CDN NEWS | 
US NEWS 
By Mia Gindis
Wall Street is growing more convinced that shipping through the Strait of Hormuz will remain impaired into the second half of the year, highlighting expectations for a longer-lasting supply shock.
A majority of surveyed investors expect flows through Hormuz to be disrupted beyond the end of June, and 43% of respondents don’t expect shipping to return to normal until after July, according to a poll by Goldman Sachs Group Inc. A third of respondents expect Brent crude to finish this year between $80 and $90 a barrel, Goldman’s Marquee MarketView survey showed.
Note: Excluding 3% ‘no view’
Source: Goldman Sachs Marquee MarketView
An impasse in peace talks between the US and Iran has pushed investors to more seriously assess the consequences of an extended disruption to flows through the strait, a chokepoint for about a fifth of the world’s oil and liquefied natural gas shipments. The waterway has been effectively closed since the war began at the end of February.
The disruption has triggered an unprecedented supply shock and prompted warnings from the world’s top oil traders that the impact of the Iran war will linger for months even after the waterway reopens. The strait currently faces a double blockade, with Tehran obstructing traffic, while US prevents ships calling at or leaving Iranian ports.
Goldman polled 837 institutional clients from May 4 to 6.
The survey also identified short oil as a favored trade in the event the strait reopens, followed by long positions in European and emerging market equities. Even as geopolitical tensions swirl, options markets are showing sustained demand for downside protection as traders hedge against the risk of a sudden de-escalation between the US and Iran.
Share This:
