JPMorgan: Probability of Strait of Hormuz Reopening Within June Is Extremely Low, Significant Upside Risk for Oil Prices
0xBroomberg
JPMorgan said on June 2 that the Strait of Hormuz is unlikely to reopen this month. Brent crude at $95/bbl already prices in a near-term reopening, but if the blockade holds, oil faces asymmetric upside risk toward $130–150.
Why does JPMorgan say the strait won't reopen in June?
The bank's core call: setting a specific date is unrealistic. Reopening requires markets to hit a pain threshold — a spike in US 10-year yields, a sharp S&P 500 sell-off, or wild swings in WTI.
This means → JPMorgan sees reopening not as a diplomatic outcome but as a compromise forced by market distress.
The report's own framing: "We need to trade as if the strait will stay closed permanently — that is what brings all sides to reopen it."
Why do negotiations keep stalling?
Axios reported that Trump would sign a US-Iran peace deal, but both sides then demanded revised wording, resetting the process to square one.
This back-and-forth has been the crisis's most consistent feature since the April 8 two-week ceasefire and Trump's unilateral extension on April 21.
Kalshi prediction-market data confirms the pattern: in mid-April traders priced in a 65%+ probability that the strait would normalize by June 1 — that bet has already lost.
This means → JPMorgan expects the "normalization by August 1" probability line to trace a similar downward path.
Where is oil now, and how much further can it run?
JPMorgan brackets the conflict-period Brent range at $90–110/bbl. The current ~$95 sits near the low end of that band.
The risk skew is stark: even a one-week delay beyond the base-case reopening date would lift JPMorgan's year-end Brent forecast by $5/bbl. A prolonged blockade opens space toward $130 or even $150.
In plain terms = the market is pricing "it opens soon." If it doesn't, the catch-up rally dwarfs any pullback.
How much have energy prices moved since the crisis began?
Since pre-conflict levels (February 27), Brent crude is up roughly 34%.
TTF natural gas — Europe's benchmark gas price — has surged 57%. Japan-Korea LNG prices are up over 73% from pre-crisis.
European jet fuel and diesel prices have each risen more than 40%.
This reflects a blockade shock that has spread well beyond crude, putting the entire energy chain under pressure.
Content is for reference only, not financial advice.