Philippe Khoury, executive vice-president for sales and trading at ADNOC, told the Middle East Petroleum and Gas Conference in London that prices could move sharply higher if demand strengthens while the Iran war supply crisis continues. His warning places August at the centre of the market’s next stress test, when summer consumption, refinery runs and depleted inventories could collide with reduced shipping capacity through the world’s most important oil chokepoint.
The Strait of Hormuz remains below pre-war traffic levels, with vessel movements only partly restored and shipping confidence still fragile. Tanker operators face elevated insurance costs, security risks and uncertain routing decisions, limiting how quickly crude, liquefied petroleum gas, jet fuel, chemicals, fertilisers and sulphur can move from Gulf exporters to buyers in Asia and Europe.
Khoury said supply chains could take up to a year to recover even after normal flows resume. That assessment reflects the scale of disruption across shipping schedules, tanker availability, port operations, insurance cover, refining logistics and destination markets. The issue is no longer only whether barrels are available, but whether they can be moved reliably, safely and affordably to buyers.
Brent crude has been trading close to the $100-a-barrel mark, with price movements responding quickly to reports of renewed hostilities, stalled diplomacy and changing expectations for shipping through Hormuz. US crude has also remained elevated, while drawdowns in inventories have added to concerns that markets have little cushion if demand accelerates into the northern hemisphere summer.
The disruption has altered the balance between physical supply and paper-market expectations. Earlier forecasts for ample 2026 supply have been overtaken by war-related losses, delayed shipments and reduced confidence in Gulf transit. Oil inventories are being drawn down at a faster pace, while the expected recovery in flows has become more conditional on security guarantees, diplomatic progress and the willingness of shipowners to re-enter high-risk routes.
Hormuz normally handles a major share of global crude and condensate exports as well as liquefied natural gas shipments from the Gulf. A full return to normal traffic would require more than a political announcement. Shipping firms need clarity on mine risks, missile threats, naval escorts, insurance pricing and contractual liability before moving large tankers back through the channel at scale.
For ADNOC and other Gulf producers, the crisis has sharpened the commercial importance of export flexibility. Abu Dhabi has been working to strengthen infrastructure that can move barrels outside Hormuz, including pipeline routes to the Fujairah export hub. Such capacity cannot fully replace the strait, but it gives producers more resilience when maritime risks rise.
Asian buyers remain central to the demand outlook. China’s consumption has been weaker than expected, but there are signs of gradual improvement among independent refiners. India has continued buying through the disruption, reinforcing its role as a major demand centre. Japan and South Korea also remain exposed to Gulf supply routes, while price-sensitive importers across Asia face tighter margins as freight, insurance and fuel costs rise.
Europe’s vulnerability is different but still significant. Jet fuel supplies have been strained, reflecting the difficulty of replacing Middle East flows quickly in a market where refining configurations, shipping distances and product specifications all matter. Higher aviation fuel costs could feed into airline margins and ticket prices during peak travel months.
OPEC+ faces a complicated policy backdrop. Additional production targets offer limited relief if physical exports remain constrained by Hormuz disruption. Spare capacity is useful only when barrels can reach customers. That has made logistics, maritime security and insurance as important to the oil price outlook as headline production levels.
The risk for consumers is that crude prices move higher before supply chains fully adapt. A sustained push above current levels would affect transport, manufacturing, petrochemicals and food supply chains through higher fertiliser and freight costs. Inflation pressures could return just as central banks and governments are trying to preserve growth.
Diplomacy remains the key variable. Even a ceasefire or easing of tensions may not produce an immediate recovery in trade flows. Shipowners, insurers and refiners are likely to wait for proof that the route is safe before restoring normal operations. That lag is why Khoury’s warning carries weight: oil markets may face their hardest test not during the first phase of the shock, but when demand begins to recover while the supply chain is still damaged.
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