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AI Summary. The United States is not insulated from global oil price shocks, as domestic prices for crude oil, gasoline, and other refined fuels have risen as much as or more than prices in Europe and Asia when major shipping routes are disrupted.
Michael Cembalest J.P. MorganAI Summary. Reduced geopolitical risk has compressed risk premia across assets, lifting equities, commodity currencies, and emerging markets, while supply shortages in commodities and AI infrastructure sustain capital flows and keep volatility elevated even as prices rise.
Dominic Wilson and Kamakshya Trivedi Goldman SachsCore argument: Shortage-driven volatility dynamics result in simultaneous equity price increases and rising market volatility, creating asymmetric upside amid fundamental uncertainty.
The Iran ceasefire and the reduction in deep downside tails have allowed the market to look ahead and compress risk premia across a range of assets. That type of narrowing in the distribution is often associated with sharp market gains in situations of fundamental uncertainty, and this has proved to be the case again. Despite oil prices and yields staying elevated, a broad range of assets—including US equities, high carry/commodity FX, and EM—have recovered smartly, and renewed AI optimism has pushed those exposures to new cycle highs. The common element is that shortages—in commodities and the AI supply chain—are driving capital flows. Those tensions mean that even if we avoid the worst tails, we are likely to see volatility rise alongside further equity price increases.AI Summary. A new European energy price shock is projected to reduce industrial production by 2% by end-2027, half the 4% hit from the 2022/23 gas crisis, because this shock is oil-driven and globally distributed, reducing the competitive disadvantage European energy-intensive industries previously faced relative to Asia.
Niklas Garnadt Goldman SachsCore argument: European industrial production faces a 2% hit by end-2027 from oil price shocks, half the 4% impact from 2022–23 Russian.
[We] project that higher oil and gas prices [will] lower Euro Area industrial production by almost 2% by end-2027 relative to our pre-conflict baseline, with negative IP growth later this year but a return to positive growth in 2027. This compares to an estimated drag of 4% during the energy crisis of 2022/23. The current price shock is expected to be smaller and less persistent, while the decoupling from Russian pipeline gas that began in 2022/23 has been sustained. The 2022/23 crisis was fundamentally driven by a sharp reduction in Russian pipeline gas supply to Europe and impacted a narrow set of highly gas-intensive industries particularly hard. The current shock is primarily an oil supply one that tends to reduce industrial production more broadly. However, in 2022/23, energy market shifts were largely focused on Europe, leading to major cost disadvantages for energy-intensive industries, particularly relative to China, and a surge in import competition. This time, energy price pressures are more global, with Asia appearing to be affected to a similar (or even greater) extent. European energy-intensive industries therefore look less exposed to competitiveness pressures.AI Summary. A blockade cutting Iranian oil revenue from $175m to ~$10m per day has historical precedent but has not produced negotiating concessions, as Iran previously sustained similar revenue losses without changing its position.
Javier Blas BloombergCore argument: Iranian crude revenue surged 75% to $175m daily since Feb. 27, yet prior sanctions reducing exports to 250,000 barrels daily.
According to my back-of-the-envelope calculations, Iran was making about $100 million a day selling its crude before the war. Since Feb. 27, that’s risen to around $175 million a day. If the US enforces the blockade, the Iranian economy will suffer an enormous blow on top of the war destruction. But whether that economic hit translates into a softer negotiation approach remains to be seen. Targeting Iranian oil revenue has been tried before — and it failed. In 2020-2021, when Trump launched a maximum pressure campaign of sanctions, Iranian crude exports dropped to fewer than 250,000 daily barrels for several months just as oil prices were depressed due to the impact of the pandemic. Even allowing for some exports slipping under the radar, Iran was earning no more than $10 million a day selling crude — and it still didn’t buckle.AI Summary. U.S. crude oil production reached a record 13.6 million barrels per day in 2025, driven by efficiency improvements despite reduced rig activity and lower oil prices.
Naser Ameen Energy Information AdministrationCore argument: U.S. crude oil production reached a record 13.6 million barrels per day in 2025, growing by 3%.
U.S. crude oil production grew by 3%, or 350,000 barrels per day (b/d), in 2025, setting a new annual production record of 13.6 million b/d. Production from the Lower 48 states excluding the Gulf of America (L48) accounted for 11.3 million b/d, or 83% of the total U.S. crude oil production in 2025. The rest of the production came from Federal Gulf of America (GOA) and Alaska. In 2025, the number of active rigs per month in L48 was 5% less than in 2024 and 1% fewer wells were drilled. Despite less rig activity and fewer wells, efficiency improvements that we saw in 2024 continued through 2025 and resulted in a slight increase in crude oil production, with new wells producing 2.9 million b/d of crude oil and wells drilled prior to 2025 producing 8.3 million b/d. Rig and well activity fell in 2025 compared with 2024 because West Texas Intermediate (WTI) crude oil prices fell from $77/barrel (b) in 2024 to $65/b in 2025.