Strait of Hormuz — Multi-Model Oil Market Analysis

1 SUMMARY — AGGREGATED MULTI-MODEL CONSENSUS

CORE GRAPH: AGGREGATED BRENT PRICE PATH WITH CONFIDENCE BANDS

AGGREGATED PRICE TABLE (Equal-Weight Average, 5 Models)

Horizon	Avg Mitigation (mb/d)	Avg Log. Penalty	Avg Net Deficit (mb/d)	Avg Brent ($/b)	Range Low	Range High	Cum SPR (mb)

AGGREGATED SUPPLY ASSUMPTIONS (mb/d by horizon)

Model	Gross Loss	Mit. Today	Mit. 1 Month	Mit. 3 Months	Mit. 6 Months	Deficit Today	Deficit 1m	Deficit 3m	Deficit 6m

RECONSTRUCTED SUPPLY & DEMAND CURVE (Day 30, Aggregated)

BRENT PRICE PATH vs DAYS FROM TODAY — WITH PROBABILITY BANDS

AGGREGATED DEFICIT & MITIGATION EVOLUTION

PRICE DISCONNECT: WHY BRENT ($101) IS FAR BELOW MODEL ESTIMATES ($146–$266)

All 5 models agree the physical clearing price under full Hormuz closure should be $146–$266/b — yet Brent trades at $101/b. The gap is not a model error — it reflects the market pricing a probability-weighted blend of scenarios, heavily discounting the "prolonged closure" outcome. Below are the key factors suppressing price, ordered by estimated impact.

Bottom line: The $101 price implies ~50% probability of swift resolution. If that probability drops below 30%, Brent should reprice to $140–$180. If closure persists past SPR exhaustion (~day 120), prices converge to model estimates ($146–$210).

RE-RATING CATALYST MODEL: WHAT DRIVES PRICE TOWARD MODEL ESTIMATES

Each scenario shows a price path from current $101/b toward model equilibrium. Click legend items to toggle scenarios. The Expected Path is the probability-weighted blend of all scenarios including a 35% ceasefire resolution.

RE-RATING CATALYSTS — TRIGGER CONDITIONS & PROBABILITIES

Catalyst	Probability	Trigger Day	Peak Price	Year-End	Key Milestone

PRICE GAP DECOMPOSITION: $101 → MODEL CONSENSUS ($208 at 1 Month)

INTERACTIVE MODEL CONTROLS

Adjust Scenario Parameters

Closure Effectiveness: 95%

Elasticity Multiplier: 1.0x

Stock Release Strength: 1.0x

Alt. Supply Response: 1.0x

INTERACTIVE SIMULATION: BRENT EQUILIBRIUM PATH

INTERACTIVE: SUPPLY-DEMAND CURVES

View Day: 30

2 INDIVIDUAL MODEL RESEARCH TABS

3 INFO MERGED — COMBINED NON-DUPLICATE DATA

BASELINE PHYSICAL MARKET (Averaged)

Metric	Averaged Value	Range

Country	Crude (mb/d)	Products (mb/d)	Total	Bypass?

MERGED HORIZON TABLE

Horizon	Mitigation	Log. Penalty	Net Deficit	Brent ($/b)	Cum SPR	SPR Remaining

MERGED COUNTERMEASURES (Deduplicated, Averaged)

Countermeasure	Avg Realistic (mb/d)	Range	Avg Confidence	Notes

DESTINATION EXPOSURE

Destination	Hormuz Flow (mb/d)	Share

4 SENSITIVITY ANALYSIS

CROSS-MODEL SENSITIVITY COMPARISON

Model	Low 1m	Base 1m	High 1m	Low 3m	Base 3m	High 3m	Low 6m	Base 6m	High 6m

5 RED TEAM / FAILURE MODES

1
Bypass capacity lower than assumed. Saudi Petroline + Yanbu terminal may not sustain 3.5-5 mb/d. All models flag this as the single biggest swing factor.
2
Houthi Red Sea escalation. Yanbu bypass requires Red Sea transit. If Bab el-Mandeb is interdicted, the bypass becomes non-viable.
3
Crude quality mismatch. Gulf supply is medium/heavy sour. SPR releases are light sweet. Refineries calibrated for sour crude face yield penalties.
4
SPR less deliverable than assumed. Pipeline constraints limit US SPR to ~1.4-2.2 mb/d sustained. IEA coordination historically never exceeded 2 mb/d combined.
5
Product dislocation outpaces crude. Gulf exports ~5 mb/d products (diesel, jet, LPG). Europe relies on Gulf for 50%+ of jet fuel. Product cracks explode before Brent fully reflects stress.
6
Tanker fleet freeze. War-risk insurance cancellations could paralyze global VLCC fleet. Even released SPR oil can't move without insurable hulls.
7
Earlier reopening. A 14-30 day diplomatic resolution would crash prices rapidly. Models overstate if closure is short.
8
Demand elasticity even lower. If near-term elasticity is 0.02 instead of 0.04, price-only clearing becomes impossible for months.
9
LNG contagion. Qatar LNG (~80 mtpa, 20% global) also transits Hormuz. Gas price spike increases oil-for-power demand, partially offsetting oil demand destruction.
10
Financial market amplification. Paper-market panic, margin calls, and short-squeezes could drive transient spikes well beyond physical equilibrium.

6 FINAL JUDGMENT

⚡ SCENARIO SIMULATOR

SCENARIO PRESETS — SELECT TO AUTO-CONFIGURE

      Click cycle: Unselected →
      ✓ AND (all must occur) →
      ◆ OR (any may occur) →
      Unselected
    

Conflicting events detected:

Peak Brent

—

scenario peak

3-Month Brent

—

day 90

Delta vs Base

—

at day 90

Events Selected

of 100+

            ⓘ BASE CASE ASSUMPTIONS (click to collapse)
          

Swift Resolution Scenario — What the market prices at $101/b:
▶ Ceasefire framework: ~Day 14
▶ Hormuz reopens: ~Day 30
▶ Residual disruption: 12%
▶ Recession probability: 15%
▶ SPR bridge: active (415 mb)
▶ Saudi Petroline: active (5 mb/d)
Price Path (cubic Hermite interpolation):

                Day 0Day 7Day 14Day 30Day 60Day 90Day 180Day 270+
              
                $101$104$107$97$85$82$79$78
              
How Scenarios Work:

              • Physics engine computes supply/demand balance with event parameters

              • Delta method: scenario_price = base_path + delta × absorption × mean_reversion × adaptation

              • SPR suppression: 0.20+0.80·((t−30)/90)1.5 (400mb IEA + 415mb US SPR fill gap for 60-90 days)

              • Market belief: 0.40+0.60·(1−e−t/120) (traders discount worst case — real-world: $103 vs $350 physics)

              • Absorption: 1−e−t/τ (shock: τ=5d, gradual: τ=30d)

              • Mean reversion: 0.40 + 0.60·e−t/300 (fear premium fades, 40% permanent structural repricing)

              • Market adaptation: 1/(1+0.003t) (supply chain adjustment — gentler for prolonged crises)

              • Daily cap: max ±4% per day (calibrated: Gulf War 1.3%/d, current crisis 2.8%/d, Abqaiq 15% outlier)

              • Post-duration fade: exponential decay τ=21d (price normalizes in ~3 weeks after crisis ends)

              • closureEffectiveness base = 0.12 (12%); events add to this

              • Floor price: $40/b (marginal production cost)
            
Events compute deltas from this baseline. Zero events selected = base case only.

FORWARD BRENT PRICE PATH — ANCHORED TO $101 (TODAY)

- - Base Case (Swift Resolution) ▬ Scenario Forward ■ Confidence Band ◆ Current $101

SCENARIO PROBABILITY (AND/OR LOGIC)

100%

—

SCENARIO HORIZON TABLE

Horizon	Base Forward	Scenario Forward	Delta	Net Deficit	SPR Remaining

Select events from the left panel to build a custom scenario. Click once for AND (blue ✓), twice for OR (green ◆), three times to deselect.

#▲	Event ID▲	Label▲	Category▲	Dir▲	Prob%▲	mb/d▲	Conf▲	Clos.Δ▲	Sup.Δ▲	Elast▲	Adder▲	Dur▲	Sources▲	⚠▲

SOURCES

Primary: EIA (Hormuz flows, STEO), IEA Oil Market Reports (Feb/Mar 2026), OPEC MOMR, DOE (SPR data), S&P Global Platts, Aramco/ADNOC operational statements.
Elasticity: Caldara et al. (2019), Kilian & Murphy (2012), IMF WEO (2011), Labandeira et al. (2017 meta-analysis), Hamilton (2009).
Models: GPT PRO (ChatGPT o1 Pro), Claude DS (Claude Sonnet), Gemini DR (Gemini Deep Research), GPT DR (ChatGPT Deep Research), Claude Agent (Claude interactive model).

Day 0	Day 7	Day 14	Day 30	Day 60	Day 90	Day 180	Day 270+
$101	$104	$107	$97	$85	$82	$79	$78

Strait of Hormuz Closure: Multi-Model Oil Market Analysis