The global oil market may soon face a major shock, as experts warn that current oil prices do not reflect the real situation on the ground. While markets appear calm for now, analysts believe a serious supply crisis is building and could become visible in the coming weeks.
Oil Prices Not Matching Reality
Energy experts say oil futures are currently disconnected from the actual physical supply situation. Prices like West Texas Intermediate are still below $100 per barrel, while Brent Crude has just crossed that level.
This stability is mainly due to investor optimism about possible peace talks between the United States and Iran. At the same time, stock markets are performing strongly, with investors largely ignoring the ongoing conflict.
However, experts warn that this calm is misleading and may not last long.
Supply Disruption From Strait of Hormuz
A major concern is the disruption of oil shipments through the Strait of Hormuz, one of the world’s most important oil routes.
According to oil analyst Paul Sankey, shipments that were sent before the conflict have only recently reached their destinations. Since the strait has been mostly blocked for over 40 days, there has been very little new supply entering the market.
This delay means the real impact is only starting to show now. Sankey warned that the situation is “locked in” and will continue to worsen in the coming months.
Falling Inventories and Rising Risk
As fresh oil supply decreases, countries are now using their stored reserves. This has caused inventory levels to drop sharply.
Sankey described the situation as “getting scary,” as reserves are being used faster than they can be replaced. Even if the strait reopens immediately, the supply chain will not recover quickly because tankers are currently not in the right locations to resume normal operations.
This creates a time lag that cannot be avoided, making the next two months especially risky for global oil supply.
Warning of Sharp Price Surge
Analysts from JPMorgan have warned that oil inventories in OECD countries could soon reach “operational minimum” levels. This could happen between May 9 and May 30.
Once this point is reached, oil prices may rise sharply and quickly, rather than gradually. This means the market could see sudden spikes instead of slow increases.
Long Recovery Even After War Ends
Even if the conflict ends soon, the oil supply chain will take time to recover. Experts estimate:
- Ports may take up to two months to fully reopen
- Tanker crews may wait two to three weeks before returning
- Oil production could take around four months to reach near full capacity
This means the effects of the disruption will continue long after the war ends.
Global Supply Loss Already Massive
The situation has already led to a huge loss in oil supply. According to Trafigura Group Chief Economist Saad Rahim, around 1 billion barrels of oil have already been removed from the market.
If the conflict continues, this number could increase to 1.5 billion barrels.
Meanwhile, Frederic Lasserre from Gunvor Group warned that if the war lasts another month, global stockpiles could run out completely, reaching what experts call “tank bottoms.”
Growing Gap Between Perception and Reality
Experts agree that there is a major gap between what markets believe and what is actually happening.
Many investors are still focused on positive signals like possible peace talks and strong stock markets. However, the physical supply chain tells a different story, with shortages, delays, and falling reserves.
This mismatch could lead to a sudden correction, where prices quickly adjust to reflect the real situation.
