The New Numbers Are Ugly

When we last reported, $4.50 was the national average at the pump. The forecasts just got revised sharply upward, the peace talks died, and two of Wall Street's biggest banks are now projecting an energy crunch that runs deep into the fall.

Goldman Sachs, as reported by The Guardian on April 27, 2026, raised its Q4 2026 Brent crude forecast to $90 per barrel — up from a prior projection of $80. U.S. crude (WTI) was revised to $83 for October-December, up from $75. Goldman cited "lower Persian Gulf production" and pushed back its timeline for export normalization from mid-May to end of June at the earliest.

Brent crossed $108 per barrel intraday on April 27, according to The Guardian's live market coverage.

That's where crude is trading right now.

The Scale of the Supply Shock

Goldman's analysts put the production loss at 14.5 million barrels per day of Persian Gulf crude — offline because of the ongoing U.S.-Israel military campaign and the resulting blockade of the Strait of Hormuz. That has triggered what Goldman calls a record global inventory drawdown of 11 to 12 million barrels per day this month alone.

The market is burning through global reserves at a pace with no historical precedent.

ING's analysis, published May 18 by IndexBox, estimates the disruption at roughly 13 million barrels per day — slightly lower than Goldman's figure, but the same conclusion: the market is in crisis.

Peace Talks Are Dead — For Now

According to ING's report via IndexBox, the current U.S. President rejected Iran's counterproposal peace plan. Full stop. No deal. No timeline for a new one.

That killed any near-term hope for reopening Hormuz, and the market reacted immediately — Brent surged back above $100.

ING's base case now assumes some recovery in oil flows during the rest of Q2, with a return to near-normal flows in Q3. Under that scenario, Brent averages $104 per barrel in Q2 2026 and $92 in Q4. Goldman's revised forecast looks almost optimistic by comparison.

Every single day without a resolution makes the Q3 recovery scenario less likely.

BofA Calls $90 the Best Case

Bank of America's commodity strategist Francisco Blanch isn't feeling optimistic about the summer either. Bloomberg reported Blanch saying $90 Brent is the oil market's best-case scenario and that the U.S. faces a "challenging summer gas season."

$90 is the floor, not the ceiling, according to BofA.

Given that refining margins are already elevated — gasoline, diesel, and jet fuel prices have surged faster than crude itself — the pump price pain isn't going away. ING's analysis confirms this dynamic: refined product prices have been so strong that crude didn't need to spike as high to destroy demand. When crude does catch up to product prices, expect another leg higher at the pump.

What the Media Is Glossing Over: The LNG Time Bomb

Everybody's talking about oil. Almost nobody is talking about natural gas.

ING's analysis, cited by IndexBox, makes this point bluntly: gas markets are "underestimating the magnitude of the supply disruption." The Strait of Hormuz is the ONLY practical route for Persian Gulf LNG to reach its destinations. There is no meaningful alternative.

Qatar — the world's largest LNG exporter — has shipped exactly two LNG cargoes since the war began. Two. Normal flow is dramatically higher. The global LNG market has ZERO slack to absorb this shortfall.

European natural gas prices have pulled back from their post-conflict peaks, but ING says that retreat is a mistake. The market is mispricing the risk. When that correction hits, Europe — already energy-stressed — faces serious supply shortages heading into fall.

The Two Factors Holding Prices Down — Temporarily

Prices haven't hit $150 yet. Several factors explain the temporary reprieve.

First: Chinese oil imports dropped sharply. China is drawing down its own stockpiles rather than buying on the open market. That temporarily reduces global demand. But inventories run out. When China comes back to the market, the price floor goes up.

Second: U.S. oil exports hit record highs in April. According to ING's analysis, that surge is inventory-driven — not new production. America is selling existing reserves to fill the gap, not pumping new supply fast enough to compensate. That's a one-time relief valve, not a permanent solution.

Shell Senses Opportunity — Drops $13.6 Billion on Canadian Oil

While consumers bleed at the pump, Shell moved fast. The Guardian reported on April 27 that Shell is acquiring Canada's ARC Resources in a $13.6 billion deal. In a world where Persian Gulf supply is structurally uncertain for the foreseeable future, Canadian oil sands just became a lot more valuable.

Big energy is playing offense. American households are playing defense.

The Bottom Line

If Goldman and BofA are right, pump prices don't come down meaningfully before fall — and only if peace talks restart and Hormuz reopens by June. That's not guaranteed. It's not even the base case anymore.

The EIA's May 2026 Short-Term Energy Outlook is consistent with the grim picture, though the PDF was not fully parseable — the agency's own data infrastructure apparently struggling to keep up with the pace of this crisis.

The summer driving season starts in weeks. Jet fuel prices are already punishing airlines, which will pass costs to travelers. Diesel prices are hammering trucking and freight, which means everything you buy gets more expensive.

This is an inflation accelerant, a supply chain stress test, and a geopolitical standoff with no clear end date — all happening simultaneously.

The best-case scenario, per Bank of America, is $90 oil.

Plan accordingly.