Investing.com -- Jefferies hiked its long-term oil price forecasts, contending that the forward curve no longer reflects the structural realities facing global energy markets, as supply constraints tighten and geopolitical risk to energy infrastructure intensifies.

The broker lifted its terminal WTI and Brent price forecasts by $5 per barrel, to $70 and $75, respectively, and lifted its 2026 WTI estimate to $81.79 per barrel. It also raised its 2027 WTI forecast to $75.

The revisions come as Jefferies analysts see the current futures curve as mispriced on both ends. At the front of the curve, roughly 10–12 million barrels per day of oil, condensate, and refined products are effectively offline amid an escalating energy crisis.

Floating storage built up through sanctions, combined with strategic reserve releases of around 400 million barrels, have "temporarily muted front-month prices, masking the severity of supply tightness,” the team led by Lloyd Byrne wrote. They expect front-month prices to eventually rise to incentivize demand destruction as those buffers erode.

At the back of the curve, the analysts argue that pricing is too low to draw the supply response needed to rebalance markets. U.S. shale, once a rapid swing producer, has become more disciplined and returns-focused.

Even at high-$60s to low-$70s WTI in 2027, management teams across the industry "show little appetite to accelerate activity, stressing that price duration drives capital decisions," they said.

Jefferies models flat U.S. shale oil growth in 2026 at normalized pricing, and sees only around 550,000 barrels per day of additional exit-rate growth at $85 WTI — potentially insufficient to meet demand and rebuild inventories, the analysts said.

The team also points to a structural shift in the risk calculus for energy infrastructure. The proliferation of low-cost drone technology, alongside ballistic missiles capable of evading defenses, has "fundamentally altered the risk calculus for global energy infrastructure."

With around 20% of identified world liquified natural gas (LNG) growth located behind the Strait of Hormuz, the analysts believe investor weightings toward real assets will need to increase.

On the investing front, they recommend buying high-quality operators on weakness. “We recommend adding on a pull back, which investors are looking to sell. We expect the front to come down, but the back of the oil curve to rise,” they wrote.

Top picks cited include Ovintiv, ConocoPhillips, EOG Resources, Northern Oil and Gas, Cenovus Energy, SLB, Baker Hughes, and Halliburton.