Crude oil has been the gorilla in the room for the last 2-months and with no obvious resolution in the Middle East the inflationary back drop may not disappear any time soon. It’s disconcerting to acknowledge but the ASX, at least in the short term, feels at the mercy of President Trump and the new regime in Iran, who it feels have the upper hand with the Strait of Hormuz still not freely “open for business.”
- We ultimately expect crude oil to trade down another 10-15% when the US and Iran can agree terms.
MM is cautiously bearish towards December Brent Crude around $US91
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