The provided report from the International Energy Agency (IEA), dated May 2026, analyses a massive global oil supply shock triggered by a conflict in the Middle East and the closure of the Strait of Hormuz. This disruption has forced a record drawdown of global inventories and led to extreme price volatility, with crude costs fluctuating near $110 per barrel. While demand is contracting due to higher prices and economic slowing, the market remains in a deep deficit as alternative production from the Atlantic Basin and emergency stock releases struggle to bridge the gap.