Oil Price Analysis: The Glut Is Back, Yet the Upside Risk Remains
By:
Key Points:
- Hormuz has reopened but the truce looks fragile - crude transited at 14mb on June 22, the busiest day since March 1, even as a vessel was struck days later and the US-Iran MOU shows early signs of fraying.
- Crude and refining margins have decoupled. Front-month crude has collapsed while the 3-2-1 crack sits at the top of its range, an anomaly that points to refining, not crude, as the real bottleneck.
- The system has no slack left: US refiners are maxed at 96.1% utilisation with product inventories near multi-year lows, leaving no buffer to absorb an outage and setting up an asymmetric upside risk into the autumn turnaround.
PREMIUM
Read what the experts are trading this weekExclusive analysis from FXEmpire top analysts — curated insights you won't find on the free site.In-depth analysis
Curated reports
Top analysts
Unlock Premium
There are many elements to cover as we have this ‘soft reopening’ of the Straight of Hormuz. We have seen high-traffic days on the 21st and 24th, with 14mb of crude transiting the strait on June 22 – the busiest day since March 1. Then the attack on UN escorted ships, Iranian dark-fleet vessels switching their AIS transponders back on, Indian imports of Russian crude hitting all-time highs, and plenty of other weeds we could crawl into.