Oil Market Underprices Risks from Iran War, Vitol Executive Warns

Vitol's managing director for Bahrain, Tom Baker, believes that the oil market is underpricing risks related to the Iran war.

The conflict has led to a significant reduction in Middle East supply, with approximately 14 million barrels taken offline due to Iran's effective closure of the Strait of Hormuz and attacks on energy infrastructure.

Baker stated at the S&P Global Energy Middle East Petroleum and Gas Conference that 'crude can come back online, but from a product perspective, it might be very hard for the system to catch up for the rest of the year.'

He added that 'the turning point could be when someone really needs those physical molecules and the physical molecules just aren’t there to buy.'