JPMorgan Economist Sajjid Chinoy on India’s Biggest Dangers from an Extended Iran Conflict

GIVEN WHAT WE SEE IN THE MARKETS, PERHAPS THIS MARKET COULD BE LONGER THAN WE THINK. DURATION IS THE KEY. IF THIS WERE TO GO ON FOR WEEKS AND MONTHS, THEN IT REPRESENTS A BIG MAC OR SHOCK.THE KEY CONSTRAINT IN THE NEAR TERM OVER THE BINDING CONSTRAINT WILL BE STORAGE FACILITIES IN EACH OF THESE OUTLYING PRODUCERS. IT IS WITH THE STORAGE CONSTRAINT THAT PRODUCTION BEGINS TO SHUT DOWN AND WHEN PRODUCTION SHUTS DOWN, YOU HAVE A HIGHER IMPACT OF HIGHER PRICES. WE SHOULD NOT FORGET THAT BEFORE THE CONFLICT START ...