Hormuz Ship Traffic Collapsed 98%: Fuel Is Up 80% and Rising

Let's do the math on how bad this is. Before the US-Iran conflict kicked off, 135 ships per day moved through the Strait of Hormuz. Right now, according to Bloomberg's midterm election coverage, that number is sitting somewhere between 2 and 12 vessels daily. That's not a supply chain hiccup. That's a supply chain cardiac arrest.

The price tags are following accordingly. Jet fuel is up 80%. Shipping fuel is up 70%. Diesel is up 20% across 95 countries. A Reuters study confirms US consumers are absorbing the sharpest fuel cost increases of anyone, which tracks perfectly with Bloomberg's reporting that affordability and inflation are the dominant voter concerns heading into Tuesday's midterms. Nothing focuses the electorate like paying $7 for a gallon of gas.

Social sentiment is doing that thing where it splits into two very loud camps. Felix Nikolas Prehn on YouTube is pointing out the wild disconnect: the S&P 500 is somehow up roughly 10% since the war began despite oil surging over 50%, powered by AI earnings and 3.4% GDP growth. Meanwhile, the jeremiah babe crowd is screaming about tanker mines, nuclear risk, and $5 trillion wiped from the Nasdaq 100 since October 6th. Both groups have a point, which is the most annoying kind of market moment.

The Nasdaq did flirt with its third 10% correction of the year, bouncing off the 200-day EMA. The Traveling Trader on YouTube notes that historically the Nasdaq is green 83% of the time six months after touching that level, and the S&P 500 is up 100% of the time twelve months after midterms. Great stats. Also, none of those prior midterms involved tanker explosions and limpet mines in one of the world's most critical shipping chokepoints, so, grain of salt.

The VIX spiked 12.91% on October 30th to 19.42, which is elevated but still nowhere near the kind of panic you'd expect from four burning tankers and a war that's been running for eight months. Either the market knows something, or the market is in deep denial. The falling 10-year Treasury yield, now at 4.93%, suggests at least some money is quietly moving toward safety while the retail crowd argues about it on YouTube.

Qatar is the only regional market doing anything interesting, surging against broader Gulf declines as it plays host to Iran-US mediation talks now in their third day. If those talks fail, watch oil's fourth consecutive monthly gain turn into something much more uncomfortable for every airline, logistics company, and commuter on the planet.