The Strait of Hormuz Is Repricing the Entire World Economy
The politicians continue to speak about the Strait of Hormuz as though this were merely a regional dispute between Iran and its neighbors. That is complete nonsense. The strait is one of the most important arteries in the global economy, carrying roughly one-fifth of the world’s oil and gas shipment
Source: Armstrong Economics
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DW NOTE
The Strait of Hormuz has been effectively closed for four days — one ship transiting versus the usual 73 per day — and oil is still trading 23% below recent highs. Either the market believes the closure is temporary, or it has priced in a supply shock so severe that demand destruction is already offsetting lost barrels. Neither interpretation is reassuring.