Brent crude has held above $100 per barrel for most of the past month, even as a series of reports indicates that Middle East crude flows have returned to normal. The benchmark traded at about $60 before the war, so the current level represents a premium of roughly $40 that has now persisted for weeks. The question facing the market is why prices have not responded to the apparent recovery in physical supply.
The data in question comes from tanker-tracking services and investment banks, which have published numerous reports and figures in recent weeks on crude movements through the Strait of Hormuz. Their combined picture is one of flows that have recovered to pre-war levels and, on some counts, moved beyond them. That mismatch between recovering physical barrels and a benchmark holding near $100 is the puzzle the analysis sets out to explain.
The article's answer begins with the observation that restored flows do not, by themselves, restore a market. Crude transit through Hormuz returning to pre-war levels, it argues, is not the same as the market returning to pre-war conditions. Framing the situation as a 'perfect storm', the piece points to a convergence of factors, rather than any single cause, behind the persistent price level.
For companies operating across the oil value chain, the implication is that flow data alone offers an incomplete read on market tightness. Tracking figures were circulated widely in recent weeks, yet prices have not followed the signal they carried. Until the pressures keeping the market tight are better understood, the roughly $40 gap between today's benchmark and its pre-war level will remain a central input for planning, procurement and hedging decisions across the sector.
Source: Oilprice
