Posts Tagged ‘Oil’

Forget about Greece, it’s all about the oil

posted by rossgillam

Following the second €130bn bailout for Greece, you could be forgiven for thinking that the Eurozone crisis might finally be abating. However, the increasing tensions between Iran, Israel and the West pose a significant threat to economic recovery.

As Gideon Rachman wrote this week, the threat of conflict with Iran is increasingly real. Israel’s Defence Minister, Ehud Barak, has stepped up the rhetoric against Iran, recently calling for tighter nuclear sanctions, to the extent a pre-emptive missile attack by Israel no longer looks out of the question. Similarly, whilst the Foreign Secretary, William Hague, explicitly said the Government are not advocating military action against Iran, Mr Hague would not support a backbench motion calling for the unilateral ruling out of it.

Added to this is the escalation of conflict in Syria. Despite the veto by Russia of a recent UN resolution that sought to put an end to Bashar al-Assad’s authoritarian regime, increased media attention of al-Assad’s crackdown, heightened by Marie Colvin’s untimely death this week, means some form of military intervention from external sources also looks more likely than previously believed. Such intervention is likely to provoke a response from Iran, a fierce ally of al-Assad, which could draw in other regional players, such as Saudi Arabia and Israel. Whilst such a scenario currently seems a long way off, as events across the Middle East have shown us in the last 14 months, anything is possible.

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FPS’ Friday Fiver

Hello All, and apologies for a late night Fiver – it’s been one of those weeks in financial and professional services. Still, below we have a trip through the week’s news highlights (sadly not including Tom Watson’s intern) as you head into the weekend. Thanks to Ed, Jonathan, Ross and our latest contributor, Josh Glendinning. Have a great weekend all.

UK VS THE WORLD…..While UK GDP figures dominated the headlines on Wednesday, members of the FPS team were given an insight into what lies ahead for global growth in 2012. At an event put on by British American Business we heard from, Alexis Karklins-Marchay of Ernst & Young that despite the woes of the Eurozone, the global economy can still expect growth of over 5% this year.

Much of this output will come from what Ernst & Young term Rapid-growth markets (RGMs), a set of 25 countries they expect will account for nearly half of global growth in the next ten years. Their report on RGMs and its micro-site are an excellent resource for anyone looking for facts and figures on the future shape of the world’s economy.

As an aside, one of the panellists, Stephen Castle of the International Herald Tribune, offered an anecdote from his time in the Brussels press corps. An unnamed member of the German press, brought up in the same region of the former East Germany as Angela Merkel offered Stephen an insight on Merkel’s approach to the Eurozone crisis. In the GDR, cars and appliances were never reliable, and the parts required to fix them were never available. As a result, citizens took to patching things up and making do until they broke again. The German journalist had decided Merkel was taking the same approach to the crisis…

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