The Intelligence from The Economist Drill pickle: oil prices still misjudge shock
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Apr 30, 2026 
Matthieu Favas, commodities editor who analyses oil markets and supply shocks. Sophie Pedder, Paris bureau chief who maps France’s 2027 political landscape. Jon Fasman, senior culture correspondent who tracks Brazil’s World Cup hopes. They discuss the scale of the Strait of Hormuz disruption and why markets seem calm. They outline France’s wide-open presidential race and Brazil’s high footballing expectations.
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Largest Oil Supply Shock Ever
- The Strait of Hormuz closure created the largest petroleum supply disruption in history, cutting about 13 million barrels per day versus expectations.
- That deficit is far bigger than the ~3 million bpd loss feared in 2022 after Russia's invasion, making it unprecedented in scale.
Temporary Buffers Hid The True Shortfall
- Markets haven't fully priced the shock because buffers such as pre-war excess exports, shadow tankers, and strategic stock releases absorbed much of the loss.
- Those buffers are now largely exhausted, removing the cushion that kept prices from spiking further.
Hidden Demand Destruction Softened Prices
- Demand destruction has already occurred in less-visible markets (e.g., Indian cooking oil, Asian petrochemicals using naphtha), reducing apparent global demand.
- That hidden contraction partly explains why consumer-facing prices haven't shattered records yet.