Despite the announcement of a deal to end the Iran conflict and reopen the Strait of Hormuz, energy experts caution that global oil and gas markets will not return to normal quickly, with supply disruptions expected to persist for months.
The agreement, reached on Sunday, has eased immediate market fears and triggered a fall in crude prices at the start of the week. Brent crude, the international benchmark, slipped by $3.45 to $83.89 per barrel, while US West Texas Intermediate fell $4.03 to $80.85 per barrel. Even with the decline, prices remain significantly higher than the pre-war level of around $70 per barrel.
Analysts say the underlying disruption to global supply chains cannot be resolved in the short term. Shipping routes through the Strait of Hormuz, which normally carry around one-fifth of the world’s oil and refined fuel supplies, were severely disrupted during the conflict, leaving tankers stranded in the Persian Gulf for more than three months.
Daniel Evans, global head of fuels and refining research at S&P Global Energy, said the recovery process will be gradual and dependent on logistical and financial conditions. He noted that insurance coverage, crew availability and safety assurances will all need to be restored before shipping activity can return to normal levels.
“There needs to be confidence that there is a safe window to bring vessels in, load them and move them out again,” Evans said, adding that restarting operations will require coordination across multiple sectors.
Even once shipments resume, the physical movement of oil remains slow. Tankers can take weeks or even months to reach refineries across global markets, meaning the impact of renewed flows will not be immediate.
Complicating the recovery further, several Middle Eastern producers were forced to halt or reduce output during the conflict due to storage constraints, a process known as shut-ins. Restarting those facilities is expected to take time, particularly in countries with more complex extraction conditions.
Alan Gelder, senior vice president at energy analytics firm Wood Mackenzie, said Gulf producers such as Saudi Arabia and the United Arab Emirates could recover more quickly due to alternative export routes. However, he warned that Iraq and other heavily affected producers may require up to a year to fully restore output.
Investment in new energy infrastructure has also been delayed by the conflict, further slowing long-term recovery. Analysts say companies are unlikely to restart major capital spending until there is confidence that stability in the Strait of Hormuz will last beyond a short-term ceasefire.
As Daniel Sternoff of Columbia University noted, uncertainty remains over how quickly normal shipping conditions can be restored, leaving the global energy market in a cautious transition phase despite diplomatic progress.
