Not like a switch

Markets cheered yesterday’s temporary ceasefire with Iran and the announced reopening of the Strait of Hormuz.
However, the situation remains fragile, particularly given ongoing tensions in Lebanon. More importantly, normalization of trade flows will not happen overnight. According to JP Morgan, it may take up to three months for tanker traffic to return to normal levels.
This lag matters. Even with de-escalation, the economic impact of disrupted flows will persist in the near term and should not be underestimated.