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Strait Of Hormuz Closed!

By Shain Vernier6th Dec 2023 4:40 PM
Key Level0.00001
Next Level0.00002
Pips+1

Welcome to Thursday’s trade! Without question, the markets are trading in a fragile equilibrium right now. Although a ceasefire is technically in place in the Middle East, the reality on the ground is telling a very different story.
The key issue: the Strait of Hormuz remains effectively closed.
Despite the ceasefire announcement, shipping traffic through the world’s most critical energy chokepoint is still severely restricted, with only a fraction of normal vessel flow getting through. That’s the disconnect markets are grappling with—headline peace, but no functional normalization.
Crude oil prices have rallied sharply back above $100, with both Brent and WTI jumping more than five percent as traders price in prolonged supply disruption. There are now hundreds of tankers effectively stranded, with millions of barrels sitting idle, unable to move through the region. While it’s true that there is a ceasefire, no clear framework for restoring normal shipping conditions exists. Markets aren’t pricing peace—they’re pricing uncertainty.
Here’s the bottom line: crude is leading, geopolitics is driving, and the macro implications are building. A closed Hormuz keeps inflation risk alive, complicates central bank expectations, and adds another layer of instability just as markets were looking for clarity.
We’ll cover the current situation and more on today’s US session live stream (1:00 PM EST, Switch Markets on YouTube). See you there!

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Other
Key Level 0.00001
Next Level 0.00002
Pips +1
GBPAUD
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