The status quo of the Iran conflict is unsustainable; stockpiles are running low. A ceasefire deal is fragile, and Iran retains leverage via the Strait of Hormuz. If the strait remains closed, expect significantly worse conditions in H2 2026, with energy and food security issues, though some sectors (tech, logistics) may find opportunities.

Mitsui's US gas business is performing above plan and represents over a quarter of net earnings. The company is looking to expand LNG and gas chemicals investments globally (US, Middle East, Australia, Africa) to meet rising demand from AI data centers. Hori calls for urgent reopening of the Strait of Hormuz.

Global oil supply has dropped by 14-15 million barrels per day over the past months, eating through strategic and commercial stockpiles. Even if a deal is signed, it will take time to refill inventories. Expect a knee-jerk selloff on a deal, but then higher-for-longer prices with continued volatility. China may resume buying if Brent falls below $80.

The Iran war is an economic war for India, with high import dependency for crude and natural gas. Rising import bills are leading to current account deficits and pressure on the rupee. India is bracing for a bigger impact over a longer period and is intensifying energy diversification efforts, including expanding strategic reserves with UAE.