Hormuz reopening is quickly flooding oil markets with supply
“Asian refineries are already well supplied till August, and the prompt barrels released from the Strait of Hormuz simply push the balances to an overhang, without China picking up on demand.” — June Goh, Senior Oil Analyst at Sparta Commodities
- Expert: June Goh (Senior Oil Analyst, Sparta)
- Publication: Bloomberg
- Market Focus: Crude Oil, Trade Flows, Global Supply/Demand Balance
- Geographies: Asia, Angola, Persian Gulf, Global Markets
In a recent analysis for Bloomberg, Sparta’s Senior Oil Analyst, June Goh, flags the critical disconnect between Hormuz reopening supply and collapsing Asian demand. With refineries in the region already well supplied through August, the stream of barrels now flowing through the strait is creating a structural oversupply that China — typically the market’s top buyer — is no longer absorbing. Angolan crude, normally snapped up by Chinese refiners, is trading at discounts exceeding $10 per barrel, the widest in more than a decade. Traders should monitor whether inventory refills in other regions can absorb this flow before pricing pressure intensifies further.
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