J.P. Morgan Drops Iran Conflict Baseline as Saudi Exports Hit Decade Low
JPMorgan's commodities team has abandoned its scenario framework for the US-Iran war, leaving crude markets without a directional roadmap for the first time since fighting began.
J.P. Morgan's head of global commodities strategy, Natasha Kaneva, told Rigzone on Thursday (2026-09-17) that her team no longer holds a baseline view on the US-Iran conflict — the first time the bank has been without one since the war started. "We simply don't know how to model the endgame," the analysts wrote. "At the onset, we thought we did."3
Saudi Arabia's export numbers explain part of why the outlook is so difficult to frame. Kpler data show the kingdom shipped just 3.2 million barrels a day last month, its lowest level in more than a decade, after both its normal export routes were compromised and crude was diverted onto longer corridors. ICE Brent crude front-month was trading at $101.58 a barrel as of early Tuesday (2026-09-22), elevated but well below the spikes recorded during the conflict's worst escalations.7
The bank had been among the more structured voices framing the conflict's trajectory from the start. When Trump announced a two-week ceasefire on Wednesday (2026-05-20), crude collapsed in a single session. NYMEX WTI front-month fell 16.4% to $94.41, its largest one-day decline since 2020, and ICE Brent crude front-month dropped 13.3% to $94.75. Equities surged alongside: the S&P 500 closed up 2.5% and the Dow jumped 1,325 points. J.P. Morgan's trading desk wrote that "assuming this is not a feint from any of the parties, the market is likely to treat this as a de facto end of the conflict," and anticipated "euphoria" returning to markets.1
But the ceasefire did not hold. Iran subsequently announced the closure of the Strait of Hormuz to all vessels. WTI futures climbed more than 2% intraday on Thursday (2026-06-11), after both benchmarks had already breached $90 a barrel the prior session.4
Brent's price arc through Q2 was extreme. ICE Brent futures settled at $102.58 on Thursday (2026-05-21), down $2.44 or 2.3%, as deal uncertainty returned. The second quarter ended with ICE Brent having shed close to 40% from its peak, the steepest quarterly decline since 2020, as optimism about a peace agreement repeatedly outran events.2,5
Macquarie strategists Vikas Dwivedi and Walt Chancellor, in a note on Thursday (2026-07-09), still expected the tension to prove "relatively short-lived." That call has not been validated.6
U.S. retail prices are absorbing the supply tightness. National gasoline rose from $4.31 to $4.43 a gallon in four days during the week of September 14, per AAA data, while diesel climbed 42 cents over the same stretch. South Carolina's statewide average reached $4.11 on Thursday (2026-09-17), up from $4.05 on Wednesday (2026-09-16). In Charleston, the overnight move alone was 15 cents.7
J.P. Morgan's admission reflects a conflict that has so far defied the standard playbook for Middle East supply disruptions. The bank maintained a base case through multiple escalations and a failed ceasefire. Abandoning that framework is an uncommon step for a strategy desk that crude traders have followed closely through every escalation cycle.3
Saudi export volumes are the most concrete metric available. At 3.2 million barrels a day, per Kpler, shipments are running far below pre-conflict capacity, with no clear timeline for route normalisation. A sustained reopening of Strait transit would shift the supply picture quickly. Until that happens, ICE Brent front-month will keep taking its cues from military and diplomatic developments rather than supply-and-demand fundamentals.7