It's another day but it will be the same old story in markets as it has been since last week. Every inch of the broader market mood is fixated on the Middle East as the energy disruption continues to drag on. Despite whatever safety assurance or what Trump says about the war being won, the fact remains that the Strait of Hormuz remains in de facto closure.
And unless that changes, oil prices will stay underpinned and even more so the longer the status quo extends. In turn, that will continue to have an impact on broader market sentiment. Be it from major currencies, to stocks, to bonds, to precious metals. It's all connected at the moment with their respective fates tied to the movement in oil prices.
US president Trump may claim that Iran has been defeated, or at least incapacitated, and that victory draws near. However, the fact remains that no commercial vessel is able to transit safely through the Strait of Hormuz still. That as Iran somehow continues to maintain its presence around that part of the region in striking down anything and everything that moves there.
As things stand, the speculation is that the only ones brave enough to transit are "shadow fleets" with ties to Iran or certain sanctioned entities. These will be ones operating with AIS transponders turned off and are "safe" due to carrying Iranian cargo.
Besides that, there is almost no actual vessels willing to take the risk to cross the strait currently. Kpler data has signaled that transit across the strait is basically non-existent now. Meanwhile, AIS data might show ships crossing but that number is relatively low (1-2 per day) and even then those vessels are likely ones with ties to Iran.
If you're an independent vessel, it makes no sense to risk the situation. And that is where we are at now.
In essence, actions speak louder than words. It's always the case with any war. And until the energy disruption situation improves, the danger is that oil prices will slowly return back to the highs in the days/weeks ahead. Just be reminded that with each passing day, the risk of that grows even greater.
