Jumana Bersechi, Bloomberg Middle East correspondent reporting from Dubai, gives on-the-ground updates about tanker strikes and port evacuations near the Strait of Hormuz. She covers widening threats to shipping and how that is reverberating through global oil markets. She also discusses China’s refined-fuel export curbs and how banks are reacting in the Gulf.
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Attacks Spread Beyond Strait Of Hormuz
Attacks have expanded beyond the Strait of Hormuz to northern Persian Gulf waters and Oman's Salalah port, widening threats to shipping and energy flows.
Jumana Bersechi reports two tankers ablaze off Iraq and Oman temporarily cleared vessels from a terminal that exports ~1 million barrels a day.
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Historic Reserve Release Has Limited Short Term Impact
The IEA coordinated a record 400 million barrel release from strategic reserves to counter the supply shock, with 172 million barrels from the U.S.
Despite the release, NYMEX and Brent spiked (NYMEX ~$92.53, Brent ~$97.99) showing limited immediate relief.
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Conflict Could Slash Global Supply By Millions
Bloomberg's IEA estimate: the Middle East conflict could cut global oil supplies by about 8 million barrels per day, roughly 7.5% of global output.
The IEA calls this the biggest supply disruption in oil market history, amplifying price risk.
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Today's top stories, with context, in just 15 minutes. On today's podcast: 1) Brent briefly jumped back above $100 a barrel after the Iran war led to more shipping turmoil in the Middle East and China tightened fuel export curbs to cope with the fallout from the conflict. The global oil benchmark surged as much as 10% to $101.59 a barrel, while West Texas Intermediate rose to near $96, before paring gains. Two tankers were struck in Iraqi waters and Oman temporarily cleared ships from its key export terminal outside of the Strait of Hormuz, underscoring the widening threats to energy supply and overshadowing a record reserves release by the IEA to try and cool prices. In further signs of strain, Chinese refiners have begun canceling agreed refined fuel export cargoes, including gasoline and diesel. The country’s top processors were told last week to stop signing new contracts, and the latest directive is a step up from the earlier guidance. 2) Goldman Sachs Group Inc. and Citigroup Inc. have told staffers in Dubai to stay away from their offices as Iran’s attacks on Gulf cities continue. Goldman has instructed employees to seek permission before going into its offices across the Middle East, according to people familiar with the matter. Standard Chartered Plc also asked staff in the Dubai International Financial Centre and nearby areas to leave their offices on Wednesday, the people said, declining to be identified discussing confidential information. Several Wall Street banks have already been allowing employees in the United Arab Emirates to work remotely since the war began. Some lenders have also offered staff the option to temporarily leave the country, Bloomberg News has reported. 3) President Trump’s administration started the first of several sweeping trade investigations that set the stage for new tariffs, the centerpiece of a push to replace levies struck down by the US Supreme Court. US Trade Representative Jamieson Greer announced Wednesday that his office would begin a probe into more than a dozen major economies under Section 301 of the Trade Act focused on alleged excess manufacturing capacity. The investigations, which typically take months to complete, are required for the president to unilaterally place duties on imports from specific countries deemed to employ unfair trading practices. Economies that will be subject to the inquiry include some of the US’s largest trading partners: China, the European Union, Mexico, India, Japan, South Korea and Taiwan.
Bloomberg Daybreak: US Edition