10% of oil supply begins to disappear, first country to collapse has emerged

On Monday, the financial markets just opened, and the U.S. immediately began generating headlines by artificially driving down oil prices.

The Wall Street Journal reports that U.S. officials have stated that the White House plans to announce this week the formation of a military alliance to escort commercial ships through the Strait of Hormuz. So far, multiple countries have agreed.

In addition, the Pentagon has also indicated that it will complete its military operations in Iran within four to six weeks, and the U.S. progress will be ahead of schedule.

Can oil prices truly fall back under the manipulation of the Trump administration?

Current Trump may be creating an illusion for global investors, suggesting that the Strait of Hormuz will immediately reopen within the next 2-3 weeks, and that the energy crisis will be effectively alleviated.

Whether it’s the Russia-Ukraine war or the U.S.-Iran conflict, these are the main macroeconomic contradictions today.

The primary global economic issue now is the fragmentation caused by the overselling of commodity prices, which are the focal point of global利益分配 (benefit distribution).

From an economic cycle perspective, since 2015, the global economy has ended its recession and entered a depression. The U.S. and its allies have issued大量货币 (a large amount of currency) to stimulate the economy, but these dollars are not reflected in commodity prices.

This has caused resource-producing countries like Russia and Iran to suffer significant losses.

In the global利益分配 (benefit distribution), the U.S. is attempting to suppress inflation by pushing down resource prices, resulting in substantial losses for resource-dependent nations.

Russia and Iran, as resource-rich countries, rely heavily on oil and natural gas exports for their fiscal revenues, which account for roughly half of their budgets.

According to the Russian Federal Savings Bank, Russia can only balance its budget when oil prices are around $104 per barrel.

According to the International Monetary Fund (IMF), Iran needs oil prices to reach approximately $164–165 per barrel to achieve fiscal balance.

This directly creates a natural contradiction between resource-exporting countries and demand countries: Europe and the U.S. need low oil prices to curb inflation, while resource countries require high oil prices to survive and develop.

Since 2014, oil prices have remained below $80 for years. Even after the outbreak of the Russia-Ukraine war and prices surged past $140, the U.S. quickly released reserves to suppress prices and reduce domestic inflation.

For China, regardless of whether oil prices are high or low, these inflationary effects are transmitted outward. Therefore, China is not very sensitive to fluctuations in oil prices.

From this perspective, it becomes clear that wars or conflicts are difficult to end.

Especially now, as the global economy has exited recession and entered a depression, the U.S. is struggling, and Russia and Iran are in even worse shape. To improve living standards, conflicts between countries are an inevitable trend.

Even if wars or conflicts do not erupt now, they will in the future.

Therefore, it is unlikely that the Strait of Hormuz will reopen in 2-3 weeks, and even 2-3 months or 2-3 years, it will be difficult to restore navigation unless oil prices remain stable above $100 or even $150 for an extended period.

In the short term, what the financial markets should pay attention to is that supply disruptions have just begun. The voyage from the Persian Gulf to major Asian ports takes approximately 15–22 days.

This means that the last batch of oil tankers that departed the Strait of Hormuz two weeks ago has begun arriving at ports in recent days. After that, global supply will gradually decrease by about 10%.

So far, oil-consuming countries are only now entering a supply disruption crisis. Vietnam is the first victim of this oil crisis because it is the only Asian country without strategic oil reserves.

Media reports indicate that many gas stations in Vietnam have already closed, and the public is beginning to lack transportation options; even buses are struggling to obtain gasoline.

Some companies are starting to implement remote work, and in the future, there may be restrictions on electricity use and factory closures.

This situation is expected to spread to other Asian countries and even across Europe.

Author’s note: Personal opinion, for reference only.