Oil Market Volatility Spikes Amid Hormuz Disruptions
The global oil market has been experiencing extraordinary volatility in 2026 due to a combination of factors, including severe disruptions to the Strait of Hormuz, Middle East production outages, low inventories, and high refinery utilization.
The Strait of Hormuz is one of the world's most important energy chokepoints, with an estimated 20.9 million barrels per day moving through it in the first half of 2025. However, transit volumes collapsed in 2026, with EIA estimates showing a sharp decline from 21.6 million b/d in Q4 2025 to just 4.9 million b/d in Q2 2026.
The disruption has had far-reaching consequences, affecting not only crude oil but also petroleum products, LNG, shipping, insurance, and refinery feedstock availability. Oil prices have been volatile, with front-month Brent trading as high as $118 per barrel on April 29 and falling as low as $72 on June 26 during Q2 2026.