Stock futures dip after report Trump considering plans to occupy or blockade Kharg Island, drones strike Kuwait’s largest oil refinery
After a small relief rally yesterday afternoon, as Israeli Prime Minister Benjamin Netanyahu said his country is helping with US efforts to open the Strait of Hormuz, risk assets like stocks are once again under pressure.
Futures on the S&P 500 are currently off 0.5%, a downturn seemingly catalyzed by a new report from Axios, which states that President Trump is exploring plans to “occupy or blockade” Kharg Island.
Citing four sources familiar with the matter, Axios highlights that any attempt to take Kharg Island — a small island of just 16 square kilometres that processes 90% of Iran's crude oil exports — would put U.S. troops more directly in the line of fire.
From a markets perspective, however, the most important detail might be the timeline, with Axios quoting one source as saying:
We need about a month to weaken the Iranians more with strikes, take the island and then get them by the balls and use it for negotiations.
Up to a month’s more strikes and disruption of global commodity markets before beginning a potentially risky land assault isn’t exactly what investors will want to hear currently, as Brent Crude remains north of $110 per barrel after another Iranian drone attack on the Mina al-Ahmadi refinery in Kuwait, which processes about 730,000 barrels of oil each day, per Al Jazeera.
Citing four sources familiar with the matter, Axios highlights that any attempt to take Kharg Island — a small island of just 16 square kilometres that processes 90% of Iran's crude oil exports — would put U.S. troops more directly in the line of fire.
From a markets perspective, however, the most important detail might be the timeline, with Axios quoting one source as saying:
We need about a month to weaken the Iranians more with strikes, take the island and then get them by the balls and use it for negotiations.
Up to a month’s more strikes and disruption of global commodity markets before beginning a potentially risky land assault isn’t exactly what investors will want to hear currently, as Brent Crude remains north of $110 per barrel after another Iranian drone attack on the Mina al-Ahmadi refinery in Kuwait, which processes about 730,000 barrels of oil each day, per Al Jazeera.
