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• Economic strains in emerging markets increase two months after the Iran War

  The charts below, two months after the Iran War began, show the impact of the war on the economy in emerging and developing countries. They are facing increasing inflation, fiscal strains, and trade disruptions. 1/DIRECT HITS Middle East countries and their neighbors are the most directly affected. Qatar recorded its first-ever?trade deficit of $1.2 billion after the Strait?of?Hormuz closure slashed imports by half and exports more than 90%. JPMorgan's economists predict that Qatar's economy will shrink by 9% in this year due to damage caused to an LNG facility, which is more than Iran's forecast of minus 6.1%. The Fund cut its growth projections for the emerging and developing economies group from 4,2% to 3,9%. This month's IMF-World Bank meetings, held in Washington, included stark warnings. The event heard Qatar Finance Minister Ali Ahmed Al-Kuwari say that "a full-fledged effect is on its way and is not too far away." The emerging Asian markets are especially vulnerable, as over 50% of crude oil imports and over a third of gas imports pass through the Strait of Hormuz. The higher prices of crude oil have benefitted producers further away. Brazil and Kazakhstan have seen their currencies strengthen by more than 9% in the past year. Emerging market stocks are also at record highs. 2/ TRUNNING TANKERS Energy costs have risen, and inflationary pressures are increasing. This has reduced the room for central banks to reduce interest rates. Instead they've started pushing them in a different direction. Last week, the Philippines raised rates, and Turkey, Poland Hungary, the Czech Republic and South Africa are now more hawkish, due to the threat of a'second round effect', where wages and costs will rise. JPMorgan?says that markets in the majority of the 15 emerging economies they track are pricing in a tighter monetary policies over the next 6 months. Economists predict it too. Zahabia Gupta, a senior analyst at S&P Global, said that rising inflationary pressures and a risk-off attitude could tighten the financing conditions. This would push (bond) yields higher. 3/ SUBSTANCE STRAINS The governments of emerging markets already spend hundreds billions of dollars per year to cushion households from high energy costs. And the recent spikes will only increase that number. IMF estimates global fossil fuel subsidies will amount to $725 billion by 2024, or 6% of the global GDP. This is down from 12 percent in 2022 when Russia's invasion of Ukraine caused a spike in energy prices. The calculations don't separate emerging markets but the Fund claims that three-quarters of all subsidies are distributed in the Middle East, North Africa and Central Asia. Citi's Joanna Chua wrote in a client note that "we see growing fiscal risk in EM if this energy?shock is more persistent." She pointed out Egypt, Turkey Indonesia, India, Hungary, and Poland as being particularly vulnerable. The Fragile Few Analysts fear that Egypt, Sri Lanka, and Pakistan are among a group of lower-income, crisis-scarred countries, which they say is being pulled back into trouble. Fuel and food prices are rising in Egypt. Tourism revenues, which brought in nearly $20 billion last fiscal year, could also drop. The cost of paying back Egypt's debt has also risen, with almost $30 billion in payments due. Sri Lanka has agreed to a temporary reduction in its IMF funding and reinstated fuel subsidies. This is to give the country some breathing room. Pakistan's FX reserves were $16.4 billion at the end of March, which is less than three month's worth of imports. Analysts warn that these are negative figures when you factor in the central bank’s foreign currency liabilities. Another blow for Africa The IMF graph below shows that many of Sub-Saharan Africa's poorer countries are particularly affected by the current economic situation. Bottom-left quadrant: a dependency on imported oil and strained government finances. The longer crude prices remain high, the greater the fiscal pressures. The head of the IMF Kristalina Gheorgieva stated at an event held in London, last week that "we have a negative shock to supply". She stressed "the worst thing is to try to balloon demand" as some countries do by offering subsidies to the entire population, instead of just those who are most in need. She believes that the Fund may need to provide an additional $20 to $50 billion in emergency assistance due to the crisis.

• Aluminum prices rebound amid supply concerns in the US-Iran standoff

  Aluminum?prices rose on Friday as a result of fears that supply would be limited due to the ongoing standoff between Iran and the U.S., which has impacted shipments from the Gulf, where there are large smelters. Iran warned on Thursday that it would respond to any new attacks by the United States with "long, painful strikes". In official open-outcry trade, benchmark three-month aluminum on the London Metal Exchange increased 1.4% to $3.522 per metric ton, ending five sessions of losses. Metal used for construction, transportation and packaging reached $3,672 per?ton, its highest level in four years on April 16. This was after disruptions in operations in the Gulf?which accounts for around 9% of worldwide production. Prices fell after the truce that halted the attacks. Nitesh Sha, commodity strategist for WisdomTree, said: "It is?the danger of supply-side destruction due to a prolonged conflict, as the facilities in Qatar or Bahrain will not open?anytime? soon." There are indications of escalation and then de-escalation. You don't know where you stand at any given time. Prices are a bit choppy. Emirates Global Aluminium has said that it could take a full year to fully restore primary aluminium production in its Al Taweelah Smelter, which was damaged by an Iranian attack. The LME Cash Contract premium to the three-month Future The price of a ton rose by 7% on Friday to $60, after having more than doubled in the past two months. This indicates concerns about supply. The Shanghai Futures Exchange was closed for Labour Day until Wednesday, which slowed down trading. LME nickel dropped?0.5% during official activity, to $19380 per ton, after reaching a two-year high of $19 645 earlier in session due to reduced supplies from top producer Indonesia. Bank of America analyst Michael Widmer stated in a note that the nickel positioning adjustment was?remarkable. Funds switched from being net-short to net-long. "All things considered, we only see a limited downside to nickel." LME copper for three months fell 0.2%?to $12.965 per ton. Zinc dropped 0.6% to $3.342, while lead remained unchanged at $1.955. Tin gained 0.2%, to $49.300. Click here to see the latest news in metals.

• UK factories hit by Iran War: Expect higher costs and delivery delays

  According to a survey, the impact of the war with Iran was highlighted by the rise in cost pressures for British manufacturers in April. Delivery delays also increased. S&P Global's UK Manufacturing Purchasing Managers' Index increased to 53.7 from 51.0 in February. The final reading is slightly higher than 53.6 from the provisional data for April. The U.S. and Israel war against Iran, which began late?February this year, has disrupted international shipping. The vital sea channel is still closed, squeezing out 20% of world oil and gas supplies and driving up global energy prices. Due to Houthi attacks in Yemen, many vessels have chosen to avoid the Red Sea route and instead take the much longer journey around southern Africa. S&P reported that restrictions on ships attempting to pass through the Strait of Hormuz had caused delivery times to be longer than they have been in almost four years. The survey found that output and new orders increased last month. However, input costs for manufacturers rose at the fastest rate since June 2022. Rob Dobson of S&P Global Market Intelligence said that the increase in production was partly due to clients who brought forward purchases to offset expected price increases and supply disruptions. As this process unfolds, along with declining business optimism in the second half of the year, the growth in the sector may?cool, while inflationary pressures remain high." The PMI's measure of average selling prices rose at its fastest rate since November 2022. The optimism of businesspeople about the next 12 months has dropped to its lowest point in over a year. The survey?respondents expressed concern about the effects of?the Middle East Conflict and?the government policies. The first increase in hiring was not seen since October 2024, when Finance Minister Rachel Reeves introduced tax increases for employers in her budget. Suban Abdulla reported; Hugh Lawson edited.

• Never mind the oil, but feel the earnings with MORNING BID EUROPE

  Wayne Cole gives us a look at what the future holds for European and global markets. Investors in Asia are once again made to feel foolish by the U.S., who come in and buy stock like drunken sailors. Surging oil prices don't matter when tech earnings look so bright. Caterpillar, a company from the old economy, has also embraced AI. The demand for Caterpillar's power equipment in data centers helped it to surpass Street forecasts by almost 10% and increase its share price. Apple's results were also better than expected, but not as much as they have been in the past. Analysts called it a solid result. It's possible that this is why Apple shares have only risen 1.9% after hours. Momentum is a powerful force on the markets. Why is it rising? People are buying it. Why are people buying it? It's rising. Goldman Sachs analysts say that this is going beyond momentum, and into mania. The recent Wall Street rally is one of the narrowest in history, and earnings upgrades are also very narrow, driven almost exclusively by semiconductors, information technology, and communications. Investors must ignore the effects of the?worst shock to the oil markets?ever recorded. Brent is down from its peak of $126.41, but this is mainly due to the fact that June's contract was rolled into July. It's now up around 1% at $111.00. There is still no sign of the Strait of Hormuz being opened anytime soon. Iran and the U.S. are content to exchange verbal threats. Prices will have to increase as supplies of fuels such as petrol, diesel and jet fuel, bunker oil, fertilisers, etc., become ever more scarce. Four major central banks warned this week of the inflation risks that lie ahead. Both the ECB and BoE said that rates could be raised as soon as June. The FOMC, however, is not in a mood to cut rates no matter what Kevin Warsh and his boss might want. High oil prices make it difficult for Japan to achieve its latest currency intervention because the country's trade surplus is about to explode in the coming months. The dollar has risen to above 157.00, as the market tests Tokyo's resolve. To defend 160.00, it will likely?require dumping more dollars. What will Trump and the U.S. Treasury think? The following are key developments that may influence the markets on Friday. Huw Pill, Bank of England's Chief Economist, gives a speech on the central banks latest interest rate decision ISM Manufacturing Survey for April

• Nickel has its best month since 2 years, as copper climbs in China

  The copper price rose on Thursday, and was poised to 'crack a five-day decline after positive factory data from China. Nickel prices were 'heading towards their biggest monthly jump in two years due to tighter supply coming out of Indonesia. In official open outcry, the benchmark three-month copper price on London Metal Exchange rose 0.6% to $13,085 per metric tonne. Metal used in construction, manufacturing and power was expected to rise by 6% in April. This would be the best month in?2026, based on the hope that the Middle East conflict will be contained. A private survey revealed that China's manufacturing sector expanded in April at the fastest rate since the end 2020, thanks to booming?new orders. Copper stocks on the Shanghai Futures Exchange also rose. Continue to be drawn down as 192,025 tonnes fell 4.6% from last week. The SHFE will be closed on Friday for the Labour Day holiday. It won't reopen again until May 6th. The CRU analyst Craig Lang stated on a webinar that the demand for refined copper in China will grow by 2,8% this year due to ongoing grid investments and tighter scrap supply. Lang stated that fund investments have been driving the recent high copper price. Global exchange stocks are at their highest level since early 2000s. Lang said that he believes copper prices will fall to $11,000 by the end of the year, and then recover?over a medium-term. ING stated in a report that additional price support comes from supply-side 'risks' to raw materials sulphur. Nickel was 1% higher at $19 465 per ton, and is on track to gain 13.9% in this month, its largest monthly increase since April 2024, due to tighter mine production limits in Indonesia. Smelters there are also feeling the squeeze of sulphur. Sucden Financial stated that "levels approaching $20,000/t?increase the probability of additional supply?being approved?or reactivated?" Lead edged up 0.3% to $1,943.50, while tin rose 1.9% to $48,700. Aluminium fell 0.2% to $3480. (Reporting and editing by Harikrishnan Nair, Sonia Cheema and Harikrishnan Nair; Additional reporting by Amy Lv, Lewis Jackson and Amy Lv)

• Rating agency Fitch does not see any immediate impact from UAE's exit from OPEC

  Fitch, a credit?rating company, said the United Arab Emirates'?decision to withdraw from OPEC 'would not have an immediate 'impact on its metric' but could increase oil revenues over the long term. Paul Gamble said that the OPEC withdrawal would not have any immediate impact on the country's?metrics, but could boost its oil revenues in the long term. Gamble, however, said that once the strait is fully reopened, the?UAE would likely increase oil exports as it will no longer be restricted by OPEC 'decisions. It would be helpful to diversify the economy and move away from oil, but it is likely that the UAE will still need to improve its AA stable credit rating. Fitch's rating is one notch below both S&P Global's and Moody’s respective ratings for the country. Gamble stated that "an increase in oil exports" would not have any impact on the rating, but "it would certainly help the sovereign balance sheet." He said that he saw the UAE's request for a currency swap line with the U.S., as "proactive", albeit "surprising" in terms of timing given the UAE's huge amount?of liquid assets. "Clearly, the UAE has liquidity needs right now." Swap lines are another way to access this?liquidity rather than selling a big pile of Treasuries or other government bonds. "But this is a precautionary measure and it's nothing to worry about." (Reporting and editing by Libby George, Keith Weir and Marc Jones)

• MORNING BID AMERICA-Oil fears shroud tech splurge

  What's important in the U.S. and international markets today by Mike Dolan, Editor at Large,?Finance and Markets The markets can't ignore the new surge in oil prices due to the Iran war. The global crude oil prices rose to their highest levels since the beginning of the war amid reports that Washington is considering a return to military action in order to break the impasse. The price of the June Brent futures contract hit a four-year high of $126 per barrel on the last day, and the new benchmark for July surged up to $115/bbl, before falling back. The Fed's Wednesday hawkish stance was largely influenced by the fuel price squeeze. Below, I'll go into more detail. Check out my most recent column about the signs that U.S. Inflation is on the rise. Listen to the Morning Bid podcast. Subscribe to the Morning Bid daily podcast and hear journalists discussing the latest news in finance and markets seven days a week. OIL FEAR SHROUDS THE TECH SPLURGE On Wednesday, the Fed kept rates the same. However, three regional presidents voted in favor of removing references to "easing bias" from its statement. Jerome Powell, the outgoing chair of the Fed, surprised many when he announced that he would stay on in a board position - at least temporarily - once his chairmanship ended next month. Powell's tenure on the board will last until the early part of 2028. This means that there won't be a vacancy in the board immediately for President Trump. Futures markets have eliminated all bets that the Fed will ease this year. There is a 1 in 3 chance of a rate increase by April next year. Treasury yields have risen again. The 30-year yield briefly topped 5% for the firs time since September. The dollar briefly jumped, but was knocked back below 160 yen due to Japanese intervention fears. Today, the European Central Bank (ECB) and Bank of England (BoE) will announce their rates. Both are expected to hold policy, but also warn of inflationary pressures related to oil. Meanwhile, after the Wednesday bell, mega-cap earnings swept in. Alphabet's share price soared by more than 6 percent on the back of its impressive cloud business and its beating. Meta, however, fell more than 6 percent as investors worried about its recent capex boost. Share price reactions were subdued to Microsoft and Amazon's results, but there was no major red or green flag in the massive AI buildout. The spending by the "hyperscalers" this year will likely top $700 billion. The bill may be justified, or it may not. But the demand for AI equipment and chips will continue to rise for the time being while the final outcome of the massive capex is still being assessed. Finaly, Asian shares dropped?on Thursday's renewed oil surge, while European stocks opened lower and Wall Street Futures were mixed. Chart of the Day South Korean tech giant Samsung Electronics announced record quarterly profits driven by a?jump of 49-fold in chip income. It said it expects supply shortages to worsen next year, as clients invest more on AI. The results come just a day after U.S. megacaps Microsoft Alphabet Amazon and Meta revealed that their 2026 capex plans have now topped $700 billion. Watch today's events * U.S. PCE inflation data for March (8:30 am EDT), and weekly jobless claims (8:30 am EDT). Apple's earnings in the U.S. Bank of England rate decision (7:15 am EDT) & European Central Bank rate announcement (8:15 am EST). EDT) Want to receive Morning Bid every morning in your email? Subscribe to the newsletter by clicking here. Follow us on LinkedIn, X and ROI. The opinions expressed here are the author's. These opinions do not represent the views of News. News is committed to the Trust Principles and a commitment to independence, integrity and neutrality.

• TotalEnergies, Nextnorth to build $300 million Philippine Solar Farm

  By America Hernandez PARIS, 30 April - French oil major TotalEnergies, and Philippine renewables developer Nextnorth, have announced that they have started construction on a 440 Megawatt-peak Solar Park in the Asian nation. The $300 million project is scheduled to be 'online' by the end of 2027 and will produce 1.2 Terawatt-hours over a period of?20 Years. The remaining half will go to the national grid in the fourth renewable tender round. Total, unlike other oil companies that have walked back on their renewable commitments has expanded its green portfolio. Most recently, it formed a joint venture, with Emirati company Masdar, to develop wind, sun and batteries in Asian nations which are heavily reliant on natural gas imported. Energy security is more important than ever for the Philippines. Nextnorth CEO Miguel Mapa said that the country needed a large, affordable, domestic renewable energy capacity to meet a growing demand and a heavy dependence on imported fuels. Sumitomo Mitsui Banking Corporation and ING Bank NV are among the financial institutions that offer loans. TotalEnergies is putting 65% of its stake in the project into a renewable joint venture it has with Masdar. Nextnorth will hold 35%. (Reporting by America Hernandez in Paris. Mark Potter (Editing)

• Mining supercycle: Big money bets billions

  Major fund managers have predicted a sustained rally for mining and metals, as money pours in at the fastest rate in years. This is due to a robust AI infrastructure, increased defence spending, and a move away from expensive technology stocks. The assets under management of mining exchange-traded funds grew by more than twofold to $87.4 Billion by March 31 compared with $37 Billion a year ago, according to data compiled for ETFGI by the research firm. shows. Oil and gas?and agriculture also saw significant inflows. This marks one of the sharpest shifts in investment towards hard assets ever. Investors invested $8.24 billion in mining in the first 3 months of 2019. This is a change of $10.8 billion in sentiment from the first three month of 2025, when President Donald Trump announced sweeping tariffs that resulted in a $2.52 billion outflow. BlackRock portfolio manager Evy Hambro said capital was starting to move from high-valued tech stocks into hard assets. She called it "the beginning stages of a commodities supercycle". Morningstar's U.S. Technology Index dropped 9% in the 1st quarter. BHP and Rio Tinto, the two world's largest mining companies, have both seen their shares reach record highs in this year. Hambro stated that "the material intensity of GDP?is increasing", pointing out the surge in capital investments into grid infrastructure, data centers, electric vehicles, and charging stations. Hambro, a leading analyst, said that unlike the urbanisation-driven boom of China in 2000, demand in this cycle is "much stronger and more resilient", because there's global diversification in AI, electrification, and defence. Analysts and investors said that the change in market structure increases the risk of price fluctuations, as metals are smaller than global equity and bond markets and more susceptible to bottlenecks within mining, refining, and transportation. Taosha Wan, from Fidelity, also stated that a supercycle focused on mining and energy has already begun as the Iran War pushes government to prioritize supply security. GOLD VS INDUSTRIAL METAL The flow of funds has been skewed towards industrial metals. In March, copper funds received $198 million while gold's raging rally was accompanied by profit-taking. VanEck Gold Miners ETF (GDX) alone lost $710 millions last month but is still up over $1 billion for the year. Investors say that the pullback of gold in a geopolitical crisis is notable. Investors say that rather than seek shelter in safe havens, the markets are betting on the Iran conflict to catalyse real-economy responses, requiring energy security and infrastructure investments requiring steel, copper, and rare Earths. Fund managers say that the fact that oil and gas funds have received almost $6 billion net in the first three months of the year confirms the idea investors are preparing for infrastructure spending. Portfolio managers are attracted to diversified miners such as BHP and Rio Tinto, which sit at the intersection of many demand drivers. Anix Vyas is a portfolio manager for Harding Loevner. He said that aluminum and copper are in high demand. This demand has increased as the Iran Crisis unfolds. Rio Tinto, which holds both metals, can also benefit from an increase in demand due to data centres?and industrial applications. Vyas described the shift as investors leaving software companies that are vulnerable to AI disruption in favor of companies with more durable advantages like miners who control critical minerals. Small Markets, Big Swings Metals futures are relatively small, so heavy inflows may magnify volatility while a larger uptrend is still intact. The London Metal Exchange reported that trading volumes in metals futures, including copper and aluminum, totaled $21 trillion. Meanwhile, the CME recorded gold futures trades of more than $25 trillion. This pales in comparison to the $85 trillion generated by Nasdaq 100?futures, and the more than $135 billion in S&P500 futures. The dramatic swings in ETF flows from one year to the next show how easily sentiment can change and how susceptible these markets are for a reversal. This sector also represents a very small portion of the global market. The top?five mining firms represent just 0.4% of MSCI ACWI Index, compared to 16.8% of the top five technology companies. Metals and mining products make up just 0.57% of the total equity ETF share. The major mining companies' shares are still trading at 7 to 8 EV/EBITDA multiples, which is well below the 14-times multiples seen in the 2008-2010 boom. This suggests that there could be significant upside potential if the supercycle continues. Copper is at the intersection between everything and critically undersupplied. "I have no doubt that copper prices could double or even triple in the next decade, and owning producers of copper will provide multiples of the spot price increase," said Charlie Aitken. He is the group investment director for Australia's Regal Partners. The company is overweight with mining and metals, and had A$21 billion (15.05 billion) at its disposal at the end March. Investors said that while investing in this sector offers an inflation hedge, it could also lead to price increases, which would compound inflation pressures caused by the Iran War's impact on the energy markets, and pose risks to the global economy.

• What is the difference between a driller and a trader? Iran War exposes Big Oil’s transatlantic division: Bousso

  The first quarter profits of European oil majors were boosted by bumper trading gains, as the Iran Warupended supply chain. This highlights how shifting?barrels across the globe can sometimes be more important than pumping them from the ground. BP, Shell, and TotalEnergies spent years developing vast oil trading'machines' that are now at the core of their businesses - setting them apart from their U.S. counterparts, for better or for worse. BP announced a first-quarter profit of $3.2 billion on Tuesday. This is more than twice the figure from last year, largely due to what BP called an exceptional performance in its oil trading. Oil trading is housed in the Customers and Products division, which has a profit of $3.2 billion before tax and interest. This is the best result for oil trading since Russia invaded Ukraine in 2022. According to ROI calculations, BP’s oil trading – the buying and the selling of crude and other fuels for its global retail network as well as end customers – likely contributed $1.5 billion pre-tax profits in the third quarter. The size of BP's trading operations is both a source of upside potential and risk. The company trades 12 million barrels per day, which is equivalent to roughly 11% global demand. This is 10 times BP’s upstream production capacity and 8 times its refinery capacity. TotalEnergies reported a $5.4 billion net profit for the third quarter. This was a 29% increase year-over-year, driven in part by strong trading. Earnings in the segment of refining chemicals, which is where Total's oil trade takes place, have more than quadrupled from a year ago to $1.6 billion. Shell, which is estimated to trade 14 million barrels per day, has also reported a strong performance in the first quarter ahead of its results on May 7. OPPORTUNITY RISK The majors have the flexibility to take advantage of small price fluctuations across products and regions because they can exploit a'sprawling network of refineries, storage terminals, pipelines and tankers. The opportunities and dangers multiply when those dislocations reach seismic levels, as they have in the last two months. Since the Iran War broke out on 28 February and the Strait of Hormuz has been effectively closed, over 13 million bpd of production - 13% of the global supply – have been trapped in the Gulf. This has sent shockwaves throughout crude and refined products markets. The impact was massive. Brent crude has increased by more than 60% since the beginning of the war, to $115 per barrel. This is accompanied with tremendous volatility on oil, fuel, and liquefied gas markets. Arbitrage is possible when disruptions of this magnitude occur. Rerouting diesel or jet fuel in highly unusual ways, like shipping cargoes to Australia where prices have risen since the beginning of the conflict, is one example. Trading at this level is capital intensive and can be unforgiving when things go wrong. Tankers that hold large amounts of cargo for long periods can cost a lot of money. BP said that its working capital increased by $6 billion during the third quarter. This included $4.1 billion due to higher oil prices, longer routes for shipping and larger inventories. These positions will unwind in the coming months but they are still significant. Large trading arms have been able to absorb losses during this turbulent time. BP is heavily exposed to the Gulf. Equity upstream production was around 411,000 barrels per day (bpd) in the Middle East - or about 17% of total output by 2025. TotalEnergies accounts for 15% of its production through operations in Qatar and Iraq, as well as the United Arab Emirates. Shell reported a lower production due to "outages" in Qatar. BP estimates trading can typically deliver a return of up to 4% on the average capital invested. Shell provides similar advice. In times of extreme volatility, this increase is almost certain to be higher. UNRIVALED EXTRACT Exxon Mobil, Chevron and their European competitors may envy the trading profits of their European counterparts. Both U.S. giants keep trading under tight control, using it only to manage internal volumes?upstream or downstream. Previous attempts to create more independent trading desks failed, partly because the highly centralised decision making at these firms prevented traders from acting quickly in fast-moving markets. This contrast is a two-way street. Exxon may not have the same trading success as the European giants, but their upstream operations are far superior. Exxon-Chevron will produce 4.7 million bpd in 2025 and 3.7 millions bpd by then, which is well above BP, Shell, and TotalEnergies, who each produced 2.5 million bpd. The European upstream sector's weakness is partly due to the heavy investments made in renewables and lower-carbon fuels in this decade. BP and Shell have retreated from this strategy following heavy losses but still lag behind their U.S. competitors. Exxon's and Chevron’s massive production engines will generate enormous cash if the prices remain high after the Iran War, but the trading profits of BP Shell and TotalEnergies might not be re-created if volatility decreases. Investors find it difficult to value trading operations because they are opaque and volatile. Trading could become more important to European majors, given their inability match U.S. competitors on production. This would increase the valuation gap between Europe and America. Energy industry will be increasingly defined by new divisions: traders and drillers. You like this column? Open Interest (ROI) is your new essential source of global financial commentary. Follow ROI on LinkedIn and X. Listen to the Morning Bid podcast daily on Apple, Spotify or the app. Subscribe to the Morning Bid podcast and hear journalists discussing the latest news in finance and markets seven days a weeks.

• Reports that the US is considering military options for Iran's break-out have caused oil prices to rise.

  Oil prices rose Thursday after a report that the U.S. was considering military action against Iran to break the deadlock of negotiations to end the conflict. This increased concerns about more supply disruptions for already curtailed Middle East Exports. Brent crude futures, for June, rose by $5.27 or 4.5% to $123.30 per barrel at 0347 GMT, after rising 6.1% the previous session. The June contract expires Thursday. It has been increasing for nine days. The more active contract, the July contract, was trading at $113.10 up $2.66 or 2.4% after rising 5.8% the previous session. U.S. West Texas Intermediate futures were up $2.42 or 2.3% at $109.30 per barrel after climbing 7% the previous session. They have risen in eight of nine sessions. Both benchmarks have a chance to reach their fourth consecutive month of gains. According to a report published by Axios late Wednesday, U.S. president Donald Trump will receive a briefing Thursday about plans for a series of military attacks on Iran to encourage it to return to negotiations over its nuclear program. U.S., Israel and other countries began air strikes against Iran on 28 February. In retaliation, the U.S. closed off shipping in the Strait of Hormuz - a chokepoint of energy from Middle Eastern producers. The U.S. has blocked Iranian ports amid a ceasefire which has stopped active combat. The talks to end the conflict have reached a deadlock. The U.S. insisted on talking about Iran's alleged nuke weapons programme, while Iran demanded some control over the Strait of Hormuz and compensation for the damage caused by the war. In a recent note, ING analysts said that the oil market had moved from an overly optimistic state to the reality we are now seeing in the Persian Gulf. A White House official stated that Trump had spoken with oil companies on Wednesday about ways to reduce the impact of a possible U.S. Blockade lasting months. Tony Sycamore, IG's market analyst, said that the prospects for a near-term solution to the Iran conflict and a reopening of 'Strait of Hormuz' remain dim. Sources said on Wednesday that the OPEC+ grouping of Organization of the Petroleum Exporting Countries members and their allies will?likely agree on a small increase of 188,000 barrels a day in oil production quotas by Sunday. The meeting is held just one week after the United Arab Emirates withdrew from OPEC on May 1. This withdrawal will have a major impact on the ability of the oil producer 'group to control the prices. The Gulf nation's departure would allow them to increase production once exports resume, but analysts believe that this will not affect the market fundamentals in the coming year. This is especially true with the closure of the Hormuz and other production disruptions due to the war. Wood Mackenzie analysts stated in a report that it would take several months for Gulf countries, including UAE, to reach pre-war levels of production.

• Prices of oil continue to rise as US-Iran conflict keeps supply off the market

  The oil prices continued to rise on Thursday as there was concern that supply in the Middle East, a key region for producing oil, would remain stagnant due to the deadlock in the talks between the U.S. and Israel over the war against Iran. Brent crude 'futures' for June were up $1.91 or 1.62% to $119.94 per barrel at 0057 GMT, after rising 6.1% the previous session. The June contract expires Thursday, and the July contract is at $111.38 up 94 cents or 0.85% after rising 5.8% the previous session. U.S. West Texas Intermediate Futures for June are up 63 cents or?0.59% at $107.51 per barrel after climbing 7% the previous session. They have risen in eight out of nine sessions. A White House official revealed that U.S. President Donald Trump had discussed with oil companies on Wednesday how to minimize the impact of what could be a months-long U.S. blockade of Iran’s ports. This triggered concerns on the market about an extended disruption of oil?supplies. Tony Sycamore, IG's market analyst, said that the prospects for a near-term solution to the Iran conflict and a reopening of?Strait of Hormuz remained dim. The meeting was held after a deadlock occurred in the efforts to resolve a conflict that has caused thousands of deaths and what analysts call the biggest energy disruption the world has ever seen. Since the U.S. began airstrikes on Iran in February, Tehran has blocked most shipping except its own, through the Strait of Hormuz. This is a major chokepoint for Middle East energy supplies. The U.S. started blocking Iranian ships this month. Sources say that on the'supply side,' the OPEC+ grouping, which includes OPEC and its allies, is 'likely to agree on a.small increase in oil production quotas of 188,000 barrels a day, Sunday. The meeting is just days after the United Arab Emirates announced its withdrawal from OPEC on May 1. This move will 'damage the ability of the oil producer group to control the price'. The Gulf nation's departure would allow it to "raise production" after exports resume, but analysts say that this is unlikely to have a significant impact on the market fundamentals in the coming year, particularly with the Hormuz war and other production disruptions. Wood Mackenzie analysts stated in a report that it would take several months for Gulf countries, including UAE, to reach pre-war levels of production.