Post #16104

Oil Is Chopping Around, But Nonetheless Still Elevated Oil is ripping higher again, back above $100, as markets reprice geopolitical risk following the collapse in U.S.–Iran talks. The U.S. move to block access to Iranian-linked flows through Hormuz adds another layer of tension to an already constrained route. On paper, increased control over the strait should ease supply concerns — but that’s not how markets are reading it. The added risk of retaliation and broader regional conflict is keeping a strong risk premium baked into price. That’s what’s driving the move higher. Fundamentally, the backdrop is still tight. The strait has effectively been restricted for weeks, OPEC output has dropped sharply, and while Saudi is restoring some capacity, it’s not enough to fully offset disruptions. From a macro lens, this keeps inflation risk elevated and growth concerns in play. Higher energy prices continue to complicate the policy outlook. - Alan