![](\"https:\/\/fortune.com\/img-assets\/wp-content\/uploads\/2026\/06\/GettyImages-2280423953.jpg?w=2048\")
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The U.S. and Iran signed a long-awaited \u201cmemorandum of understanding\u201d on June 17, pausing a Middle East conflict that upended global oil markets. As part of the deal, Iran agreed to reopen the Strait of Hormuz, the waterway that leads to the Persian Gulf and home to some of the region\u2019s top oil producers. Iran\u2019s decision to close the strait, as well as a U.S. blockade of Iranian oil and Iranian attacks on energy-producing infrastructure, curtailed global fuel supplies.\u00a0<\/p>\n
The crisis was particularly hard on emerging markets in Southeast Asia: Governments were forced to put in place four-day work weeks, ration diesel, reactivate coal plants, accelerate ethanol blending programs and curb crude exports. Philippine President Ferdinand Marcos Jr. even declared a state of national energy emergency in late March.<\/p>\n
Yet, experts caution that even with the Strait of Hormuz open, it would take months for oil flows and prices to return to pre-war levels.<\/p>\n
\u201cThe oil supply will not flip right back,\u201d Chen Chien-Ming, an associate professor of operations management at Singapore\u2019s Nanyang Technological University (NTU), tells Fortune<\/em>. \u201cA tanker\u2019s round trip between Singapore and the GCC can easily take one to two months, while many Asian countries are already facing multi-year-low stockpiles and soaring prices.\u201d<\/p>\n Given the lengthy journey Gulf tankers have to take to reach Asia, analysts like Wood Mackenzie\u2019s Sushant Gupta expect regional crude stockpiles to continue declining into August, before slowly starting to build up again. \u201cIn the past three months, fuel stocks have dropped to the bare minimum in many countries, so we don\u2019t expect them to reach anywhere near pre-war levels\u2014at least within this year,\u201d he explains.<\/p>\n Full market recovery may also take time since some processing facilities, including Qatar\u2019s Ras Laffan, the world\u2019s largest LNG terminal, were damaged in the war. Refineries also can\u2019t immediately restore oil and gas production following a shutdown.<\/p>\n Still, Pushan Dutt, a professor of economics at INSEAD, suggests that increasing desperation by both Asian buyers and Middle Eastern producers to get things flowing again could accelerate that timeline. \u201cIf the ceasefire holds and is not interrupted by hostilities between Israel and Hezbollah, we should expect a quicker return to normalcy in terms of the resumption of oil flows,\u201d he says.\u00a0<\/p>\n Resumed oil flows won\u2019t immediately lead to lower energy prices.<\/p>\n The Iran energy crisis has \u201ctaught many countries a lesson,\u201d says Wood Mackenzie\u2019s Gupta, who foresees that severely hit geographies like South and Southeast Asia will double down on building up their oil stockpiles, potentially to levels higher than before the Iran war. \u201cChina and the U.S. will want to rebuild their oil reserves, while Asia will want to relax rationing, so demand and supply will rise concurrently, limiting the rate of price decline,\u201d Dutt adds.<\/p>\n Oil prices may also decline slowly as investors require evidence of lasting security, mine clearance and clarity on sanctions. Yet, given the start-stop nature of negotiations over the last few months, prices could remain elevated for a while.<\/p>\n \u201cMarkets have to realize that the signing of the peace deal is just the first step,\u201d says Gupta. \u201cIt\u2019s unrealistic to expect prices to decrease very significantly in the near-term.\u201d<\/p>\n Given the fragile state of relations between the U.S. and Iran, some pundits also worry that the peace deal\u2013really just a 14-point memorandum of understanding\u2014could fall apart. (Since signing the deal, Trump has already threatened to resume attacks and \u201cbomb the hell out of Iran if they violate the agreement\u201d.)<\/p>\n \u201cWhile an agreement is clearly positive, we need to see evidence that it holds,\u201d wrote Kim Fustier, HSBC\u2019s senior global oil and gas analyst, in a Tuesday note. \u201cIn April, Iran had declared the Strait open then closed it again. In May, Iran established the Persian Gulf Strait Authority (PGSA) to codify its control over Hormuz. The status of the PGSA is not yet clear and if it persists, flows could stabilise below pre-conflict levels.\u201d<\/p>\n On Thursday, the White House said that plans for Vice President JD Vance to travel to Switzerland for a new round of \u2018technical\u2019 talks with Iran had been delayed. \u201cThe logistics of these negotiations have never been simple or predictable,\u201d the statement read.<\/p>\n \u201cThe MoU does not enforce action, which means the negotiators can walk back their promises whenever they want,\u201d says Chen. \u201cOf Iran\u2019s 14 points, war reparations and the unfreezing of Iranian assets are straight up a deal-breaker; the Iranian government also demands that Israel withdraws from Lebanon and ends all military operations\u2014and I don\u2019t expect Israel to comply.\u201d\u00a0<\/p>\n \u201cIt\u2019s a step in the right direction, but I don\u2019t think the MoU will materialize into long-term peace,\u201d he concludes.\u00a0<\/p>\n<\/div>\n #Strait #Hormuz #open #soonbut #Asia #faces #prolonged #oil #supply #crunch<\/p>\n","protected":false},"excerpt":{"rendered":" The U.S. and Iran signed a long-awaited \u201cmemorandum of understanding\u201d on June 17, pausing a Middle East conflict that upended global oil markets. As part of the deal, Iran agreed… <\/p>\n","protected":false},"author":1,"featured_media":8056,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[1748,8490,10258,1751,10259,640,280,181,1849,10260,641,1709],"class_list":["post-8055","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance-news","tag-asia","tag-crunch","tag-energy-industry","tag-faces","tag-global-oil-supply","tag-hormuz","tag-oil","tag-open","tag-prolonged","tag-soonbut","tag-strait","tag-supply"],"_links":{"self":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/8055","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=8055"}],"version-history":[{"count":0,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/posts\/8055\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=\/wp\/v2\/media\/8056"}],"wp:attachment":[{"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=8055"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=8055"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fintechpulse8.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=8055"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Is the peace deal sustainable?<\/strong><\/h2>\n