News & Insights

Yesterday's ceasefire rally was real, and we understand why markets reacted the way they did. A 15% single session drop in oil and a surge across every major equity index reflects genuine relief that immediate escalation has been avoided. But markets have a habit of pricing the headline rather than the reality underneath it, and the reality here is that the Strait of Hormuz is still operating under Iranian coordination conditions, tanker insurance has not been reinstated, Gul

WTI is up 75 percent YTD, driven by the Hormuz escalation premium we have been tracking since Jan 1. What changed this week is structural, not incremental. The Houthis have entered the war in a manner that directly threatens Bab El-Mandeb, and this is a qualitatively different risk from Hormuz. Hormuz is a production chokepoint. It throttles oil at the source. Bab El-Mandeb is a distribution chokepoint, and in the current configuration it is more insidious, because Saudi Arab

The energy shock is moving into the real economy much faster than most desks anticipated. Three weeks into the US Iran conflict, the Strait of Hormuz is effectively impaired, and with Brent pushing past 112 dollars, we are no longer looking at a price spike but a structural bottleneck. While the strip implies an eventual return toward 80 dollars by late 2027, shipping confidence takes far longer to rebuild than a ceasefire takes to sign. Our house view is that Brent remains a