The post A US-Iran Peace Deal May Not Be Enough To Save the Oil Market Now: Here’s Why appeared on BitcoinEthereumNews.com. HFI Research has stated that the oilThe post A US-Iran Peace Deal May Not Be Enough To Save the Oil Market Now: Here’s Why appeared on BitcoinEthereumNews.com. HFI Research has stated that the oil

A US-Iran Peace Deal May Not Be Enough To Save the Oil Market Now: Here’s Why

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HFI Research has stated that the oil market has passed its breaking point, which was projected around mid-April

The analysis argues that these inventory draws will occur regardless of any reopening of the Strait of Hormuz, driven by structural and logistical constraints. This comes amid notable uncertainty around the diplomatic efforts to resolve the US–Iran war.

Why a Peace Deal May Not Reverse the Oil Market Shock

HFI explained that even with a US-Iran peace deal, oil market recovery would be delayed by logistical bottlenecks. An estimated 160 million barrels of floating storage in tankers would begin discharging. However, transit and offloading alone would take 30–40 days, with tanker turnaround requiring an additional 20 days. 

Meanwhile, around 70 very large crude carriers (VLCCs) en route to load US crude for Asia face a much longer cycle. It would take 6–8 weeks for loading, 45–50 days for transit, and another 20–25 days to offload and return. 

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Onshore constraints in the Middle East further complicate the recovery. The region holds 600 million barrels in onshore storage. Producers need roughly 200 million barrels drained before they can restart output. 

That would take at least 100 VLCC. However, current tanker activity suggests this rebalancing may not occur until mid-to-late June at the earliest.

The report highlighted that cumulative storage lost due to the closure already totals roughly 1 billion barrels, rising to 1.98 billion by the end of June.

According to HFI, given the limited commercially available crude to offset such losses, the market may require demand destruction to restore equilibrium. If the Strait remains closed beyond April, oil prices could move into uncharted territory, with traditional pricing mechanisms breaking down.

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The post A US-Iran Peace Deal May Not Be Enough To Save the Oil Market Now: Here’s Why appeared first on BeInCrypto.

Source: https://beincrypto.com/oil-market-breaking-point-hormuz-peace-deal/

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