Change can often feel inevitable, yet somehow we can also feel stuck. In the workplace, maybe we have been trying to embed more agile ways of working. Or perhaps we have moved to a hybrid setup, but the business culture is dragging its heels behind the policy. Staff politely nod and agree in meetings, say all the right things, and use all the current buzzwords, but in practice, they change very little when they return to their desks.

Take digital transformation. We invested a lot of the budget in new tools with the expectation of driving productivity and efficiency, but their adoption just isn’t resonating. Most seem to be still clinging to the older way of doing things.

Such a scenario can feel like the system pushing back on us, but it is invisible, and nobody is openly saying why.

Read more

Last weekend, I read a newspaper article about how students in England who are about to enter university are ditching the humanities for subjects such as medicine, law, and engineering, which are perceived as offering greater job security after graduation. It is a trend that has been growing for several years, often driven by the need to earn money quickly in an education system where most students take on considerable debt compared with students in other European countries. England has produced some of the world’s most successful humanities graduates, including J. R. R. Tolkien and J. K. Rowling. Some students would no doubt prefer the freedom to pursue what they are most passionate about and succeed on their own terms, but instead feel compelled to make a calculated career decision before their adult lives have really begun. For many, choosing a university course will be the first time they have had to make a decisive choice between financial security and the freedom to become the person they truly want to be.

Long before modern society, human beings have often pondered how much protection they needed to feel secure and how much freedom they needed to adapt and create meaning in their life. There always seems to have been a historical tension between one and the other, but it is more difficult to have sufficient amounts of both at the same time.

Ancient philosophers such as Plato and Aristotle thought about these sorts of issues nearly 2500 years ago. Later, political philosophers such as Hobbes and Locke provided the initial frameworks for this dilemma. The pessimistic Hobbes, leaning towards security, had imagined life without an overarching authority as chaos, while the more optimistic Locke insisted that liberty was essential for trust and progress. But centuries later, their philosophical debate still lives on, even beyond the philosophy departments of universities. This perennial debate is at the core of how societies work. It also matters when we make decisions about our career or invest for our future.

Subscribe now

But this tension is also a systems problem. It would not be complete to say that security and freedom are just philosophical opposites. Rather, they are more like twin forces that oscillate within every system, pulling and pushing, shaped by feedback loops, incentives, constraints, and the way risks propagate through complex environments such as the international political system.

When political leaders over‑optimise for security, they often trigger second‑order effects that reduce their ability to adapt or survive later. Take the example of the Cold War, which divided a large part of the world during the second half of the last century. Many of the leaders of the nations engaged in this conflict had come to realise that while security can make you feel relatively safe, too much of it could also become a trap. A security dilemma arose where one side’s defence became the other’s threat. The quest for more security just made the system feel more insecure. For citizens, it meant there were things you couldn’t do, places you could not visit. Freedom became a casualty of security. The eventual collapse of the Soviet system showed clearly how too much security without enough freedom left it unable to adapt. In the aftermath of 9/11, Western societies also experienced the phenomenon of too much security and not enough freedom as travelling by air became more cumbersome. More recently, the quest for health security during the COVID pandemic led to national lockdowns in many countries throughout the world but also produced economic and social consequences, with increased unemployment and isolation a factor for many.

In the workplace, a similar story has also unfolded over time. Take the example of the loyal Japanese salaryman (サラリーマン) who found stability in his work life, but at the cost of creativity, or the restless Silicon Valley workers who have pursued freedom over job security but also discovered job volatility and burnout. Investors also face this same sort of dilemma when they trade in the financial markets. Their priorities reflect how they trade. For example, bonds offer relatively good financial safety; some sometimes claim to be as good as gold, but they offer little growth. Equities promise greater freedom through higher returns, but they are also exposed to wild swings in the market, so they offer less security. Everywhere we find human decision, it seems we run into this dilemma.

Read more

The fundamental purpose of most businesses has long been to generate profit and create wealth for their stakeholders. From the mass production and vertical integration of the Ford Motor Company in the early 20th century to the focus on intellectual property, software and ecosystems by big tech firms such as Apple today, the methods used to achieve that purpose have evolved, particularly as technological innovation has progressed, financial engineering has become more sophisticated, and social relations have transformed. For more than a century, business advantage largely came from scale, efficiency, and vertical control; the idea that producing more, faster, and more cheaply in a coordinated way was the dominant approach within the corporate world to deliver a competitive edge and shareholder value. Ford had initially standardised so much that you could have your Model T car in any colour you want as long as it was black. General Electric became the masters of optimising a portfolio of operations under expert management. Many businesses still operate on this basis today.

Pursuing scale and efficiency remains fundamental for competitiveness, but these alone seem no longer sufficient for stellar success in this new era. What is often called the external environment today looks a lot different from what it was just twenty years ago, when many of today’s leaders and managers first entered the workforce after learning about how past masters of business, such as GE’s Jack Welch, achieved so much success in his era.

Subscribe now

But today’s international business landscape is more interconnected and increasingly defined by different dynamics such as geopolitical uncertainty, climate considerations, and algorithmic decision-making. In this system, what once worked no longer seems enough. A different way of thinking and decision-making is needed. That’s because profit and wealth are being increasingly rebuilt on a new foundation of systems literacy, where the ability to understand and influence within complex systems from finance to technology, policy, or ecology determines who captures the most value and who is ultimately left behind. Today’s most successful firms, from data-driven platforms to green-energy pioneers who use resilient and adaptive strategies, illustrate just how much the system of international business has changed.

Systems literacy is a way of understanding the world as an interconnected whole, a “system of systems” in which well-placed small interventions can cascade into large-scale or even global impact. Examples include how Tesla has transformed car production into an integrated energy system that is reshaping global charging standards and industry structures, where its charging connector has become the de facto North American standard. Denmark’s Ørsted has evolved from a fossil-fuel utility into a global orchestrator of offshore wind ecosystems that now shape energy markets and supply chains worldwide.

The Hidden Systems Beneath Modern Wealth

Today’s Financial and Data Infrastructures

Across the world, capital and data now increasingly flow through algorithmic systems that shape markets in real time, defining the very parameters of commerce. Asset managers in North America are deploying AI in their investment processes, with those making the biggest impact aligning AI to strategy. In Europe, the European Central Bank’s Digital Euro and the EU Taxonomy for Sustainable Activities are embedding political goals and objectives into financial architecture. Meanwhile, in Asia, Alipay and WeChat Pay are merging payments, logistics, and social data, which are transforming urban finance and everyday life, and complementing state investment in digital infrastructure, which is aimed at narrowing the urban–rural divide.

The Structural Power Shift

The new trade routes have moved. Today they are digital platforms hidden in cyberspace where big tech firms such as Amazon and Alibaba excel at orchestrating the real-world logistics and market access. Algorithms now increasingly shape what consumers and firms around the world perceive as what the market actually is.

For most of the modern era, power tended to live inside key institutions such as governments or corporations. However, more recently it increasingly lives within the systems and control architectures that can even define what counts as a market in the first place.

But political leaders have found a way to re-exert control by regulating what is deemed acceptable behaviour in their jurisdictions. This development is a signal that platform governance and environmental considerations have become a central field of political economy. Policy is now embedded in data and technical standards. For example, the European Union’s 2018 GDPR data protection law and its 2022 Digital Markets Act attempt to rebalance this structural power by regulating the gatekeeping power of the largest digital companies. The 2022 U.S. CHIPS and Science Act has reconfigured semiconductor supply chains around national security objectives. Meanwhile, Japan and South Korea are using industrial strategy to secure energy and materials, with Japan’s GX Strategy and South Korea’s Framework Act on Supply Chain Stabilisation Support for Economic Security being good examples.

The EU is an interesting case as it increasingly exerts global regulatory influence in ways that have become known in political science circles as “the Brussels Effect”, a term coined by Columbia Law professor Anu Bradford. This phenomenon sees the EU’s large single market use its market power to regulate industries ranging from big pharma to big tech, to the extent that European internal rules effectively become global norms. The 2023 Carbon Border Adjustment Mechanism (CBAM) is a good example of the EU exporting European norms globally by compelling compliance with its regulations. Today, it has become more efficient for multinationals to scale a global product that also meets these European standards rather than having to build separate products for different markets. So the standards set in Europe are exported globally.

While the Brussels Effect is primarily regulatory and market-access driven, there are other power dynamics at play in the international economic system. China, a global economic powerhouse in its own right, has its own domestic strategy that blends industrial policy with digital surveillance infrastructure and is now actively exporting that model through initiatives like China Standards 2035, which aims to move from being a consumer of international standards to a producer and exporter. An emerging “Beijing Effect” that could lock countries into Chinese technologies and standards is a different approach that has had some success in parts of the world despite Western resistance.

Accelerated Change

Once these emerging systems start reinforcing themselves, change should be expected to accelerate and become less linear. Each new layer of data, infrastructure, or policy will amplify the next. Generative AI models, whether built by OpenAI in the US or DeepSeek in China, are now scaling at a pace that would have been unthinkable just a decade ago. Their growth is driven by a very simple loop where more data enables more computation, and more computation in turn produces more data. Stanford’s recent analysis shows how quickly the centre of gravity has shifted, where nearly 90% of notable AI models in 2024 originated from industry, up from 60% in 2023. In other words, the frontier is increasingly corporate.

All of this compute means that more energy should be expected to be consumed in the coming years, at a time when concerns continue to grow among policymakers about the impact of climate change on their societies. Thus, political power is also increasingly asserting itself in this domain. Initiatives such as the EU’s 2020 European Green Deal and the 2023 Fit for 55 packages, the 2022 U.S. Inflation Reduction Act, and China’s growing dominance in renewable technologies are accelerating the energy transition through a positive feedback loop between policy, capital, and innovation.

Five Ways Forward

So what can businesses do today to become more systems fluent in an international environment that is becoming less linear and more complex?

Here are five suggestions to make that leap based on current thinking:

1. Map the Systems That We Operate In.
   First of all, systems mapping can be a useful way to visualise interdependencies and move away from linear thinking. It’s like moving from playing checkers to playing chess. Network theory is also useful in revealing leverage points and risks. A small shift in one area can produce big changes everywhere.

2. Integrate Regulation Into Strategy.
   Situational awareness is important, so decision-makers need to watch out for the regulatory signals. New regulations signal where structural change is moving towards. In Europe, firms such as Siemens have aligned with EU sustainability frameworks, turning compliance into an advantage. These types of signals can be picked up earlier in the legislative cycle, before new regulations even become law. This early knowledge provides a significant advantage.

3. Invest in Interoperability.
   Innovation is forever important, but so too is interoperability. That means building platforms that plug into emerging standards. The 2024 EU Interoperable Europe Act shows how shared standards can drive resilience and growth.

4. Prioritise Trust and Legitimacy.
   In today’s economy, ethics has moved from the margins of corporate life to the core of business strategy. Transparency and ethics are now often preconditions for market access. Ørsted’s renewable transition is in many ways an instructive example of this.

5. Cultivate Systemic Thinkers and Translators.
   Adapting also means having the right people, in the right place, at the right time, who are also thinking in the most useful ways. Build an eclectic team that spans disciplines and mental models, combining economics, technology, strategy, and policy insight. This will enable better anticipation of future trends and the articulation of them from different perspectives.

Closing Thoughts

Peter Senge once described organisations as “learning systems.” The systems thinker, Donella Meadows, taught that leverage lies in feedback and structure. Today, those ideas increasingly define competitiveness.

Systems literacy can help leaders to anticipate nonlinear shifts and build resilience. Scale and efficiency still matter in business. They are necessary but no longer sufficient. Understanding how systems interact in the interconnected global economy and then positioning strategy accordingly is an approach that should also be incorporated.

Subscribe now

In most companies, we’re often led to believe that the org chart tells us everything we need to know about how the business works and what our role is within it. The arrows and boxes tell us who should report to whom, who has responsibility over each particular area, and who is ultimately in charge.

It’s a comforting picture of how a business should operate and probably a lot closer to what we may think is the case on our first day on the job, straight out of university. But if only everything were so linear and structured, we would never have to worry about distractions such as office politics or internal power plays and just focus on getting the job done. Life would be more straightforward.

Anyone who’s spent time inside a modern business organisation knows that the official hierarchical structure is only part of the picture, or at least they often have that feeling that there is something else at play because the big decisions that are often taken don’t always neatly align with business priorities or the formal structures we would expect. Things often pan out differently when strategies that were supposed to drive the business forward actually stall or fade away from the agenda, and people with no official title somehow manage to exert more influence over the direction of the business than those officially higher up on the org chart. Silos and fiefdoms sometimes develop while at the same time higher management is encouraging team collaboration.

Sometimes we are left scratching our heads after a team meeting wondering how the latest decisions taken are in any way aligned with what the business strategy is supposed to be. The CEO says one thing at the annual get-together, but that is not how things are done locally. I remember a regional manager once telling me that in his view, head office makes the strategy sound so simple; he left motivated after the annual kickoff event, but within a week he felt he was back to fighting trench warfare.

Without figuring out why this happens, it is no surprise that the workplace environment can lead some to become demotivated, cynical or even worse for the business: they start looking for a new role elsewhere. Sometimes it is really only the fear of running into the same kind of environment elsewhere that keeps people in their existing roles.

To figure out why things don’t turn out as we are often led to expect, it is useful to look to another part of society where we see this same type of phenomenon: political life.

In the political world, at least the democratic world that I am most familiar with, there is also an official type of org chart with the head of state at the top, the government and the various local authorities and state bodies who are tasked with implementing the policies that people voted for. But it doesn’t always turn out that way: programmes are abandoned, or decisions are made on matters that nobody voted for. For example, almost nobody votes to go to war out of choice, but it seems to happen more often than it should in some countries.

The thing to realise is that power has more than one face; it isn’t just about structure, it operates inside a system of relationships, incentives, and constraints. This is exactly what British political scientist Steven Lukes uncovered in his classic “three dimensions of power” model. He wasn’t thinking about corporations when he developed it, but political science and business often blend into each other (many business models have their origins in political science), especially when it comes to change, conflict, or transformation. Lukes gives us a sharp lens for understanding how power actually operates. It is particularly useful to adapt it to a business setting because so often in business we’re grappling with internal complexity.

The Political Science Model

Lukes’ Three Dimensions of Power challenged the old idea that power only has one face, that it is only about who wins a debate or a vote. That’s just what we see at the surface. But below that social veneer there are two deeper, subtler layers of influence: what gets discussed, what doesn’t, and what people believe is even possible.

Here is how the model works:

Different approaches have been used to illustrate this model graphically, such as a pyramid and concentric circles with visible power in the centre. However, I think the iceberg approach works really well in illustrating the power that is visible on the surface but invisible below. The power below the surface explains that feeling we may often have that there is something else at play than the official priorities.

The Three Faces of Power:

Visible Power (overt power)

This is the power we can see, such as who prevails in a formal decision or vote. Examples also include a budget signed off, a key leader appointed, or the approval of a new strategy.

Agenda Power (the mobilisation of bias)

Agenda power is about who decides what even makes it onto the table for discussion. For example, we may have a transformative proposal that could drive new business in new areas, but if we can’t get it on the agenda, it's not going to happen.

Ideological Power (deep cultural assumptions or unspoken norms)

Ideological power is even more subtle; it is about who shapes what people believe is possible, normal, or acceptable. For example, cultures that make disagreement feel like an action of disloyalty rather than constructive feedback, or status quo assumptions that are never allowed to be questioned. This can include non-discussion about business branding or mythologies about “what makes us successful”, even when there are better options that even higher management would like to hear if only the idea could reach up to them.

Power is often about outcomes, but this model shows that power is also about the battles that never get fought.

Why This Matters for Business

This is political theory that I am applying to the business world because it has a real practical use. Once you see it, you really can’t unsee it.

In today’s organisations, all three faces of power show up in strategic and subtle ways, for example:

• Visible power is the visible structure of the system that sits with formal leadership such as executives, budget holders, and boards. This type of power is clear, necessary, and trackable, but it is also often reactive.

• Agenda power lives with its gatekeepers that shapes system priorities. In the political world, this could be the chiefs of staff who decide who gets in to meet the president; it also includes respected insiders or the leaders of key projects such as dealing with a pandemic or a security issue. In the business world, they are the functional heads who shape the agenda inside their domains.

• Ideological power involves the informal dynamics that move the system. It is embedded in the business culture, in the lingo and language that is used, and the mythologies of what the business is about, why it is the best or even why the world is in a better place because the business is there. But it is also why some companies can’t read the signals and pivot, even when the writing’s on the wall.

A stalled transformation effort can be a good example of how these invisible powers play out. On paper, everyone’s aligned on the new strategy. But behind the scenes, there may be middle managers who keep “raising concerns”, putting up roadblocks or encouraging disunity with the direction of change. In situations such as this, it is the faces of agenda and ideological power that are doing counterproductive work.

So in moments of disruption or internal conflict, this model is helpful in unscrambling why formal authority alone wasn’t enough to overcome the other two dimensions of power.

How Teams Can Adapt the Model

Knowing that there is more than one face to power helps business leaders to take more control of the situation to better align with the business priorities.

Here are some thoughts on how to begin to apply Luke’s model explicitly in a business environment. These are practical ways to rebalance influence. And they reflect a growing awareness that managing power really means managing systems.

• Use stakeholder mapping tools to help track both formal and informal influence, that is to say who people listen to, trust, and follow.

• Organise agenda-setting rituals such as reverse town halls or open-priority weeks to create space for ideas to surface from within rather than the usual centres of control.

• Conduct culture audits; initiatives such as internal storytelling campaigns and norm-resetting activities help loosen the grip of ideological power, challenging what’s seen as acceptable or possible.

Power is Not Just Positional

In business, titles will still matter because good organisation needs a formal structure. But if we want to drive real change, we also need to see power as a system and read between the lines, to watch out for what’s not being said, to notice who’s shaping the agenda, and to constantly challenge the assumptions holding the system in place.

Last year, I made a short video about this topic on YouTube, which is available here:

In this edition: signal; system insights; what I am reading; and one last thing.

Signal

Strait Stays on a Knife-Edge as Iran Deal Yet to Be Done

There were positive signs last weekend US and Iranian diplomats were edging toward a framework that could ease tensions around the Strait of Hormuz, after US President Trump had posted on his social media platform that an agreement had been “largely negotiated” and was awaiting finalisation, with a flurry of regional diplomacy involving Pakistan, Qatar, Saudi Arabia, the UAE, Turkey, Egypt, Jordan and Bahrain.

Read more

In this edition: signal; system insights; what I’m reading; and one last thing.

Signal

The West Still Coordinates

This week in Paris, G7 finance ministers, their central bank governors, leaders of key international financial institutions, and other guests met in the G7 multilateral format amid significant challenges to the international system, including rising concerns about global economic imbalances, public debt, and bond market volatility, as the impact of geopolitical events reverberates throughout the international economy.

The gathering, hosted by France, comes ahead of next month’s G7 leaders’ summit in Evian and on the back of last week’s high-profile but inconclusive summit between U.S. President Donald Trump and Chinese President Xi Jinping in Beijing.

Ahead of the meeting, French officials were reported to have succinctly framed the economic pattern:

Read more

In this edition: signal; system insights; what I am reading; and one last thing.

Signal

No Significant Breakthroughs in Beijing

• U.S. President Donald Trump travelled to Beijing this week to meet with Chinese President Xi Jinping, with the expectations around the highly anticipated summit tempered by the ongoing war in Iran.

• It was President Trump’s first trip to China since 2017 and his first face-to-face with Xi since their October 2025 summit in South Korea.

Why It Matters:

• Given the geopolitical context in which neither side fully controls, this was arguably expected to be one of the most consequential bilateral meetings between the US and China in some time.

• Any useful cooperation between the U.S. and China is good for both countries but also for international stability, particularly on reopening the Strait of Hormuz, which could offer near-term relief to international oil prices.

• While there were no significant breakthroughs at this summit, some trade business was completed, and President Xi has been formally invited to visit the US in September.

Read more

There is never a dull day in business decision-making these days. It can sometimes feel like the system is disrupting everything, everywhere, all at once. Business leaders often describe volatility as the new normal. But volatility is only the surface expression of deeper system transitions.

Business decision-makers clearly face a dense network of increasingly interlinked risks, such as the ongoing energy shock emanating from the conflict in the Middle East. The conflict has driven up the international price of oil and gas in a relatively short period of time, discomforting balance sheets the world over. But there are also other risks to business operations, such as regulatory changes from carbon taxes to data localisation laws, changes to the terms of trade driven by geoeconomic considerations or significant digital disruption as AI increasingly embeds itself in everyday business operations and redefines the commercial landscape with new opportunities and emerging risks. Moreover, shifting consumer dynamics, from TikTok-driven product surges to Gen Z’s ESG preferences, means that sources of profit and growth should never be taken for granted.

This spectrum of risks reflects the constant interaction of political decisions, economic forces, social shifts, and technological breakthroughs. At its core is the question of how power drives structural change, which in turn drives the emerging trends in these areas. Understanding this interplay is at the heart of political economy, where markets and power often collide to shape new business realities and drive the next cycle of business headlines. Short-term noise gets a lot of attention, but what matters more is the underlying structural changes that generated it in the first place.

Subscribe now

The Need for Strategic Foresight

In an environment that feels more unstable and chaotic, it can be all too easy to focus too much on symptoms rather than causes. But such an approach makes finding a cure more difficult.

Scenario planning is one of the most effective ways for decision-makers to make sense of complexity. Applying it with systems thinking principles helps organisations not only to dynamically visualise how multiple factors interact, amplify, or counterbalance each other. It also helps to understand where change is emanating from and how reactions to emerging trends also feed back into reshaping the wider system. We may not be the biggest players, but sometimes small changes we make can also trigger larger changes later.

If we see our environment in systemic terms, we can see that the environment we are in is not separate from us. It is not a single external linear factor that drives today’s trends. We are also embedded actors, so our decisions and actions, as well as those of our partners and competitors, also feed back into the system. They help shape future scenarios.

Read more

Read more

In this edition: signal; system insights; what I am reading; and one last thing.

Signal

Washington and Beijing Could Move Toward AI Diplomacy Amid Strategic Decoupling

The United States and China are reportedly considering formal talks on artificial intelligence ahead of a planned Trump–Xi summit in Beijing next week, according to the Wall Street Journal.

The discussions would take place against a backdrop of export controls, semiconductor restrictions, rare-earth negotiations, and broader geopolitical competition.

The U.S. continues tightening controls on advanced AI chips, and China is accelerating efforts to build technological self-sufficiency.

Read more

In this edition: signal; on the radar; systemic insights; what I am reading; and one last thing.

Signal

Dire Straits: The Strait That Won’t Reopen

Despite the ceasefire framework agreed in early April, the world’s most critical maritime chokepoint, the Strait of Hormuz, remained severely disrupted and highly abnormal for commercial shipping this week, kee…

Read more

In this edition: signal; on the radar; system insights; what I am reading; and one last thing.

Signal

EU to Shield Households and Industry from the Fossil Fuel Price Surge

Who says lightning never strikes twice? In fact, lightning seems to prefer to strike the same place twice. For the second time in less than five years, Europeans have been struck again by a bolt from the blue and are yet again paying the price of Europe’s dependency on imported fossil fuels.

This week, the European Commission proposed “new actions to protect Europeans from the fossil energy crisis,” combining short‑term relief for households and industry with a push toward clean energy independence and reduced exposure to volatile fossil fuel markets.

At last month’s EU Council meeting, EU heads of government requested

“a toolbox of targeted temporary measures to address the recent spikes in the prices of imported fossil fuels arising from the crisis in the Middle East”.

The measures were also a topic of discussion at the Informal European Council in Cyprus this week.

Read more

In this edition: signal; system insights; what I am reading; and one last thing.

Signal

More Talks Expected After US Enforces Blockade on Iranian Ports Amid Hormuz Crisis

This week, the United States military said it had activated a targeted blockade of Iranian ports and coastal waters, a dramatic escalation in the almost 2-month-old US-Israel conflict with Iran, which began on February 28.

Read more

In this edition: Signals; systemic insights; what I’m reading; one last thing.

Key Signals

A Temporary Pause in Hostilities

The single most consequential geopolitical event of the week was the last-hour agreement towards a temporary pause in hostilities in the ongoing US-Israel-Iran conflict in the Middle East.

• US President Donald Trump had demanded that Iran open the Strait by Tuesday, 8 p.m. ET, threatening to decimate bridges and power plants in Iran if it didn’t.

• Iran agreed to the temporary ceasefire within hours of that deadline and to allow safe passage through the Strait of Hormuz during the two weeks.

Why this matters: The now six-week-old US-Israeli conflict with Iran, which began in late February, has triggered what the International Energy Agency has characterised as the

• The conflict has already exposed how quickly a chokepoint like the Strait of Hormuz can transmit geopolitical risk into global energy, shipping, inflation, and asset prices more broadly.

• There have been immediate consequences for oil, LNG, shipping, inflation, and asset prices, which remain the case. The latest ceasefire developments have only temporarily moved the situation from one of acute panic to, at best, unstable containment.

• In addition to oil, this conflict has also significantly impacted global LNG and regional gas supply chains. European gas storage has already been reported as low for the season, with some estimates and scenarios pointing to end-of-winter levels around 30% or slightly below, depending on weather and supply conditions. The impact of the conflict complicates the task of creating a buffer for next winter.

• Oil and gas prices are likely to remain elevated above pre-war levels as governments around the world are expected to hoard and restock. This is likely to remain the case in the coming months, even if talks scheduled for this weekend in Islamabad prove encouraging.

• A renewed conflict will only increase supply uncertainty and price volatility in the weeks ahead.

Key details:

Read more