The energy market is experiencing a phase of extreme tension, driven by the blockage of oil tankers in the Strait of Hormuz, one of the most strategic arteries of global trade. This logistical paralysis has pushed crude prices back to levels last seen in April 2024: USD 90 for Brent and USD 87.70 for WTI, representing a weekly increase of nearly 24%.
Despite Washington’s attempts to calm the market, naval escorts, potential use of strategic reserves, and exemptions allowing the sale of Russian oil stored offshore, the momentum remains firmly upward. Insurers are withdrawing coverage, flows remain disrupted, and military solutions will take time to implement.
In this environment, the geopolitical risk premium has become the main driver of prices, and some players, notably Russia, are deriving strategic benefits from the situation.
Key Points of the Analysis
The Strait of Hormuz: A vital chokepoint
Nearly 20% of global oil supply passes through this corridor. Its blockage results in:
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an immediate reduction in available supply,
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a mechanical rise in prices,
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costly rerouting of maritime traffic.
A price spike despite U.S. intervention
Washington’s measures aim to stabilize the market:
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naval escorts to secure shipping lanes,
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potential use of strategic petroleum reserves,
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exemptions to release Russian oil stored on tankers.
However, these actions remain insufficient in the short term to offset the logistical disruption.
Russia as the main beneficiary
U.S. exemptions allow Russian oil stored offshore, notably destined for India, to be sold. As a result:
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Russia benefits from increased demand,
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trade flows shift in its favor,
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elevated prices boost its energy revenues.
Saudi Arabia circumvents Hormuz
Riyadh is rerouting part of its exports through the Red Sea. This flexibility limits the impact on its volumes but is not enough to stabilize the global market.
A persistent risk premium
Prices continue to rise because:
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insurers are cancelling coverage,
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military escorts are not yet operational,
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flows remain heavily disrupted.
As long as traffic does not return to normal through the Strait of Hormuz, the geopolitical premium will remain embedded in crude prices.
Investment conclusion
The oil market is entering a phase of sustained tension, driven more by geopolitics than fundamentals. This environment benefits:
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oil producers,
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LNG exporters,
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companies with rerouting capabilities.
Conversely, energy‑intensive sectors and the airline industry remain under pressure. Visibility will stay limited until the Strait of Hormuz returns to normal operations.