In fact, we have not yet felt the full effects of the war with Iran in prices. Wojciech Kostrzewa, president of the Polish Business Roundtable, recently talked about this in an interview with Business Insider. The authors of the CNN analysis have a similar opinion. “When will prices return to pre-war levels? Not soon. Almost certainly not this year. Or maybe never.” – we read on the website. Unblocking the strait is a matter of one decision, but unlocking the economy will be a long-term process.
In its scenario for the post-war world, CNN lists several steps ahead of us. The portal warns against a logistical nightmare.
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The first step is to remove bottlenecks in the Strait of Hormuz. As we read, it will take some time because tankers are not very fast. The entire process may take up to three months.
Step No. 2 is to reduce inventories, so that producers can start production.
Production is then to be resumed. “Turning on production is not like flipping a switch. It is a complex engineering challenge, requiring advanced physical calculations and work lasting up to several weeks,” we read.
The fourth step is to repair. CNN emphasizes that many plants were damaged during the war. In some cases, it may take years to restore full power.
What about prices after the strait opens?
“JPMorgan analysts who expect the strait to open in early June predict that the average price of crude oil will be $97. per barrel for the rest of the year” – reports CNN. The pessimistic forecasts that Wojciech Kostrzewa told us about even assume a range of $110-130. In 2025, the average price of a barrel was around $70.
The American portal notes that: There are still a lot of “ifs” in the case.
