Market commentary with Joachim Döring

Our experts don’t only monitor the capital markets intensively, but are also active market participants in the interest of our clients on a daily basis. Here you can regularly find the latest market commentary of our expert Joachim Döring, Head of Wealth Management.

13. May 2022

Oil embargo and the consequences

While the EU is still discussing an oil embargo against Russia, Germany has joined the embargo of the G7 countries. In doing so, the German government is sending a clear signal to Moscow. However, the embargo calls into question the future supply of gasoline in Berlin and the surrounding area. For this reason, the move surprised me, because in addition to the foreign policy signal, it also shows the extent to which the government is prepared to act. In addition, the embargo by the seven major economic states means that the oil price will no longer be formed by supply and demand, but will be distorted by political intervention. Thus, it escapes economic analysis. This type of intervention will cause the price to be distorted upward. That, in turn, has an effect on inflation. After all, as a countermeasure, the German government has announced that gasoline prices will be subsidized for three months. This, too, is a political intervention that distorts prices and makes economic analysis difficult. Stay healthy!

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Joachim Döring