Philip Crowther

"There has not been any increasing traffic here because there is no deal and it is still very much deemed too dangerous for any container ships... for oil tankers and those carrying liquefied natural gas to pass from the Persian Gulf through the Strait of Hormuz." The total blockade of the Strait of Hormuz removes a massive percentage of global daily oil and LNG supply from the market. Because Middle Eastern supply is trapped or offline (Kharg Island attacked), Western and US domestic energy producers will capture massive premiums as global buyers scramble to secure safe, non-Middle East energy sources. LONG. US-based supermajors and broad US energy equities will see massive cash flow expansion driven by a sustained geopolitical risk premium and direct supply shortages. A sudden diplomatic breakthrough or successful US-led naval coalition that rapidly reopens the Strait, causing the geopolitical risk premium in oil to collapse.

"It is still very much deemed too dangerous for any container ships... to pass from the Persian Gulf through the Strait of Hormuz to, well, essentially where I am here. Out into the wider world." When major maritime chokepoints are closed, global shipping fleets must reroute around the Cape of Good Hope or remain idle. This drastically increases ton-mile demand (the distance ships must travel), absorbs excess global vessel capacity, and causes daily freight rates to skyrocket. Both container shipping and product tankers will see immediate, massive margin expansion. LONG. Shipping equities are highly leveraged to spot freight rates, which will remain elevated as long as the Strait of Hormuz is impassable. The conflict ends quickly, or global demand destruction occurs due to high energy prices, leading to a drop in overall shipping volumes.

"It is still very much deemed too dangerous for any container ships... to pass from the Persian Gulf through the Strait of Hormuz to, well, essentially where I am here. Out into the wider world." When major maritime chokepoints are closed, global shipping fleets must reroute around the Cape of Good Hope or remain idle. This drastically increases ton-mile demand (the distance ships must travel), absorbs excess global vessel capacity, and causes daily freight rates to skyrocket. Both container shipping and product tankers will see immediate, massive margin expansion. LONG. Shipping equities are highly leveraged to spot freight rates, which will remain elevated as long as the Strait of Hormuz is impassable. The conflict ends quickly, or global demand destruction occurs due to high energy prices, leading to a drop in overall shipping volumes.

"There has not been any increasing traffic here because there is no deal and it is still very much deemed too dangerous for any container ships... for oil tankers and those carrying liquefied natural gas to pass from the Persian Gulf through the Strait of Hormuz." The total blockade of the Strait of Hormuz removes a massive percentage of global daily oil and LNG supply from the market. Because Middle Eastern supply is trapped or offline (Kharg Island attacked), Western and US domestic energy producers will capture massive premiums as global buyers scramble to secure safe, non-Middle East energy sources. LONG. US-based supermajors and broad US energy equities will see massive cash flow expansion driven by a sustained geopolitical risk premium and direct supply shortages. A sudden diplomatic breakthrough or successful US-led naval coalition that rapidly reopens the Strait, causing the geopolitical risk premium in oil to collapse.

"There has not been any increasing traffic here because there is no deal and it is still very much deemed too dangerous for any container ships... for oil tankers and those carrying liquefied natural gas to pass from the Persian Gulf through the Strait of Hormuz." The total blockade of the Strait of Hormuz removes a massive percentage of global daily oil and LNG supply from the market. Because Middle Eastern supply is trapped or offline (Kharg Island attacked), Western and US domestic energy producers will capture massive premiums as global buyers scramble to secure safe, non-Middle East energy sources. LONG. US-based supermajors and broad US energy equities will see massive cash flow expansion driven by a sustained geopolitical risk premium and direct supply shortages. A sudden diplomatic breakthrough or successful US-led naval coalition that rapidly reopens the Strait, causing the geopolitical risk premium in oil to collapse.

"It is still very much deemed too dangerous for any container ships... to pass from the Persian Gulf through the Strait of Hormuz to, well, essentially where I am here. Out into the wider world." When major maritime chokepoints are closed, global shipping fleets must reroute around the Cape of Good Hope or remain idle. This drastically increases ton-mile demand (the distance ships must travel), absorbs excess global vessel capacity, and causes daily freight rates to skyrocket. Both container shipping and product tankers will see immediate, massive margin expansion. LONG. Shipping equities are highly leveraged to spot freight rates, which will remain elevated as long as the Strait of Hormuz is impassable. The conflict ends quickly, or global demand destruction occurs due to high energy prices, leading to a drop in overall shipping volumes.