As shipping through the Strait of Hormuz slowly resumes, U.S. oil markets have so far avoided a sharp price spike — a result industry leaders say owes much to storage capacity and emergency measures. The developments matter now because they will shape fuel costs, refinery operations and how quickly global crude flows return to normal.
Speaking at a JPMorgan conference on June 23, 2026, Phillips 66 CEO Mark Lashier said a large volume of crude remains stuck in the waterway — an amount he estimated at roughly 90–100 million barrels — and that moving it ashore will be gradual as onshore tanks must first make room.
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That bottleneck means crude flows will not simply snap back to pre-disruption levels overnight. Lashier warned that even as tanker transits continue on a limited basis, the backlog offshore and full onshore storage will slow the recovery in shipments and refined-product availability.
Industry actions that blunted the immediate shock included government and commercial steps to redistribute oil and refine products, and higher-than-normal refinery runs in North America. Phillips 66, which processes primarily North American grades such as Western Canadian heavy crudes, said it kept plants running at elevated rates to offset some of the lost seaborne movement.
Regulatory flexibility also played a role. Temporary waivers of the Jones Act allowed non-U.S. vessels to move cargoes along domestic coasts, helping reposition fuels between U.S. regions more quickly than would otherwise have been possible.
- Onshore storage: Low inventories at the Cushing, Oklahoma hub provided short-term relief by enabling internal transfers, but that cushion is finite.
- Strategic releases: Drawdowns from the Strategic Petroleum Reserve helped temper price spikes but are by nature temporary measures.
- Refinery activity: Higher run rates at some refineries replaced some imported supplies, easing immediate shortages of finished fuels.
- Maritime routing: Limited transit through the Strait and shipping adjustments meant crude supply was slowed, not stopped, preserving a degree of market stability.
These interventions appear to have prevented a dramatic price surge — Lashier said the response limited the upside that might otherwise have pushed benchmark crude far higher — but he and others caution that several of the stabilizers are short-lived.
That leads to a broader concern: with emergency stocks falling and storage rebalancing still in progress, the market could establish a higher baseline price for crude. “Some of the temporary buffers are gone,” Lashier told the conference, suggesting a possible structural rise in what traders and producers consider a floor under crude prices.
For consumers and businesses, the implications are practical. A higher crude floor would feed into gasoline and diesel costs, raise operating expenses for transport and shipping, and squeeze refining margins if demand softens. Insurers and shippers may also factor ongoing regional risks into freight rates, extending the economic ripple beyond oil terminals.
How quickly supply normalizes depends on several moving pieces: the pace of tank turnover at coastal and midcontinent hubs like Cushing, the ability of refineries to sustain elevated runs without maintenance disruption, and the security of shipping lanes. Markets will watch those indicators closely in the coming weeks as the backlog clears.
In short, the immediate crisis eased through coordinated commercial moves and strategic releases, but industry leaders warn the market is not fully back to normal — and the temporary nature of some fixes could leave crude prices on firmer footing going forward.
