Oil flows through Hormuz will take time to recover, banks say
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Summary
A recovery in oil flows through the Strait of Hormuz and oil production after the U.S.-Iran peace deal will take months rather than days, analysts at Goldman Sachs, BNP Paribas and Bank of America said. Goldman expects Gulf exports to normalize by end of July and crude production to recover by October, but ship availability and shipper risk aversion could constrain flows.
Market Impact
The multi-month recovery timeline means oil markets may face continued supply tightness into late 2026 even as prices have already fallen sharply. Bank of America sees oil markets in deficit until Q4 2026, and mine-clearing logistics add further delay risk. This analysis is informational and avoids any directional trading claims.
Why It Matters
It quantifies the gap between the diplomatic deal and actual supply normalization, which shapes energy-price and logistics expectations.
Key Points
- Goldman Sachs expects Middle East Gulf exports to normalise to pre-war levels by end of July, with crude production recovering by October.
- BNP Paribas said even in a best-case scenario it would take several months for oil flows to normalise, requiring producers to restore about 12 million barrels per day.
- Bank of America said clearing mines would likely take months, not days, and oil markets could remain in deficit until Q4 2026.
- Before the conflict, the Strait of Hormuz handled about a fifth of global oil supply.
Key Entities
Evidence
Goldman Sachs said it expects Middle East Gulf exports to normalise to pre-war levels by the end of July, and crude production to recover by October.Supports: Supports the Goldman timeline.
BNP Paribas said that even in a best-case scenario it would take several months for oil flows to normalise, and that this would require producers to bring back about 12 million barrels per day of shut-in production.Supports: Supports the BNP timeline.
Bank of America said clearing mines would likely take months, not days, given logistical challenges, adding that oil markets could remain in deficit until the fourth quarter of 2026.Supports: Supports the BofA outlook.