Key Takeaways
- Oil prices have fluctuated around news flow and the ability of shipping to navigate the Strait of Hormuz.
- Prices fell ahead of the weekend after Iran declared the Strait open, before rising once more after shipping was again blocked.
- Equities continue to price in relatively benign outcomes with positive earnings updates (and future guidance) driving upside.
- This situation in commodity markets is more complex as real supply constraints loom into view.
- With shipping movements curtailed, energy supply issues are becoming more acute. Concerns are growing over jet fuel supplies in Europe on a four-to-six-week view.
- Volatility will likely remain a feature ahead of ceasefire negotiations.
Anthony Willis
Senior Economist, Multi-Asset Solutions team
