Persian Gulf oil squeeze is disrupting global markets

An apparent order telling ships to avoid the Strait of Hormuz slowed tanker movements, prompting regional output cuts and a rise in oil prices above $100 a barrel.

An apparent recording telling ships not to enter the Strait of Hormuz circulated in industry groups and coincided with a sharp slowdown in tanker traffic. Hundreds of vessels are reported to be waiting to transit, and some merchant ships were struck in recent days. Regional producers have reduced or slowed output as storage fills, while some exporters signaled production cuts to avoid overflowing tanks. U.S. energy officials said energy would flow soon, but the situation remains unsettled. Key facts: - An apparent instruction to avoid the Strait of Hormuz spread through industry channels and reduced tanker movements. - More than 1,000 ships were reported waiting to pass the strait, and a number of vessels were attacked in the period described. - Several Gulf producers have curtailed or slowed production as storage capacity nears limits, and some companies declared force majeure in related commodities. - U.S. Energy officials publicly said shipments would resume, while oil prices rose above $100 a barrel amid the disruption. Summary: The disruption has tightened global energy flows and pushed commodity prices higher, with immediate effects on shipments and regional output. Undetermined at this time.