Strait of Hormuz, a major development! Iran announces that ships from these countries can pass safely! Saudi Aramco also has breaking news!

The most critical variables are changing!

On March 25 local time, Iranian Foreign Minister Amir-Abdollahian stated in an interview with Iranian state media that vessels from countries such as China, Russia, Pakistan, Iraq, India, and Bangladesh have safely passed through the Strait of Hormuz.

Additionally, Reuters reported that three insiders disclosed on Monday that Saudi Aramco, the world’s largest oil exporter, will reduce crude oil supplies to Asian buyers for the second consecutive month in April, following disruptions to trade via the Strait of Hormuz due to the war between the U.S. and Israel and Iran.

Today, the Asia-Pacific market remains under pressure. Aggregate data shows that since the start of the Iran conflict, global investors have withdrawn about $52 billion from Asian emerging market stocks (excluding China), marking the largest recorded monthly outflow.

Vessels from these countries are allowed to pass

According to CCTV International News, on March 25 local time, Iranian Foreign Minister Amir-Abdollahian stated in an interview with Iranian state media: “The U.S. forces Iran to demonstrate control over the Strait of Hormuz—thinking Iran is bluffing and lacks the courage to do this, but Iran did it. The U.S. used all its capabilities to stop this, but failed.”

Amir-Abdollahian reiterated, “The Strait of Hormuz is not completely closed, only closed to the enemy. The region is a war zone, and there is no reason to allow the vessels of the enemy and its allies to pass. For friendly countries of Iran, or in cases where Iran decides to facilitate passage for other reasons, the Strait of Hormuz is safe for passage—vessels from China, Russia, Pakistan, Iraq, India, and Bangladesh have safely passed through the Strait of Hormuz.”

In addition, Saudi Aramco plans to reduce crude oil exports to Asian buyers next month. Sources say the producer will only supply Arab light crude oil exported from the Red Sea port of Yanbu to long-term customers in April, leading to tight supplies for Asian refineries and limiting their refined oil output. The company stated in a release that Saudi Aramco will continue to utilize alternative export routes from Yanbu to respond to the changing regional situation and ensure reliable energy supplies. “We are always committed to meeting customer expectations, have adjusted loading plans to reflect the new realities, and will keep customers informed of the latest developments.”

Data from analysis firm Kpler shows Saudi Arabia’s daily crude oil exports so far in March have averaged 4.355 million barrels, down from 7.108 million barrels in February. The producer is trying to increase crude oil exports through Yanbu to offset transportation disruptions in the Strait of Hormuz.

The stock market is still under pressure

This afternoon, Asia-Pacific stock markets continued to plunge. Japan’s Nikkei 225 index fell by 1%, and South Korea’s KOSPI index dropped nearly 3%. A-shares and Hong Kong stocks also experienced increased volatility.

Aggregate data shows that since the start of the Iran conflict, global investors have withdrawn about $52 billion from Asian emerging market stocks (excluding China), marking the largest recorded monthly outflow. Oil-importing economies like India and South Korea led the sell-off, as soaring crude oil prices raised concerns about inflation and growth.

These outflows have exceeded those related to the pandemic and the Ukraine war, as investors turn to markets less vulnerable to energy shocks. Analysts at Morgan Stanley pointed out that Asia’s vulnerability to energy costs, combined with a strong dollar and profit-taking in tech stocks, has exacerbated the stock market downturn.

Several Wall Street financial leaders and institutions have issued warnings, emphasizing that the destruction and uncertainty of the Ukraine war and the ongoing pandemic will loom over the market for a long time, and investors should remain vigilant rather than follow blindly.

Former Goldman Sachs CEO Lloyd Blankfein stated that even if a peace agreement is reached tomorrow, the damage to infrastructure and psychological stress caused by the Ukraine war will persist. Current market sentiment is overly complacent. Stock strategist Tom Lee noted that if peace talks succeed, it would be a turning point for the stock market, but currently, we are still in the fog of war with mixed information. Investors should approach the currently conflicting messages with caution. Top economist David Rosenberg believes that broader war risks have not dissipated.

Typesetting: Luo Xiaoxia

Proofreading: Liu Xingying