Rabobank strategists highlight that Brent Oil prices are down on screens even as the US blockade of Hormuz, combined with Iran’s actions, threatens prolonged disruption. They warn that refinery feedstock is running out, airlines like Qantas are cutting flights, and policymakers are loosening energy taxes into a supply shock that could fuel inflation.

Hormuz blockade and refinery disruptions

"Yes, a once-unthinkable US blockade of Hormuz is now in place, extending into the Gulf of Oman and the Arabian Sea, on top of the pre-existing Iranian blockade – and Trump has underlined he will sink any Iranian ships trying to break it. Two tankers have already turned away, according to tracker data."

"Yes, Iran is threatening Gulf ports, saying none would be safe if its own aren’t; Russia is withdrawing almost all its remaining staff from Iran’s Bushehr nuclear plant; US minesweepers maybe heading towards the Middle East, pointing to a demining process that could keep Hormuz closed for weeks yet; and even the US energy secretary just warned that oil prices are likely to rise until ‘meaningful’ traffic resumes through the Strait."

"That contrasts with the nothing many global oil refineries will have flowing through them shortly now the last tankers enroute before the war have arrived, pointing to looming shortages of key fuels in places. For example, in Australia, Qantas is now cutting domestic flights.

"However, equally notably, the general global fiscal trend is towards loosening, at least in terms of energy taxes, to try to smooth over a supply shock, which every economic textbook underlines ends badly – first, if everyone does the same, not just some, and second if this Hormuz crisis drags on.

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)