UBS On-Air: Market Moves UBS On-Air: Paul Donovan Daily Audio 'Tariffing Hormuz traffic?'
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Mar 31, 2026 Discussion about a possible US pullback from the Gulf and the implications for control of the Strait of Hormuz. Exploration of how an Iranian toll on shipping could act like a trade tariff and push oil prices higher. Coverage of recent tanker attacks and regional security risks. Notes on who might bear defense and war costs and potential shifts in Gulf arms buying.
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Hormuz Toll Acts Like Tariffs
- A US withdrawal from the Gulf could leave Iran effectively controlling the Strait of Hormuz and imposing a de facto toll on shipping.
- Paul Donovan compares that toll to US-style tariffs, meaning oil flows might resume but at higher prices reflecting an Iranian 'toll'.
Tanker Strike Near Dubai And Who Pays
- Iran appears to have hit a fully laden tanker near Dubai, showing the conflict's real-world disruption to shipping and energy routes.
- The White House has suggested Gulf states might be asked to pay war costs, complicating regional reconstruction and defence spending choices.
War Could Reroute Petrodollar Flows
- The war could shift Gulf defence procurement away from US suppliers toward other vendors, changing how petrodollars are recycled.
- That reallocation would increase petrodollar flows into non-dollar currencies over time.