《The New York Times》: Market Gradually Digesting Hormuz Strait Blockade

June 4, According to a New York Times report, even if the U.S. eventually reaches a peace deal with Iran, it could still take a long time for normal shipping to resume through the Strait of Hormuz. Major security risks and surging war insurance costs mean global energy trade is unlikely to rebound to pre-crisis levels anytime soon. The U.S., Canada, Brazil, Kazakhstan, Venezuela, and other oil-producing nations are ramping up crude oil output. The U.S. Strategic Petroleum Reserve (SPR) is continuing to release stockpiles to ease supply shortages. At the same time, Saudi Arabia and the United Arab Emirates are diverting some of the transport demand that once relied on the Strait of Hormuz via onshore oil pipelines. Still, the Gulf region’s economy is facing intense pressure. Qatar’s liquefied natural gas (LNG) exports are heavily dependent on the Strait of Hormuz; the International Monetary Fund (IMF) projects its economy could shrink by roughly 9% this year. Overall economic growth forecasts for Gulf countries have also been sharply cut. Tight energy supplies have driven up prices for natural gas, fertilizers, and food, further fueling global inflation. But as markets source alternative supplies, adjust consumption patterns, and new production capacity gradually comes online, the impact of the Hormuz crisis is shifting from a short-term shock to the gradual pricing of long-term risks. Going forward, the market’s focus is likely to shift back to liquidity, interest rate policies, and global economic fundamentals.