Thummel: Energy Volatility Hinges on Strait of Hormuz Traffic, Investing in Infrastructure

Rob Thummel says energy-market volatility should dissipate but only after a multi-month period once ship traffic through the Strait of Hormuz normalizes; he cautions it won’t happen any time soon. Implication: oil price volatility and energy risk premia may ease over months, lowering sector-specific risk for portfolios but offering no immediate reduction in market stress.

Analysis

Rob Thummel says energy-market volatility should dissipate but only after a multi-month period once ship traffic through the Strait of Hormuz normalizes; he cautions it won’t happen any time soon. Implication: oil price volatility and energy risk premia may ease over months, lowering sector-specific risk for portfolios but offering no immediate reduction in market stress.