In a market update sent to Rigzone on Wednesday, Rystad Energy said reports of a U.S.-Iran peace deal are gaining credibility, but warned that, even if a deal is made, “the consequences for physical oil markets will be slower and more conditional than futures prices are currently pricing in”.
Rystad Energy Chief Oil Analyst Paola Rodriguez-Masiu, who is based in the Netherlands, stated in the update that a deal announcement “would move futures further immediately”, highlighting that “even the potential of a deal is already triggering a decline in oil prices”.
Rodriguez-Masiu added, however, that the physical market “does not run on political timelines”.
“Even under an optimistic scenario involving a 30-day phased reopening of the Strait of Hormuz, meaningful volume recovery would happen in June at the earliest, with processing port arrivals lagging by an additional four to six weeks after that,” the analyst warned.
“Transit insurance markets need to reprice, vessel operators need verified and sustained access, and commercial confidence cannot be rebuilt overnight,” Rodriguez-Masiu said.
“The six to eight week lag between credible access conditions and real flow normalization is not a conservative estimate, it is a structural feature of how shipping markets work. Global markets should not mistake a ceasefire headline for a supply headline,” the analyst went on to state.
Rystad pointed out in its update that its prior estimate of six to eight weeks “between a credible access condition and meaningful volume recovery remains intact”.
“Physical flows back to 80-90 percent of pre-disruption levels are a July story. Processing port arrivals lag by an additional four to six weeks,” it added.
Rystad went on to state that several signals distinguish today’s situation from prior episodes where U.S. proposals have been floated and failed to materialize.
One of these is that “China has changed its posture”, the update outlined.
“Iran’s Foreign Minister Araghchi made his first visit to Beijing since the war began on February 28,” the update noted.
“China’s Foreign Minister Wang Yi publicly called for a comprehensive ceasefire and for Hormuz to reopen ‘as soon as possible’. Beijing describing itself as ‘deeply distressed’ while hosting Iran’s top diplomat is a materially different posture than anything seen to date,” it added.
“China’s leverage over Iranian oil revenues gives it tools Washington does not have, and there is now direct evidence it is deploying them,” it went on to state.
Another signal is that the U.S. has made “a tangible operational concession”, the update outlined, noting that U.S. President Donald Trump has paused U.S. efforts to escort commercial vessels through the Strait.
One more signal, according to the update, is that the IRGC is silent.
“Unlike every previous juncture where U.S. proposals have been floated, the Islamic Revolutionary Guard Corps has not commented,” the update stated.
“Navigation statements aside, there has been no significant political response or official positioning. In Rystad Energy’s view, that silence is analytically significant,” it added.
“It suggests the proposal is being considered at a level that warrants caution before public response,” it continued.
In a BMI report sent to Rigzone by the Fitch Group early Thursday, BMI analysts revealed that they are keeping their forecast for front-month Brent crude oil futures unchanged at an annual average of $78 per barrel for 2026.
“The forecast aligns with our Country Risk team’s core ‘Extension’ scenario, which sees an early May resolution to the war, sparking a sharp initial sell-off in oil, followed by a more gradual normalization of flows through the Strait of Hormuz and production upstream,” the analysts said in the report.
“That said, there is a significant risk that we soon shift to a longer extension scenario, in which the war drags on and disruption to the Strait of Hormuz continues for an additional four to six weeks, into mid to late June,” they added.
Under this scenario, the analysts said they would direct their forecast users to “shift from Brent futures (a financial contract) to Dated Brent (a physical contract) as their primary crude pricing benchmark”, noting that they believe the latter is “more reflective of conditions in the underlying market for oil”.
The analysts also noted that, under this scenario, they would raise their 2026 annual average forecast for Dated Brent to $90 per barrel, “reflecting a larger cumulative loss of supply, increased damage to energy infrastructure, and longer post-conflict recovery horizon”.
In a market analysis sent to Rigzone on Wednesday, Konstantinos Chrysikos, Head of Customer Relationship Management at Kudotrade, highlighted that oil was extending a decline “amid de-escalation hopes”.
“Oil prices fell for a second consecutive session on Wednesday as markets reacted to growing expectations that diplomatic efforts between the United States and Iran could eventually lead to a broader easing of tensions in the Middle East,” Chrysikos said in that analysis.
“Reassuring signals from Washington helped improve sentiment. At the same time, reports that an agreement between the two countries could be reached soon to end the gridlock and reopen the Strait of Hormuz raised hopes that supply currently trapped in the Gulf could return to global markets,” he added.
Chrysikos went on to warn in that report, however, that “constraints on maritime flows remain in place, leaving the physical market in a state of tightness”.
“In addition, any normalization is likely to be gradual,” he said.
“Looking ahead, oil markets are likely to remain highly exposed to renewed volatility in the case of a setback, while market participants could remain cautious ahead of any new developments,” he cautioned.
“While optimism around an agreement could maintain downward pressure on prices in the near term, failure to reach an agreement or renewed tensions could quickly reverse the recent decline,” Chrysikos went on to state.
Rigzone has contacted the White House and the Iranian Ministry of Foreign Affairs for comment on Rystad’s update, the BMI report, and Chrysikos’ analysis. Rigzone has also contacted the International Press Center of China’s Ministry of Foreign Affairs for comment on Rystad’s update. At the time of writing, none of the above have responded to Rigzone.
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