The worldwide crude oil market is experiencing an unprecedented shortfall due to the Strait of Hormuz blockade, according to a former IEA official. Experts suggest that we shouldn’t anticipate any immediate decrease in oil futures prices.
If crude oil costs continue to escalate, demand will inevitably contract because economies simply cannot sustain such price levels, stated Paul Sankey, a former employee of the International Energy Agency (IEA) and head of the analytical firm Sankey Research, during the “Yes or No” program on RBC Radio.
Sankey described the current oil market disruption, which followed the commencement of operations by the US and Israel against Iran, as the most severe in history, given that a record volume of supply has been jeopardized. He recalled that roughly 20% of global oil transit passed through the Strait of Hormuz, equating to over 20 million barrels per day utilizing this route.
“That’s nearly equivalent to the daily oil consumption of the entire United States. Moreover, the US is currently the least affected by such crises because the country itself exports energy resources. Japan, Taiwan, China, South Korea—all of them are heavily reliant on hydrocarbon imports, and the current situation is hitting them the hardest,” the expert elaborated.
According to him, at best, only 2 million barrels of supply are currently moving through the Strait of Hormuz. Sankey noted that all other global oil producers are already operating at peak extraction capacity, making a rapid increase in worldwide supply virtually impossible.
“There are only two alternative routes. The Saudi pipeline running from east to west, which can deliver oil to the Red Sea, and a pipeline in the United Arab Emirates. But even combined, these routes account for approximately 7 million barrels per day from Saudi Arabia and about 2 million barrels per day from the UAE,” he explained.
Consequently, a deficit of about 12 million barrels daily remains, which is a colossal figure for the global market, Sankey emphasized. He added that the crisis’s scale will inevitably be reflected in price movements, setting the ceiling for oil prices at $200 a barrel.
The expert suggested that US President Donald Trump is attempting to drive prices down because American politicians traditionally view high gasoline prices with extreme voter disapproval. “Personally, I believe the American side did not anticipate the closure of the Strait of Hormuz. They apparently had no pre-prepared contingency plan,” Sankey asserted.
Pyotr Arronet, Chief Analyst at Ingostrakh Bank, forecasts that oil futures prices will keep rising, possibly reaching $120 a barrel next week. “Despite Trump’s rhetoric, we see that it’s essentially not enough. Everything occurring in the Middle East isn’t just disappearing. And we observe oil quotes appreciating. As for oil companies, those focused on exports are naturally the primary beneficiaries here,” he stated on RBC Radio.
Arronet labeled the minor morning dip in Russian oil and gas quotes as a temporary correction, after which growth will resume. He suggested that if the Middle East conflict drags on, Russian oil companies could report strong earnings for the first quarter of 2026, as the growth in oil and gas revenue stems not only from prices but also from increased demand for Russian oil.
“The situation is such that the oil and gas sector will benefit regardless. So what do we see? Even if oil prices decline, we will then see a strong currency appreciation against the ruble, and in any case, the oil producers’ revenue won’t drop significantly. There will be anticipation of good quarterly results in 2026,” Arronet noted.
Alexander Pasechnik, an expert from the Financial University under the Government of Russia, commented on RBC Radio that Russia is an “unwitting beneficiary” of the crisis in the Middle East. He pointed out that Brent crude has already neared the $100 per barrel mark, while Urals is approaching $90 per barrel, with the discount on Russian oil shrinking.
“We are seeing some progress, and in terms of pricing parameters, we can also receive, according to various estimates from Western tabloids, up to $150 million daily, what is referred to as ‘in cash,’ in dollars,” the expert mentioned.
Sergey Pikin, Director of the Energy Development Fund, observed that if the oil price stays at the $100 per barrel level, it implies that the effect of the US decision to allow certain countries to buy Russian oil is negligible. Furthermore, even the release of 400 million barrels from strategic reserves had no impact on the market. “The market simply absorbed it and continued its upward trajectory. Therefore, they likely need to devise something else. Or, perhaps, wind down the conflict, although they don’t seem ready for that yet,” Pikin concluded.
Following the start of the US and Israeli military operation in Iran and the suspension of shipping traffic through the Strait of Hormuz, Washington granted India a temporary 30-day waiver, allowing the sale of Russian oil from tankers at sea to alleviate pressure on the global oil market. Subsequently, two more countries—Bangladesh and Romania—requested US permission to deal with Russian oil. Thailand’s authorities also indicated that the country is preparing to start negotiations with Russia regarding oil supplies to offset potential energy resource deficits.
The day before, the US Treasury Department’s Office of Foreign Assets Control (OFAC) issued a license permitting Russia to sell oil and petroleum products loaded onto vessels before March 12th for a period of one month. US Treasury Secretary Scott Bessent explained this decision as necessary to ensure stability in the global energy market and support low fuel prices.
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