Brent crude settled at $103.08 on Wednesday, not at $98.28. This paper owes its readers a correction. Yesterday's edition reported that the market called the war's bluff as Brent crashed below one hundred dollars a barrel, and the analysis that followed — concerning the gap between forward pricing and physical supply — was built on what turned out to be an intraday flash, not a settlement. The $98.28 figure was real in the sense that a screen displayed it for a period of minutes. It was not real in the sense that anybody who tried to take delivery at that price found it waiting for them at close.

The distinction matters because markets do not express convictions at 2:14 p.m. They express them at settlement. And the settlement said $103.08 — still elevated, still carrying a war premium that Goldman Sachs now estimates at twenty-five to thirty-two dollars per barrel above pre-conflict levels, and still well above the number at which anyone can plausibly argue the market has called anything at all [1].

Goldman, for its part, has stopped hedging. The bank raised its 2026 average Brent forecast to eighty-five dollars — up from seventy-seven — and projected that prices would reach $110 per barrel during March and April, the peak disruption window [1]. This is not the forecast of an institution that believes the war premium is dissolving. It is the forecast of an institution that has looked at the Strait of Hormuz traffic data and drawn the obvious conclusion.

That data, for anyone who missed it, is stark. On Monday, March 24, two vessels transited the Strait of Hormuz [1]. The usual daily count is between one hundred fifty and one hundred sixty. Iran is now charging approximately two million dollars per ship to pass — not a toll in any traditional sense, but an extraction that has the practical effect of reducing strait traffic to a trickle while generating revenue for a government under comprehensive sanctions [1]. The physical chokepoint that this paper has spent the past week documenting has not reopened. It has, if anything, tightened.

The gasoline market, which has the disadvantage of being the part of the oil complex that ordinary people actually experience, reflects this with uncomfortable precision. The national average price at the pump reached $4.18 to $4.22 on Wednesday, up thirty-four percent in a single month [1]. That four-week increase is the second-largest since Hurricane Katrina made landfall in August 2005 — a comparison that should give pause, because Katrina destroyed refining capacity along the Gulf Coast, while the current spike is the product of a deliberate military standoff in a waterway eight thousand miles from the nearest American gas station. The mechanism is different. The cashier does not care about the mechanism.

What happened on Wednesday's trading floor was not a market calling a bluff. It was a market flinching. Peace-talk optimism — the same species of headline-driven enthusiasm that produced Monday's whiplash and Tuesday's false break below one hundred — briefly pushed Brent below the psychological barrier in early trading. Traders who had spent the previous forty-eight hours absorbing reports of a fifteen-point American peace plan, a possible Turkish mediation channel, and presidential assurances that oil would "drop like a rock" acted on the narrative they preferred. For a few hours, the screen told a story about diplomacy winning.

Then the physical market reasserted itself, as physical markets tend to do when confronted with the difference between a draft proposal and an open shipping lane. Brent clawed back above one hundred dollars by mid-afternoon and settled at $103.08 by close. The recovery was not dramatic in percentage terms — roughly five percent off the intraday low — but it was categorical in what it communicated. The market tested the thesis that the war premium was collapsing. The war premium did not collapse. It flexed, absorbed the blow, and returned to approximately where it had been before the peace-talk headlines landed.

The broader equity context reinforces the picture. Roughly three trillion dollars in market capitalization swung back and forth over the course of this week — a figure that captures not a directional move but an oscillation, a market that cannot decide what it believes because the underlying situation does not permit belief [2]. The S&P moved in ranges that would have been newsworthy in any week that did not also feature a shooting war in the Persian Gulf. The VIX remains elevated. Credit spreads have widened. None of this is the behaviour of a market that has priced in a resolution.

This paper wrote yesterday that the forward curve was pricing a quick resolution and a return to sixty-five dollars within four to six weeks. That was an accurate description of what the forward curve was doing at the time. It was not, as the settlement demonstrated, an accurate description of what the market ultimately concluded. The forward curve priced a hope. The settlement priced a reality. The reality is that the Strait of Hormuz remains functionally closed, that Iranian crude remains offline, that the pipelines that might bypass the chokepoint remain insufficient, and that two million dollars per transit is not a price signal — it is a blockade with a receipt.

The correction this paper owes is narrow but important. Brent did not settle below one hundred dollars. It visited that neighbourhood briefly, found the rent too cheap to be credible, and left. The war premium is intact. The gasoline price is accelerating. Goldman is forecasting higher, not lower. And the market, which this paper prematurely credited with calling the war's bluff, did no such thing. It flinched, reconsidered, and went home above one hundred and three.

Markets call bluffs when they commit. This one has not committed to anything except volatility.

-- HENDRIK VAN DER BERG, London