Oil prices experienced steep losses last week reflecting a sharp increase in tanker traffic exiting the Strait of Hormuz. Brent Crude recorded a weekly decline of more than -10.0%, concluding Friday at $72 a barrel as supply concerns eased. Saudi Aramco’s key Ras Tanura oil refinery resumed oil loading for the first time in four months. The facility, one of the largest in the Middle East, has the ability to process more than half a million barrels a day whilst also serving as a critical export terminal for Saudi Arabian oil. However, while the improvement in supply flows has helped stabilise markets in the near term, the broader backdrop remains uncertain. The agreement between the US and Iran continues to appear fragile, with reports of further attacks by both sides in recent days highlighting the risk that volatility in energy markets may persist. Near‑term price direction is therefore likely to remain heavily driven by political rhetoric and developments in Washington and Tehran.

In equity markets, sentiment turned notably weaker, with sharp declines seen across the artificial intelligence (AI) value chain. Semiconductor names were particularly weak amid highly volatile trading conditions, with interest‑rate concerns compounding negative sentiment. The S&P 500 fell -2.0%, while the technology‑heavy Nasdaq declined -4.6% (both in dollar terms), reflecting a broad pullback in growth‑orientated sectors. The weakness extended into Asia. In Japan, the Nikkei 225 dropped -2.7% (in yen terms), as early‑week gains were quickly unwound, again driven by technology‑related selling. Chinese equities also lost momentum, with the Shanghai Composite falling -1.6%, while Hong Kong underperformed further, weighed down by heavy declines among large internet names.

European markets proved more resilient, with the MSCI Europe ex‑UK slipping just -0.4% (in euros). In contrast, the FTSE 100 rose +1.4%, bucking the broader trend seen elsewhere. That resilience in UK equities came despite heightened political uncertainty dominating headlines throughout the week, following Prime Minister Keir Starmer’s resignation. Attention has since turned to the likely succession, with the now former Greater Manchester mayor Andy Burnham widely expected to assume leadership of the Labour Party. With his candidacy likely to go unchallenged, markets are increasingly treating him as the Prime Minister‑in‑waiting, though the broader policy implications remain unclear.

SJP Approved: 29/06/2026

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