Hosted by Christina Ruffini and Sir Richard Dearlove
Guest
Helima Croft
Helima Croft is Managing Director and Head of Global Commodity Strategy at RBC Capital Markets and a former senior CIA analyst. Helima Croft breaks down what market players are getting wrong about the oil supply disruption.
Episode Summary
The Strait of Hormuz is in a chokehold. The scale of this oil supply disruption has already exceeded the shocks of the 1970s. Sir Richard Dearlove and Rosanna Lockwood sit down with Helima Croft, Managing Director and Head of Global Commodity Strategy at RBC Capital Markets and former senior CIA analyst, to break down what market players are getting wrong, why reopening the Strait is far harder than it looks, and what a Houthi entry into the conflict could mean for the Red Sea.
In this episode:
3:04 Technical Side of Supply Disruption
6:11 IEA and Comparison to Russia-Ukraine
9:32 Alternative Routes for Oil and Gas
12:08 Russia is the Big Winner
13:13 Ground Troops Needed to Open the Strait of Hormuz
17:14 The US Domestic Picture
21:43 Will Houthis Disrupt the Red Sea?
27:52 What Market Participants Are Not Understanding
30:57 Is $200 Barrel Crude Oil Possible?
33:19 Sir Richard and Rosanna Discussion
Hosted by Sir Richard Dearlove (former MI6 Chief) and Rosanna Lockwood (International Journalist)
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Transcript
COLD OPEN
Croft: The moment that Houthis sort of enter the chat on this conflict, we are gonna have to start thinking about the security of the Red Sea. We're really looking at $200 a barrel running into the middle or later part of this year. Is there anything left in Trump's so called arsenal that he could use to calm the market? So we wanna think about who's the big winner in this. We talk about important countries being net losers. The big winner is Russia.
INTRODUCTION
Lockwood: Hello, and welcome to One Decision. I'm your cohost, Rosanna Lockwood, and I'm joined by our cohost, as ever, Sir Richard Dearlove. Hello, Sir Richard.
Dearlove: Hi, Rosanna. Good to see you again. Good to be discussing these crucial events.
Lockwood: Energy today because we are living through the largest oil supply disruption in history. Can you believe we're saying that? With the Strait of Hormuz in a chokehold, we're seeing crude oil prices skyrocketing. Helima Croft joins us today to break down the geopolitical reverberations of this historic moment. She's just the woman to speak to. She's very respected across the markets as the managing director and head of global commodity strategy at RBC Capital Markets, as well as a former senior economic analyst at the CIA. Helima, so good to see you. Thank you for making time.
Croft: Thank you for having me.
Lockwood: Where to begin? Let's just talk with the word unprecedented, because that's the word that's been flying around, especially in the last week or so, or two weeks, we should say, as we see the oil price climb. Talk to us about how unprecedented this is.
INTERVIEW
Croft: I mean, the scale of the supply disruption is unprecedented. It goes beyond the disruption that we saw in the seventies. That was the great oil shock that gave rise to the International Energy Agency and western countries talking about strategic stockpiles. In sheer volume of supply shot in, we have exceeded that at this point. And the real question is, how long does this go on? When we hear the 200 a barrel number thrown around, that's contingent on a disruption that extends for multiple months and no effective alternative routes being open. And so I think that the big question for energy markets is how long does this go on? And do we see alternative choke points also effectively closed down? I'm paying very close attention to the Red Sea. That's where the Saudis are rerouting some of their exports to a port called Yanbu. And if the Houthis enter this conflict and make that sea lane difficult, then I think we will be talking about higher prices, certainly higher than we saw right before the financial crisis when we had oil at $147. I think we will take out that number if this goes on. And, again, we see that sea lane imperiled.
Dearlove: Helima, can you also explain the technical side of disruption? Because I think a lot of people don't understand that fully. Because you get a situation where you run out of storage capacity because you can't ship. You then start closing down wells. My understanding is that once you close the well down, it can take weeks, sometimes months, to reopen the wells. Then, you know, if they've got water in them, you have to pump. I mean, could you explain a little bit of that? Because I think that is so important as an aspect of the crisis.
Croft: This is why we are really on the clock, Sir Richard, because as you pointed out, we now have countries effectively shutting in production. Because what happens is when your barrels don't flow, and about 20% of global oil and gas flows through the Strait of Hormuz. So when you cannot physically move those barrels to market, countries have to start shutting in. And we have a variety of different storage levels across the Gulf. And the country that was the fastest to shut in was Iraq. And Iraq reached shut in levels in several days that people were anticipating it might take them weeks. People were not anticipating just the shortfall that would emerge in Iraq. So Iraq is effectively almost entirely shut in at this point, and they are OPEC's second largest producer. And the problem with Iraq is that Iraq has really dilapidated infrastructure. They have invested in increasing production, but they've lagged in terms of investments in pipelines, in storage. And so the question will be for Iraq, when they eventually restart, will it take longer than countries like Saudi Arabia, which essentially have the best in class national company Aramco? So Saudi has already started shutting in a couple million barrels of production today, or we're talking on the Monday, we are hearing that United Arab Emirates has also shut in potentially half of their production. You would anticipate that both UAE and Saudi would be faster restarts than we would see in the case of Iraq. And then the other big story that I haven't even mentioned is gas. Qatar LNG is now all shut in. And Ras Laffan, their major LNG facility, that shut in very early in the war. And the restart of LNG facilities, just because of the technical aspects of cooling, getting the liquefaction plant up and running again, that is even a harder process than getting oil fields back up online.
Lockwood: I think Sir Richard's taken us the right direction. I'm asking you on the technical side of things because there's a lot of interest. And you could almost say sort of the everyman at the moment in the oil markets, you're seeing retail traders. What I mean by sort of almost amateur, everyday people trying to get in and make a quick buck of what's happening? And people are starting to realize for the first time how complicated these oil operations are to switch on, to switch off, and how long it takes for things to happen. So let's, if I could also ask you about the IEA, the International Energy Agency, and the oil reserves. This was the big story of last week, about a week ago from when we're recording, that they're gonna release this 400,000,000 barrels of oil, which is almost double what was released at the peak of the Ukraine Russia crisis. But it doesn't just happen all at once, does it, Helima? Tell us about how long that takes and where it all comes from, where it's stored, who's involved.
Croft: This is the IEA, the International Energy Agency, which again was created after the oil shocks of the 1970s. And you mentioned Russia, Ukraine, and I think that is really important because we had a very large coordinated stockpile release right after Russia invaded Ukraine, and the United States did about 180,000,000 barrels from its own stockpile. But there was no physical supply disruption in the case of Russia Ukraine. There had been concerns there would be a physical supply disruption. The head of the IEA, Fatih Birol, had warned very early in that crisis that we could see 3,000,000 barrels come off of Russia because of sanctions. But the White House really decided in the early days of that war not to aggressively sanction Russian oil. They wanted to keep Russian oil on the market. So the release of that oil, in the case of the Russia Ukraine war, was designed to keep prices lower. It was not addressing a physical shortfall in the market. That 180,000,000 barrels was used to keep prices lower. Now this release is having to address a significant unprecedented shortfall in the market. So, a, some of this oil will take time to actually reach the market. And the question is, why duration matters? How long will this release work? Because if we're losing anywhere 10,000,000 barrels, 14,000,000 barrels a day, given the offset from Saudi Arabia, if this is extended, if this goes through summer, those stockpiles, which were designed for emergency purposes, they are not going to be particularly effective in an extended duration conflict. One of the things that we've really struggled with in the United States is the fact that we chose not to refill the SPR after the Russia and Ukraine release. There was a view that maybe we didn't need to refill. We're such a large producer in the United States. We didn't take the opportunity of lower prices to refill that stockpile. And so now we have much thinner shock absorbers if this war is an extended duration supply outage.
Dearlove: Helima, can we just also now explore a little further the gas dimension? Because you mentioned that Qatar are already shutting down or shutting off. I mean, what are the alternatives? You've got the fracked gas from the Permian Basin in the United States. You've got actually some important new gas fields off the West Coast of Africa. But my understanding is that these issues, they can't sort of be switched on fast enough to fill the gap. Can you explain that a bit further?
Croft: No, Sir Richard. That's the big challenge with gas, and we could talk about what this means for fertilizer as well, what it means for food prices. But when we talk about oil, right now, there are some alternative routes to get oil from the Gulf to the market. Again, not perfect. They do not offset the volumes lost. And, again, security is contingent on the Houthis not entering the conflict. For natural gas, there is no offset. There is no alternative way to move Qatari LNG to market with the Strait of Hormuz effectively shut down. So there's not also an ability to surge output from the US or Australia or Africa to make up for those lost volumes. So then we have to pay close attention to who gets hurt the most from this. And you would really start to look at Asia. You'd look at developing countries in Asia not being able to access the gas. Then you have to think about Europe in the sense that Europe had made the decision to go off of Russian gas largely. Qatar was a big part of that story. US was part of that story as well. Australia was part of that story. But not having this source of supply obviously has implications for building storage as you think about, you know, later months in the year. So this is going to be a real problem for gas markets. I think it's gonna be the developing world that's gonna be hurt first and hurt hardest, but Europe will feel the impact of this as well. Again, because Europe made that decision to say, we are not gonna be dependent on Russian energy supplies going forward.
Lockwood: Asia is such a big part of this, as you say there, Helima. But you've also got India being a big piece of this puzzle. It's heavily reliant on the Gulf, not only for things like fertilizer, but also energy as well. So now we're seeing India hailing diplomacy talks with Tehran and saying, we're gonna manage to get some tankers through the Strait. Can you give our listeners a sense of how big an impact this does have on countries like India?
Croft: Again, volume matters. So people might look at one or two Iranian VLCCs, very large crude carriers, filled up, ready to go to India or to China. But on any given day, we had 80 ships moving through. So this is really a small volume that will be getting through even to India. What I think is important for India is they're getting a measure of relief because the United States has pulled back sanctions on Russian oil. Again, if we wanna think about who's the big winner in this, we talk about importing countries being net losers. The big winner is Russia. And Russia had been hit with sanctions the end of last year targeting its two biggest producers, Rosneft and Lukoil, essentially full blocking sanctions, which was making it hard for India to continue to import significant volumes of Russian oil. In fact, there was a deal between Rosneft and the Reliance refineries for around 500,000 barrels a day was going from Rosneft to Reliance. What was happening was we were building a lot of Russian floating storage on the water. That will now move to India sanction free. Some of it will move to China sanction free. It's a measure of relief. Again, it's not the great replacement story, though, for energy markets. So, again, India will get some volumes, but they're not in any way out of the woods even with a few Iranian tankers going through every day.
Dearlove: Can we look at the practical issue of, as it were, making the Strait of Hormuz safe or relatively safe for any shipping as opposed to certain nations doing deals? I mean, if Trump is serious, you almost certainly have to think in terms of blockading the Iranian coast and maybe even putting boots on the ground on the coastal strip. Because, as far as I recall, there are quite a lot of missile emplacements that Iran have built along the coast. They have to be taken out. I mean, can you go into the detail of that a bit further, Helima?
Croft: I think this is such an important conversation because I think the oil price right now doesn't reflect the severity of the challenge of reopening the straits. I mean, so many market participants almost think this is an easy operation, put in two or three boats, you escort them through, what's the big deal? They don't understand how many ships would have to be involved, what you would have to do. Again, putting in ground troops to go take out, you know, the missile launchers, trying to really secure the coastline, not realizing that we probably haven't seen Iran's mining capabilities deployed at this point. So this could actually be a very, very challenging operation. And as you know, President Trump has tried to get other NATO countries, you know, Asian allies to participate in an effort. And for now, a lot of these countries are saying, no thank you for now, President Trump. You have to figure this out. And the problem is that we've never done anything like this while we've been in active combat. If you think about, you know, '87 where we reflagged, United States reflagged Kuwaiti tankers and helped move them through the Strait of Hormuz. A, it was a large operation. It was like 80 ships were involved in it. We worked with countries like the United Kingdom on this, but we were not an active participant in the Iran Iraq war. We have a situation now where the United States is the principal protagonist in this story, and we have to move resources from that effort to dealing with the Strait. And then we have to commit ground troops. And the problem, I think, in the United States is that it was never told to the American public that this was an imminent threat. There wasn't a lot of preparation in advance of this to convince the American public that this was a necessary operation. And it was sold as something that would be easy, that it would look something like Venezuela or like the twelve day war in June. And there was no initial discussion about ground troops. And so are we rolling into an escalation that is a longer duration event, more US resources involved in it, and will we have higher for longer because it's going to be challenging to effectively convince shipping companies, countries that are oil producers that it's, you know, safe to go through the strait. I mean, I was really struck by comments from Sheikh Nawaf al-Sabah, CEO of KOC. He did this fantastic interview in the Princeton Alumni Weekly. And he basically said he's not gonna send his strategic tankers through the Gulf waters until there are significant security guarantees from the US Navy. And given that we are an active combatant right now, we don't know when that's gonna be possible.
Lockwood: That was my thought when reading a line somewhere along the lines of these tankers are queuing up in the Gulf, ready to pop one by one. That wording. I was just thinking of the sailors on board those ships, the companies that are responsible for them. Sir Richard's got a long history in insurance as well. How do you go about insuring that people's lives, you know, just going through that strait right now, the risk is enormous, isn't it? In terms of the US domestic picture, you brought that up, Helima, and obviously, you've got the midterms coming up later this year. Plenty of analysis out there echoing exactly what you're saying there that perhaps the American public aren't as on board with this. Polling shows, of course, that there's limited support for this war. And when we start to feel gas prices at the pump, I say where we are currently in the United States at the moment, and we're already seeing staggering increases of gasoline at the pump. That's only set to rise. At the same time, you've got Donald Trump saying on his Truth Social platform, quote, The United States is the largest oil producer in the world by far. So when oil prices go up, we make a lot of money. That's a bit of politicking there, but I just want to get your reaction to that.
Croft: Well, US oil and gas companies make a lot of money. For the US consumer, you are suffering in terms of, you know, higher gasoline prices. It's a big part of people's discretionary income. Then you think about everything in terms of shipping costs, in terms of the cost to move goods by truck through the country. So we do see significant pushback from US consumers. There's this point where when gasoline prices breach $4 a gallon, that is seen as a psychological pain point for US consumers. So I think the Trump administration will be very concerned when we breach that level, or we're likely to breach that level in an extended war scenario. And there are limited tools in terms of what you can do to abate this. Again, we are a big producer, but it's a globally traded product. And so when there's a shortage in one part of the world, we feel it in terms of the price impact in the United States.
Dearlove: Helima, it may be a sort of sub issue, but my understanding is that the Strait of Hormuz issue strategically doesn't have nearly as much impact on Israel as it happens. I mean, okay. This is a global issue. But since Israel opened up its own domestic gas fields, plus it's got other sources of supply which don't come through the Strait of Hormuz, it seems to me there's a sort of slight bifurcation in the war objectives of the two allies now because the Israelis, okay, they have to say they're worried about it, but it doesn't actually affect their economy at all in quite the same way. Is that a correct judgment?
Croft: So, Richard, I think you're onto not only the issue of, like, Israel not being as directly impacted by these shortages, but also their public broadly supports this. I mean, when you look at the polling out of Israel, I think some polls show that 81% of the Israeli population is in favor of this war and actually quite expansionist goals for the war in terms of full regime change. Whereas in the United States, we don't actually know what the actual end goal is for the Trump administration. We hear different things. We hear it could be limited to missiles, launchers, naval ships that are formal naval ships, not the small boats packed with explosives that they're using off of ports. Then you hear President Trump talking about wanting to pick the next supreme leader. So we don't really know how this ends. Whereas I think for the Israeli population, they are supportive of a broader campaign. They are supportive of a campaign that is much more geared towards full regime eradication. The United States, we have yet to be really told how this ends.
Lockwood: And returning to a point you highlighted earlier in the conversation about you're watching the Red Sea very closely. And if we think about not knowing how this ends and potentially where it could get worse is, of course, the Houthis along Yemen, the south side of the Saudi Arabian border. It's been a geopolitical flashpoint between the UAE and Saudi Arabia, particularly in recent months. It's been going on for years. Iranian backed Houthi rebels, which by all accounts, according to analysis today, as we're recording, seem to be kind of on hold. And do you think they're potentially being held in reserve to extend the conflict and to maybe target the Red Sea?
Croft: Well, gosh, I'd love to hear some of Richard's thoughts on this. But that's a view, clearly, that they are being held in reserve. And some of the comfort that some people have about this crisis is based on the fact that Saudi Arabia had invested in the East West pipeline, had invested in Yanbu Port to have this alternative route. And you're now starting to see your tankers moving in large numbers to Yanbu. But what I always say is I remember 2019 really well. I remember when the US reimposed maximum pressure sanctions on Iran. The then Iranian foreign minister, Javad Zarif, had actually been in New York for a series of meetings. And I remember being at a New York based think tank that he said, if we can't sell our oil, no one can sell their oil. And then we started having attacks off of UAE. But that summer you had a drone attack on pumping stations along the East West pipeline that was done by the Houthis. And so when I look at this current crisis, I say like, the moment that Houthis sort of enter the chat on this conflict, we are gonna have to start thinking about the security of the Red Sea. Right now, I think there's way too much complacency that this is gonna be fine, that they're gonna continue to be able to send 7,000,000 barrels a day through there. If we close Bab al-Mandab again, like, we don't have an alternative route then. It's all contingent on the Houthis staying on the sidelines.
Dearlove: Helima's really onto something important, but the Houthis are the least controlled of Iran's proxies. And they are, to an extent, more independent, and they have always acted, I think, without Quds Force control, but supported by the Quds Force in terms of armaments. And I think you see perhaps at the moment that they've hung back and not got involved, bearing in mind that they did lose some of their leadership when the Israelis last mounted a major attack. And I think they killed significant part of the Houthi leadership. But I think the answer to the question you raise is this is another dimension that the Iranians could open up if they press the Houthis really hard for assistance. So I think that could bear very heavily, as you say. I mean, I'm amazed at the moment that the price of oil hasn't gone up more than it has. I think I'm reflecting your interpretation. And, you know, you look at it all the time and think, why hasn't it gone up more? Is that question dependent on Houthi involvement, or are there other factors now which will push it up further?
Croft: I think for now, there's a corner of the market that never believed that this would be a long duration event. They were surprised it even happened. They were surprised that Iran targeted neighboring countries, even though I had been in the Gulf at the end of January, beginning of February. And the countries there, the leadership on the energy side were very concerned that it would look different this time because the Iranians had told them it would look different. But the market participants assumed that it would be a nonevent, that it would be short like in June, and there hadn't been disruption in the Russia Ukraine war of significant scale. And so once this began, they thought it would be short. And they still believe it's going to be short. And they still give Scott Bessent, our US Treasury Secretary, the benefit of the doubt when he says it's gonna be short, that they're working on a plan. And so I think what changes is if we are sitting at this point two weeks from now, if we get to mid April and this is still going on, I think we do move higher. When it comes to the Red Sea, I don't think the Houthis would actually have to do much. A couple drones, a couple missiles fired on ships there, and they had the ability to give a lot of people grave concern about the security of the Red Sea because they had been so disruptive before. Just a little show of force in this current context, I think would have major ramifications. So that to me is gonna be such an important variable. Do they stay on the sidelines? Do they do something even is more like a for show? Because in this context, people will start remembering what had happened the last couple years with the Red Sea.
Lockwood: To your point about the markets, market psychology and that corner of the markets that still didn't believe it would go on so long, perhaps this is a taco traders, you know, Trump always chickens out. You know? Is it gonna be a quick turnaround, a quick flip flop? Like Greenland. Exactly. You know? And perhaps there was some hope it would be like a Venezuela operation and be over fairly quickly. I'm sure the Trump administration did hope that. Look. When the markets react, can you give our listeners who maybe aren't traders or aren't operating in the market? I remember last week or however long ago it was when President Trump said, this war could certainly probably end soon or something. That's a paraphrase of his quote. And we saw the markets react almost immediately and deflate.
Croft: Yes. I love this question because we had a massive run up with the Asia open Sunday night. We ran up to almost $120. And then you had, on Monday, first expectations of a coordinated stockpot release, which took some of the price back. And then President Trump came out and said, it's going to be soon. And then a quarter of the markets, nontrivial quarter of the market, decided, okay, he's gonna end this soon. It's gonna be like Greenland. I call it recency bias, where you essentially look at Greenland, you look at Venezuela, you look at June and you say, it's just gonna follow the same pattern. But what I think market participants are not getting, even now, because we've seen a little softness since Treasury Secretary, again, signaled he had a plan or he was letting some ships through or, you know, US energy secretary was out on talk shows also saying it's gonna be a few more weeks. Iran has a say. Even if the United States declares victory, Iran can also continue attacks on tankers because they're not just hitting tankers right at the entry and exit point of the Strait of Hormuz. They're hitting tankers off the coast. Like, we have a much wider field, a blast radius in contested waters. So the Iranians can continue these attacks. They can continue to snarl shipping, even if we declare mission accomplished again. And they could decide. Maybe they want to send a tougher message to Washington about these type of military activities in the region. They may want us to cease and desist for a considerable period of time. I don't think they want us back in six months' time.
Lockwood: Is there anything left in Trump's so called arsenal using social media or speeches that he could use to calm the markets, or is it gonna be sheep cried wolf the more times he says, oh, I'm gonna end this soon. I'm gonna end this soon, but there's clearly no off ramp in sight.
Croft: I think that the really big factor for the market will be any indication you can get ships moving, which is going to be enormously challenging. And I'm not sure market participants have woken up to that fact. I mean, even when you think about if the Iranians were to start laying mines, we have about four minesweeper vessels, dedicated vessels. No US dedicated minesweeper are in the region right now. And so if the Iranians were to start, you know, mining the waters and harbors on a significant scale, that would be a challenge for us. But the more the Trump administration keeps saying it's going to be a short war, they have control of the situation, and that proves not to be the case, then you have the emerging credibility gap. And we saw that when Secretary Wright, energy secretary Wright, someone on his team posted on social media that the US had escorted a tanker through the strait. And that was on a Tuesday after the Monday, it's going to be soon sell off. Then we had a further sell off on Tuesday when Secretary Wright said that we had escorted a tanker. It proved to be a phantom tanker. There was no escort. And so the more that the administration is seen as trafficking alternative facts, these type of comments have diminishing efficacy. They don't work as well. So, again, at a certain point, you're gonna have to back words with action.
Dearlove: I think there's another issue which makes me feel we're not near the end of this war yet, which isn't directly related to the shipping, but is certainly directly related to the strategy. And that's Israel's concern about disposing of the 450 kilos of HEU hidden somewhere in Iran, which implies some sort of raid or boots on the ground because you can't get your hands on it unless it's negotiated out of the way, and I don't see that. Are we really looking at $200 a barrel running into the middle or later part of this year? Can you imagine higher prices like that as you go into peak summer driving season?
Croft: No. This is so important. Like, what are the ultimate aims? I mean, I always think about, I will personally say I feel like I'm a creature of the Iraq war. I was a young agency analyst in 2003. And the whole question of, tell me how this ends. And if we are dedicated to going and finding that highly enriched uranium, I heard in Washington last week that that is under absolute consideration in the White House. Again, that's a ground force operation. So are we now embarked on a rolling escalation? Have we sort of fallen into the Robert Pape escalation trap? We started with limited aims and now we're talking about ground troops for two operations, to secure the coastline and to get the highly enriched uranium. How many troops is that going to involve? And these are complex operations. And again, I'm not sure the market realizes these are complex operations. But what happens if you have a higher casualty count? What's the US resolve on this? And again, I think the Israeli and US public have different appetites for casualties and for higher energy prices.
Lockwood: So much to watch out for. Look, Helima, before we let you go, we ask all our guests this on One Decision podcast. What one decision are you looking out for in the coming days or weeks with regards to this war?
Croft: I mean, the one decision I'm looking towards is to Yemen. What happens with the Houthis? Do they decide to stay on the sidelines, or do they decide to even just show a force with a few missiles or drones, change our view of the security of that second choke point?
Lockwood: Helima Croft, so good to speak to you at this important time.
Croft: Thank you for having me.
ANALYSIS WITH SIR RICHARD DEARLOVE
Dearlove: Well, I think we teased out two really big deal issues. And the one that she explained so clearly was the issue of Yemen and the Houthis and the risk to alternative routes out of Saudi Arabia for Saudi Arabian oil through the Red Sea. I think that's really important. And the other issue, which she understood and did emphasize, is there are two aspects now to boots on the ground. One is a coastal blockade where you would maybe need to put marines along the Houthi straits there to control the coastal area. And the other thing was, you know, the HEU that the Israelis are so keen, I would put that as their primary war aim to destroy that. So her analysis, which is cogent in relation to the markets and the fact that people don't understand the seriousness, I really hope that a lot of people listen to this podcast and get the message that the situation now is getting really complex and that all the pressures on Brent crude oil price are upwards. And that it's hard at the moment as she made so clear for the leadership in Washington to start talking the market down because they're running out of options, and they're running out of credibility. So that's my main takeaway.
Lockwood: I think this is a crucially important podcast, and I think we're really offering something important for people to listen to. Yeah. You've picked up on that, I wrote that down, that stood out for me too. Her warnings about the Red Sea, about the Houthis, and about them being a particularly sort of critical part of the dynamic of the ongoing part of this war, that sort of discussion we had about them being in reserve. But also the market psychology. She's so good on that. And I think a lot of people, it's a bit like what we saw. I was covering the markets for CNBC back during the peak of COVID. I was based out in Asia, and we were seeing so much of what you call retail trading, day trading, speculative frenzy happening. And interestingly, we're seeing this this time around with oil because this is just what the world is like now. People like placing bets. You've got companies that allow people to sort of bet on geopolitical outcomes now and do sort of game theory, and then you've got people actually speculating in the markets. So people are kind of more engaged with geopolitics and news topics because it's either making them a quick buck or losing them lots of bucks. And I just think that's a really important part of this as well. It's another reason why I hope people listen to this because you've got to listen to smart people like Helima who understand the markets and understand all the geopolitical ramifications before you start putting your money there and potentially losing it all. Well, that is all for this week's episode. Join us on Tuesday for One Decision in Brief where we analyze the most important global affairs stories. For more conversations with leading decision makers and thinkers, check out onedecision.com and our YouTube page where you'll find additional commentaries, conversations, and explainers. I'm Rosanna Lockwood with Sir Richard Dearlove. Thank you for listening.
