LondonA reopened Hormuz leaves months of tanker queues.
JPMorgan sees $97 average Brent for 2026 regardless — bottlenecks shift from the waterway to tanker charters, refinery ramp-ups, and logistics.
Aramco’s Amin Nasser warned a delayed reopening stretches normalization into 2027; 100 million barrels are lost weekly, he told investors.
Sources: MoneyControl
THE BULLWHIP
Commodity shocks don't unwind when the cause does. A closed strait creates weeks of stranded cargoes, missed loading slots, and refineries running down crude stocks — all of which take months to renormalize even after ships move again.
WHY TANKERS BECOME THE BOTTLENECK
The global VLCC fleet (Very Large Crude Carriers, ~2 million barrels each) is roughly 900 ships. When Hormuz closes, vessels reroute or wait — when it reopens, every loader wants a tanker simultaneously. Day rates spike from ~$40k to $200k+, and the shortage is physical, not financial.
WHAT 100 MILLION BARRELS A WEEK MEANS
Hormuz carries roughly 21 million barrels daily — about a fifth of global oil consumption. A week of full closure removes more crude from the market than Saudi Arabia's entire spare capacity, and the missing barrels don't reappear; they're consumed elsewhere by drawing down strategic and commercial inventories.
REFINERY RAMP IS NOT A SWITCH
A refinery that ran reduced throughput during the disruption cannot return to full rates instantly. Catalysts need reconditioning, hydrocracker temperatures step up over days, and crude slate changes require recalibration. Each restart carries fire and pressure-vessel risk; operators move deliberately.
THE SPARE CAPACITY MYTH
OPEC's headline spare capacity (~4-5 mbd, mostly Saudi) sounds like a buffer, but bringing it online means producing from older fields with higher water cut and lower pressure. Sustained output above nameplate damages reservoirs — a constraint reservoir engineers respect even when politicians don't.
BACKWARDATION VS CONTANGO
Oil futures curves invert during supply scares: prompt barrels trade above future barrels (backwardation), incentivizing inventory drawdowns. The curve flips back to contango — future above prompt — only when physical tightness fully resolves, which lags spot price normalization by months.