Summary
- Crude shipments through the Strait of Hormuz have been halted, and crude storage facilities in Middle Eastern oil producers are reportedly nearing capacity.
- International oil prices rose, with crude futures topping $85 a barrel to the highest level in about 19 months, before giving back part of the gains to around $82.
- JPMorgan warned that if alternative export routes are not secured, some producers could reach storage limits in about three weeks.
Forecast Trend Report by Period
With crude shipments through the Strait of Hormuz halted due to the Iran conflict, crude storage facilities in Middle Eastern oil-producing countries are reportedly rapidly nearing capacity.
According to Walter Bloomberg on the 4th (local time), Iraq has already cut some crude production, and Saudi Arabia and the United Arab Emirates (UAE) may also move to scale back output in the coming weeks. The explanation is that with exports blocked, spare storage capacity is being depleted quickly.
International oil prices climbed, with crude futures topping $85 a barrel to the highest level in about 19 months. However, prices gave back part of the gains to around $82 after reports said Iran signaled the possibility of peace talks.
Total crude storage capacity across the Gulf region is estimated at about 100 million barrels, but usable capacity is said to be lower when facility locations and operational constraints are taken into account. Storage at key export terminals such as Saudi Arabia’s Ju'aymah and Ras Tanura is also filling up quickly.
JPMorgan warned that if alternative export routes are not secured, some producers could reach storage limits in about three weeks.
JH Kim
reporter1@bloomingbit.ioHi, I'm a Bloomingbit reporter, bringing you the latest cryptocurrency news.
