Keep an eye on oil stocks, like Exxon Mobil (XOM).
All as tensions boil over between the U.S. and Iran after the U.S. destroyed Houthi boats. In response to that, Iran sent the Alborz destroyer through the strategic Bab el-Mandeb Strait, adding that it “periodically conducts” operations in the Red Sea to secure shipping routes.
Unfortunately, this doesn’t appear to be a check on shipping routes.
“Any escalation of conflict in this region is certainly going to add more of a risk premium on Brent,” Bernstein’s Senior Energy Analyst Neil Beveridge told CNBC. “We haven’t seen the Iranian naval incursions before. And as long as it really doesn’t lead to any escalation, then I don’t really see any significant impact at this level,” he added.