Source: Fortune
Summary
The oil market is facing chaos as the war in Iran has effectively shut down the Strait of Hormuz, leading to production cuts in the UAE and Kuwait, and a 60% drop in Iraqi output. The US is considering widening its range of targets in Iran, and the conflict shows no sign of resolution. Oil prices are nearing the $100-a-barrel threshold, with Brent crude up 30% last week. The US has promised to bolster financial protection and potentially provide military escorts for ships in the region.
Our Reading
The numbers tell one story. Oil production is getting cut, and prices are nearing $100 a barrel. The Strait of Hormuz is effectively shut down, and the US is considering widening its targets in Iran. Saudi Arabia is diverting crude to its Red Sea coast, but it’s not enough to alleviate the pressure. The conflict is bringing crude to a tipping point, and the psychological threshold of $100 a barrel is within reach.
The strategy enters a familiar phase: the blame game. The US is blaming Iran, Iran is blaming the US and Israel, and the oil market is blaming everyone. The numbers will tell another story soon.
Author: Evan Null
