There is a long-term vision to their economic policy - perhaps around re-industrialization - but the way it's being executed won’t yield quick results, certainly not enough to offset the short-term negative economic impact it's already created. On oil, we’re seeing a strong technical floor at around $60, but OPEC is adding supply into a market where recession risks loom. Lower prices may boost demand a bit, but not enough to overcome the broader economic headwinds, such as tariffs. And OPEC’s unwinding of supply is a multi-stage process - the volumes yet to come are significant, so we’re not at the bottom yet.
How much longer can the market structure stay in backwardation?
I don't think there's any way to avoid a persistent contango, at least for a while, until there's a meaningful production shift, whether from OPEC or non-OPEC producers. That’s what happens when a weak market persists. Over time, flat prices and structure, tend to move together, even if they diverge briefly in the short term. If Brent breaks the $60 floor, that could accelerate the shift.
Has geopolitical risk been completely removed from the oil price?
We need to separate rhetoric from real-world impact. Take the Houthis in the Red Sea, for instance: the market made its adjustments, and now we’re in a kind of semi-detente. We may see something similar with Iran, which has already improved relations in the Gulf - not completely, but to an extent.