Trump Declares Iran Peace Deal Over as Oil Seen Rebounding Toward $90

3 articles · Updated · Fortune · Jul 10

Oil fell below $70 a barrel even after Trump said on July 8 the interim Iran deal was "over," but analysts say that calm misreads renewed drone, rocket and vessel exchanges in and around Hormuz.
Near 1 billion barrels of global reserves have been drawn down, Strait traffic remains well below normal, tanker insurance and shipping costs have at least doubled, and about 7 million barrels a day of refining capacity is still offline.
China is the key swing factor: it cut imports by roughly 5 million barrels a day while using reserves, masking tightness for now, but analysts expect buying to resume by late August and push crude back near $90.
U.S. buffers are also thin, with the Strategic Petroleum Reserve down to just above 300 million barrels from 415 million at the war's start and Cushing inventories at 19.6 million barrels, below the 20 million danger line.
That leaves Trump exposed before November's midterms: gasoline has eased to $3.88 a gallon from a $4.56 May peak, but analysts say a lasting Hormuz disruption could keep at least 5% of world oil offline for months.