80 million barrels of crude oil are ready to pass through the Strait of Hormuz.

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As the temporary US-Iran agreement tears a gap open for the reopening of the Strait of Hormuz, as much as 80 million barrels of backlog crude oil from the Persian Gulf are poised to be released. Yet physical risks and data blind spots make the long-awaited supply chain repair full of uncertainties, simultaneously triggering a profound reassessment of global macro liquidity.

Currently, 40 very large crude carriers (VLCCs) loaded with non-sanctioned crude oil are waiting in the Persian Gulf, ready at any moment to surge into the Asian market. This substantial supply is expected to ease the prior crisis of over 10 million barrels per day of supply interruption, becoming a key incremental force to stabilize oil prices and restore downstream refinery operating rates.

However, un-cleared sea mines and “dark sailing” vessels make the actual delivery pace unpredictable. With physical supply chain obstacles still present, expectations of reopening and advancement of the US-Iran peace agreement are prompting capital to “shift from virtual to real,” causing cross-asset price anomalies like gold falling and the dollar rising.

For investors, this means the risk premium in the oil market will be hard to fully erase in the short term, while the pricing logic for macro assets is shifting from geopolitical hedging to real economy recovery. The supply chain’s fragility and structural changes in liquidity will jointly test the nerves of global energy and financial markets.

80 Million Barrels of Crude Oil Ready, Asian Market Awaits Supply Restoration

Anticipating the restoration of shipping in the Strait of Hormuz, the true scale of crude backlog in the Persian Gulf is finally emerging. According to Vortexa compiled data, 40 VLCCs are currently loaded with nearly 80 million barrels of non-sanctioned crude oil from Persian Gulf producers (excluding Iran), on standby. If smaller tankers are included, the actual backlog may be even greater.

The destination of this crude is preliminarily clear: Asia is the biggest recipient. Currently, about 21 VLCCs have indicated Asia as their destination, 5 of which are bound for China, and another 5 for transshipment hubs in Malaysia and Singapore. As of last Friday morning, at least 3 tankers were proceeding eastward through the strait at normal speed.

This increment in supply is critical for the Asian market. Last year, the region received about 15 million barrels per day of Middle Eastern crude oil. During the previous three-month-long blockade of the strait, merchant ship traffic plummeted from nearly 100 ships per day to just 2 or 3, resulting in over 10 million barrels per day of Middle Eastern crude oil supply being cut off. Asian refineries were forced to reduce operating rates, and several countries had to draw down strategic reserves to cope with the sudden supply shortage. The concentrated release of this backlog crude oil will effectively relieve Asian buyers’ anxiety over feedstock.

Mines Not Cleared and “Dark Sailing”: Physical Channel Risks Remain

Although the US and Iran have signed a temporary agreement aimed at restoring traffic in the strait and three Saudi VLCCs reappeared in the Gulf of Oman on Thursday signaling the movement of ships, the physical risks to navigation are not fully eliminated.

Shipping trade organization BIMCO issued a clear warning that sea mines in the Strait of Hormuz have not yet been cleared, and major vessel passage still faces significant risks. This means that before definite safety assurance is obtained, shipowners and insurance institutions remain cautious about sending high-value crude carriers through the strait. During the previous blockade, more than half of insurers canceled war risk insurance, premiums surged up to 500%, and such risk aversion sentiment is hard to fully reverse in the short term.

More troubling is that supply chain transparency is challenged by technological disruptions. For safety reasons or due to electronic interference, some vessels choose to shut down their Automatic Identification System (AIS) signals. This “dark sailing” status creates blind spots for tracking actual passages, making it difficult for markets to accurately verify how many tankers have really crossed the strait, and physically-focused crude traders can’t accurately assess near-term arrivals.

Macro Liquidity Reassessment: Shift from Virtual to Real Causes Cross-Asset Movements

As the physical supply chain is arduously repaired, the reality of the Strait of Hormuz reopening is causing a reassessment of global macro liquidity. With Trump signing the US-Iran peace agreement on June 17, the reopening fosters bilateral restoration of global oil supply and demand until oil factor flows gradually return to normal.

In normal state, robust supply and demand for crude prompts the real economy to absorb more cash. As supply shocks ease and the real economy exits recession, large amounts of money begin flowing back from the virtual economy to the real economy, namely the “shift from virtual to real.” This reduction in surplus liquidity is directly reflected in cross-asset price anomalies: gold prices start to fall due to liquidity outflows, while the dollar index rises.

Moreover, the recent volatility in short-term US Treasury markets needs to be re-evaluated. The recent surge in 2-year Treasury yields above 4.20% was actually a liquidity shock from money fund redemptions, not worries about Fed rate hikes prompted by a hawkish June dot plot. The decline in 30-year yields further proves that the market is not concerned about rate hikes within the year. Adding the relatively tight rhetoric of Waller at his first meeting, the long-end rate trend shows macro pricing hasn’t deviated from fundamentals. Investors assessing geopolitical risk premiums should beware asset revaluation risks brought by structural liquidity changes.

Risk Warning and DisclaimerThe market involves risk, and investment requires caution. This article does not constitute personal investment advice, nor does it take into account individual users’ specific investment objectives, financial status, or needs. Users should consider whether any opinions, viewpoints, or conclusions contained herein fit their specific situation. Invest accordingly, and bear responsibility for your own actions. ```