Bond Bulletin: Brent, but far from broken

A surge in geopolitical flashpoints has collided with surprisingly benign market conditions. This week’s Bond Bulletin takes a closer look at why credit markets and oil prices have stayed calm – and how long this dynamic might last.

What does this mean for fixed income investors?

While geopolitical risks remain elevated, fundamentals and technicals are still strong. Investors need to quite literally watch the Strait for signs of restrictions that could result in shocks to oil prices, inflation, and growth. Investor positioning should be watch-but-don’t-run for now, sticking to high conviction trades and maintaining carry. There are pockets of value to be found due to oil volatility, and also in sectors impacted more by other news and economic factors – European autos seemed a consensus underweight earlier in 2025 and currently offer value, particularly in the belly of the yield curve, along with Utility hybrids, which tend to have wider spreads but not extended duration.

About the Bond Bulletin

Each week J.P. Morgan Asset Management's Global Fixed Income, Currency and Commodities group reviews key issues for bond investors through the lens of its common Fundamental, Quantitative Valuation and Technical (FQT) research framework.

Our common research language based on Fundamental, Quantitative Valuation and Technical analysis provides a framework for comparing research across fixed income sectors and allows for the global integration of investment ideas.

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