Barrels, Boards, and Big Questions
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What are the latest updates on Trump, Iran, and the oil market?
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Hello, I'm Alan Kohler, editor-at-large of Intelligent Investor and finance presenter and columnist for the ABC.
And I'm Stephen Mayne, contributor at Intelligent Investor, founder of Crikey and shareholder activist. And we are The Money Cafe. The Money Cafe, Alan.
Good morning, Stephen.
Good morning, Alan. Now, well, let's not waste too much time on Trump and Iran because, you know, we'll all be wrong tomorrow and it will change. But... After three weeks of 3% plus rises in the market, which is unheard of, and I think it was 13 days in a row of NASDAQ increases, we sort of had record highs with everyone thinking the war's over after the declaration of the Strait of Hormuz being completely open on Friday night. And of course, fast forward five days and it's not open. And there's an extension of the ceasefire. And are they going to Pakistan to negotiate or not? What's your take, boss?
Well, firstly, the market has more or less held on to those gains. It was an incredible rally of 12 or 13% over three weeks. One of the strongest rallies in history. over such a short period of time. And, you know, the market's easing a bit now. It was down 0.6%. This is the US market, down 0.6% last night. Oil was up 2.5%. So, you know, it's kind of down a little bit, but still holding on to... Yeah, so the ceasefire was extended this morning or last night by Donald Trump in a Truth Social post in which he said, based on the fact that the government of Iran is seriously fractured, not unexpectedly... And upon the request of Field Marshal Asim Munir and Prime Minister Shabazz Sharif of Pakistan, we've been asked to hold our attack on the country off of Iran until such time as their leaders and representatives can come up with a unified proposal.
I think that's not really the case, but anyway.
He hasn't put a timeline on that, which I think is quite interesting. So it's now an open-ended ceasefire.
Yeah, that's right. So it's open-ended, but he's also extending... So he's extending the ceasefire, but continuing the blockade of Iran's own ports. So, you know, Iran has said they're not going to talk, basically, while they're blockading its ports, so...
Yeah, so you'd think their position is you can't keep on commandeering our ships. So they took, you know, the US have taken over control of one cargo ship and they're not going to deal whilst the blockade is in place. So Trump probably needs to declare the strait completely open and lift the blockade and then have talks. And then, of course, they'll fall over on uranium. And Trump will say, give us it all. And the Iranians will say no. And the standoff will continue.
And also Iran has said that they've put mines along the Strait, the Strait of Hormuz, on the most frequently used routes. So before it can be used, those have to be cleared. That'll take a while. Bloomberg is saying this morning that process will take weeks to clear the mines, even once they start it, which they haven't started yet. They've got GPS jamming going on. And insurance companies just aren't interested in insuring the ships going through the strait at the moment. And, you know, I can't see that there's no sign that that'll change. So I think the strait's going to remain a problem for a long time. At the moment, the Asian refineries are going through their sort of stockpiles to try to keep prices down, hoping that the straight opens before they run out of their inventories.
But, you know... That doesn't look like happening. So I think there will be a crunch time sometime in the next few weeks.
Yeah, that's right. So it's not sustainable. I mean, the most acute pain at the moment seems to be with jet fuel, which at its peak increased sixfold in price, went from 20 to 120.
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Chapters
7 chapters
1
What are the latest updates on Trump, Iran, and the oil market?
0:00–7:04
2
How is the energy sector affected by current geopolitical tensions?
7:04–18:53
3
What insights does Stephen provide about his upcoming board tilts?
18:53–30:54
4
How are house prices impacting different generations?
30:54–35:28
5
What challenges are faced in the productivity debate?
35:28–45:58
6
How is AI expected to influence job markets and productivity?
45:58–53:30
7
What are the implications of potential changes to capital gains tax?
53:30–54:37