JP Morgan Sees Oil Staying Above $100 Even After Hormuz Reopens
BBC Business reported Monday that JP Morgan expects global oil prices to hold in the “low $100s” for most of 2026. The bank maintained that outlook even if the Strait of Hormuz were to reopen as soon as next month.
Trump’s Rejection Sends Brent Higher
International benchmark Brent crude surged more than 4% intraday to around $105.94 a barrel. The move followed President Donald Trump‘s blunt dismissal of Iran’s latest response to US peace proposals. Trump posted on social media that he found Tehran’s terms “totally unacceptable.” Iran had relayed its counteroffer through Pakistan, demanding an immediate end to hostilities and guarantees against further US-Israeli strikes.
Washington’s own demands reportedly included free passage through the Strait of Hormuz and a halt to Iranian nuclear enrichment. Israeli Prime Minister Benjamin Netanyahu separately stated the conflict would not end until Iran’s enriched uranium stockpiles were eliminated.
Why Reopening the Strait Won’t Fix Prices Fast
JP Morgan’s research note warned that restoring the waterway to traffic would not quickly normalise supply. The bank said the constraint would likely migrate from the strait itself to tanker availability, refinery restart schedules, and broader logistical bottlenecks. Its analysts now project Brent will average $97 a barrel across the full year, leaving prices elevated well beyond the strait’s eventual reopening.
Background: A Market Transformed Since February
The Strait of Hormuz has been effectively closed since shortly after the Iran conflict began on 28 February. Around one-fifth of global oil and gas shipments normally transit the waterway. Brent had already climbed back above $100 after a ceasefire took effect on 8 April, though sporadic exchanges of fire have continued. Trump extended that truce indefinitely on 21 April to allow Iran time to submit a consolidated proposal.
Energy companies have benefited sharply from the supply shock. Saudi Aramco chief Amin Nasser told investors Monday that the disruption was likely to stretch into 2027 even if Hormuz reopened immediately, citing an unprecedented loss of roughly one billion barrels of cumulative supply. Aramco’s own cross-country pipeline had shielded it from the worst shipping disruptions. BP and Shell have separately reported sharply higher quarterly profits over the same period.
OPEC Output Already Falling
A Reuters survey found OPEC crude production dropped by 830,000 barrels per day in April compared to March, settling at roughly 20.04 million barrels per day. That decline further tightens a market already strained by the Hormuz closure, leaving little slack to absorb any fresh escalation in the Gulf.
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