At last. A rather obtuse and probably undignified way to greet an attack by one sovereign state into another. Yet it is one that most of the oil fraternity shares. This of course refers to the early hours of the Middle East Saturday clock when Israel launched precise and wave-like ariel attacks on military targets in Iran, which has since been made public as operation ‘Days of Repentance’.
The market is not exactly paralyzed but uncertainty makes investors understandably and justifiably pragmatic. It appears that they find it unnecessarily risky to leave positions open for more than a day or maximum two. Two days of marching higher was followed by two days of profit-taking. Fears of supply disruptions subsided but rest assured they have not gone AWOL.
Oil moved lower yesterday in tandem with bond prices and equities as the dollar kept advancing and gold scaled yet another historic peak before retreating. The price action had the hallmark of growing macroeconomic concerns as risk was disposed of and sanctuary was sought.
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