Hormuz Tensions Send North Sea Brent Crude Price Soaring
The price of North Sea Brent crude oil rose to $89.12 a barrel on Monday as traders monitored the Strait of Hormuz, a critical transit point for hydrocarbon exports from Gulf countries.
According to the U.S. Energy Information Administration, nearly 20 million barrels per day of crude oil and petroleum products pass through the strait in 2024, accounting for about 20% of global liquid fuels consumption over that period.
Maritime tracking data shows a further slowdown in flows over the weekend following attacks attributed to Iran against several tankers belonging to the UAE state company Adnoc. Global Risk Management analyst Arne Lohmann Rasmussen notes that the flow 'declined further over the weekend,' but adds that the reading of this data is becoming less reliable due to vessels crossing the passage with their AIS transponders switched off.
PVM analyst Tamas Varga sums up traders' reaction as: 'In the absence of clarity, it (the market) does the best thing it can: react to headlines and social media posts.'