Morning Bid: Six months and counting

• Oil flow through the Strait has dropped dramatically with tracking data showing approximately 5 million barrels per day passing through, far below pre-conflict volumes, yet crude prices remain below feared triple-digit levels
• U.S.-Canada trade tensions escalated with 25% tariffs on $20 billion of goods taking effect, followed by retaliatory Canadian levies and U.S. threats of 50% auto tariffs by year-end if no deal is reached
• Fed Chair Kevin Warsh faces scrutiny at Jackson Hole after July PCE inflation came in at 3.7% annually (above expectations), while Treasury yields hover around 4.7% following criticism of Treasury Secretary Bessent's bond-buying plans

Summary: Morning Bid - Six Months and Counting

Strait of Hormuz Crisis

The Strait of Hormuz has been effectively blocked for six months since February 28, despite President Trump's initial projection of a four to five-week disruption. The waterway previously carried approximately 20% of global energy flows. Current oil transit estimates range from 5 million barrels per day (bpd) according to tracking data, contradicting higher claims from Energy Secretary Chris Wright.

Brent crude trades below $90/barrel—above pre-conflict levels but far from feared triple-digit prices. However, diesel markets show severe stress, with European diesel profit margins near record highs. Diplomatic efforts continue, with reports that parties are working to finalize control agreements, following meetings between officials and Tehran on Thursday.

U.S.-Canada Trade Tensions

Trade relations deteriorated after a deal collapsed Friday, triggering tariffs on approximately $20 billion in goods (lumber, dairy) effective Saturday. Canadian PM Mark Carney retaliated with matching levies. The White House threatened 50% tariffs on autos and auto parts starting next year if no agreement is reached, potentially impacting the broader USMCA agreement with Mexico, America's largest trading partner.

Market Highlights

Nvidia surpassed expectations, forecasting 70% revenue growth next fiscal year, driving shares up 9% Thursday. The $5 trillion chip giant reportedly explored acquiring AI platform Hugging Face.

Salesforce and CrowdStrike boosted the software sector with strong earnings. Meta Platforms settled state lawsuits regarding children's social media addiction.

Federal Reserve

Fed Chair Kevin Warsh faces scrutiny at Jackson Hole following criticism of his recent press conference. July PCE inflation (Fed's preferred measure) came in at 0.2% month-over-month and 3.7% annually, exceeding expectations. The 10-year Treasury yield hovers around 4.7%.