The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.
0950 GMT - The cost of insuring euro-denominated credit against default climbs as escalation in the Middle East conflict lowers appetite for risk assets. The U.S. and Iran continued attacks in the Middle East for the third consecutive night, causing oil prices to jump and market sentiment to deteriorate. The iTraxx Europe Crossover index of euro high-yield credit default swaps rises 3 basis points to 252bps, S&P Global Market Intelligence data show. The iTraxx Europe Main index of euro investment-grade CDS climbs 1bp to 53bps. (miriam.mukuru@wsj.com)
0939 GMT - BP's better-than-expected performance in the second quarter and a large decline in net debt bode well for its shares ahead of the company's next strategic developments, Santander analysts say in a research note. The U.K. energy major's second-quarter update showed a strong performance across all divisions, the analysts say. Continued volatility in energy prices could remain a source of trading opportunities for BP in the coming months, they add. The situation in the Middle East and its implications for BP's strategy, alongside any guidance from new CEO Meg O'Neill on next moves, will be at the top of investors' minds when the company reports full earnings on Aug. 4, according to Santander. BP shares rise 2.3%. (adria.calatayud@wsj.com)
0924 GMT - Markets increase their expectations of the Bank of England raising interest rates due to a jump in oil prices as the Middle East conflict intensifies. The U.S. continued attacks on Iranian sites while Iran said it struck oil tankers on the Strait of Hormuz. "Surging oil prices reignited inflation and rate hike concerns," Saxo analysts say in a note. Markets price in a total of 45 basis points of BOE interest rate increase in 2026, 18bps higher than last week's pricing, LSEG data show. (miriam.mukuru@wsj.com)
0852 GMT - A quarter of the European Union's electricity generation came from solar power in June, a new monthly high for the renewable source, according to a study published by think-tank Ember. That made solar the largest single source of power for the month, ahead of nuclear and gas, Ember says. Solar has grown from just 10% of the total in the same month five years ago as EU members step up the pace of solar-panel installation, the study shows. In sunny Spain, a European leader in solar and other renewables, sun-power produced more than a third of electricity last month, Ember adds. "In just a few years solar has gone from a small player to an essential part of Europe's power system, as governments and citizens look for low-cost, quick-to-install domestic power sources," Ember analyst Chris Rosslowe says. (joshua.kirby@wsj.com; @joshualeokirby)
0847 GMT - BP investors are cheering its work to slash debt, as the U.K. energy company shifts its focus back to oil and gas, AJ Bell's Dan Coatsworth says. "One of the key worry points for investors over BP is its balance sheet. In that context, it's not a surprise to see significant debt reduction get a warm reception," Coatsworth says. While continuing volatility in energy markets makes forecasting the near-term outlook for the industry difficult, BP's move away from renewables and back toward hydrocarbon operations looks set to continue, he says. BP's charges of around $1 billion in its gas and low-carbon energy transition businesses and Shell's agreement to sell an Indian renewables business reinforce the trend, according to Coatsworth. BP shares rise 2.4%. (adria.calatayud@wsj.com)
0838 GMT - BP could shoot through its debt-reduction target a year early, thanks to rapid progress in the second half, RBC Capital Markets' Biraj Borkhataria and Adnan Dhanani say in a research note. The U.K. energy major estimates it ended the second quarter with net debt ranging from $22 billion to $23 billion, which compares with $25.3 billion as of March 31. BP is targeting net debt of between $14 billion and $18 billion by the end of 2027, but RBC estimates the company could reduce its net debt to around $8 billion by year-end. "This should coincide with BP presenting a refined corporate plan and medium-term outlook, in our view," the analysts add. Shares rise 2.6%. (adria.calatayud@wsj.com)
0833 GMT - BP could be laying the groundwork for more asset sales with its latest write-downs of about $1 billion in its transition businesses, RBC Capital Markets' Biraj Borkhataria and Adnan Dhanani say. The U.K. energy major disclosed the charges in an update that otherwise showed a strong performance in the second quarter, the analysts say in a research note. "Call it pre-divestment window dressing...better to take the hit now than show explicit value destruction at the point of sale," the analysts say. "We believe both LightsourceBP and Archaea could face the chopping block--although not formally announced by the company as far--and see no place for either in BP's portfolio long term." BP shares rise 3.2%. (adria.calatayud@wsj.com)
0825 GMT - A spike in oil prices could push the U.S. and Iran to de-escalate the Middle East war, BCA Research's Felix Vezina-Poirier says in a note. "Both sides are willing to flex, but neither wants the consequences of a much larger escalation," he says. As oil prices climb further, this could give way to defusing the conflict, Vezina-Poirier says. "There is a risk oil breaks above the $70 to $90 a barrel 'kinetic equilibrium' range, but such a spike would itself trigger the mechanism for de-escalation," he says. Brent crude rises 4% to $86.65 per barrel. (miriam.mukuru@wsj.com)
0811 GMT - BP's strong performance against key metrics in the second quarter suggest consensus estimates are likely to be increased, J.P. Morgan's Matthew Lofting and Tianyu Wu say in a research note. The U.K. energy major followed peer Shell in releasing a strong second-quarter update, the analysts say. BP's oil-trading result was slightly higher than an already exceptional performance in the first quarter, they add. Upstream price realizations were ahead of expectations and downstream operations were also strong, according to JPM. This could trigger double-digit upward revisions to consensus estimates on group earnings and cash flow from operations across divisions, the analysts say. BP shares rise 3%. (adria.calatayud@wsj.com)
0806 GMT - The dollar could rise if upcoming data on U.S. underlying inflation for June are higher than expected, MUFG Bank's Lee Hardman says in a note. Federal Reserve governor Christopher Waller on Monday said if there was another hot core inflation print, the Fed will need to consider tightening policy in the near term. His comments will make the U.S. rate market and the dollar even more sensitive to the inflation data at 1230 GMT, Hardman says. "An upside surprise for core inflation could reinforce the dollar's upward momentum even if headline inflation slows due to lower energy prices." The DXY dollar index falls 0.1% to 101.159. (renae.dyer@wsj.com)
0751 GMT - BP's second-quarter update looks strong, with pricing benefits ahead of expectations and a robust trading performance, J.P. Morgan's Matthew Lofting and Tianyu Wu say in a research note. "We expect the shares to be supported [Tuesday], driven also by this week's Middle East-led move higher on oil," the analysts say. The U.K. energy group expects price realizations to lead to benefits of between $1.8 billion and $2.1 billion in its oil production-and-operations segment and of $500 million to $700 million in its gas-and-low carbon energy segment. These seem stronger than the BP's rule-of-thumb price sensitivity as pricing caught up with market moves in February and March, according to JPM. BP shares rise 2.75%. (adria.calatayud@wsj.com)
0748 GMT - A retightening of short-term U.S.-eurozone rate differentials is keeping the euro afloat against the dollar amid renewed U.S.-Iran conflict, ING's Francesco Pesole says in a note. The rebound in oil prices came as European Central Bank interest-rate rise expectations were dwindling, leaving room for euro front-end rates to recover, he says. However, this might not offer sustainable support to the euro if energy prices continue rising. Markets could find it difficult to price in more than two ECB rate rises by year-end considering the cautious stance of policymakers recently and the negative terms of trade implications of higher energy prices, he says. The euro rises 0.1% to $1.1387 and ING sees a risk of it falling to $1.10.(renae.dyer@wsj.com)
(END) Dow Jones Newswires
July 14, 2026 05:50 ET (09:50 GMT)
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