Consensus is that Brent’s $90 per barrel price tag includes some $5 in political premium.

The political premium includes tankers avoiding sailing through the Red Sea, upending efficient supply from traditional routes, changing trade flows and adding costs.

And the oil price also reflects Ukrainian drone strikes on Russian refineries that shut in runs and limit product exports.

Wars in the West Asia are not new, and supply has been disrupted in the past. West Asia has 6 million barrels per day in spare capacity, including Iran.

A chunk of this spare capacity and the daily 18 million b/d in exports through the Strait of Hormuz that are primary targets when Mideast wars escalate.

source: @EI