UBS On-Air: Paul Donovan Daily Audio 'Here we go again'

The US declared the Strait of Hormuz open. Iran declared the Strait of Hormuz closed. Investors have responded with a muted reaction. Oil prices are up, but not in an economically meaningful way. Shipping traffic volumes seem to give more credibility to the Iranian version, but investors’ optimism bias remains. There is an assumption that the political pain of gasoline prices in the US (which have risen again recently) will justify expectations that the current situation will be resolved.