Business brief
Wednesday signal: the ceasefire called off, NATO's €70B, and ChatGPT learns to interrupt
Strikes return to Hormuz, Ankara closes with a Ukraine pledge, Exxon's war windfall, a split Fed, and a housing bill running out the clock — press a signal for coverage.
Business
Big Oil's profits now track the war, not the business — Exxon's quarter was made in the strait, and the strait is shooting again.
BackgroundExxon publishes a mid-quarter filing that previews its profits before official results. With the Strait of Hormuz shut for much of the quarter, oil prices — and oil-company profits — spiked.
- Q2 Brent averaged $96.68, up 23% on Q1 with the strait effectively shut; refining margins add ~$2.6B and oil production ~$1.6B, while war disruptions cost about $1B.
- Analysts model ~$15.7B in adjusted profit for the quarter — roughly triple Q1 — ahead of the July 31 report, awkward optics while Trump presses oil majors on pump prices.
- Wednesday’s market split on the war news: Dow −1.09%, S&P −0.28%, Nasdaq +0.2% — while energy rallied, with refiner Marathon Petroleum up 5%.
- UBS cut its 2027 forecasts anyway, assuming $75 US crude — analysts are treating the windfall as a war artifact, not a new baseline.
Business
The Fed’s next move is being written in the Strait of Hormuz — a lasting oil-price spike would convert half the committee to rate hikes.
BackgroundThe Federal Reserve sets US interest rates and publishes minutes of each meeting three weeks later. Kevin Warsh became Fed chair this year, and markets parse the minutes for where rates go next.
- A “few” officials saw a case for raising rates at the June meeting itself; the decision still landed 12–0.
- The divide is the inflation read: gas prices cool if the war winds down, but many officials flagged the AI buildout keeping semiconductor and tech-goods prices elevated.
- Warsh submitted no forecast of his own, arguing that the Fed’s published rate projections lock policymakers into positions — a tell from the first minutes of his chairmanship.
- Next meeting is July 28–29; rising oil prices between now and then would make the case for hikes on their own.
Unlock the full brief
Sign in to read every signal, takeaway, and source. Free account — Apple, Google, or email.