It seems to be the question many in the energy markets are asking. We are about to enter the ninth month of the Iran war. Or Iran "conflict." At this point, it's not very clear what to call it. The only thing right now that's "clear" is that very little is clear.
Oil is moving through the Strait of Hormuz. Most Gulf nation export volumes are well up from their lows. Iran volumes are the exception. Those are down to the point of almost being nonexistent. From the little information that trickles out of the mostly closed country, it seems the Iranian economy is crumbling. Iran's currency is losing value, and people I speak with who have family there tell me they are increasingly worried about more economic pain ahead.
Iran has one main source of money: oil. Without oil, there is little money. Without money, there is little ability to buy the weapons, drones, and missiles that cause havoc and spread fear in the Gulf. Iran is going to grow more desperate, which makes Iran even more dangerous. In just the last week or so, multiple ships have been attacked. Iran's proxy gang - the Yemeni terror group known as the Houthis - has recently killed civilians in Saudi Arabia with attacks on the airport. They also blew up part of Aramco's headquarters.
The point is this is not just a grim recap of where we stand, but an attempt to understand where we're going. As I've said and written before… I have no idea. I'm not sure that anyone really does. The best we can do is gather as much information and intelligence as possible and make educated guesses. Sorry to say it, but right now, guessing is what many are doing. The markets remain one good or bad headline away from a $10 move in oil in either direction.
While we wait, oil markets stay elevated. The paper price of oil is around $100 per barrel. Most companies and countries don't use "paper" oil. As I wrote last week, the price of an actual physical barrel of oil is much, much higher than what you see on your screens. In some cases, it may be double.