Oil markets in Asia and Europe are almost depleted as the Strait of Hormuz remains closed, according to a veteran strategist.
Jeff Currie, Carlyle's chief strategy officer of energy pathways and co-chairman of Abaxx Markets, told CNBC that Asia is close to the "minimum operating levels" as part of the reserves can't be used immediately.
"I would say, Asia, you're there. Europe, give it about another month, and look for July being a problem in the U.S.," he added.
"All of the inventories that are drawing out of the United States out of the U.S. SPR [Strategic Petroleum Reserve] are being exported into Europe, so the Europeans think they have no problem because they're getting all of this oil being imported from the United States, but that can't continue on," he added.
The comments echo those of IEA chief Fatih Birol, who said last week that oil markets could enter a "red zone" in the summer as reserves continue to decrease.
Speaking during a Chatham House session about the impact of the key waterway's closure, Birol said its full reopening is the main solution to the crisis.
Should that not happen, he said, the continued depletion of global stocks could lead oil markets to a "red zone in July or August," when demand increases during summer travel season.
Birol also said earlier this week that there could be a few weeks worth of oil left in commercial inventories. He noted that the release of reserves has been adding 2.5 million barrels of oil per day to the market, but they "are not endless."
Negotiations between the U.S. and Iran continue in the meantime, with the immediate goal being the reopening of the Strait of Hormuz. There has been a modest increase in shipping activity through one of the world's most important energy chokepoints over the past days as talks appeared to progress.
Before the conflict erupted on Feb. 28, the Strait of Hormuz handled roughly 20% of global oil and LNG supplies and saw between 125 and 140 vessel passages each day. Since the outbreak of war, maritime traffic has fallen dramatically as Iran imposed restrictions and many ships became stranded in the Gulf.
However, the past hours have seen renewed tensions as the U.S. said it had targeted Iranian forces to protect its troops, but emphasized the ceasefire is still in place.
"Targets included missile launch sites and Iranian boats attempting to emplace mines. U.S. Central Command continues to defend our forces while using restraint during the ongoing ceasefire," said CENTCOM spokesperson Capt. Tim Hawkins in a statement.
Iran's Islamic Revolutionary Guard Corps (IRGC), in turn, said it has the "legitimate" right to respond. "The Islamic Revolutionary Guard Corps warns against any violation of the ceasefire by the aggressive US military, and considers its right to reciprocal response to be legitimate and certain," the group said in a statement distributed in state-affiliated media.
