The conflict involving Iran and a U.S.- and Israel-led coalition has removed 2.6 billion barrels from global oil supply. Strait of Hormuz traffic has dropped to just 10% of its normal level. Markets are pricing in a low likelihood of normalization by August 31, with the YES outcome at 13.5%, and only 2.3% for mid-August normalization. This situation reflects a severe disruption to global oil markets and deep investor skepticism about any near-term resolution of the conflict.
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