Oil prices stay flat as US exports offset China demand drop

Despite a major Middle East supply disruption and the Strait of Hormuz closure, oil prices have remained relatively flat as the United States boosts exports and China reduces imports, aided by high inventories and inventory-driven destocking by traders. Morgan Stanley notes US seaborne exports rose to about 8.9 million barrels per day while China’s net imports fell sharply, helping shield the world from the supply shock. The base case projects a partial reopening of flows by late summer and full normalization by year-end, likely keeping Brent near current levels; a prolonged outage could trigger demand destruction and push Brent toward roughly $130–$150 a barrel if the disruption persists.