Deutsche Bank strategists highlight that Brent Oil continues to climb as US-Iran tensions persist and the Strait of Hormuz remains effectively closed. Brent futures across the curve have pushed to multi‑week highs, with US gasoline and inflation swaps also rising. Markets are increasingly pricing a more prolonged period of high energy prices.

Geopolitics sustain higher energy prices

"From a market perspective, that means oil prices continue to grind higher, with Brent crude rising +3.10% yesterday and another +0.97% overnight to $106.09/bbl."

"Back to yesterday and oil's gains extended across the futures curve."

"The 6-month Brent future (+2.34%) reached a 3-week high of $86.74/bbl as investors geared up to facing a more prolonged period of high energy prices."

"The pressures were even more visible in downstream products with US wholesale gasoline prices (+3.10%) reaching their highest level since 2022."

"This was echoed in near-term inflation swaps as well, with the 1yr Eurozone inflation swap (+16.2bps) surging up to 3.35%, whilst the 1yr US inflation swap (+8.6bps) rose to 3.32%, with the latter now only 6-7bps below its high on March 20."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)