Why Oil Prices Keep Falling Even Though Supply Is Tight

Oil has dropped below $80 a barrel despite a key shipping route—the Strait of Hormuz, which carries about a fifth of the world's oil—being shut down since February. Traders bet the crisis would be short and are now selling. Stored oil can tide things over for weeks. If the route stays closed through mid-2026 when demand peaks and reserves run low, real shortages could hit.