TEHRAN- In one of the most tense periods in the history of the energy market, Iran's authority in the Strait of Hormuz and the unprecedented crisis in US oil reserves have plunged the world into a new era of supply shock.

Accordingly, an oil and energy market analyst believes that real control over oil prices has now moved out of Washington's hands and into the hands of the true suppliers: Iran.

Mehrzad Limouchi stated in an interview with IRNA, analyzing the prevailing conditions in the global energy market: "The week ending today — May 4, 2026 — must be considered one of the most complex periods in the energy market's history of the last decade; a period in which three major economic, military, and financial crises have become intertwined simultaneously."

He added: "On the one hand, Iran's authority in the intelligent control of the Strait of Hormuz has been established, and on the other hand, the United States is consuming its last strategic reserves to curb prices. In such circumstances, one can no longer obtain an accurate picture of market reality by merely watching the nominal price of Brent crude, because in the physical market, real oil is changing hands at prices up to twice the official rates."

Limouchi stated that we are no longer in the warning stage but have entered the implementation phase of a full-scale supply shock, emphasizing: "The main spark for the price increase last week began with military developments in the Persian Gulf, where confidential reports about high-level White House consultations on options beyond sanctions against the Islamic Republic shocked the market. This approach showed that Washington has once again preferred confrontation over diplomacy."

He believes that based on information from shipping sources, the Strait of Hormuz has been under new management for nearly two months thanks to Iran's will. On a route where more than 100 oil tankers previously passed daily, the International Energy Agency estimates that between 16 and 20 million barrels of oil per day have been removed from the global supply circuit — a figure sufficient to disrupt any global balance.

The oil and energy market expert stated: "Another important point relates to data from the US Energy Information Administration (EIA). This report indicates a 7-million-barrel reduction in US strategic reserves last week — a drawdown that shows Washington's helplessness in the face of the real crisis. Simultaneously with a lack of increase in domestic production, US oil exports have reached a record 6.4 million barrels per day, a figure achieved largely by opening underground reservoirs in Texas and Louisiana, not from actual production capacity."

According to this energy sector expert, this situation has caused US gasoline reserves to also fall by more than 6 million barrels, reaching their lowest level since 2014, bringing the energy crisis to retail consumers.

Dangerous gap between futures market and physical market

Limouchi explains that the gap between the physical market and the futures market has revealed the depth of America's economic crisis. Physical oil for immediate delivery at Japanese and South Korean ports is now trading between $145 and $200, while Brent crude in London is around $115. This difference of approximately $40–80 signals the collapse of Western control over prices.

UAE's exit from OPEC has no short-term price effect

He noted: "The UAE's exit from OPEC should be assessed more as a political protest against the organization's worn-out and Western-influenced structure than an economic one. The UAE wants to step out from under OPEC's imposed ceilings, but currently, with Iran's authority in the Strait of Hormuz, it has no way to implement any increase in exports."

This oil and energy market expert emphasized: "This decision has no short-term price effect, but in the medium term, by changing Western behavior and opening export routes, it could create irregular competition among Washington's former allies. This exit has also placed Saudi Arabia in its weakest coalition position in recent decades."

Improvement of Iran's geoeconomic position

Limouchi believes that Iran has reached a point for the first time where it can impose the most painful pressures on the global economy. Control of the Strait of Hormuz has elevated Iran's bargaining power in any nuclear or sanctions-related negotiations to a new level.

He recalled: "Another advantage of Iran is its uncompetitive production cost. While producing each barrel of oil in Iran costs $10–30, this figure for US shale oil is $40–60, and for the UAE it is above $30. Furthermore, Iran's direct access to the Gulf of Oman and Chabahar Port makes Iran the only reliable exporter in the region, even in the event of a naval blockade."

Three market scenarios for the coming week

This energy market expert continued: "The outlook for the global market in the current week (May 4–11) is influenced by three key variables, including the continued authoritative control of the Strait of Hormuz by Iran, the rapid depletion of US strategic reserves, and the collapse of traditional alliances following the UAE's exit from OPEC."

Limouchi outlined and explained three probable scenarios for the near-term market:

· First scenario: Stabilization of Brent crude prices in the range of $110–125, with continued diplomatic inaction from Washington.

· Second scenario: A sudden jump to the range of $140–150, in the event of intensified US military action.

· Third scenario: A price drop below $100, possible only if Washington fully retreats and accepts Iran's terms.

In his view, the first scenario is the most likely, because the world is gradually realizing that the era of US energy dominance has ended — an era that has now given way to Iran's field authority and the physical realities of the market.

MA