Strait of Hormuz is shut and oil inventories are running dry — load up on Exxon and Chevron
The Strait of Hormuz — the narrow waterway that carries roughly one-fifth of the world's oil — has been shut since the Iran war broke out in February. An Exxon executive now warns that global oil stockpiles will soon hit all-time lows, which could push physical oil prices to $150–160 a barrel.
Idea
With the Strait of Hormuz closed since February, a huge portion of the world's daily oil supply is effectively blocked. An Exxon senior executive is now publicly warning that inventories are weeks away from all-time lows and that physical crude could rocket to $150–160 per barrel. Even if a US-Iran ceasefire materializes, analysts say the era of cheap $60 oil is over because the supply damage is already done. Oil producers like Exxon and Chevron stand to earn dramatically more per barrel, and even a broad energy ETF like USO should grind higher as the supply squeeze intensifies.