Hormuz blockade enters month four with no deal — energy stocks keep climbing
The Strait of Hormuz — the narrow waterway that most Middle Eastern oil passes through — has been effectively blocked for over three months. Iran has mined large sections of it, and there's no sign of a resolution anytime soon.
Idea
The Strait of Hormuz has been blocked for over three months and Iran has reportedly mined large sections of it. This is the world's most important oil shipping lane, and with no diplomatic breakthrough in sight, oil prices are likely to stay elevated. That means big energy companies like Exxon and Chevron keep raking in outsized profits. The OECD just warned this conflict is dragging down the global economy — but for oil producers, sustained high prices are a direct tailwind. Until there's a real de-escalation, energy stocks have a strong fundamental floor under them.