Oil Hits 2022 Highs on Hormuz Shock as Permian Stays Mute, Majors Pivot to Canada

Brent crude surged over 6% to above $118/barrel—highest since 2022—while WTI reached $107 amid Strait of Hormuz disruptions cutting Persian Gulf output by 14.5 million bpd and record inventory drains of 11-12 million bpd. UBS warns markets underestimate the shock's persistence, forecasting prices 30-40% higher for six months as supply lags recovery to January levels until year-end. Oil majors like Shell sealed a $16.4B ARC Resources deal, chasing stable Canadian Montney shale amid M&A surge, but Permian producers prioritize shareholder returns over new rigs despite elevated prices. Markets largely shrug off risks amid resilient equities.