Middle East oil shock
U.S. strikes on Iran’s Karg Island and Tehran’s vow to blockade the Strait of Hormuz have pushed Brent above $100/barrel and injected a large geopolitical risk premium into energy markets — analysts warned prices could exceed $150 if the choke point stays closed reported. That jump is already forcing investors into energy and defense names and squeezing airlines and energy-intensive sectors as input-cost inflation piles onto an uncertain Fed outlook argued.
U.S. Central Command said forces “successfully struck more than 90 Iranian military targets” on Kharg/Kharg Island [usnews.com], and President Trump posted that he ordered the raid while asserting oil infrastructure on the island was left intact in a Truth Social statement. cnbc.com Tanker traffic through the Strait of Hormuz has plunged roughly 90% as ship‑tracking data show hundreds of vessels clustered at anchor outside the chokepoint [nbcnews.com]; about 20 million barrels per day of crude and products normally move through Hormuz, roughly one‑fifth of global petroleum consumption. eia.gov The International Energy Agency approved a record 400 million‑barrel coordinated release from emergency stockpiles to calm markets [iea.org], and the U.S. announced it will supply 172 million barrels from the Strategic Petroleum Reserve, with deliveries to take about 120 days. bloomberg.com Major Gulf producers have already cut output—Bloomberg estimates those reductions shave about 6% off global supply as storage and export bottlenecks bite [bloomberg.com]—while the U.S. International Development Finance Corporation unveiled a $20 billion maritime reinsurance facility, with Chubb named lead underwriter, to backstop war‑risk cover for ships transiting the Gulf. dfc.gov
