Javier Blas on Lessons from Closing Hormuz (So Far)

Over the past five months, the Strait of Hormuz has been closed for extended stretches of time, disrupting roughly 10 to 15 million barrels of oil supply each day. It is the biggest energy supply shock in history, but global energy markets are defying historical expectations.

Despite lost production and heightened geopolitical instability, crude oil prices are far below the catastrophic levels many analysts predicted early on. But beneath the headline numbers, the broader energy system tells a far more complicated story. Refining margins have spiked to unprecedented levels, global coal consumption is pacing toward a new record high, and the ways energy moves around the world are changing in real time as the crisis continues to unfold. 

So, why hasn't this massive disruption triggered a full-blown global economic crisis? What role are China's massive strategic stockpiles, shifting demand patterns, and the ongoing energy transition playing in dampening the shock? And what are the long-term security implications for global oil refining, shipping chokepoints, and future LNG infrastructure?

Today on the show, Jason Bordoff talks to Bloomberg opinion columnist Javier Blas about how the strait closure and Iran war have impacted global energy markets so far.

Prior to joining Bloomberg in 2015, Javier held a number of roles at the Financial Times, including Africa editor and commodities editor. He is also the co-author of The World for Sale: Money, Power and the Traders Who Barter the Earth's Resources.

Credits: Hosted by Jason Bordoff and Bill Loveless. Produced by Mary Catherine O'Connor, Caroline Pitman, and Kyu Lee. Engineering by Gregory Vilfranc.