Brent: Strait of Hormuz tensions are altering the global supply outlook – MUFG

MUFG’s Michael Wan says Brent crude has slipped below US$110 per barrel after President Trump halted a US-backed operation to assist vessels leaving the Strait of Hormuz, as negotiations with Iran continue. He emphasizes that disruptions in the Strait go beyond oil prices, potentially triggering wider shortages in products such as energy, petrochemicals, and fertilizers—placing import-reliant economies at greater risk.

Hormuz tensions pressure Brent Oil

“Brent crude dropped under US$110/bbl and the Dollar weakened after President Trump announced a pause in a US-led mission to help stranded ships leave the Strait of Hormuz, allowing time to see whether a deal with Iran to end the conflict can be reached.”

“More broadly, as we’ve noted over the past two months, the implications of disruptions in the Strait of Hormuz extend beyond oil, raising the risk of shortages across a wide range of goods, including energy, petrochemicals, and fertilizers.”

“Countries that rely heavily on Middle Eastern oil, have limited ability to shift to domestic energy sources, and depend more on imported energy and food are generally more exposed to various risk scenarios.”