The spot price for cargos of Brent crude oil came in at $124.68 per barrel on Wednesday in a sign that the Iran ceasefire agreement is unlikely resolve the deep supply disruption triggered by the five-week war.
The spot price governs Brent oil for delivery in the next 10 to 30 days, in contrast to futures contracts for delivery in June and beyond.
The spot price has fallen $19.75 after the two-week ceasefire agreement between the U.S. and Iran, according to S&P Global, which tracks the data.
But it is still nearly $30 above the Brent June futures contract that closed at $94.75 on Wednesday. The higher price for actual cargo demonstrates that oil supplies will remain tight for some time even if the ceasefire agreement holds.
The spot price for actual cargo reflects the reality on the ground and the high seas, said Amrita Sen, founder of Energy Aspects. Middle East oil producers have shut down 13 million barrels per day of production because tanker traffic through the Strait of Hormuz has plunged, Sen said.
