Q2 — Price Impact

Question Restated

How high does oil go? Given current prices and the supply disruption magnitude, what are the price scenarios?

**Physical vs. futures disconnect:** ~$150/bbl (physical, IEA) vs. ~$99/bbl (futures) — a $51/bbl spread (IEA April 2026 Report)
**EIA peak:** $115/b Brent Q2 2026, $88 Q4, $76 in 2027
**Goldman full-year:** $83/b Brent average (assumes normalization / ceasefire holds); $90/b Q2
**HFI Research "Breaking Point":** Supply shortage overrides demand destruction — the market's standard price-clearing mechanism fails at this scale
**Dated Brent vs WTI Midland spread:** +$22.80 — enormous physical premium, indicative of tight physical market
**Sell-side pricing failure:** Cannot generate a price with "zero confidence in the result" for 11–13M b/d outage (HFI Research)
**Financial demand:** Record low net length / net short Brent (first time ever) — paper market maximally bearish
**Physical demand:** Record high physical demand simultaneously (Eric Nuttall, Nov 2024) — no demand destruction yet despite high prices
**SPR + IEA reserves insufficient:** ~2.5M b/d SPR, ~400M bbl IEA releases cannot close an 11+M b/d gap

[2024-09-13 Eric Nuttall — net short Brent, all-time low financial demand](../daily/2024-09-13-ericnuttall.md)
[2024-11-12 Eric Nuttall — inventories lowest seasonal in history, demand at record high](../daily/2024-11-12-ericnuttall.md)
[2026-04-13 HFI Research — $99 not the clearing price, 11–13M b/d outage](../daily/2026-04-13-hfirearch.md)
[2026-04-15 HFI Research — no US production increase coming](../daily/2026-04-15-hfirearch.md)
[[IEA-April-2026-Report]] — $150 physical vs. $99 futures, extreme disconnect
[[EIA-April-2026-STEO]] — $115 peak Q2, $76 by 2027
[[Goldman-April-2026]] — $83 full year, $90 Q2
[[HFI-Research-2026-04-20]] — "Breaking Point": supply shortage wins over demand destruction