Brent Hits $105. Trump Won’t End the War. Europe Pays

EBM Newsdesk Analysis

London, 24 April 2026 — Brent crude is trading at roughly $105 a barrel in early Friday trading, up around 20% on the week, as the Iran war enters its third week with no diplomatic off-ramp visible. The Strait of Hormuz — the chokepoint through which a quarter of global seaborne oil flows — remains firmly closed. President Donald Trump has authorised the US Navy to use lethal force against any vessel attempting to lay mines in the strait, and confirmed publicly that he is in no hurry to end the conflict. The ceasefire framework that briefly raised hopes earlier this month has been extended by a further three weeks with no substantive progress. For European business, the message from Friday’s market open is unambiguous: this is no longer a short-term shock to ride out. It is a sustained inflationary pressure that will compound through Q2 and into the summer.

The cascade is already visible across multiple commodities — not only oil and gas, but fertiliser, helium, and the critical inputs for European electronics manufacturing that depend on Middle East shipping lanes. The FTSE 100 is set for a fresh downbeat open as investors price in the longer-duration impact on the multinationals on the index and on UK-economy-exposed names.

The Pump Panic and the Retail Reality

The first economic evidence of the conflict’s impact is now in the data. UK retail sales for March, released this week, showed motorists racing to forecourts to fill up before further price increases — the kind of pre-emptive consumer behaviour that signals genuine alarm rather than one-off seasonal demand. Automotive fuel sales jumped 6.1% on the month, which alone was responsible for pushing overall retail sales up 0.7% versus February’s 0.6% fall.

Strip fuel out, however, and the picture is far less encouraging. Non-fuel retail sales rose just 0.2%. Clothing benefited from sunnier weather but the bounce will be short-lived. The honest read for UK retailers is that consumers tightening their belts ahead of expected bill increases — energy, food, transport — will dominate spending behaviour through Q2. The pump-panic uplift will not repeat. The discretionary squeeze will.

The Tech Counter-Narrative

Across the Atlantic, the picture is markedly different. US indices have hit fresh record highs this week, with investors apparently betting that worst-case scenarios in the Middle East will not materialise. The Wall Street rally is being driven by two reinforcing forces: a strong corporate earnings season and a deepening structural enthusiasm for AI-exposed equities.

Intel has been the standout this week, reporting $13.6 billion in quarterly revenue — up 7% year-on-year — in what amounts to the clearest evidence yet that the company’s multi-year turnaround is working. The shift driving Intel’s beat is the rapid corporate adoption of AI agents — autonomous software designed to handle complex tasks independently — which require precisely the kind of high-performance central processing units Intel manufactures. Where last year’s AI capex was concentrated on Nvidia’s GPUs for model training, the new wave is increasingly about inference, deployment and agent infrastructure — and Intel is well positioned to capture a meaningful share.

The strategic pattern matters more than any single quarter. Corporates across the Fortune 500 and FTSE 350 are now ring-fencing AI infrastructure budgets specifically to avoid being left behind, even in a softer macroeconomic environment. AI capex is increasingly being treated like fixed cost rather than discretionary investment.

The European Read

The combination matters for European business in three specific ways. First, the oil shock will compound European inflation at exactly the moment the ECB and Bank of England were beginning to declare cautious victory — feeding directly into the BIFS sovereign bond stress playing out across Britain, Italy, France and Spain. Second, European consumer-facing businesses will see Q2 earnings squeezed as discretionary spending compresses, particularly in retail, hospitality and travel. Third, European industrials with significant US revenue exposure — Roche being the highest-profile example this week — will see further encouragement to accelerate dollar-denominated capital allocation as European earnings come under pressure.

The honest framing for Friday’s market open: Wall Street is partying on AI optimism while the real economy in Europe absorbs an oil shock that has not finished pricing in. By close of trading today, the FTSE will likely have absorbed another leg down, the euro will weaken further against the dollar, and the longer-term cost of the Iran war for European business will become a little harder to ignore.

It is shaping up to be a frustrating Friday. It will be a more frustrating quarter.

Related Analysis

• The BIFS bond crisis and what it means for European corporate borrowing
• Inside the Iran war’s structural hit to European supply chains
• Why Intel’s turnaround matters for the next phase of AI capex