Global oil inventories could come under “operational stress” by mid-June as accessible stockpiles continue to decline amid disruptions linked to the Iran conflict, according to a note from JPMorgan Chase.
The bank said the world started 2026 with about 8.4 billion barrels of oil in storage, among the highest levels seen in the past decade. However, it said only a small portion of those inventories can be used without affecting the functioning of the global supply chain.
“Of the 8.4bn barrels, we estimate only 0.8bn are realistically available without pushing the system into operational stress,” JPMorgan said in the note. The bank added that around 280 million barrels have already been drawn down, leaving roughly 580 million barrels of usable inventories that could be exhausted by early June.
The warning comes as oil markets remain volatile following tensions in the Middle East and concerns over disruptions through the Strait of Hormuz, a key route for global crude and natural gas shipments. Brent crude futures for July delivery fell 1.21% to $108.54 a barrel on Tuesday, while U.S. West Texas Intermediate crude declined 1.76% to $100.50 a barrel.
The latest moves in crude prices followed comments from President Donald Trump, who said the United States would temporarily halt “Project Freedom”, a military initiative launched a day earlier to escort commercial vessels through the Strait of Hormuz. Trump said in a post on Truth Social that the decision followed progress in negotiations with Iran toward a final agreement.
The Strait of Hormuz normally handles about one-fifth of global oil and natural gas flows. Tehran has effectively blocked movement through the route since the United States and Israel launched attacks on Iran on Feb. 28, raising fears of tighter supplies and higher energy costs.
The conflict has triggered a sharp rise in fuel prices across global markets, with countries in Europe and Asia facing higher import costs and pressure on inflation.
JPMorgan said the issue facing the market is not the total disappearance of oil supplies, but the lack of accessible inventories needed to keep the system functioning smoothly.
“The system does not fail because oil completely disappears — it fails because the circulation network no longer has enough working volume,” the bank said. It added that several inventories remain tied up in pipeline requirements, minimum tank levels and other operational needs, limiting the amount available to the market.
The investment banker also warned that as inventories decline further, the cost of withdrawing additional barrels rises, which could lead to higher crude prices and broader economic strain.
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