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Opinion | The Battle of Hormuz Is Turning
The U.S. Navy's recent decision to enhance enforcement in the Strait of Hormuz significantly alters the geopolitical landscape surrounding oil exports, effectively minimizing threats primarily targeting Iranian shipments. This strategic move is poised to decrease the geopolitical risk premium not only in oil markets but also in broader financial assets, particularly benefiting a stronger USD. As the region stabilizes, it’s an opportune moment for carry trades and risk-on positioning, which could shift market dynamics significantly in favor of the dollar.