Crude oil prices surged today, with June WTI crude up 3.51% to $3.55, and June RBOB gasoline rising 2.22% to $0.0801, as ongoing US-Iran conflict continues to tighten global oil supplies. President Trump criticized Iran’s peace proposal, calling it a “piece of garbage,” while confirming potential US naval operations to ensure safe passage through the Strait of Hormuz, a critical transit route for a fifth of the world’s oil.
The International Energy Agency reported that global oil inventories dropped by approximately 4 million barrels per day in March and April, with the market expected to remain undersupplied until October, even if the conflict resolves. Goldman Sachs highlighted a cut in crude output by 14.5 million bpd in the Persian Gulf, leading to a drop of nearly 500 million barrels from global stockpiles, which could reach 1 billion barrels by June.
OPEC’s April production fell to a 35-year low of 20.55 million bpd, while active US oil rigs increased slightly by 2, reaching 410 rigs, a marginal rise from a 4.25-year low. In the latest EIA report, US crude oil inventories were noted to be 0.3% below the seasonal five-year average as of May 8, indicating tightening supply in a tumultuous market.
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