Oil Hits $105 as Iran Shows No Signs of Backing Down

Summary

The video covers the return of triple-digit oil prices, record gasoline costs, and the resulting inflation headache for the Fed. Michael McKee details how energy and freight costs are broadening through PPI, while RBC's Mike Reid argues structural deficits are pressuring long-end yields and his base case is a Fed hold because strained consumers cannot absorb blunt rate hikes.

• Brent crude tops $105 and WTI returns to triple digits.
• PPI detail shows diesel, jet fuel, gasoline, heating oil, and truck freight costs rising.
• Energy and tariff costs are passing from PPI into CPI.
• Michael McKee says the energy shock is spreading into goods and transport, making Fed policy harder.
• Mike Reid says inflation-indexed entitlement spending is adding to deficits and pressuring long-end Treasury yields.
• Reid's base case is Fed on hold because lower-income consumers are credit-reliant and vulnerable to hikes.
• He warns goods inflation may move the wrong way while services offer little deflation.