Summary:
- Oil prices seen peaking in coming weeks
- Peak tied to resumption of Hormuz shipping
- Prices likely to rise until flows normalise
- U.S. blockade adding to near-term disruption
- Venezuela supply ramp offers partial offset
U.S. Energy Secretary Chris Wright said oil prices are likely to reach their peak within the next few weeks, with the turning point tied directly to the resumption of meaningful shipping flows through the Strait of Hormuz.
Speaking at the Semafor World Economy Forum in Washington, Wright indicated that energy prices are likely to remain elevated, and could rise further, until vessel traffic through the critical chokepoint normalises. The Strait, which handles a significant share of global oil and gas flows, has been heavily disrupted since the outbreak of the Iran conflict, with Tehran restricting access to most non-Iranian shipping.
Wright’s comments suggest that the market is still in the tightening phase of the shock, with supply constraints continuing to feed into higher prices. He added that the eventual recovery in shipping activity would likely mark the peak in oil prices, pointing to a near-term inflection rather than a prolonged rally.
The geopolitical backdrop remains fluid. The U.S. has moved to enforce a maritime blockade extending east of Hormuz into the Gulf of Oman and Arabian Sea after diplomatic efforts to end the conflict broke down. Early ship-tracking data indicates disruption is already materialising, with vessels turning away from the strait as enforcement begins.
President Donald Trump acknowledged the domestic implications of elevated energy prices, warning that oil and gasoline costs could remain high through the U.S. midterm election period, highlighting the political sensitivity of the energy shock.
Separately, Wright pointed to rising supply from Venezuela as a partial offset
