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There were two key news events today, the US PPI data release and the escalation in the Middle East. First off, we saw the hotly anticipated PPI print for the US, which came in mixed but slightly hawkish. PPI m/m was in line with expectations at 0.4%, Core PPI m/m was below at 0.2% against an expected 0.3%, PPI y/y was above at 5.4% against 5.3%, whilst Core PPI y/y was in line at 4.6%. The other key thing to note was that last month's PPI m/m & PPI y/y were both revised upwa

We have seen further escalation in the Middle East today as the US claimed to have destroyed 5 Iranian oil tankers, adding to renewed military exchanges across the region after yesterday's attacks on Saudi oil facilities. There are still no concrete signs of renewed talks despite Qatari efforts, which have caused oil to further rise and have seen Brent pass $100 per barrel, which it actually managed at the end of the US session yesterday before continuing north today. Brent i

The only news of note has been an escalation in the Middle East today, as Saudi Arabia's oil facilities were the target of Houthi attacks with both drones and missiles. Saudi officials noted they would respond to the escalation, adding a second front to the tit-for-tat strikes between the US and Iran. On top of this, we also saw reports that the number of ships transiting the Strait of Hormuz fell to its lowest levels since May of this year, adding to the supply-side pressure

In terms of geopolitics, the escalation has resumed and has done so in fairly direct fashion. Iran reportedly fired ballistic missiles towards two US Navy warships, whilst the US responded by striking three Iranian tankers. Brent rose to the high 90's and reached as high as $99.90 today, with renewed concerns around Hormuz supply and shipping disruption. There is no diplomatic process running at the moment, and with oil near $100, the inflation impulse that has driven so much

In terms of geopolitics, there is little new to report. Oil continued to rise yesterday with no sign of progress in the Middle East. Until we see something concrete, the inflation impulse driving this market is not going anywhere. What makes yesterday interesting is that for once the Middle East was not the story. The market spent the session trading off Tokyo instead. Brent Crude Oil - 1D The yen strengthened sharply, with USD/JPY falling 1.82% and dropping nearly three yen