Nine points on the screen
Brent fell 9.13 percent on Monday to $87.94 a barrel and WTI 7.94 percent to $82.22. A week earlier prices had approached $102. The reason given is military: the United States halted 13 consecutive nights of strikes on Iranian targets, and Washington issued no official explanation. What a single session priced was not a delivered barrel; it was the halt in strikes.[1]
What the route did
On the physical side the day went the other way. Iran-backed Houthis declared a maritime embargo on Saudi ports and attacked vessels in the Red Sea and the Bab al-Mandeb strait. Two numbers summarise the result: Saudi crude exports through Bab al-Mandeb stopped, and volumes carried through the Suez Canal doubled to 1.06 million barrels a day. When one exit closes the volume does not vanish, it relocates; those 1.06 million barrels moving north are the measure of how firmly the southern exit has shut.[1]
In my column two days ago I examined the divergence between rising war-risk insurance in the Red Sea and a falling futures price, and argued that the futures price understated the physical risk. What that piece lacked was the size of the rerouting; the premiums and exclusion terms were visible, the volume moved was not. The Suez Canal figure fills that gap and strengthens the argument in the same direction.[1], [2]
The threshold
The weak point in the inference is plain: the increase through the Suez Canal could reflect seasonal or contractual routing rather than the embargo, and a single day's figure cannot separate the two. What to wait for is equally plain. If the embargo holds, crude volumes through the Suez Canal stay above one million barrels a day; if it loosens, the same volume returns to the southern route and the easing Brent priced on Monday finds its physical counterpart, late. Diversions round the Cape of Good Hope, in either case, mark the most expensive end of the route.[1]