Oil tumbles nearly 7% as US and Iran seen moving closer to deal
“The underlying supply shortfall of 10-11 million barrels per day of crude oil does not go away immediately and will see markets still drawing inventories until Middle Eastern crude production is back online, which is months away.” — June Goh, Senior Oil Analyst at Sparta Commodities
- Expert: June Goh (Senior Oil Analyst, Sparta)
- Publication: Reuters
- Market Focus: Crude Oil, Supply Flows, Middle East Production
- Geographies: Middle East, Asia, Europe
In a recent analysis for Reuters, Sparta’s Senior Oil Analyst, June Goh, warns that even a US-Iran peace deal would not immediately resolve the crude supply crisis, with a 10-11 mb/d shortfall persisting until Middle Eastern production infrastructure is repaired and back online. Brent fell nearly 7% and WTI dropped 6.5% on ceasefire optimism, but physical flows through the Strait of Hormuz remain restricted despite isolated tanker movements. The market is pricing in a deal that hasn’t happened, and the underlying fundamentals — damaged facilities, months of recovery time — haven’t changed. Traders should watch physical flow data through Hormuz closely, not headline diplomacy, as the real signal for when the supply gap starts to close.
Read the full article in Reuters
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