The Math Doesn’t Math
Why oil should be at $200 and isn’t, and what that tells us
FTI | May 3, 2026
Brent topped $126 a barrel on Thursday, a four-year high. Then Iran sent an updated peace proposal (through Pakistan) on Friday and Brent settled back at $108. Average gas at the pump is $4.39 nationally (where I live, I’m seeing $4.10).
First, some quick numbers worth holding onto. Then the real story.
Iran shutting Hormuz took 14 million barrels offline in a single move. Biggest oil supply disruption in history. Bigger than 1973. Bigger than the Gulf War. Analysts at the start of the conflict expected oil to be at $150 by now. Some called for $200. Kpler’s lead oil analyst said this week: “I would have expected prices to be above $200. It’s crazy. Everyone is scratching their heads about this.”
Oil is at $108. The math doesn’t math.
That gap is the most important macro signal in the market right now, and nobody is talking about it correctly.
WHY OIL IS LOWER THAN IT SHOULD BE
There are three reasons, and all three are temporary.
The U.S. has been unusually insulated. Domestic production buffered us.
