By Georgina McCartney and Laura Matthews

HOUSTON/NEW YORK, June 5 (Reuters) - Global oil inventories are headed for a dangerous decline as no agreement has been reached to reopen the Strait of Hormuz, and industry executives and analysts warn of another oil price shock in the coming weeks that could be severe enough to cause turmoil in wider financial markets.

Some fear that the next rise in oil prices could pose a risk to economic growth, bond yields, and the stock market.

"We are approaching unprecedented inventory levels," said Neil Chapman, senior vice president of Exxon Mobil, during the Bernstein Conference in New York on May 28. "I mean, they are actually very low levels. You can have a debate about whether (inventories) will reach those very low levels in two or three weeks. But once you get to that point, you will see a sharp rise in prices."

Chapman added that if inventory levels fall further, the price of Brent crude, on which more than 60 percent of the world's traded oil is priced, could rise to $150 or $160 a barrel.

Crude oil stockpiles and releases from strategic reserves helped keep oil prices somewhat under control during the months when the Iran war disrupted supplies to many parts of the world. Crude futures remained below $100 a barrel even though the Strait of Hormuz remained effectively closed.

US President Donald Trump has been saying for days that an agreement to reopen the Strait of Hormuz is imminent. But that has not yet materialized, and warnings are growing louder in the oil sector.

Toril Busoni, head of the oil industry and markets division at the International Energy Agency, said on Tuesday that global oil inventories could reach critical levels before the peak of the summer demand period if withdrawals continue at the current pace.

“Once (inventories) are depleted, most of the market adjustment efforts will be on the price side. That means either increased costs for consumers or a forced reduction in demand,” said Mohammed Begrin, vice president and senior market analyst at Rosenberg Research, adding that the tipping point could be reached by the end of June.

“Once we enter the second half of June, we are likely to see a rapid rise in oil prices,” JPMorgan’s Data Assets & Alpha Group said in a forecast based on research conducted by the bank, unless traffic through the Strait of Hormuz returns to its pre-conflict levels.

The U.S. Energy Information Administration, the world's largest oil producer, said on Wednesday that crude inventories in the country, including stocks in the Strategic Petroleum Reserve, fell to 791 million barrels in the week ending May 29, their lowest level since February 2024.

US crude oil inventories have fallen by about 64 million barrels since the start of the war, and have continued to decline for eight consecutive weeks.

The United States is currently working to release 172 million barrels from its strategic petroleum reserve as part of an effort coordinated by the International Energy Agency to release an unprecedented 400 million barrels of oil to combat rising prices.

Withdrawals from these stockpiles helped to limit the size of the supply-side shock, along with a decline in China's seaborne crude oil imports, which in May reached their lowest level in nearly 10 years.

"I think the risk of a second price shock is real, but the key point is that it could result from the depletion of strategic reserves rather than the closure of the Strait of Hormuz as happened in the first shock," said Shokhro Zukhritdinov, an oil trader based in Dubai.

Analysts at Data Assets & Alpha said that the drawdown from the U.S. Strategic Petroleum Reserve, the switch to different fuel types, and other factors that have limited price increases may not be enough if the turmoil continues.

The White House did not respond to a request for comment.

Indirect consequences

Investors said the crisis has already led to the addition of a permanent risk premium to crude oil prices, with consequences that are reflected in the level of inflation, bond yields, and consumer spending.

Joseph Tanios, chief investment strategist at Northern Trust Asset Management, believes the latest developments are an indication of a permanent structural change in energy markets.

"The Strait of Hormuz has now become a permanent geopolitical chokepoint," he said, adding that a return to pre-war oil price levels, which were below $70 a barrel, seems unlikely even if tensions ease.

As a result, Tanios believes the global impact will be uneven, with Europe and Asia remaining more vulnerable to continued inflation in energy prices, while the United States will be relatively safe given that it exports more oil than it imports.

Adam Schickling, chief economist at Vanguard, therefore believes that rising oil prices represent only a "modest obstacle" to the US economy, thanks to domestic oil production and strong investments in artificial intelligence that have offset the pressure on consumers.

However, Vanguard estimates that US economic growth could slow by about 0.4 percentage points in a scenario where the price of crude oil rises to about $120 a barrel and remains at that level for a year.

For households, the impact depends less on a specific oil price level and more on how long prices remain high. Consumers still have some protection against shocks, as fuel costs represent a smaller percentage of income than during previous oil crises. However, this protection diminishes over time.

Phil Blancato, senior market strategist at OSAIK, said that continued price increases over the next three months, with the start of the peak summer driving season, will lead to a further decline in consumer spending.

He added, "Consumer confidence has already reached an all-time low, but if oil prices remain at this level for another three months, or rise significantly in the short term, then we will start to look for a real economic impact," and urged diversifying investment portfolio categories, including looking for investments outside the stock market.