Oil Just Blew Past $100 and the Strait of Hormuz Is Basically a Parking Lot Now
Iranian strikes on Gulf shipping have markets in full panic mode while 400 million barrels of reserve oil does approximately nothing
Buckle up: oil is trading above $100 a barrel, Iranian strikes are targeting tankers near Iraq, and the Strait of Hormuz — which handles roughly 20% of global seaborne oil — is turning into the world's most expensive bottleneck. The IEA coordinated emergency release of 400 million barrels from strategic reserves sounds impressive until you do the math: at 20 million barrels per day of disruption, that's maybe three weeks of buffer. Analysts are already pricing in a $30/barrel geopolitical war premium, with Bloomberg commentators warning that's not going anywhere soon.
Bloomberg Daybreak noted this morning that Iranian oil is somehow still flowing through Hormuz even as Gulf neighbors' exports get shut down — which tells you everything about how chaotic and asymmetric this situation is. Meanwhile, on Mad Money, Cramer flagged oil is already up 50% year-to-date and could hit $120+ if no ceasefire materializes. Equities are skidding globally. Shares of energy infrastructure plays like $SOC are ripping, while the broader market is in full risk-off mode.
Six days of conflict. $11 billion in estimated US war costs. One hundred dollar oil. The market has officially decided Trump's victory lap was premature — and it's billing us all for the lesson.