Rachel Ziemba 5.0 2 ideas

Ziemba states, "in the short-term, we will see that shift" to less clean energy like coal, especially in Asia and Europe, and expects emissions standards may be relaxed. High oil and gas prices, supply disruptions, and the need for readily available local energy sources will incentivize a shift back to coal. Increased demand for coal as a substitute fuel makes the asset attractive. A rapid de-escalation collapses energy prices, or environmental policy remains rigid despite the crisis.

Rachel Ziemba states if the Strait of Hormuz "stays as effectively closed, we will see oil prices continuing to grind out." The physical supply disruption is immense (~11 mbd per IEA), and Asian refiners are already paying premiums of $150-160 for deliverable crude. The scale of the effective outage outweighs strategic reserve releases and sanctions exemptions, pointing to higher prices. The Strait reopens quickly, or a coordinated global release of reserves overwhelms the supply gap.