Good morning, Happy to be back in Hong Kong! The world is on fire, this time, the threat of war widening beyond just Israel and Iran but to the US and that means the gulf. Meanwhile, Japan sees core inflation rising to 3.7%YoY and this forces the BOJ to hike (it really doesn't
First, let's go through what's happening. Iran has been attacked by Israel and has shown that it is weak. Now that it is weak, it will have to fight back strongly or risk being seen weak. So it's a question of how it will surrender not whether and when. Will it do that to the US
20% of global oil consumption flows through the Strait of Hormuz. It is a narrow channel so if that gets choked up, we're looking at a big oil supply shock. Who's affected? Producers - the gulfs like Saudi, Kawait, UAE. Who are the importers? Asians, namely China, India,
84% of the crude oil and condensate and 83% of the liquefied natural gas that moved through the Strait of Hormuz went to Asian markets in 2024. China, India, Japan, and South Korea were the top destinations for crude oil moving through the Strait of Hormuz to Asia, accounting
So while we are far from the conflict here in Asia, we are affected. And yes, there are some winners. Alternative to oil like biofuel (soybeans in the US to turn into oil) and coal etc will also rise as demand will rise. In Asia, only a few net energy producers. Malaysia,