Trump’s Hormuz toll plans bring oil supply risks back in spotlight
Drone footage of the oil tanker HELGA docking at one of the offshore oil terminals near Basra in southern Iraq as it prepares to load crude oil, the second ship to arrive since the Strait of Hormuz was closed on April 24, 2026.
Muhammad Horse | Reuters
President Donald Trump’s plan to impose a 20 percent fee on cargo passing through the Strait of Hormuz threatens a global oil glut, especially if renewed hostilities again close the key waterway.
Analysts said the proposed tax is less about its direct cost and more about what it signals: a growing risk that disruptions to shipping through the Bosphorus could lead to supply shortages, upending surplus forecasts made earlier this month.
Andy Lipow, president of Lipow Oil Associates, said on CNBC’s “Squawk Box Asia” that the market had been counting on stronger supplies following the U.S.-Iran memorandum signed last month, but that optimism has faded.
“These surpluses are definitely in danger, especially if the strait closes completely.”
Lipow estimates that Trump’s proposed fee, if applied to crude cargoes, would add about $16 per barrel to oil shipped through the strait; However, the administration has not yet announced how this fee will be implemented.
Oil prices since the beginning of the year
Citi warned that the implementation of the fee could also eliminate the possibility of a wider military conflict in the near term.
“We believe the risk of escalation in military tensions increases significantly if this announcement is implemented,” Citi said in a note published early Tuesday. he wrote.
“There is also an increased likelihood that the Iranian regime will move away from the Memorandum of Understanding until after the mid-term US elections, a scenario that is likely to be seen as higher for longer oil prices,” Citi analysts added.
Although the proposed tax would increase shipping costs, other experts said investors are increasingly focused on the possibility that an escalating conflict could remove the barrels from the market altogether.
“The immediate impact is obviously supportive of oil prices, but the more significant issue is the risk of renewed physical supply losses,” said Henry Hoffman, associate portfolio manager at Catalyst Energy Infrastructure Fund.
US West Texas Intermediate futures for August delivery rose 2.27% to $79.91 per barrel. International benchmark Brent crude futures for September delivery rose 2.14% to $85.11, extending gains after rising 9.6% in the previous session.
Ship traffic decreases in the Bosphorus
If exporters can’t ship crude out of the Gulf, storage tanks could eventually fill up, leaving producers with little choice but to temporarily halt production, Hoffman said. “This makes the loss of effective supply potentially much larger than what can be measured by looking at damaged infrastructure alone.”
The latest developments will also undermine the expectations of the International Energy Agency and others that global oil markets will be comfortably supplied. Just last week, the IEA said it expected the oil market to return to surplus towards the end of 2026, but the outlook depended on the gradual recovery of tanker traffic in the strait.
He added that the timing could be particularly challenging if demand in Asia recovers as supply in the Middle East becomes less reliable. “Saudi Arabia recently moved its primary Asian crude grade from a massive premium to a discount, which should encourage Chinese refiners to increase purchases after imports fell sharply during the initial disruption.”
Saudi Aramco I recently lowered the prices According to the Oman/Dubai comparison, it decreased by $11 per barrel to a discount of $1.50.
“In other words, Chinese demand may begin to recover as the reliability of supply in the Middle East deteriorates again.”
