Iran conflict boosts coal demand as Strait of Hormuz remains closed: WSJ
The ongoing conflict involving Iran has led to significant disruptions at the Strait of Hormuz, impacting global energy markets. As a result, there has been a notable increase in coal demand as countries look for alternative energy sources. Market predictions indicate a decreasing likelihood of normal traffic through the strait in the near future.
- ▪The conflict has caused disruptions at the Strait of Hormuz, a key maritime route for oil and LNG supplies.
- ▪The closure of the strait has led to a resurgence in coal demand as nations seek alternative energy sources.
- ▪Market participants are increasingly doubtful about the likelihood of normal traffic resuming by the end of May or July 31.
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## Market Snapshot The market for “Strait of Hormuz traffic returns to normal by July 31” is priced at 42.5% YES, down from 46% 24 hours ago. For the “Strait of Hormuz traffic by end of May” scenario, the market is at 4.2% YES, previously at 6%. Meanwhile, the market on “Trump’s Hormuz blockade announcement by May 31” reflects a 19.5% YES probability, down from 24%. ## Key Takeaways – The ongoing Iran conflict appears to be reducing the likelihood of normal Strait of Hormuz traffic by both the end of May and July 31. – The WSJ report suggests that the closure of the Strait has led to a resurgence in coal demand, impacting related energy markets. – Pricing trends indicate that market participants view the potential for a US blockade lift announcement by May 31 as increasingly unlikely.
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