The potential blockade of the Strait of Hormuz, through which approximately 20% of the world’s oil passes, is considered the main geopolitical risk factor in the short term.
Senior economist at Banco Carregosa, Paulo Monteiro Rosa, highlights the market’s restrained behavior following the attacks on nuclear installations in Iran.
“Despite the U.S. entering the conflict, Brent [traded in London and serving as a reference for national imports] stabilized at $78,” showing that investors “continue to bet on a temporary conflict and a short-term resolution, which might even involve regime change in Iran,” he stated.
However, he warns that a formal blockade of Hormuz would have “significant and disruptive consequences for the global energy market balance.”
The economist notes that Brent rose from $64 at the beginning of June to $78 and that the increase in fuel prices in Portugal, with diesel increasing by about eight cents per liter today, “already reflects this risk.”
Filipe Garcia, economist at IMF – Informação de Mercados Financeiros, points out that despite the sharp rise in crude oil in recent weeks — the WTI contract, traded in New York, has risen by more than 40% since May — the market has reacted with moderation.
“The closure of Hormuz is not the main scenario. For Iran and other Gulf countries, it would mean losing their revenue source, and for Iran’s most important customers, such as China and India, it would lead to higher prices and product unavailability,” he explained.
“Israel and the U.S. are aware of this fact, and it’s no surprise that the Iranian oil infrastructure hasn’t been attacked yet — and it seems a relatively easy target,” he commented.
Vítor Madeira, an analyst at XTB, is more direct regarding the risks: “A blockade of the Strait of Hormuz would have an immediate and very significant impact, potentially causing Brent to rise by up to 25% in the first days. If the blockade persists, an escalation exceeding 50% in barrel value cannot be ruled out. This would impact all transported goods and global inflation,” he stated.
Despite the warning, the expert acknowledges that an escalation scenario is not inevitable.
“If U.S. and Israeli military operations are successful in neutralizing strategic threats, the conflict’s intensity may retract. This would create space for diplomatic initiatives and, subsequently, a possible correction in oil prices,” he explained.
“In this scenario, the market would likely absorb the initial shock and resume a more stable trajectory,” he added.
Regarding fuels, he warns that “if the conflict worsens, adjustments may be more pronounced and immediate.”
Gregor Hirt, global investments director at Allianz Global Investors, notes that the evolution in the coming weeks will also depend on the major producers’ ability to stabilize flows.
“The major producers, especially Saudi Arabia, can offset supply disruptions, but most of their exports also pass through the Strait of Hormuz. A coordinated release of strategic reserves — which cover about 90 days of imports in the European Union — can help mitigate immediate effects,” he pointed out.
The U.S. has reserves for about 20 days, although it is almost self-sufficient, and it’s estimated that China has 30 days’ worth.
In the medium term, analysts agree that if geopolitical stability is achieved, the market will return to being guided by traditional supply and demand fundamentals.
“The speculative component, which currently dominates price formation, tends to disappear – behavior previously observed in similar conflicts,” concludes Vítor Madeira.
