On May 1, June WTI crude oil closed at $101.05 per barrel, down $4.15 (-3.90%), while June RBOB gasoline fell to $3.63, a decline of $0.1176 (-3.15%). Prices dropped significantly as the ceasefire in the Middle East has eased geopolitical tensions, allowing for a return to relative calm in the Persian Gulf.
The U.S. Central Command reported that military forces successfully defended against Iranian attacks while facilitating the passage of U.S. vessels through the Strait of Hormuz on April 30. Notably, Goldman Sachs estimates that crude output in the Persian Gulf has been reduced by approximately 14.5 million barrels per day (bpd), with the current crisis depleting global crude stockpiles by nearly 500 million barrels, projected to reach a billion barrels by June.
Additionally, the International Energy Agency revealed that about 13 million bpd of global oil supply has been impacted by the ongoing conflict and the Strait’s closure, while OPEC+ plans an increase of 188,000 bpd in June following prior production cuts. The situation continues to pose a threat, as 20% of the world’s oil and LNG transit through this vital strait, and production cuts from Middle Eastern oil producers have reached around 6% due to storage limitations.
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