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Iran is obviously trying to angle for leverage by driving up the price of oil by distrupting the flow of traffic through Hormuz. The US, meanwhile, is trying to choke out Iran and extract severe economic costs.
In the middle are the people in the region and the global buyers of crude oil. No one is winning at the moment and there doesn’t appear to be any hope of a near-term breakthrough. One idea floated this week was that Trump would declare victory and leave others to navigate ships through the Strait or negotiate with Iran. On the other side, Iran has been struggling to slow shipping and is now attacking land-based targets in Kuwait instead.
There are signs that the market is running out of patience (and oil) with crude prices up more than $10 in the past week and threatening the July high of $93.50. That will be a pivot point in the short term.
This article was written by Adam Button at investinglive.com.
