Oil Price Risk Revisited
JPMorgan warned oil could spike to $120 a barrel if a Strait of Hormuz stalemate continues, highlighting an upside shock scenario for energy costs. That kind of move would ripple through transportation, logistics and any company with significant fuel exposure. (apacnewsnetwork.com)
JPMorgan says oil could revisit $120 a barrel if shipping through the Strait of Hormuz does not fully recover until July. (bloomberg.com) In an April 10 note, the bank said a slower return to normal traffic would add $15 to $20 a barrel to current prices. Brent crude was just below $100 that day, and settled at $95.20 on April 10. (bloomberg.com) (tradingeconomics.com) JPMorgan said 346 energy-related vessels were still trapped inside the Persian Gulf as of April 9, including 241 carrying cargo. The bank said those ships held 104 million barrels of crude and condensates, 1.3 million tons of liquefied natural gas and 5.5 million barrels of liquefied petroleum gas. (bloomberg.com) The Strait of Hormuz is the narrow sea lane between Iran and Oman that carries about 20 million barrels a day of crude oil and oil products. The International Energy Agency said that was about 25% of the world’s seaborne oil trade in 2025. (iea.org) The channel is only 29 nautical miles wide at its narrowest point, and the actual inbound and outbound shipping lanes are 2 miles wide each. The International Energy Agency said only 3.5 million to 5.5 million barrels a day can be rerouted through alternative pipelines. (iea.org) That bottleneck reaches beyond crude oil. The International Energy Agency said about 19% of global liquefied natural gas trade also moves through the strait, with Qatar and the United Arab Emirates heavily dependent on it. (iea.org) Other banks are using lower base cases but the same trigger. Barclays said on April 9 that its 2026 Brent forecast of $85 a barrel assumes a swift normalization of Hormuz flows, and warned that delays or renewed escalation would push prices higher. (reuters.com) JPMorgan’s earlier stress case was sharper. On April 2, Reuters reported the bank had warned oil could jump to $120 to $130 a barrel in the near term, with prices above $150 possible if Hormuz flows stayed impaired into mid-May. (reuters.com) Shipping companies are still treating the ceasefire as fragile. Maersk said on April 8 that the two-week United States-Iran ceasefire did not yet provide enough security certainty to resume normal operations in the strait. (reuters.com) Oil has already backed off its war highs, but the price path still depends on how fast tankers move again. If traffic stays restricted into July, the market JPMorgan described would look less like a brief scare and more like a supply shock. (bloomberg.com)
