Stocks Are Ignoring It, But JPMorgan Warns The "Oil Shock Is Now Fully Playing Out"

Despite last week's 2-week ceasefire, shipping volumes through the Strait of Hormuz have remained at early April levels as Iran tightens its grip through new transit rules, threats of force, and an evolving—though still unofficial—IRGC-linked toll system. Conflicting political messaging has deepened uncertainty, including a White House suggestion that a post-conflict joint toll could be considered alongside the announcement of a US naval blockade of the Strait. Adding to the security risks, an armed group targeted a sailing vessel on Sunday off the Yemeni coast, according to the British government.

Against this backdrop, JPMorgan's commodity head Natasha Kaneva - who two weeks ago laid out a handy map showing the chronological shockwave of the Gulf oil crisis around the globe - writes in her latest note that reopening the Strait has become the market’s most time sensitive priority. The last tanker to clear Hormuz on February 28 is expected to reach its destination around April 20, marking the point at which preclosure barrels are fully exhausted from the global supply chain