Oil gives back gains after U.S. strike: Here's why

Oil Market Dynamics - Oil prices initially spiked following US strikes on Iran but later decreased [1] - US oil production direction is likely flat to down, despite potential incentives from higher oil prices [3] - Easing permitting processes in areas like Alaska could incentivize more drilling [6] - OPEC is adding 400,000 barrels a day, increasing global oil supply [7] Geopolitical Risks & Shipping - The Strait of Hormuz has never been closed, even during the Gulf War [8][9] - Increased risk in the Strait of Hormuz has led to shipping day rates rising from $24,000 to $100,000 per day [10] - Almost all exported Iranian oil is bought by China [11] - Potential disruptions could occur at Bab el Mandeb strait and the Suez Canal, in addition to the Strait of Hormuz [13] Iranian Oil & Sanctions - Iran exports 15 million barrels of oil a day, despite sanctions [15] - Disruption of the Strait of Hormuz would be economic suicide for Iran, as 90% of its oil is exported from Kharg Island [14]