How the Iran War Is Rewiring the Oil Market

Sometimes it's best to expect the unexpected. When the Straits of Hormuz first closed, everyone was in a panic and it was the biggest crisis that many of us have seen in this generation.

There are thousands of vessels that are stuck. Ships are still getting attacked. They said they control the strait. They do not.

We heard from the International Energy Agency that this is the biggest oil supply crisis ever seen.

It is in the world's largest oil producing region. The. Strait of Hormuz is responsible for 20 to 25% of the world's oil as well as gas seaborne tree.

So we're talking about 20 million barrels per day. It also meant that a lot of food supplies, fertilizers, and other essential commodities were stuck.

Ever since the Iranian revolution, the 70s, the idea that hormeus has been important has been known, but it's always been a back burner issue.

Oil prices and shortages were expected to soar. There is worry in the market that there is no end in sight.

That knock-on effect really is being felt. People were really wondering how the world would cope with such a disruption.

Many of the banks were talking $150 a barrel, $200 a barrel. But then it didn't happen. Markets barely blinked at some of the challenging headlines coming from the Middle East. The market has.

Been pretty. Resilient. Although we did see prices top $126 a barrel, many of those worst fears were never materialized.

We saw the market adjust to the crisis in somewhat surprising ways. Price response actually shows how resilient markets can be.

So how was the biggest energy crisis in a generation so easily swallowed? And does this ability to cope mean the world has reached peak Hormuz?