Podcast: The Iran podcast – Where do we go from here?

In this episode of Sparta Market Outlook Podcast, host Felipe Elink Schuurman and analysts Neil and Michael dive into the escalating tensions in the Persian Gulf, focusing on the Iran-Israel airstrikes and their ripple effects on global oil and shipping markets. The discussion explores the potential for U.S. involvement, the strategic weakening of Iran’s proxies, and the resulting market volatility, including spiked freight rates and disrupted oil flows. They analyze the low-probability but high-impact risk of a Strait of Hormuz closure, its implications for crude and product markets, and the trading opportunities arising from mispriced spreads, all while emphasizing the need for caution in an unpredictable geopolitical landscape.

Key Points:

• Risk of a protracted conflict rises but the market sees Hormuz closure as tail-end.
• High volatility has made some arbs unsustainable already.
• Light ends vs middle distillates; relative spreads depend on Iran-only disruption vs worst-case regional disruption to oil flows.
• Freight rates have spiked and fixtures slowed until the market understands next level of risk.
• Oil assets are vulnerable, as shown already in this weeks news.