Global | BBVA Research Big Data Geopolitics Monitor

Summary

Geopolitical risk has reached extreme levels in the Middle East and the US amid the ongoing conflict between Israel and Iran. The closure of the Strait of Hormuz has disrupted global oil markets, significantly increasing economic policy uncertainty and worsening economic sentiment in the Gulf countries.

Key points

• Key points:
• The US president signaled a potential diplomatic resolution, delaying planned strikes on Iranian energy infrastructure. This eased market tensions, leading to a rebound in stocks and a drop in oil prices.
• Iran fired multiple waves of missiles at Israel, triggering air raid sirens in major cities like Tel Aviv, while officially denying any ongoing direct negotiations with the United States.
• Geopolitical risk indicators show a persistent gap between the US and Europe, with the former situated in the extreme risk area while European countries remain in the high-risk zone.
• Economic policy uncertainty has escalated to extreme levels, particularly in Qatar and Israel, while economic sentiment has deteriorated to unprecedented lows in Qatar and Oman.

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