Hormuz Closure Threatens Global Oil Supply

Global oil markets are being warned of an approaching supply crunch as the Strait of Hormuz remains closed for an extended period, according to analysts and industry executives. Even with benchmark prices sending mixed signals—West Texas Intermediate (WTI) still below $100 per barrel while Brent crude trades above $100—several observers said the physical market is moving toward tighter availability in the months ahead.

Paul Sankey, president of Sankey Research, said on April 23, 2026, that conditions are “guaranteed” to worsen, even if the Strait were to reopen immediately. The warning is tied to timing in the supply chain: pre-war cargoes have already arrived at their destinations, while replacement flows have been constrained for more than 40 days. As a result, the market is increasingly leaning on stored barrels rather than fresh deliveries.

Analysts at JPMorgan said commercial inventories across OECD countries are on track to fall to “operational minimums” between May 9 and May 30. They said that once those minimum levels are reached, price moves could become exponential. The same analysts framed the risk as a shift from financial-market pricing to a more acute physical shortage dynamic as stocks are drawn down.

The strain is not limited to crude. The disruption is also affecting refined products, including jet fuel in Australia and solvents used for chipmaking in Japan, according to the same set of assessments. These product-specific constraints highlight how a prolonged interruption can ripple through multiple parts of the energy and industrial supply chain, not just upstream oil production.

Even in a scenario where the Strait of Hormuz reopens, JPMorgan said normalization would take time. The bank estimated ports could require two months to resume operations, while tanker crews may wait two to three weeks before moving to ensure safety. JPMorgan also estimated that restoring oil production to 99% capacity would take four months, underscoring that reopening a chokepoint would not immediately restore prior flows.

Industry figures also pointed to the scale of lost supply. Trafigura Group Chief Economist Saad Rahim said 1 billion barrels of supply have already been lost, and that figure could rise to 1.5 billion if the conflict continues. Separately, Frederic Lasserre of Gunvor Group said that if the conflict persists for another month, global stockpiles would be depleted.