Yesterday, mysterious explosions rocked 2 oil tankers in the Gulf of Oman, clogging up a crucial oil supply route.
Although US authorities blamed Iran, details are still hazy. But what’s clear is that oil prices rose more than 3% as concerns mounted.
The gulf’s Strait of Hormuz is a route for ⅓ of the world’s oil — so disruptions cause mayhem in the markets.
Yesterday’s attacks — which came after 4 other attacks in the area on May 12 — suggest continued volatility, a problem for anyone who buys Middle Eastern hydrocarbons.
Now, with 2 of the world’s largest oil-producing regions — Venezuela and the Middle East — in chaos, Texas’ booming Permian basin region is suddenly a crucial point of stability in global oil markets.
Shares in US oil operations spiked significantly yesterday in response to the volatility in the market.
Most oil buyers won’t abandon their existing suppliers… yet. But if conditions continue to deteriorate, lots of global oil junkies are going to start lining up on Texas’ dusty doorstep.