Crude prices may be back near levels seen before the Iran war, but the surge in oil exports from the Middle East following the reopening of the Strait of Hormuz is creating
Crude prices may be back near levels seen before the Iran war, but the surge in oil exports from the Middle East following the reopening of the Strait of Hormuz is creating a chaotic market that could take months to settle.
The steep slide in Brent crude LCOc1 back to pre-war levels of around $73 a barrel following the U.S.-Iran interim deal might, at first glance, suggest business as usual has returned to the world’s most important oil and gas hub. The narrow waterway, which once carried about a fifth of global oil and gas, had been effectively paralysed by conflict for more than 100 days.
But beneath the surface, the market is anything but orderly. What looks like normality is a system trying to reboot all at once.
First, there’s the race to liberate trapped volumes. Dozens of tankers stranded inside the Gulf during the war have rushed to leave in recent days.
U.S. Energy Secretary Chris Wright said flows briefly exceeded pre-war levels of around 20 million barrels per day, though ship-tracking data suggests overall traffic remains far below the roughly 125 daily crossings seen before the conflict. Some vessels appear to be disabling tracking systems during transit,
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