Oil prices edged higher on Monday, with Brent crude climbing 0.6% to $72.44 per barrel, as fresh U.S.-Iran military strikes disrupted shipping through the strategic Strait of Hormuz. However, traders are increasingly focused on a growing imbalance in tanker traffic that could signal a near-term crude glut and complicate efforts to restore normal supply flows.
Data from LSEG and Reuters Open Interest revealed a stark mismatch: last week, only one tanker entered the Gulf for every four that departed, a ratio far below pre-conflict levels. This departure-heavy pattern suggests that while exports are moving out, the lack of returning vessels is creating a bottleneck that could delay the restart of oil fields and refineries. Without a steady inflow of ships, producers cannot empty storage tanks and resume normal output, potentially forcing production cuts even as spot prices remain capped by ample export volumes.
The futures curve has shifted into contango, with August Brent trading below September for the first time since the war began on February 28. This structure typically signals near-term oversupply, as barrels accumulate faster than buyers in Asia and Europe can absorb them. The contango highlights the risk of a mini-glut building in the Gulf region.
Despite the shipping disruptions, major loadings continue. Saudi Aramco (TADAWUL:2222) was seen loading crude at Ras Tanura, with a fourth very large crude carrier (VLCC) docked on Monday. Three other supertankers loaded and then went dark after departing over the weekend, with one later reappearing past the strait en route to Japan. Two VLCCs moved through the strait and docked at a UAE terminal to load additional cargoes. Meanwhile, Iran accelerated shipments from Kharg Island after the U.S. granted a 60-day sanctions waiver, with Iranian-flagged VLCCs Dan and Hawk transiting the strait on Saturday.
Overall oil flows through the Strait of Hormuz reached 19.87 million barrels per day in 2025, but bypass pipelines can handle only 3.5 million to 5.5 million bpd, covering about 18%-28% of normal volume. This limited pipeline capacity leaves the market vulnerable if hostilities flare up again. U.S. Energy Secretary Chris Wright noted that about 72 ships carrying 20 million barrels passed through Hormuz in 24 hours last week, but many vessels still avoid the main channel due to mines, and a full recovery in navigation could take weeks as demining operations continue.
Traders remain divided on the outlook. Phil Flynn of Price Futures Group believes oil will continue moving through the strait, while PVM’s Tamas Varga warns of imminent oversupply. June Goh at Sparta Commodities pointed to increased exits from Hormuz and noted that China has not yet picked up crude demand, adding to the bearish sentiment. Fabien Yip of IG Group in Sydney commented that oil had risen too quickly on ceasefire optimism before the recent vessel attack delivered a reality check. Tony Sycamore, also of IG, said crude is reasonably priced with a downward bias if Hormuz opens in a limited way, but is way too cheap if fighting resumes.
Energy traders now face a patchy reopening. While exports may cap Brent prices, the flow of vessels could remain tight, keeping supply off balance. Attacks continue to pose risks for freight and insurance costs. Washington and Tehran reportedly agreed to halt strikes, with possible talks in Doha on Tuesday, though Iran has not yet responded to the report. The coming days will be critical in determining whether the tanker imbalance eases or deepens, shaping the next move for oil markets.
