FINANCIALS: Black & Blue Owl

Today, the 32-member countries of the International Energy Agency unanimously approved a coordinated emergency oil release of 400 million barrels, the largest in its 52-year history. The effective closure of the Strait of Hormuz has removed approximately 20mbd of oil from the global market. That implies the IEA is providing 20 days' worth of relief oil supplies and that the group expects a short war. The price of a barrel of Brent crude oil is up about $6.50 this evening to $98.68, suggesting the market doubts a short-war scenario.

We started to doubt a short-war narrative three days after the war began. We are now starting to worry more about the stability of the private credit market if the oil shock persists and weakens the US economy. By some estimates, at a sustained crude oil price of $100 per barrel, the "Oil Tax" would wipe out the increase in tax refunds attributable to last year's One Big Beautiful Bill Act (OBBBA).