With no agreement restoring passage through the Strait of Hormuz, global oil inventories have fallen to dangerously low levels. JP Morgan warns that unless transit is normalized, oil could surge again in late June. U.S. crude stocks have declined for eight straight weeks to their lowest since Feb 2024. Analysts say the second-round price shock risk stems from the depletion of buffer stocks rather than a formal closure; investors see the Strait as a persistent geopolitical bottleneck and expect p

With no agreement restoring passage through the Strait of Hormuz, global oil inventories have fallen to dangerously low levels. JP Morgan warns that unless transit is normalized, oil could surge again in late June. U.S. crude stocks have declined for eight straight weeks to their lowest since Feb 2024. Analysts say the second-round price shock risk stems from the depletion of buffer stocks rather than a formal closure; investors see the Strait as a persistent geopolitical bottleneck and expect prices to remain above $70 even if tensions ease. Higher oil is a modest headwind for U.S. growth but poses greater inflationary risk for Europe and Asia; if crude averaged $120/bbl for a year, growth in the U.S. could slow by roughly 0.4 percentage point.