Iran has closed the Strait of Hormuz, one of the world's most critical energy chokepoints, sending European natural gas futures sharply higher. WTI and Brent crude futures both rebounded to pre-Friday levels following the closure. The strait handles roughly 20% of global oil trade, making any disruption an immediate supply shock.
Energy prices spiking at the source means higher costs ripple through the entire economy — from airline fuel bills to heating costs to manufacturing inputs. Energy stocks (XLE, XOM, CVX) typically benefit from supply shocks like this, while consumer discretionary, transportation, and industrials face margin pressure. If the closure holds, inflation expectations will rise, complicating the Fed's path to rate cuts.
Ongoing: Monitor whether Iran's closure is enforced or symbolic — duration is everything. Watch for a U.S. or allied naval response in the Persian Gulf. Next EIA weekly petroleum inventory report will reflect any immediate supply disruption. Any emergency OPEC+ statement could either calm or amplify the move.
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