Daily update
Daily update
- The UAE’s imminent departure from the OPEC oil cartel is the most significant to date. Near term, there is little impact—oil prices are primarily influenced by Iran. Longer term, it may mean more supply, although OPEC’s influence in broadly defined energy supply is likely to decline at an accelerated pace with electrification. The move may signal a more urgent need for revenue by the UAE—reflecting reconstruction, rearmament, and the loss of revenues from oil, tourism, and nomadic wealth.
- Media reported that US President Trump suggested a lengthy US blockade of the Strait of Hormuz. Markets are unlikely to give too much weight to this. US political pressures seem to be increasing—Trump’s approval rating hit an all-time low in the Reuters/IPOS poll; approval of the President’s handling of the cost of living was 22%.
- Spanish and German April inflation data should show a modest increase in the yearly rate. Spain has the mitigation of massive solar electricity generation, and Germany focused on energy efficiency four years ago. Neither offset the loss of oil flows, but they remind investors that the world has changed since 2022.
- US March trade data will show the impact of oil prices on both imports and exports. Durable goods orders numbers are also due.