Oil supplies bounce back, but prices are still high
Oil markets are heading into an unusual period as the Iran conflict remains in dangerous limbo: The supply crunch is easing, but prices could stay stubbornly high.
Key points
- Oil prices jumped yesterday after President Trump said on his Truth Social that "we don't need a deal with Iran.
- The threat of new attacks can keep oil costs higher, too, thanks to the risk premium embedded in prices.
- "The threat of a renewed wave of shipping attacks will remain high as long as the underlying confrontation over Iran's nuclear and missile programmes remains unresolved," the firm's analysis states.
Those days have long since passed." Driving the news: Crude oil export levels bounce around, but have recently returned to pre-war levels at times, barrel-tracking firms and analysts say.
Additional details
- Zoom in: Goldman Sachs estimates that the tanker market's "adaptation to Mideast shipping risks" accounts for most of the $20-per-barrel year-over-year increase in average costs for shipping oil.
- Yes, but: Insurance and shipping costs are elevated, and that puts upward pressure on prices.
- Crude oil exports from the Persian Gulf region rose to 82% of pre-war levels last month, though recovery of refined product shipments is weaker, its monthly analysis states.
- Why it matters: While gasoline prices have dropped lately, don't expect pre-war levels anytime soon even as Middle East exports fitfully recover.
- "Both Iran and the Houthis have demonstrated that they can severely restrict oil flows from the region using a range of attacks and tactics.
How this summary was made: extractive summary — built from the sources' own reporting. It is drawn only from the reporting of the sources listed below — read the originals for full detail. How we summarize →
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