"1011 Insider Whale" Agent: The Hormuz Crisis May Become Prolonged, Rising Oil Prices Will Reshape Global Asset Pricing

ME News message, April 6 (UTC+8), “Insider Whale 1011” agent Garrett Jin posted “Oil is the War,” stating that the current Middle East conflict is continuing to escalate. The duration of disruption of the Strait of Hormuz may far exceed market expectations. The rise in oil prices is not only a result, but also a core variable of this round of conflict. As the situation shifts from airstrikes to ground operations, the conflict could evolve into a long-term war of attrition. Iran does not need to win; it only needs to raise the cost of war to force its opponents to seek withdrawal. Against this backdrop, the Strait of Hormuz is unlikely to quickly resume navigation, and crude oil supply will remain constrained.

In terms of prices, WTI crude oil has recently been unusually higher than Brent crude oil, reflecting a reshaping of the global supply-and-demand structure and a shift in Asian buying toward U.S. crude. Analysts believe this is not only a short-term contract factor, but also a signal that the entire global crude oil pricing curve has moved upward. Garrett Jin expects that, under the baseline scenario, oil prices may remain in the range of $120 to $150. If the conflict continues for a longer cycle, there is even the possibility of probing toward $200. He emphasized that although the market has already priced in the conflict itself, it has not yet fully priced in the risk of the conflict becoming “long-term.” Oil prices will become a core variable affecting interest rates, exchange rates, the stock market, and the crypto market. If ground warfare fully unfolds without a quick victory, global assets may face a chain of re-pricing. (Source: PANews)