Even if the Strait of Hormuz were to reopen tomorrow, the global oil market is already heading toward a near-term supply crunch. June is likely to mark the low point for supply and inventories, as weeks of disruption compound into a structural deficit. So far, the system has functioned, but only superficially. Prices have adjusted and flows have rerouted, yet the real strain will emerge when storage tanks are drained and operational limits are breached. This is uncharted territory. The global energy system has never faced a disruption of this scale, and the impact will not be evenly distributed. Lower-income and geographically isolated markets, such as East Africa or Australia, are already showing stress due to limited refining capacity and dependence on imports. As inventories fall below minimum operating thresholds, localized shortages may begin to surface. Even in a best-case scenario, recovery will be slow. Rebuilding inventories and restoring supply chains could take months, potentially a year, keeping prices elevated in the interim.
OPEC Fractures and Russia’s Growing Concern
Beyond the immediate crisis, a more structural risk is emerging: the weakening cohesion of OPEC+. The UAE’s exit raises questions about whether other producers may follow or simply increase output independently. In a post-crisis environment, there will be strong incentives to ramp up production rapidly, to refill depleted storage, capture market share, and meet pent-up demand. For major exporters like Russia, this poses a serious challenge. A fragmented producer alliance could trigger aggressive competition and price volatility, undermining revenues at a critical time. The risk is clear: today’s supply shock could evolve into a disorderly production surge, ultimately tipping the market from scarcity into oversupply.