"Oil surging back to $100 a barrel shows that energy markets are reacting to a genuine geopolitical shock. The Iranian attacks on tankers, ports, and infrastructure in the Gulf have significantly heightened concerns about disruptions to one of the world's most critical oil pathways, the Strait of Hormuz, through which about one-fifth of the world's oil supply typically passes."
"Even partial disruption to shipping through Hormuz has enormous consequences for markets. Energy traders respond quickly to risks, with every strike on infrastructure, every tanker attack, and every threat to shipping feeding directly into oil prices, reflecting the increasing risk premium associated with Middle Eastern oil supplies."
Global markets are experiencing significant strain from two concurrent crises: escalating energy prices and intensified trade tensions. Brent Crude briefly exceeded $100 per barrel following Iranian attacks on Gulf energy infrastructure and shipping, despite the International Energy Agency releasing 400 million barrels in emergency reserves. The Strait of Hormuz, through which approximately one-fifth of global oil supply passes, faces disruption risks from ongoing conflicts. Energy traders immediately price in geopolitical risks, with Brent crude rising over 30% since the conflict began. Simultaneously, the Trump administration has launched extensive trade investigations targeting major global economies, creating additional market uncertainty and investor concern.
Read at London Business News | Londonlovesbusiness.com
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