The barrel exceeds 100 dollars and uncertainty sets in
The numbers speak for themselves. Brent oil, the world benchmark, is already trading above $101. The American West Texas Intermediate is around 107. These are increases of 9% and 16% in a single day, respectively.
This is not a normal market fluctuation. It is the second week of a conflict that is touching the energy arteries of the planet.
Approximately 15 million barrels of crude oil—about 20% of the world’s oil—are typically transported through the Strait of Hormuz each day.
That data, from the consulting firm Rystad Energy, explains everything. The strait is a geographical bottleneck between Iran and the Arabian Peninsula. Through it comes crude oil from Saudi Arabia, Kuwait, Iraq, Qatar and the Emirates.
Now, the real threat of missile and drone attacks has virtually brought traffic to a standstill. The oilmen are not taking risks.
The result is a snowball. Storage tanks in producing countries fill up because they cannot export. Iraq, Kuwait and the United Arab Emirates have already cut production. The offer is strangled.
Add to this that since the beginning of hostilities, oil and gas facilities have been targeted on several fronts. Each attack compounds concerns about stable supply.
Last week we already saw brutal increases: 36% for US crude oil and 28% for Brent. Today consolidates an alarming trend.
The market is operating in fear. Trading is volatile and each headline from the region moves the needle. We are not facing a short speculative crisis, but rather a geopolitical shock with profound ramifications.
When a war affects 20% of the global oil flow, we stop talking only about figures on a screen. We talk about the real cost that families will begin to feel in gasoline, in heating, in the products that arrive in trucks.
Uncertainty is now the main raw material in the Middle East. And its price, as we see, is very high.
