Morgan Stanley said the March-to-April drawdown, combined with a near two-month Hormuz disruption, has sharply reduced oil market buffers as JPMorgan warned usable safety stocks could run low before inventories are fully depleted.
Morgan Stanley said global oil inventories fell by about 4.8 million barrels per day between March 1 and April 25, reflecting severe supply disruption during a period when Hormuz was near closure for almost two months. The new report adds that more than 1 billion barrels of supply losses are limiting the market’s ability to absorb further disruption. JPMorgan also warned that usable safety stocks may be reached before inventories are exhausted, underscoring that the effective buffer available to the oil market could shrink faster than headline inventory levels suggest.