Why Global Jitters Could Fortify Your Portfolio
The Achilles’ Heel of Global Trade
Let’s be honest. Every time a politician in the Middle East clears their throat, the energy markets get a nasty case of the jitters. Iran’s recent military games in the Strait of Hormuz were a perfect, if theatrical, reminder of a simple truth. The world’s oil supply is precariously balanced on a few geographical knife edges.
When you learn that a fifth of the entire planet's daily oil consumption squeezes through a waterway just 34 kilometres wide, you start to see the problem. These so called chokepoints, whether it's Hormuz or the Suez Canal, are the Achilles’ heel of global trade. They represent a fundamental vulnerability, and in a world that feels increasingly unstable, I think that vulnerability creates a rather straightforward opportunity for those paying attention. When things get tense, where does the smart money look for safety?