Two Critical Scenarios That Will Determine the Direction of Oil
While developments in the Middle East and restrictions in the Strait of Hormuz affect prices in the global oil market, experts are discussing two different scenarios shaped by supply and demand balances.
The conflicts in the Middle East and transportation restrictions in the Strait of Hormuz changed balances in the global oil market, causing Brent crude to exceed $90. The future of the markets will be determined by the course of the conflicts and strategic decisions to be made.
The Impact of the Strait of Hormuz on the Global Market
The Strait of Hormuz is the most critical transit point through which approximately 20 percent of world oil shipments pass. Disruptions in the region are directly reflected in prices.
Alternative Routes and Supply Support
While Saudi Arabia and the United Arab Emirates are activating alternative pipelines, the increase in US production and the use of biofuels are among the factors supporting global supply.
The Role and Risks of Strategic Reserves
The coordinated release of strategic reserves by countries has eased price pressure. However, the fact that reserves cannot be used at the same pace for a long time increases potential risks.
Scenarios Above $70 and $90
In the event of a possible agreement and a return to normal shipments, Brent crude is expected to drop to around $70. If the war prolongs, prices are projected to remain permanently above $90.