In a way, the two major geopolitical hotspots had mitigating impacts on one another yesterday, the net result was a downtick in oil prices as the morning rally turned into a defensive move. Pandora’s box has been re-opened in Gaza. Trading accusations, Israel and Hamas blame each other for breaching the truce agreement, which has brought relative calm to the region since January.
Market participants and beyond are akin to teenagers gathering on a street corner, under a dimly lit streetlight, waiting for something that makes sense of the darkness. Today’s dose of anxiety comes in the form of negotiations between the White House and the Kremlin over Ukraine’s future. We discuss one aspect of Russia through an oil lens below, but logic suggests that Moscow will ask too much during the Trump/Putin phone call.
In a few years, we will look back at 2025 and conclude that whatever the outcomes of the Ukrainian-Russian war turn out to be or whatever the incumbent US Administration eventually accomplishes were obvious. Hindsight is a salient human characteristic, and we believe that predicting the future is a simple task. On the contrary, it is close to impossible and what will have seemed inevitable in the future is anything but obvious today.
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