Trump's Hormuz toll plans bring oil supply risks back in spotlight

Key Points:

• President Donald Trump's proposal to impose a 20% fee on cargo passing through the Strait of Hormuz raises concerns about disrupting global oil supply, potentially threatening the previously forecasted oil surplus.
• Analysts warn that the fee could add about $16 per barrel to crude oil costs and increase the risk of military escalation, which may lead Iran to abandon the recent U.S.-Iran memorandum of understanding, further driving up oil prices.
• Vessel traffic through the Strait of Hormuz has sharply declined, with only 14 ships crossing recently compared to 37 a week earlier, risking storage capacity issues that could force producers to cut output due to inability to export crude.
• The International Energy Agency's forecast of a global oil surplus by late 2026 depends on stable tanker traffic through the strait, but renewed conflict and supply disruptions could delay or derail this outlook.
• As Middle Eastern supply reliability deteriorates, Asian demand—particularly from China—may rebound, with Saudi Aramco already cutting prices to encourage increased purchases amid falling imports during recent disruptions.