Oil supplies bounce back, but prices are still high
Summary
Oil exports from the Persian Gulf have partly recovered, and global supply has recently exceeded demand for the first time since the Iran conflict began. Prices may remain high because attacks, shipping risks, insurance and transport costs continue to raise the cost of moving oil.Key Facts
- Persian Gulf crude exports reached 82% of pre-war levels last month, while refined-product shipments recovered less.
- The International Energy Agency expects the global oil market to return to a surplus this quarter as supply rises and conflict reduces demand.
- Oil exports have at times returned to pre-war levels, according to tracking firms and analysts.
- Verisk Maplecroft expects threats to shipping to persist into 2027 and says attacks increased last month.
- Goldman Sachs estimates that adjustments to tanker operations amid Middle East shipping risks account for most of a $20-per-barrel year-over-year rise in average oil-shipping costs.
- HSBC analyst Kim Fustier said the existing logistics system may be close to its limit for sustaining the current recovery in exports.
- President Donald Trump said the United States does not need a deal with Iran, and oil prices rose after his remarks.
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