JP Morgan flags Strait of Hormuz normalization probability near 30%
JP Morgan says the U.S.-Iran situation holds steady, cutting the probability the Strait of Hormuz returns to normal before year-end to roughly 30% and urges watching refined-product crack spreads.
JP Morgan says the U.S.-Iran situation held steady this week, lowering the probability the Strait of Hormuz will return to normal before year-end to roughly 30%.
The bank notes the U.S. is inclined toward an "unprecedented" campaign of economic pressure, while Iran's short-term interests and incentives for action may not align.
Monitor refined-product crack spreads (gasoline/diesel prices minus crude costs), a proxy for refinery margins and product tightness, for signals that Hormuz conditions are materially normalizing or deteriorating.