Strait of Hormuz Conflict Escalates: US Strikes Iran, Oil Prices Jump

The conflict in the Strait of Hormuz has escalated again, with the US resuming military strikes on Iran over the weekend. The move led to a 2% increase in oil prices, pushing benchmark Brent Crude above $90/barrel for the first time since July.

Oil majors such as Shell, Chevron, and ExxonMobil have seen their stock prices rise due to the increased demand and higher prices. However, Shell's natural gas assets in Qatar have been affected by the war, with a co-ownership stake in the Pearl Gas-to-Liquids (GTL) plant damaged in an Iranian attack on March 18.

Shell expects repairs to the damaged train to take about six months, and further strikes in the region would likely contribute to even higher natural gas prices. This could temporarily boost Shell's bottom line and share price, but any oil stock price gains caused by higher oil prices have so far been temporary.