Oil Market Absorbs 13 Million-Barrel Shock as Iran War Costs US Households $800
Updated
Updated · CNN · Sep 12
Oil Market Absorbs 13 Million-Barrel Shock as Iran War Costs US Households $800
3 articles · Updated · CNN · Sep 12
Summary
$800 in added fuel costs per US household has not broken the oil market more than six months into the Iran war, with crude still largely reaching buyers despite disrupted Hormuz flows.
13 million barrels per day of lost supply has been offset by Saudi pipeline diversions, US-backed escorted shipments, roughly 2 million bpd of extra output, stockpile drawdowns and a 5 million bpd drop in global demand.
$87 to $89 Brent is the range some analysts see if the conflict becomes a prolonged stalemate, versus about $64 if the war ends, suggesting the market can function at higher prices without fully normalizing.
Late next year is when strains could intensify if inventories keep falling, as Cushing only recently moved above operational minimums, China still imports well below prewar levels and US naval escort operations remain costly.
Constrained Hormuz exports are expected to persist through year-end, and S&P Global Energy no longer sees Middle East production returning to prewar levels even by the end of next year.