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Stock impact report

Why the Strait of Hormuz matters [Globe and Mail, The (Toronto, Canada)]

Franklin Resources, Inc. (BEN) 
Last franklin resources, inc. earnings: 4/30 08:30 am Check Earnings Report
There is a ripple effect through natural gas (LNG), fertilizer and global shipping, which can show up later as higher electricity bills, higher food prices, and weaker economic growth. Why this chokepoint matters. Roughly 20 million barrels of oil per day (of about 110 million barrels consumed per day globally) move through this strait. In addition, a large share of global LNG shipments, and a meaningful amount of fertilizer moving by sea transit the same corridor. Any disruption doesn't just hit one market – it simultaneously stresses several critical supply chains. How markets are pricing the risk. Energy prices have jumped because markets are adding a risk premium for supply that could be disrupted. But pricing also suggests investors still expect the situation to resolve relatively quickly. That expectation shows up in a common commodity market pattern called “backwardation,” which occurs when the price of oil for immediate delivery is higher than the price for oil delivered l Show less Read more
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