Navigating Oil: Corporate Strategy in a Volatile Market
On February 28, 2026, a conflict involving the United States and Iran began when coordinated airstrikes targeting Iranian military and nuclear infrastructure took place. In response, the Iranian military launched retaliatory missile and drone strikes targeting U.S. bases and U.S. allied countries Qatar, Saudi Arabia, and the United Arab Emirates. Alongside these military strikes, the Iranian government has taken de facto control over the crucial Strait of Hormuz. The Strait of Hormuz is a narrow waterway in the Middle East that borders Iran. The strait connects the Persian Gulf to the open ocean and is a key export pathway for oil and gas to many countries across the world. It is estimated that 20% of the world’s oil supply flows through the strait. With exports through the strait now significantly disrupted, global energy markets have begun to experience a sharp supply shock. Corporations, particularly in the energy, transportation, and manufacturing sectors, are now facing heightened regulatory scrutiny and compliance risk as they attempt to navigate significant cost pressures and operational uncertainty.