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  • 6/17/2025
Energy security expert at the Brookings Institute Samantha Gross says oil prices usually factor in supply uncertainty.

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00:00We saw prices jump a bit to factor in a bit more risk, but the kind of risks that you
00:07spoke about in your intro, about the Strait of Hormuz potentially being disrupted, are
00:12not priced in right now. Because at this moment, markets are well supplied. It's just there's
00:18definitely traders are on edge about what might possibly happen based on the conflict
00:23that we're seeing.
00:24From what you've seen, would you conclude it's not Israel's goal to rattle international
00:29markets?
00:31I don't think it's Israel's goal to rattle international markets. They have attacked oil
00:37facilities in Iran, but they're primary facilities that serve the Iranian public. They're not
00:43facilities that are focused on exports. However, the real question for markets going forward
00:48is how Iran will react to the reaction to the Israel attacks. And will they do something
00:55to interrupt shipments, not just not of their own, but of the other Gulf producers because
01:00of their control of the Strait of Hormuz?
01:03So how likely would you say these actions are on Iran's part?
01:08You know, it's a really difficult question. It's not something that anyone wants to see
01:13happen, likely including the Iranians. But it's the kind of action they might take if they
01:18really feel like they're pressed against the wall. Because this is the kind of action that could
01:24really draw more countries into the conflict. If they were to disrupt shipping through the Strait of
01:30Hormuz, they would be disrupting shipping from the other Gulf producers, like the United Arab
01:35Emirates, or Saudi Arabia. And there's already not a lot of love lost between Iran and those countries,
01:42countries, plus the impact that it would have on global markets, on the global economy. This could
01:48really widen the conflict in a way that could be problematic for Iran. But it's the kind of thing
01:54they might take if they don't feel like they have other options.
01:57If it's widened, if this conflict is drawn out, will that affect risk calculations and ultimately prices?
02:05Oh, absolutely. I mean, the real question is how long this conflict goes on,
02:10how deeply it's felt in Iran, and what they feel like they need to do in order to get out of the
02:17conflict. Blocking oil shipments is the kind of thing that they would only do if they really felt
02:22like they didn't have other good options, because it has such severe consequences. But it's hard to
02:28say what might happen if they really do feel like they're in a bad way.
02:32Finally, with what we're seeing with these blows being traded, and then oil prices retreating,
02:38could the markets be underestimating the extent of the current crisis?
02:43Well, it's really hard to say. I mean, it depends on what happens over the coming days.
02:49Markets will react very quickly if they see greater risk building up. So they're building
02:53in the risk that they see now, but that could change rapidly if the situation changes.
02:58Samantha Grose, Director of Energy Security at the Brookings Institute,
03:02joining us there from Washington. Thank you for speaking with us.
03:05My pleasure.

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