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Informist, Monday, May 25, 2026

MUMBAI – Crude oil prices are likely to be prevented from rising as supply losses are seen recovering once the Strait of Hormuz reopens, ANZ Research said in a report. US President Donald Trump has intermittently signalled that a deal with Iran is imminent, which could ease supply concerns, it said.

Transit of tankers through the Strait of Hormuz rose to five on May 23. A total of 23 million barrels of crude is known to have moved outbound across the strait on 11 vessels so far in May, averaging 1.15 million barrels per day, ANZ Research said. "This has discouraged bullish market positions and limited panic buying," the report said. Exports from Oman and Saudi Arabia also improved, but volumes from Persian Gulf producers fell last week to 7.85 million barrels per day.

But physical markets show few signs of an oil supply crisis, particularly in the US, where commercial crude oil stocks remain relatively high. Moreover, high inventory levels in Asia have also helped buffer supply losses.

China's crude oil reserves are likely to be around 1.7 billion barrels and similar levels are also seen in Japan and South Korea, though to a lower extent. This has been aided by 500,000 barrels per day to 1.0 million barrels per day of demand rationing. China's imports have fallen sharply, while many Asian countries have rationed supply or mandated four-day work weeks to reduce demand, according to the report.

Meanwhile, the International Energy Agency reports that as of May 8, about 164 million barrels of oil have been released from emergency stockpiles by member countries. "The drawdown of the US strategic petroleum reserves has accelerated in recent weeks, it said. Drawdown in global production inventories slowed last week, driven by builds in jet fuel and distillate inventories in the US and Europe," according to the report.

"The spread between dated Brent and front-month futures fell to $4 per barrel as the spot physical price weakened," the report said.  End

Reported by Taniva Singha Roy

Edited by Avishek Dutta

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