Brent crude oil is expected to remain above $100 a barrel for months due to stalled negotiations between the U.S. and Iran, according to BMI chief economist Cedric Chehab. A potential deal is not anticipated until the end of the first quarter of 2027, Chehab told CNBC, citing the need for economic pressure to build on both sides. Elevated oil prices will continue to pressure global inflation and monetary policy, he added.
Sustained high oil prices above $100 per barrel will continue to fuel global inflation, complicate central bank efforts to control price growth, and potentially impact economic growth as energy costs rise for consumers and businesses.
Crude oil prices are expected to remain elevated in the coming months, with Brent crude staying above $100 per barrel, as negotiations between the U.S. and Iran remain stalled, according to BMI chief economist Cedric Chehab. Chehab told CNBC that a potential deal between the two nations could take "several months yet," and is not anticipated until the end of the first quarter of 2027. He cited the need for economic pressure to build on both sides as a reason for the delay.
Chehab noted that these sustained high oil prices will continue to put pressure on global inflation, inflation expectations, and monetary policy, posing a significant challenge for policymakers. He also commented that the economic pressure on the U.S. economy is tightening.
Separately, U.S. President Donald Trump announced late Sunday an "energy ceasefire" between Russia and Ukraine, though Moscow has not officially confirmed its implementation. President Trump stated the agreement was to take effect immediately. Ukrainian President Volodymyr Zelenskyy indicated that Ukraine would agree to the ceasefire if Russia also did, awaiting clear details of the dialogue between America and Russia. A White House official reportedly described the proposal as "refinery for refinery," suggesting a focus on halting attacks on each other's oil refineries rather than broader energy infrastructure.
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