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The 8 April ceasefire announcement and parallel discussions around a 45-day truce have not resolved the Strait of Hormuz disruption. They have, for now, capped the worst-case scenario, but tanker traffic remains at a fraction of normal levels and Iran's demand for transit fees signals a structural shift, not a temporary one.
What began as a regional conflict has become a global energy shock, and the question for markets is no longer whether Hormuz was disrupted, but how permanently the disruption changes the pricing floor for oil.
Key takeaways
- Around 20 million barrels per day (bpd) of oil and petroleum products normally pass through the Strait of Hormuz between Iran and Oman, equal to about one-fifth of global oil consumption and roughly 30% of global seaborne oil trade.
- This is a flow shock, not an inventory problem. Oil markets depend on continuous throughput, not static storage.
- If the disruption persists beyond a few weeks, Brent could shift from a short-term spike to a broader price shock, with stagflation risk.
- Tanker traffic through the strait fell from around 135 ships per day to fewer than 15 at the peak of disruption, a reduction of approximately 85%, with more than 150 vessels anchored, diverted, or delayed.
- A two-week ceasefire was announced on 8 April, with 45-day truce negotiations under way. Iran has separately signalled a demand for transit fees on vessels using the strait, which, if formalised, would represent a permanent geopolitical floor on energy costs.
- Markets have begun rotating away from growth and technology exposure toward energy and defence names, reflecting a view that elevated oil is becoming a structural cost rather than a temporary risk premium.
The world’s most critical oil chokepoint
The Strait of Hormuz handles roughly 20 million barrels per day of oil and petroleum products, equal to about 20% of global oil consumption and around 30% of global seaborne oil trade. With global oil demand near 104 million bpd and spare capacity limited, the market was already tightly balanced before the latest escalation.
The strait is also a critical corridor for liquefied natural gas. Around 290 million cubic metres of LNG transited the route each day on average in 2024, representing roughly 20% of global LNG trade, with Asian markets the main destination.
The International Energy Agency (IEA) has described Hormuz as the world’s most important oil transit chokepoint, noting that even partial interruptions may trigger outsized price moves. Brent crude has moved above US$100 a barrel, reflecting both physical tightness and a rising geopolitical risk premium.
Tankers idle as flows slow
Shipping and insurance data now point to strain in real time. More than 85 large crude carriers are reported to be stranded in the Persian Gulf, while more than 150 vessels have been anchored, diverted or delayed as operators reassess safety and insurance cover. That would leave an estimated 120 million to 150 million barrels of crude sitting idle at sea.
Those volumes represent only six to seven days of normal Hormuz throughput, or a little more than one day of global oil consumption.
Updated shipping and insurance data now confirm more than 150 vessels have been anchored, diverted, or delayed, up from the 85 initially reported. The 1.3 days of global consumption coverage from idle crude remains the binding constraint: this is a flow shock, not a storage problem, and the ceasefire has not yet translated into meaningfully restored throughput.
A market built on flow, not storage
Oil markets function on continuous movement. Refineries, petrochemical plants and global supply chains are calibrated to steady deliveries along predictable sea lanes. When flows through a chokepoint that carries roughly one-fifth of global oil consumption and around 30% of global seaborne oil trade are interrupted, the system can move from equilibrium to deficit within days.
Spare production capacity, largely concentrated within OPEC, is estimated at only 3 million to 5 million bpd. That falls well short of the volumes at risk if Hormuz flows are severely disrupted.
Oil market analysis
How long do idle tankers last?
135M idle barrels — days of cover against each demand benchmark
vs. Strait of Hormuz daily flow (20M bbl/day)
vs. Global oil consumption (104M bbl/day)
vs. US Strategic Petroleum Reserve release (1M bbl/day)
135M
idle barrels on tankers (midpoint of 120–150M range)
~33%
of daily Hormuz flow that is idle storage, not transit
<31 hrs
is all idle storage against global daily consumption
Inflation risks and macro spillovers
The inflationary impact of an oil shock typically arrives in waves. Higher fuel and energy prices may lift headline inflation quickly as petrol, diesel and power costs move higher.
Over time, higher energy costs may pass through freight, food, manufacturing and services. If the disruption persists, the combination of elevated inflation and slower growth could raise the risk of a stagflationary environment and leave central banks facing a difficult trade-off.
No easy offset, a system with little slack
What makes the current episode particularly acute is the lack of slack in the global system.
Global supply and demand near 103 million to 104 million bpd leave little spare cushion when a chokepoint handling nearly 20 million bpd, or about one-fifth of global oil consumption, is compromised. Estimated spare capacity of 3 million to 5 million bpd, mostly within OPEC, would cover only a fraction of the volumes at risk.
Alternative routes, including pipelines that bypass Hormuz and rerouted shipping, can only partly offset lost flows, and usually at higher cost and with longer lead times.
Bottom line
Until transit through the Strait of Hormuz is restored and seen as credibly secure, global oil flows are likely to remain impaired and risk premia elevated. For investors, policymakers and corporate decision-makers, the core question is whether oil can move where it needs to go, every day, without interruption.
Wednesdays FOMC meeting was always going to be about whether we’d see a hawkish pushback against market expectations of a dovish Fed in 2024, or a validation of those expectations, from the market reaction to the meeting, traders decided the latter is the conclusion. Rates were kept on hold at 5.35%-5.5% as expected but the updated dot plot and the language of the accompanying statement and Powell presser confirmed what most market participants were predicting, US rates have peaked, and multiple rate cuts are coming next year. This saw the USD dump along with yields with the US Dollar Index (DXY) blowing through its 200-day SMA (where it had been finding support) closing at session lows of 102.77.
The next minor support to the downside being the November swing low of 102.46. The Yen was a particular beneficiary of the dump in US yields which saw the rate differential between the US and JP 10 Year tighten significantly. USDJPY dropping to a 142 handle as it played catch up to the yields and now testing a key support level around its 200-day SMA and December lows.
Gold surged over 30 USD an ounce as a falling Dollar and yields emboldened the bulls. XAUUSD retaking the psychological 2000 USD an ounce level after finding strong support at the October Lows – December high 50% Fib level. A retest of the major resistance at 2070 could be on the cards, and is a key level to watch for gold traders.
Central bank action continues today with both the SNB and BoE scheduled to release their latest rate decisions.
American wholesale chain, Costco Wholesale Corporation (NASDAQ: COST), announced financial results for the first quarter of fiscal year 2024 after the closing bell in the US on Thursday. Company overview Founded: September 15, 1983 Headquarters: Issaquah, Washington, United States Number of employees: 316,000 (2023) Industry: Retail Key people: Hamilton E. James (Chairman), W.
Craig Jelinek (President and CEO) The results Costco reported total revenue of $57.799 billion for the quarter, which narrowly beat Wall Street analyst estimate of $57.785 billion. Revenue was up by 6% from the same period a year prior. Earnings per share (EPS) reported at $3.58 per share (up by 16.61% year-over-year), above $3.411 per share expected.
The company announced a cash dividend of $15 per share to all shareholders of the stock as of close of business on 28/12/2023. Stock reaction Shares of Costco were down by 1.75% on Thursday at $630.78 a share. The stock was down by around 1% in the after-hours as Wall Street digested the latest results from the company.
Stock performance 1 month: +9.48% 3 months: +12.16% Year-to-date: +38.76% 1 year: +36.54% Costco stock price targets Oppenheimer: $675 Evercore ISI: $650 Stifel: $615 Truist Financial: $619 Telsey Advisory Group: $625 JP Morgan: $605 Wells Fargo: $525 Loop Capital: $630 Deutsche Bank: $652 Morgan Stanley: $585 Bank of America: $610 Costco Wholesale Corporation is the 29th largest company in the world with a market cap of $281.37 billion. You can trade Costco Wholesale Corporation (NASDAQ: COST) and many other stocks from the NYSE, NASDAQ, HKEX, ASX, LSE and DE with GO Markets as a Share CFD. GO Markets now offers pre-market and after-market trading on popular US Share CFDs.
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US technology giant and one of the largest semiconductor companies in the world, Broadcom Inc. (NASDAQ: AVGO), announced fourth quarter and fiscal year 2023 results after the market close in the US on Thursday. Company overview Founded: 1961 Headquarters: San Jose, California, United States Number of employees: 20,000 (2023) Industry: Semiconductor, computer software Key people: Henry Samueli (Chairman), Hock Tan (President and CEO) The results Broadcom reported revenue of $9.295 billion (up by 4% year-over-year) vs. $9.277 billion estimate. Earnings per share (EPS) also topped analyst estimates for the quarter at $11.06 per share vs. $10.96 per share expected.
Net revenue reached $35.819 bill for the full fiscal 2023, up by 8% from the year prior. EPS reached $32.94 per share, an increase of 24.31% year-over-year. CEO commentary "Broadcom's fiscal year 2023 revenue grew 8% year-over-year to a record $35.8 billion, driven by investments in accelerators and network connectivity for AI by hyperscalers," President and CEO of Broadcom, Hock Tan, highlighted the reasons for the successful year for the company. "The acquisition of VMware is transformational.
In fiscal year 2024 we expect semiconductor to sustain its mid to high single digit revenue growth rate, with the contribution of VMware driving consolidated revenue to $50 billion, and adjusted EBITDA to $30 billion," Tan concluded. Stock reaction Shares of Broadcom ended the day up by 2.06% on Thursday at $922.26 a share before the latest results were announced. The stock dipped by around 1% in the after-hours trading.
Stock performance 1 month: +0.32% 3 months: +6.69% Year-to-date: +63.53% 1 year: +72.16% Broadcom stock price targets Rosenblatt Securities: $1000 Oppenheimer: $1100 Susquehanna: $1100 KeyCorp: $1200 Evercore ISI: $1050 Truist Financial: $995 Benchmark: $950 TD Cowen: $900 Wells Fargo: $900 Mizuho: $960 Deutsche Bank: $950 Broadcom Inc. is the 20th largest company in the world with a market cap of $378.07 billion. You can trade Broadcom Inc. (NASDAQ: AVGO) and many other stocks from the NYSE, NASDAQ, HKEX, ASX, LSE and DE with GO Markets as a Share CFD. GO Markets now offers pre-market and after-market trading on popular US Share CFDs.
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The largest US retailer of aftermarket automotive parts, AutoZone (NYSE: AZO), released its latest earnings report for its fiscal first quarter that ended on November 18, 2023, before the US market opened on Tuesday. Company overview Founded: July 4, 1979 Headquarters: Memphis, Tennessee, United States Number of employees: 119,000 (2023) Industry: Retail Key people: William C. Rhodes III (Chairman, President, & CEO), Jamere Jackson (CFO) The results AutoZone reported revenue of $4.19 billion for the quarter, slightly beating $4.188 billion estimate.
Earnings per share reached $32.55 per share vs. $31.573 per share expected. The company opened 25 new stores during the quarter in United States, Mexico and Brazil. One store was closed in the United States.
AutoZone has 7,165 stores as of November 18, 2023. CEO commentary "I want to thank all AutoZoners across the company for their efforts during our first fiscal quarter. The commitment to superior service resulted in our ability to deliver strong financial results.
Our domestic sales results were solid despite tough comparisons from a year ago, while our international business continues to deliver exceptionally strong sales growth. We remain committed to driving sales and earnings growth throughout fiscal 2024, while returning cash to our shareholders," William C. Rhodes, CEO of the company said in a letter to investors.
Stock reaction Shares of AutoZone were little changed at the end of Tuesday’s session, ending the day up by 0.26% at $2,671.12 a share. Stock performance 1 month: +0.78% 3 months: +4.50% Year-to-date: +8.31% 1 year: +8.72% AutoZone stock price targets Wedbush: $2750 Truist Financial: $2933 TD Cowen: $2975 Oppenheimer: $2600 Argus: $2920 DA Davidson: $2500 Evercore ISI: $2750 Morgan Stanley: $2750 Barclays: $2742 JP Morgan: $2975 AutoZone Inc. is the 362nd largest company in the world with a market cap of $47.10 billion. You can trade AutoZone Inc. (NYSE: AZO) and many other stocks from the NYSE, NASDAQ, HKEX, ASX, LSE and DE with GO Markets as a Share CFD.
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US software giant, Adobe Inc. (NASDAQ: ADBE), reported Q4 and fiscal year 2023 financial results after the market close in the US on Wednesday. Company overview Founded: December 1982 Headquarters: San Jose, California, United States Number of employees: 26,000 (2022) Industry: Software Key people: Shantanu Narayen (Chairman & CEO) The results Revenue reported $5.048 billion for Q4 and reached $5 billion mark for the first time (up by 12% year-over-year) vs. $5.014 billion estimate. Earnings per share (EPS) reported at $4.27 per share vs. $4.134 per share expected.
Fiscal year 2023 revenue reached a new record of $19.41 billion – a new record and an increase of 10% year-over-year. EPS reported at $16.07 per share, up by 17% from the year prior. Adobe expects revenue to reach between $5.10 to $5.15 billion in first quarter of fiscal year 2024, which would fall below analyst estimate of $5.16 billion.
CEO commentary ''Adobe drove record revenue of $19.41 billion in FY23 and 17 percent year-over-year EPS growth, with strong momentum across Creative Cloud, Document Cloud and Experience Cloud. Adobe’s strategy, category leadership, ground-breaking innovation, exceptional talent and global customer base position us well for 2024 and beyond,'' Shantanu Narayen, CEO of Adobe said in a letter to investors. Stock reaction The stock was down by 1.48% at the end of Tuesday, trading at $624.26 a share.
Share price fell by around 6% in the after-hours trading after the release of the latest results as future guidance fell short of estimates. Stock performance 1 month: +6.44% 3 months: +14.47% Year-to-date: +88.29% 1 year: +86.41% Adobe stock price targets Citigroup: $675 BMO Capital Markets: $690 KGI Securities: $730 Piper Sandler: $650 DA Davidson: $640 Oppenheimer: $660 HSBC: $519 Barclays: $640 Bank of America: $660 Adobe Inc. is the 28th largest company in the world with a market cap of $288.50 billion. You can trade Adobe Inc. (NASDAQ: ADBE) and many other stocks from the NYSE, NASDAQ, HKEX, ASX, LSE and DE with GO Markets as a Share CFD.
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Volatility never sleeps. Trade over earnings releases as they happen outside of main trading hours Reduce your risk and hedge your existing positions ahead of a new trading day Extended trading hours on popular US stocks means extended opportunities Sources: Adobe Inc., TradingView, MarketWatch, MarketBeat, CompaniesMarketCap
USD continued to run higher in Monday’s session with US yields surging to highs not seen since 2007. Beats in both US manufacturing and employment data along with some hawkish Fed Speak supporting yields. Monday’s risk tone started off upbeat after the US Congress came to an agreement over the weekend to narrowly avoided a government shutdown, however this soured during the session seeing most equities finish in the red and supporting the USD with haven flows.
DXY surged through the psychological 107.00 level its highest print since November 2022 and having its biggest up day since February. EUR fell victim to USD strength despite a similar move higher in Euro Zone bond yields. EURUSD pushing below the key 1.05 support level from highs of 1.0591 earlier in the session.
EU Manufacturing and employment data were both in line with expectations, failing to offer the Euro any extra support. Some hawkish ECB talk from member de Guindos where he dismissed talks of rate cuts also not enough to lift the single currency. Technically EURUSD has no clear support from here until the next big figure at 1.04 though it has entered oversold territory on the daily RSI which may lend some temporary support.
USDJPY rose to highs of 149.90 on the surge in US treasury yields just short of the psychological 150 level where traders seem to be wary of pushing through, cautious of a BoJ intervention. Yen weakness came despite jawboning from the Japanese Finance minister and beats in manufacturing data. Yield differentials still the driving force in USDJPY as carry traders pile in, though with some caution at these levels.
AUS and NZD were sharply lower against the USD with risk sentiment souring as the session progressed, base metals also saw pressure, seeing the AUD underperform. NZD also saw notable underperformance but was not as soft as AUD, AUDNZD falling below the key 1.07 level. A big couple of days ahead for the two Antipodeans with the RBA meeting today and RBNZ tomorrow.
Today’s RBA meeting will be the first under Governor Bullock's stewardship with markets expecting the RBA to keep rates unchanged traders will be more interested in the accompanying statement where they will be eyeing any deviations that supports another hike by year-end. Todays Calendar: