11 Weeks into Blockade, Wall Street Warns: June May Be the Final Line of Defense for Oil Prices

Major Wall Street banks are密集ly warning that the oil supply cushion has reached a critical point. If the US-Iran negotiations fail to break the deadlock by June, inventory exhaustion will drive Brent crude oil to make up historical extremes.

The blockade of the Strait of Hormuz has entered its 11th week, and both the US and Iran once again rejected ceasefire proposals over the weekend. On Monday, Brent crude oil surged 4.6% to $105.99 during the trading day, then fell back to around $101; WTI crude oil broke through the $100 mark at one point, with a gain of 4.8%, then fell back below $97. Since the outbreak of conflict at the end of February, global oil prices have risen nearly 50%.

Morgan Stanley pointed out that a daily supply buffer of 9.3 million barrels built by China and the United States is approaching a critical point. The bank explicitly warned that the last line of defense supporting oil prices has not broken historical records is rapidly consuming. If the blockade continues into late June, the market will have to bear the severe upward pressure that was successfully avoided before.

Goldman Sachs believes that the market is currently experiencing the largest supply shock on record, with global commercial inventory falling to a low point in eight years. The bank warned that if the normalization process in the strait continues to be sluggish after mid-June, oil prices are most likely to surpass the historical peak of 2008, that is, to rush towards $150 and higher levels.

Bank of America has raised its forecast for US inflation in 2026 to 3.6%, characterizing the current situation as "moderate stagflation." Citigroup emphasized that the market significantly underestimated the tail risk of the negotiations breaking down. In extreme escalation scenarios, major banks generally believe that oil prices returning to the "$200 era" is no longer a pie in the sky.

The differences between the US and Iran on the core terms of the nuclear agreement are still huge. Despite Washington showing strategic softening, Iran has not compromised. Saudi Aramco warned that the global energy system has lost 10 billion barrels of supply in the past two months. If the Strait of Hormuz continues to be closed, the petroleum market will lose about 100 million barrels of supply per week.

June has become a common watershed in Wall Street's pricing logic. This is not only the red line for whether the inventory buffer can be maintained, but also the bottom line of the negotiation timetable. Once this key window is missed, the crude oil market without an umbrella will face a severe impact of more than $150 per barrel.