The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.
0910 ET - Crude futures lose ground with the market holding out hope for an end to the U.S.-Iran conflict, while reports of some tanker transit through the Strait of Hormuz and the UK's easing of restrictions on Russian diesel and jet fuel offer some relief. Oil prices will likely continue to zig-zag as the continued blockage of the strait contains downward corrections, while "creative methods" for skirting the strait to get oil out limits upside, Ritterbusch & Associates says in a note. "But our stance remains bullish as we still see a big gap between the U.S. and Iran regarding the nuclear issue." WTI is down 2.3% at $101.80 a barrel as the July contract moves to the front of the curve. Brent is down 2.4% at $108.58.(anthony.harrup@wsj.com)
0844 ET - Bitcoin rises slightly along with U.S. stock futures as the recent selloff in global bonds takes a pause due to an easing of oil prices. The recent bond market turmoil is driven by fears that higher oil prices due to the Iran war will push up inflation and prompt central banks to raise interest rates. Brent crude is last down 2% at $109 per barrel after three oil tankers crossed the Strait of Hormuz overnight, according to LSEG data. President Trump suggested the Iran war could end soon but warned of fresh military strikes if a peace deal isn't agreed in coming days, keeping risk sentiment cautious. Bitcoin rises 0.6% to $77,466, LSEG data show. (renae.dyer@wsj.com)
0622 ET - The Japanese yen could stay weak even if Bank of Japan Governor Kazuo Ueda sounds more "hawkish" by favoring raising interest rates ahead of the June meeting, MUFG Bank's Derek Halpenny says in a note. "The pricing for a [June] hike is already showing an 80% probability, so it's unlikely that a more hawkish BOJ at this stage will be enough to lift the yen," he says. Signals of more rate rises beyond June would help but seem unlikely. Middle East developments and oil prices will therefore remain key. Additional intervention to prop up the yen might be needed, he says. The dollar trades flat at 159.04 yen after hitting a near three-week high of 159.25 Tuesday, LSEG data show. (renae.dyer@wsj.com)
0621 ET - Palm oil futures ended little changed, with the Bursa Malaysia Derivatives contract for August delivery falling 2 ringgit to close at 4,583 ringgit a metric ton. Rival oils traded weaker overnight as slow progress in resolving the U.S.-Iran conflict weighed on sentiment, say Kenanga Futures analysts in a note. Profit taking after a recent rally and concerns that India may raise import duties likely also pulled down prices, they say, although a weaker Malaysian ringgit could cushion the fall. They peg the support and resistance levels for the August contract at 4,500 ringgit and 4,625 ringgit, respectively. (megan.cheah@wsj.com)
0620 ET - The Bank of England is unlikely to increase interest rates more than once this year after weaker-than-expected U.K. inflation data and jobs data released this week, Ebury's Matthew Ryan says in a note. "The job market slack should act as a natural brake on second-round inflation effects." Elevated gilt yields are also "acting to tighten financial conditions, and adding aggressive hikes into the mix would risk overkill", Ryan says. Ebury says one BOE interest rate rise is possible in the summer. Investors fully price in two quarter-point BOE rate rises in 2026, LSEG data show. (miriam.mukuru@wsj.com)
0557 ET - U.S. Treasury yields decline from recent highs as markets stabilize, though the unresolved Middle East situation continues to leave investors cautious. "Concerns over the duration of the tensions and the absence of meaningful progress toward a diplomatic resolution continued to sustain caution, while prolonged supply disruptions and elevated oil prices fuel inflation expectations," says FXEM's Abdelaziz Albogdady in a note. Recent labor market figures pointed to continued strength in hiring activity, while the Federal Reserve is increasingly expected to raise rates next year, he says. The 10-year U.S. Treasury yield falls 2.6 basis points at 4.642%, according to Tradeweb. (emese.bartha@wsj.com)
0545 ET - U.K. data suggests inflation would have dropped close to the Bank of England's 2% target without the Iran war, Berenberg's Andrew Wishart says. Headline inflation fell to 2.8% in April, from 3.3% in March. The surge in oil prices since February has added 0.7 percentage points to inflation, wholly explaining why it remains adrift of the target, Wishart says in a note. The drop in services inflation--to 3.2% from 4.5%--will help overcome the perception that the U.K. has a particularly intractable inflation problem, he notes. While headline inflation will continue to rise as higher import prices feed through, if services prices--which the BOE can influence most--continue to behave, the central bank need not raise interest rates, Wishart says. (edward.frankl@wsj.com)
0526 ET - Default protection costs for Middle East nations' sovereign debt remains fairly high due to concerns about the ongoing U.S.-Iran conflict. Investor are nervous about the impact of the prolonged war on Gulf countries. Bahrain's 5-year credit default swaps trade at 253bps after climbing 5bps to that level on Tuesday, S&P Global Market Intelligence data show. Qatar's 5-year CDS rose to a four-week high of 38bps on Tuesday and remains at that level. (miriam.mukuru@wsj.com)
0523 ET - The recent selloff in global government bonds offers ideal conditions for the dollar to strengthen, ING's Francesco Pesole says as the dollar reaches a six-week high against a basket of currencies. "Unlike in 2025, this selloff is being driven by inflation concerns rather than fiscal fears, making it unambiguously dollar positive," he says in a note. ING's measure of the dollar's safe-haven appeal is the strongest since late 2022 and the second-highest reading in its dataset dating back to 2005. The dollar could therefore rise further unless genuinely constructive news emerges from the Iran war, he says. The DXY dollar index rises to as high as 99.471. ING expects it to break above 99.500. (renae.dyer@wsj.com)
0522 ET - The dollar rises to a six-week high against a basket of currencies as markets increasingly bet on the Federal Reserve raising interest rates, MUFG Bank's Derek Halpenny says in a note. "There is scope for yields to move further higher," he says. While the Fed will ultimately raise rates less than many other G-10 central banks, market pricing for rate rises remains relatively low considering the risk of a further jump in oil prices, he says. The Fed's meeting minutes at 1800 GMT could reveal a shift towards a more restrictive stance, he says. Markets price a 70% chance of a 25 basis-point rate rise by year-end, LSEG data show. The DXY dollar index rises to a high of 99.471. (renae.dyer@wsj.com)
0517 ET - Oil prices extend losses, falling more than 2% in midmorning European trade as the Trump administration continues to pressure Tehran to agree to U.S. demands to end the conflict. Brent crude is down 2.1% to $108.93 a barrel, while WTI futures fall 2% to $102.05 a barrel. Meanwhile, the U.K. government watered down sanctions on Russia, allowing imports of diesel and jet fuel refined abroad from Russian oil to enter the country as the near-closure of the Strait of Hormuz continues to squeeze supply. Earlier this week, the U.S. extended a sanctions waiver allowing countries to purchase Russian oil currently stranded at sea. (giulia.petroni@wsj.com)
0510 ET - The decline in U.K. inflation in April tells us little about the persistence of the surge in inflation to come, Capital Economics' Ruth Gregory says in a note. Rising oil prices lifted fuel prices, but this was offset by a fall in the utility price cap. Inflation should hover around 3% until July, when the utility price cap rises about 13% on month, Gregory says. If energy prices ease, interest rates should remain at 3.75%, she says. "But the longer energy prices stay high, the more likely second-round effects will be." One or two rate hikes in the coming months are possible if energy prices stay high or rise further, she says. April annual CPI inflation was 2.8%, versus 3.3% in March. (edward.frankl@wsj.com)
(END) Dow Jones Newswires
May 20, 2026 09:10 ET (13:10 GMT)
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