Oil prices near $100 after Strait of Hormuz closure, IEA reports record stock draw

U.S. and Israeli military action. The price increase has occurred over three months since the launch of Operation Epic Fury. The International Energy Agency reported last week that global oil stocks are being drawn down at a record rate. Several factors have so far limited supply shortfalls, including releases from strategic reserves, rerouting of Gulf oil through pipelines, and reduced Chinese imports.

Economics stated that if the strait remains closed and OECD inventories continue declining at April's pace, stocks could reach critically low levels by the end of June. He projected Brent crude could reach $130-$140 per barrel under those conditions.

Natasha Kaneva of JP Morgan said OECD stocks could hit operational stress levels by early next month. She described how high prices would begin to ration demand through reduced driving, industrial cuts, airline schedule reductions, and lower refinery throughput.

The IEA warned that further price volatility is likely ahead of peak summer demand. S. has been relatively insulated as a net crude exporter, though American consumers have paid an estimated $40 billion in additional gasoline costs since the conflict began.

Finance reported that supply disruptions have spread beyond oil to LNG, refined products, fertilizers, shipping, and industrial inputs. It stated that even if marine traffic resumes, the energy system would remain tighter and more fragile than before the closure.

Governments in multiple countries have introduced measures to limit energy demand. Forecasters have lowered GDP growth expectations for oil-importing nations.