2% by November 1974), the Iran-Iraq war in 1980 (CPI around 14.59%), the 1990 Gulf War (CPI more than 6.0%), and the 2022 Russia-Ukraine war (annual CPI rose to about 9.0%) — to illustrate how conflicts in key energy regions have pushed inflation.
Oil price technical outlook
The author interprets long-term technical charts as strongly bullish and notes WTI has traded within a descending channel since the July 2008 high at $147.27, with a bottom in April 2020 and a record high resistance at $129.42 in March 2022.
“Oil prices surged as the conflict in the Middle East started to disrupt energy supply and shipping routes across the Gulf”
A rebound from the April 2020 bottom in the last quarter of 2025 has taken WTI to $90, which the article sees as resistance from September 2023, and the immediate WTI target is set at $110.
A sustained break above $110 could push WTI toward $125–$130, and a further break above $130 could move prices toward $150 near the July 2008 highs.
For Brent, the article notes a breakout from a descending trendline at $72 and the 200 SMA at $80, with an immediate target of $100 and potential upside to $125–$135 if disruptions persist.
The writer concludes that recent attacks, production cuts and shipping risks have already reduced available supply and, combined with firm economic activity, will likely keep oil prices supported in the short term and could push them toward the $150 region in the next few weeks.
The article also acknowledges the risk premium could fall if the conflict subsides or shipping through the Strait of Hormuz returns to normal.
The article is by Muhammad Umair, who is described as a finance MBA and engineering PhD and founder of Gold Predictors.