WTI Geopolitical Risk Premium & Supply Disruption Analyzer

Decomposing physical equilibrium fair value from headline-driven Middle East conflict options across WTI futures contracts.

Simulated WTI Spot

$74.20

▼ -1.35% intraday pullback

Physical Fair Value

$69.80

Supply-Demand Balance

Risk Premium Wedge

$4.40

5.9% of barrel price

Cumulative Weekly Trend

+5.20%

Pacing biggest gain since July

Hormuz Flow At-Risk

0.85 M

Barrels / day net exposure

MODEL PARAMETERS & PRESETS

SELECT REGIME SCENARIO:

Baseline Physical Fair Value ($/bbl) $69.80

Global refinery demand, US inventory draws, and baseline supply equilibrium.

Strait of Hormuz Disruption Prob. (%) 12%

Probability of commercial tanker harassment or maritime blockade in transit corridors.

Potential Volume Outage (M bpd) 1.50 M

Direct crude flow interruption prior to OPEC+ and SPR mitigation.

OPEC+ Spare Capacity & SPR Buffer (M bpd) 2.20 M

Saudi / UAE idle capacity + emergency stock releases absorbing the supply shock.

Washington Diplomatic De-escalation Bias (%) 65%

Washington signaling avoidance of wider conflict dampening speculative risk pricing.

BARREL VALUE DECOMPOSITION $69.80 Fair + $4.40 Risk

Physical Baseline Geopolitical Wedge Total WTI Spot

WEEKLY TRAJECTORY & FRIDAY PULLBACK +5.20% Week

Mon ($70.50) Wed Spike Thu Peak ($75.22) Fri Spot

HORMUZ & REGIONAL CHOKEPOINT STRESS LEDGER Elasticity Multiplier: ~0.16 $/bbl per 100k bpd net deficit

Stress Regime	Transit Outage	Buffer Offset	Net Deficit	Implied Premium	Simulated WTI

Market Synthesis: WTI is trading at $74.20, reflecting a $4.40 geopolitical risk wedge over estimated $69.80 physical baseline fundamentals. Friday's intraday retreat (-1.35%) corroborates Bloomberg's report: speculative long exposure unwinds when overnight combat pauses and diplomatic channels de-escalate, even while multi-week momentum remains protected by broader structural Middle East tension.