Strait of Hormuz Blockade Strands 600M Barrels, 60% Drop Spurs USD Rally
Barclays warns over 50 days of Strait of Hormuz closures have blocked 600 million barrels and shut in 10 million b/d, pressing oil supply risks and recommending builds. Macquarie highlights a 60% drop in Middle East crude imports to Asia and predicts a Q2 U.S. dollar rally, pressuring oil prices.
1. Strait of Hormuz Blockade Strains Oil Supply
The U.S. blockade of the Strait of Hormuz has now exceeded 50 days, preventing the flow of over 600 million barrels of crude and shutting in roughly 10 million barrels per day. Barclays warns that physical markets remain tight, with oil equities undervaluing the supply squeeze and advises investors to build positions ahead of further disruptions.
2. Economic Conflict Fuels Dollar Strength
Macquarie notes Middle East crude shipments to Asia have plunged by 60% versus pre-conflict levels, depleting buffers in Australia and India to 33 and nine days of reserve coverage. The firm forecasts that ongoing economic warfare will boost the U.S. dollar in Q2, creating additional headwinds for oil prices until safe passage is restored.