Calm Holds Around Strait of Hormuz as Iran Weighs US Peace Proposal
Tensions around the Strait of Hormuz have eased while Iran continues to weigh Washington's peace proposal, with Asian oil importers closely monitoring signals on supply stability.
Tensions around the Strait of Hormuz have eased noticeably compared with the heat of recent weeks. According to the Economic Times, Iran continues to consider the peace proposal handed to it by Washington. While Tehran has yet to issue an official decision, global oil markets are pricing in cautious optimism.
Major Asian oil importers, led by India, China and Japan, are closely monitoring the safe passage of tankers through the strait. Indian refiners are keeping contingency plans tight against any short-term supply shocks; Air India was forced last week to cut staff and flights. Trump's comment that the war will be 'over quickly' has met a mixed response in markets.
International analysts believe that the longer Iran takes to respond, the longer a risk premium will remain embedded in oil prices. Asian energy stocks and airlines started the week cautiously. Even as the strait quiets, regional military presence and insurance premiums are likely to stay elevated.
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