Something for your Espresso: Balancing soft inflation and Houthis
The Red Sea tensions are growing amidst very soft inflation numbers. Is the duration rally at risk of being derailed?
Morning and Happy New Year from Europe.
There has been plenty of action in the Red Sea over the New Years weekend and oil markets also react from the get-go of the year.
Satellite photos reveal that the re-routing of ships continues and geographical divergences are starting to show up in Dirty Suezmax prices, hinting of a rising price-impact of the turmoil.
Being long Energy is probably a decent hedging idea of long duration bets into January.
Chart 1: Rising divergences in Dirty Suezmax prices
The Red Sea tensions are growing amidst very soft inflation numbers. Is the duration rally at risk of being derailed?
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