This is the chart of the year, courtesy of OilPrice.com. Brent at almost $105, WTI over $102, with nowhere to go but up so long as shipping traffic through the Strait of Hormuz remains at a standstill. At one point in overnight trading, both Brent and WTI approached the $120 mark. Expect both to do the same today unless something about current fundamentals changes for the better.
Over at Bloomberg, Javier Blas has a story up detailing the few alternate routes which exist to take crude out of the Persian Gulf region, but the pipelines he discusses can only move a fraction of the 20 million barrels of crude which normally transit the Strait each day.
Key excerpt:
Washington: Iran’s strategy in its war with the US and Israel is by now clear: Impose an intolerable economic cost on President Donald Trump, forcing him to abandon his “war of choice” as American gasoline prices surge. Is there any way the Islamic Republic’s blueprint for survival can fail? Yes, if its old regional nemesis, Saudi Arabia, can cushion the oil market.
