Q3 2025 Economic Commentary

Rising Temperatures

The potential for a wider conflict in the middle east has provided a volatile backdrop for markets in recent months. Whilst the current Israel / Iran ceasefire appears to be respected, Donald Trump believes he can achieve a ceasefire between Israel and Hamas. More recently he has issued an(other) ultimatum to Russia about agreeing a ceasefire in Ukraine, promising “severe” tariffs and secondary sanctions against countries that buy Russian oil.

In response, Brent Crude has been volatile. Markets are assuming that Iran will not restrict the flow of oil through the Strait of Hormuz, which caters for over 20% of the world’s daily volume by transit. Supporting this assumption is that China purchases 89% of Iran’s oil exports.