The Iran conflict is increasingly becoming a stress test for the global energy markets. Analysts see parallels to the 2022 oil crisis.
• TS Lombard rethinks forecast: conflict could last for months
• Strait of Hormuz remains a key risk factor for oil prices
• RBC and Goldman Sachs also warn of continued price pressure
The military conflict between the United States and Iran is now in its fourth week. Since then, stock markets around the world have been glowing deep red, and the price of gold is also suffering. Only the oil market thrives in this scenario.
Hopes for a quick end to the war and the associated relaxation on the stock markets are increasingly dwindling, as the analysis house TS Lombard also found.
Forecast adjusted: Months of crisis instead of a quick end
The London-based analysis house, like many other observers, expected a quick end to the Iran war in the first weeks. The tide has now turned: As MarketWatch reports, TS Lombard has noticeably revised its expectations upwards.
Instead of a short period of increased uncertainty, the situation could drag on for significantly longer. “The return to normal business in the global oil market could now take months, not weeks,” the assessment says.
This is shaping up to be a course that, according to TS Lombard, could be as long as the energy shock of 2022. At that time, geopolitical tensions kept oil prices high for months. TS Lombard now sees the duration of the current conflict as ranging from several weeks to around five months.
Strait of Hormuz as a decisive means of pressure
Why the situation could drag on for so long has particularly to do with the strategic importance of the Strait of Hormuz. According to TS Lombard, Iran has established an effective means of pressure here. The country can allow its own exports to continue, but at the same time paralyze international shipping traffic.
Relaxation depends above all on whether safe transport routes can be guaranteed. “The power to reverse the price shock remains with the USA,” TS Lombard expert Christopher Granville is quoted as saying via MarketWatch. The prerequisite would be free passage for tankers through the strait. This is exactly what there are currently doubts about. In addition, important infrastructure such as the export hub Kharg Island has also become a factor of uncertainty.
Other analyst firms are also uncertain about the sudden end of the war
TS Lombard is not alone in this assessment. Other large houses are also becoming more cautious. According to RBC Capital, the conflict could drag on much longer than initially thought. In discussions with political decision-makers, it became apparent that a combination of expanded US war aims and Iran’s military capabilities could drag the conflict “well into the spring.”
This would have noticeable consequences for the markets. RBC expects that oil prices could initially rise above the highs from the Ukraine crisis in 2022. “We believe we will surpass $128 a barrel if the war continues for another three to four weeks,” the analysis said.
Goldman Sachs is also already seeing movement in the market. Analysts are talking about an increased risk premium on the oil price. This primarily reflects the uncertainty about how severely supply chains could be affected. What remains crucial is how long and to what extent transport through the Strait of Hormuz will be disrupted.
Markets between hope and structural risk
There is a mixed picture on the financial markets so far. On the one hand, many investors are still betting that political solutions will be found. On the other hand, nervousness is growing. Above all, the uncertainty about the duration of the conflict is causing reluctance – although US President Donald Trump initially postponed previously threatened attacks on Iranian energy infrastructure due to “very good and productive discussions”.
Benedict Kurschat, editorial team at finanzen.net
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