Iran just mined the world's most important oil chokepoint — load up on big energy stocks
The U.S. Secretary of State says Iran has placed naval mines across large parts of the Strait of Hormuz, a narrow waterway that roughly one-fifth of the world's oil passes through every day. That's a serious threat to global oil supplies.
Idea
The Strait of Hormuz is the world's most important oil chokepoint, with roughly 20% of global oil flowing through it. If Iran has mined large sections, oil tankers can't safely pass, which chokes off supply and sends prices spiking. When oil prices surge, the big oil producers like Chevron and Exxon rake in extra cash on every barrel. History shows that Middle East supply threats trigger multi-week runs in energy stocks, not just a single day's pop. This is the kind of news that can keep pushing the sector higher as tensions escalate.