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Key Moments

  • Rabobank strategist Michael Every highlights that intensifying tensions involving Iran, Israel, and the US could unleash sharp volatility in energy prices.
  • Every notes that potential conflict timing is unclear, but argues that once hostilities start, Oil benchmarks could swing dramatically in either direction.
  • He also points to Russian nuclear threats against the UK and France and warnings over energy infrastructure as underreported risks for markets.

Escalating Tensions and Energy Market Uncertainty

Rabobank Senior Global Strategist Michael Every stresses that mounting geopolitical strains have the potential to trigger substantial turbulence in energy markets. He focuses on the growing frictions among Iran, Israel and the US, and emphasizes that the timing of any possible conflict remains unresolved.

According to Every, the start of open hostilities would have a pronounced effect on energy prices. He outlines a wide spectrum of possible outcomes for Oil benchmarks, ranging from a sharp move higher to a steep decline, depending entirely on how events unfold.

Middle East Military Developments and Regional Warnings

Every highlights growing military and diplomatic activity in the Middle East as a key element of war risk hanging over crude prices.

DevelopmentDetails
US military presence in Israel“In the Middle East, 11 US F-22s are now on the ground in Israel, as Reuters reports Iran is close to buying Chinese supersonic anti-ship missiles.”
Regional diplomatic alerts“Embassies are sending warnings to their citizens around the region; Turkey is preparing to prevent an Iranian refugee surge at its border.”

He underscores that the start date of any broader conflict is still unknown. As he puts it: “It remains to be seen when this war might begin –today, or after market close Friday?– or what then happens, but such an outcome looks more likely than a sudden Peace For Our Time deal.”

Binary Outcomes for Oil Prices

Every characterizes the crude price outlook as heavily clouded by war risk. He argues that the energy market reaction would not be marginal, stating: “Either way, the impact on energy prices will be notable – either sharply up or sharply down.”

This framing underscores that, in his view, the primary risk for investors is not directionally obvious but rather centered on the scale of possible moves once a conflict scenario is clarified.

Russia, Nuclear Threats and Overlooked Infrastructure Risks

Beyond the Middle East, Every points to other geopolitical developments that he believes have not received adequate attention from financial market participants.

He notes: “Russia threatened the UK and France with nuclear strikes after alleging the pair were trying to get a nuclear weapon or dirty bomb to Ukraine: the financial media didn’t notice. It warned of plots to destroy gas pipelines through the Black Sea, following that of the Druzhba oil pipeline to Slovakia this week, which the financial media also didn’t notice.”

These comments highlight additional layers of geopolitical risk tied to both nuclear rhetoric and potential attacks on critical energy infrastructure, which Every suggests are being underestimated or overlooked in current market discourse.

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