After the U.S.-Iran conflict began, the price of oil climbed from below $60 to nearly $120 at its peak, a move of almost 100%. That swing is the starting point for a June 2026 market analysis from the brokerage D Prime, which argues that oil is the most volatile asset of the year and traces the volatility to three things: geopolitical risk, uneven reserves and a handful of narrow shipping lanes.
Where the oil is
D Prime says the Northern Hemisphere holds more than 70% of proven reserves, and nearly half of the global total sits in the Middle East. The top five countries account for more than half, with Venezuela first. North America and Asia Pacific, two of the busiest economic regions, hold only 13.3% and 2.8% of reserves, respectively. China does not rank in the top 10 and sits behind Nigeria.
The reserve-to-production ratio, which estimates how many years a region can keep pumping at today’s pace, stands at around 47 years worldwide as of 2025. The Middle East had a ratio of around 120 years in the late 1980s. It is now under 50. In Asia Pacific it has stayed below 20 for most of two decades.
The producer and consumer gap is wide. D Prime puts U.S. daily output at around 22.8444 million barrels, ahead of Saudi Arabia’s 10.872 million, with U.S. consumption at about 20.4637 million barrels per day. China produces around 5.3343 million barrels a day and uses around 16.3705 million.
The Strait of Hormuz
The analysis counts eight key oil chokepoints and gives Hormuz top billing. Between 18.5 million and 20 million barrels of crude and liquid products pass through it each day, or 31% to 34% of global seaborne oil trade. It is the only sea passage from the Persian Gulf to the Indian Ocean. The strait runs around 150 km east to west with an average width of 34 km, and the main shipping channel is just 3 km wide in each direction.
Most of the oil loading ports of Saudi Arabia, Kuwait, Iraq, Iran, Bahrain, Qatar and the UAE lie inside the Gulf. Saudi and UAE pipelines offer a bypass, but their combined capacity is around 6.6 million barrels per day. After the conflict, daily ship traffic through the strait reportedly fell from dozens or even hundreds of vessels to only around 4 or 5.
Other lanes
The Strait of Malacca, between the Malay Peninsula and Sumatra, is around 1,080 km long and takes ships of up to 300,000 tonnes. Its narrowest stretch, the Phillips Channel, measures 2.7 km. More than 90% of the crude consumed by China, Japan and South Korea passes through. Ships could reroute via Indonesia’s Sunda Strait or Lombok-Makassar Strait, but the detour south costs much more.
The Bosporus, in Istanbul, is 30.4 km long, 3.4 km wide at most and only 708 metres across at its narrowest point. It is Russia’s key route for goods and energy exports heading to Europe, and winter fog can force closures.
The Suez Canal, in Egypt, runs around 190 km and is about 300 metres wide. It can cut a journey between Europe and Asia by up to 10,000 km. In past Middle East wars it was closed five times, once for eight years. The Panama Canal, around 81.3 km long, sits in a calmer part of the world.
