In recent days, oil has been extremely volatile because traders are rapidly adding, then removing, a geopolitical risk premium. Brent crude surged to almost $120 a barrel as the Israel-US conflict with Iran raised fears that flows through the Strait of Hormuz, a route for roughly a fifth of global oil supply, could be badly disrupted, with shipping and some regional output already hit. It then fell back towards the low-$90s after Donald Trump said the war could end 'very soon' and as hopes grew for emergency stock releases by the G7/IEA. For investors, the key point is that a lasting oil shock would lift inflation and make central banks more cautious on rate cuts, while a retreat in energy prices eases that pressure. Markets reflected that shift: European stocks rebounded and short-dated gilts and Bunds rallied as rate-hike fears faded.