Oil shock spreads global strain

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If oil prices are swinging wildly,

who's actually making money from it,

it's world business express from the BBC World Service.

I am Bissy Adibayo.

What could Nigeria's president's visit to the UK

mean for trade and investment?

And Eurozone inflation takes up just a central bank's prepared

their next move.

So oil prices have jumped above $109 of barrel

after an Iranian padric chemical complex was hit by airstrikes.

South Pass is the world's largest natural gas field,

which is shared by both Iran and Qatar.

So what's it like trying to trade oil in the middle of this conflict?

Greg Neumann is a co-founder of Onyx Capital Group,

which describes itself as the world's leading market maker

in all derivative contracts.

To begin with, it was absolutely manic.

We're talking about annual moves in a day and back again in the same day.

And that was the most volatile day we've ever seen.

Since it's been touch and go,

moments where markets are consolidated and then gone volatile again.

And I think in particular last week, there was a consensus,

I think, forming that this is going to be a long and sustained crisis.

And the Trump administration kind of lost control of the narrative

and control over the market.

So it was finally able to act with a bit of certainty.

So things have gotten a bit easier to trade,

but having said that, balances and the logistics and trade routes

have been so messed with for quite a long time,

but it really did step up in December with the Trump administration's

increased sanctions on Russia.

And of course, we had the Venezuela situation.

At least in the oil trading community we're seeing as all these things is linked.

And if it's really going to end, we really need to see

the agreements made with Russia and Ukraine as well as around in Venezuela,

because they're all ultimately linked and so is the oil market.

We're heading now to Bangladesh where an energy crunch

is really starting to buy it and it's linked to the conflict involving Iran.

The country relies on imports for about 9 to 5% of its energy

and we're now seeing long queues at fuel stations as people worry about shortages.

I have to wait here at least half an hour.

We have nothing to do, nothing to say.

We're suffering, only suffering.

We can't do anything without oil.

For those people who want to go at the village,

they are facing issues like the bus cost, it's become a higher price.

And the government has even shut down universities to cut electricity use

and that's affecting everything from lecture halls to student accommodation.

Salman Said is a journalist in Bangladesh.

Bangladesh has been going through a fuel crisis.

So there wasn't chaos initially, but what happened was the pumps

started closing down, then some of the pumps were not having enough

fuel to give out to their customers.

So there was huge queues and then what happened was government made a rule

that the prices should not be increased.

They made a limit for motor pipes and cars.

Other transport prices have hiked up.

And all of this is really coming with eat and independent celebrations.

So how much difference is it making there?

So to save the power, the shopping malls and these fares were

asked to shut off their extra lights they were using to attract customers

to save energies.

So the prices of these fuels have increased only in the black market still

because of the limited amount of fuel transportation costs has increased.

So people are suffering and the homebound passengers are struggling.

Government has also made some requests to the India to supply fuel

and they've also asked the US government for permission to buy fuel from Russia.

And is it just the cost of transportation this is impacting?

Or are we beginning to see this also trickled down to the shops

or the price of goods and services going up as well?

Prices of goods have already gone up once during the month of Ramadan

and after this war it has further gone up because there's a limited number of

transportation services facilities.

So the perishable goods have already gone up a bit.

There is a tension even on so in the government sector

if they don't make their shipment on time then there might lose a lot of their order.

Salman side journalists in Bangladesh there.

But now let's talk about inflation in the eurozone which has

ticked up close to 2% and higher than it was last month.

Ross Mould from AJ Bell is here with me in the studio.

Ross tell us how's the situation with you?

Good day BC.

So the inflation figure is below the European Central Bank's 2% target.

So that's the good news as far as they're concerned.

And they're expected to leave interest rates unchanged for the sixth time in a row tomorrow

Thursday.

But they have a difficult decision because of oil and gas prices going up.

In 2007 they raised interest rates to stop inflation when there was a big oil price spike.

They got that wrong.

There were too slow to move in 2022 when oil and gas prices went up.

They got that wrong.

So it won't be easy this time.

For the moment the markets think they will raise rates twice this year at some stage.

And with the Middle East tensions pushing oil prices higher that we've been talking about.

And we await the Fed decision and the ECB data tomorrow.

How much does all of that complicate things for central banks?

Same debate for the Federal Reserve, the Bank of England, the ECB.

Inflation could go up if oil and gas prices stay sustainably high.

We still don't know if they will.

But it is a risk.

At the moment they would probably like to cut interest rates rather than raise them.

But at the moment financial markets think we will get nothing from any of them this week.

Maybe two Fed cuts this year.

Nothing from the Bank of England.

And again maybe two hikes from the European Central Bank.

We'll keep our eyes on that.

Also pleasure, Ross Gold Investment Director and AJ Bell.

The Lycra Company is best known for making spandex and other

stretch fabrics as file for bankruptcy protection in the US as it looks to cut more

than a billion dollars of debt.

Its lenders have agreed to provide fresh finance in and wipe out most of what it owes.

And the company says it's business as usual for customers, suppliers and staff.

Nigeria's president, Bola Ahmed Tanubu, is beginning a two-day state visit to the UK.

We're trained in investment firmly in focus.

The UK is one of Nigeria's largest trading partners with bilateral trade worth around

nine to ten billion dollars a year.

So what could this visit do to shift that relationship and unlock new business opportunities?

A question I put forward to Shil, I will win Lee, a Nigerian economist.

The UK is one of Nigeria's largest trading partner.

We've had wrong diplomatic and historic ties for many years.

And as a way today, it's not just because Nigeria is currently undergoing reforms.

But because we also have a world where you're seeing, should I say,

it retreats in multilateralism and global cooperation.

But you're seeing more countries actually favor bilateralism.

And it's quite interesting because trade between the UK and Nigeria is worth around

ten billion dollars a year.

But then it still tends to favor the UK.

So what would a more balanced relationship actually look like in practice?

For quite many years, Nigeria operated on that system that was guided by

largely by subsidies.

So now you've had reforms, which in essence has actually

liberated the foreign exchange system.

And by so doing, it's also the value that currency now exports a lot more commodity.

So in some way, it looks like Nigeria is now going to begin to take advantage

of that cooperation and partnership.

And if you look at it, we've got a stronger economy now.

Inflation is slowing down.

Interest rate is easing.

Our GDP is growing.

Foreign reserves is improving.

Point exchange is a lot more stable as a way.

So Nigeria is a lot more poised at this time to take advantage of

die relationship than we have at any other time.

So what do you think the real opportunities are in Nigeria

for international investors right now?

I mean, in terms of infrastructure, we'll be looking at technology, for example.

Technology is key.

Nigeria is looking to actually take off when you look at artificial intelligence here.

So there's a lot of opportunities in that, which I also think is something that

the United Kingdom is very keen about.

But of course, the fiscal infrastructure.

There's still a lot of opportunity in that.

We're looking at our real road infrastructure, energy,

empire infrastructure as well.

So there's a lot of opportunity, surely in terms of the oil and gas,

which is the energy as well.

The best B2B marketing gets wasted on the wrong people.

So when you want to reach the right professionals, use LinkedIn ads.

LinkedIn has grown to a network of over one billion professionals,

including 130 million decision makers.

And that's where it stands apart from other ad buys.

You can target your buyers by job title, industry,

company, role, seniority, skills, company revenue.

So you can stop wasting budget on the wrong audience.

It's why LinkedIn ads generates the highest B2B return on ad spend

of major ad networks.

Spend $250 on your first campaign on LinkedIn ads

and get $250 credit for the next one.

Just go to LinkedIn.com slash broadcast.

That's LinkedIn.com slash broadcast.

Terms and conditions apply.