Citibank: Even if the ceasefire deadline is extended, global oil inventories may still decrease by about 900 million barrels.

Citigroup researchers said Monday that even if the United States and Iran agree to extend the ceasefire this week and oil transportation through the Strait of Hormuz and oil production return to normal levels by the end of June, global crude oil and refined oil inventories could still decrease by about 900 million barrels. Citigroup said this decline will include a 500 million barrel decrease that has already occurred, as well as an additional 400 million barrel decrease due to delays in capacity restoration, logistical bottlenecks, and related disruptions caused by conflicts. Citigroup pointed out: "Even if the conflict ends this week, by the end of June, global crude oil and refined oil inventories will still reach the lowest level in eight years." Citigroup said that if disruptions in transportation through the Strait of Hormuz continue at the current level for another month, total inventory losses could rise to about 1.3 billion barrels. In this scenario, Brent crude prices could reach close to $110, $90, and $80 per barrel in the second, third, and fourth quarters of 2026 respectively. Citigroup said that if the disruption continues for two more months, inventory losses could increase to about 1.7 billion barrels, which would bring inventories to the lowest level on record, with prices reaching $130 per barrel in the second quarter, based on data from the past 25 years.