EIA: STRAIT MAY BE CLOSED TO LATE MAY
The US Energy Information Administration on Tuesday said it now assumes the strait will be effectively closed through late May, leading to much larger losses of Middle Eastern oil and gas supplies than its prior forecasts. The agency had earlier expected the waterway would be shut through late April.
Even after flows resume through the Strait of Hormuz, it will take at least until late 2026 or early 2027 for oil output and trade patterns to return to pre-conflict levels, the EIA said.
Disruptions linked to the near-closure of the strait have prompted producers to curtail exports, with a Reuters survey on Monday showing OPEC oil output in April fell to its lowest level in more than two decades.
The EIA estimates 10.5 million barrels per day of output were lost during April across the Middle East due to the strait closure, limiting exports.
Other sources have pegged the supply losses much higher. JP Hanson, global head of oil and gas at Houlihan Lokey, said the conflict has created a 14 million bpd supply gap.
“The market now faces an aggregate billion-barrel deficit, compounded by drained strategic reserves and limited capacity to replace lost volumes,” Hanson said in an email.
Saudi Aramco CEO Amin Nasser warned on Monday that disruptions to oil exports through the strait could delay a return to market stability until 2027, with the loss of about 100 million barrels of oil per week.
