Cambridge Associates warns Iran war leaves markets with less energy slack, raising portfolio risk
USO•Cambridge Associates flagged rising portfolio risk from the Iran war as refined-fuel and LNG shortages tighten despite recovering crude exports. Global oil stocks fell 507 million barrels from February to August, while August Gulf refined-product exports were nearly 60% below pre-war levels.
1. Energy supply tightens
Cambridge Associates said its base case is for a simmering conflict, partial energy flows, volatile costs, higher freight rates and higher insurance premiums. IEA data showed global oil stocks fell 507 million barrels from February to August, reducing capacity to absorb new disruptions.
2. Portfolio measures
August Gulf refined-product exports fell to 3.7 million barrels per day, nearly 60% below pre-war levels, lifting fuel prices. Cambridge Associates advised stress-testing liquidity and obligations, trimming overlapping exposures and adding distinct return drivers beyond equities and sovereign bonds.
