Analyst: The market is not betting on the long-term closure of Hormuz or a third oil crisis.

Ryoji Musha, president of Japan's Musha Research, said that the pessimism reported in the media is far from the actual market behavior and should not be ignored. Since the outbreak of the Iran conflict on February 28, the S&P 500 index has regained all lost ground and returned to a level just 1% below its historical high. Although the prices of recently delivered crude oil futures remain high, the prices of contracts delivered six months later have fallen back to the $70 range. Therefore, the market does not assume that the Strait of Hormuz will be closed for a long time, nor does it assume that a third oil crisis will occur. In addition, Musha pointed out that the world economy's reliance on oil is no longer as high as it was in the 1970s, and the share of oil in Japan's energy structure has decreased from 76% during the first oil crisis to 35% in 2024. Alternative routes such as oil pipelines from Saudi Arabia and the UAE already exist, and it is not in Iran's interest for the Strait of Hormuz to be closed for a long time, as it is also a lifeline for Iran's trade. Japan is still vulnerable to the impact of rising energy imports and transportation costs, but the way the market is trading no longer resembles the pattern of a full-blown oil crisis.