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Iran Conflict Spurs Global Search for New Trade Routes
15 Jun
Summary
- US investment firm KKR sees increased focus on supply route security.
- Gulf nations seek alternatives to the Strait of Hormuz due to conflict.
- Markets may underestimate oil price outlook by up to $10 a barrel.
The ongoing conflict involving Iran is prompting a significant global shift towards securing alternative supply routes for goods. US investment firm KKR observes that businesses worldwide are increasingly prioritizing 'the security of everything,' encompassing access to vital resources such as minerals, energy, food, semiconductors, and water.
Gulf nations, heavily reliant on the Strait of Hormuz for trade, are proactively seeking new transit options due to the waterway's vulnerability. This strategic pivot aligns with a broader international trend focused on supply chain resilience.
KKR also suggests that current market valuations may underestimate the future outlook for oil prices over the next 12 to 18 months, with potential increases of up to $10 a barrel, even if a definitive peace agreement is reached.
