RBC Warns: The Expectation of a US-Iran Agreement is Ahead of Reality, June-August Oil Market Faces Stern Pressure
Taylor Wilson
Brent crude fell over 19% in May as markets bet on an imminent U.S.-Iran deal; RBC warns expectations have far outrun reality, and June–August will be crude's true stress test.
How far have oil prices fallen, and why?
Brent dropped over 19% in May — the steepest monthly fall since March 2020. WTI fell nearly 17%, its worst month since April 2025.
On May 29, Trump posted that a final decision on the Iran conflict was imminent. WTI slid 1.73% to $87.36; Brent fell 1.77% to $92.05.
This means → the market is already pricing in "deal any day now," but RBC says supply reality is nowhere close.
Where do the deal negotiations actually stand?
According to CNBC citing U.S. officials, negotiators have agreed on the framework of a 60-day memorandum of understanding (MOU) covering an extended ceasefire and arrangements for Iran nuclear talks.
But the MOU still needs Trump's final signature. More than three weeks have passed since the first "deal imminent" headlines, during which Iran has lost an estimated 300 million barrels of output.
In plain terms = a framework exists, but the last step is missing — and every day of delay adds to the damage.
How fast are global inventories draining?
RBC data shows the crisis is now in its third month, with global stocks depleting at a record pace.
At the current six-week average drawdown rate, onshore crude inventory measured in days of refinery throughput could fall to 30–40 days by October — the lowest since RBC began tracking in 2016.
This reflects a critical dynamic: strategic petroleum reserves (SPR) — government emergency oil stockpiles — and other "energy shock absorbers" are running out fast. And because some countries' data is opaque, the true drawdown may be systematically underestimated.
Even with a signed deal, can the Strait reopen quickly?
RBC says no. Early-stage transit would likely be one-way only, adding significant logistical complexity.
With ongoing threats from missiles, drones, and sea mines, few Western shipping firms would risk re-entering the Strait of Hormuz on the strength of a 60-day MOU alone.
Sky-high insurance premiums and U.S. sanctions law barriers around payments to IRGC-linked entities (Islamic Revolutionary Guard Corps) further narrow shipowners' options. Put simply = a paper agreement and actual shipping are two different things.
Does Iran itself want a deal?
RBC analyst Helima Croft notes that factions inside Iran may prefer to maintain the current "no war, no peace, oil barely flowing" status quo.
This means → as summer inventory costs become harder to hide, Iran calculates its bargaining leverage will grow on its own — removing any incentive to settle quickly.
Despite hyperinflation now far worse than in January, Iran's government has reportedly faced no new wave of mass protests, and the IRGC has allegedly used the ceasefire period to rebuild some military capability.
What is RBC's bottom-line call on the market?
Croft describes the current trading mindset as a "Memento" mentality — each "deal imminent" headline is treated as a decisive breakthrough, while the market selectively forgets the diplomatic deadlock and repeated military escalation.
Her conclusion: absent a substantive breakthrough, June through August will be a severe stress test for crude markets. "Time is running out, and the window to reopen Hormuz and avoid a hard landing is closing fast."
This signals RBC's belief that February 27, 2026 may prove to be the peak for Hormuz tanker traffic for the foreseeable future — in other words, the best days may already be behind us.
Content is for reference only, not financial advice.