Market Overview - Energy sector is the only sector performing well today due to rising oil prices following Israel's air strikes against Iran [1] - Crude oil prices are up approximately 7% [1][7] Iran's Energy Sector and Oil Exports - Iran exports about 17 million barrels of oil per day, with over 90% of these exports originating from Car Island [2][10] - Car Island, a small island in the northern Persian Gulf, is the primary export point for Iranian crude oil [2][9][10] - Israel's decision not to target Car Island is noteworthy [8][10] - Iran's oil exports are now almost entirely directed to China [8] Strait of Hormuz - The Strait of Hormuz is a crucial artery for global energy trade, only 21 miles wide at its narrowest point [4] - Approximately 20 million barrels of oil pass through the Strait of Hormuz daily, accounting for about 20% of global oil and product demand [4] - The Strait handles 34% of the global seaborne oil trade [5] - About a third of the oil passing through the Strait is destined for China [5] - Saudi Arabia, the UAE, and Kuwait also export crude oil through the Strait [5] - The Strait is the sole export route for Qatar and the UAE, which together account for about 20% of global LNG supply [6] - Energy firm Kepler suggests that a closure of the Strait could push Brent crude oil prices above $100 per barrel [6] Market Reaction - WTI crude oil initially rallied 14% overnight but is now up a more modest 7% [7] - The market is focusing on the fact that no oil supply has been disrupted [7] - Traders are exhibiting a more measured response, possibly due to past experiences where geopolitical events did not significantly impact oil supply [7]