Market Priced for Risk, Not Disruption: Fmr. WH Advisor

• Markets are underpricing the current energy disruption, which is the worst the world has ever seen, focusing on risk rather than actual disruption.
• Significant supply losses (12M bpd oil, 20% LNG, 5M bpd products) are already impacting global markets, leading to demand destruction in various countries.
• The conflict is expected to last longer than market expectations, and there is no clear plan for its resolution, exacerbating market uncertainty and price volatility.
• Rising fuel costs (e.g., diesel over $5) are rippling through supply chains, increasing consumer prices and impacting global economies.

Amos Hochstein asserts that financial markets are significantly underpricing the severity and duration of the current global energy disruption, which he describes as the worst ever. He highlights ongoing supply losses across oil, LNG, and refined products, leading to demand destruction and rising costs globally, with no clear end in sight for the conflict.