Spring forecast: Reeves to insist she has ‘right economic plan’; Markets drop again as Middle East crisis drives up oil and gas prices – live updates

Rolling coverage of the latest economic and financial news, including the UK’s spring forecastRachel Reeves’s plans could be hit by Middle East conflict, say economistsEuropean stock markets have opened with fresh falls, as the Middle East crisis continues to grip bourses around the region.In London the FTSE 100 share index has dropped by 104 points, or almost 1%, to 10,667 points at the start of trading, a one-week low.Sentiment towards BP and Shell has strengthened significantly off the back of oil price spikes. But it’s a complex picture. Neither company has production in Iran. But BP’s significant production in Iraq and Abu Dhabi risks being bottlenecked through disruption to the Strait of Hormuz. For Shell the same applies to its LNG facilities in Qatar and the Emirates. If a moderate sustainable regime is established in Iran, there is the potential for substantial derisking, and for prices to be rebased downwards. If sanctions are removed, it also opens the door for investment into Iranian oil fields.But uncertainty remains high. This could prove to be highly profitable for both Shell and BP’s trading arms with Shell’s optimisation capabilities in LNG transit likely to be in particularly strong demand. Shell’s balance sheet strength also leaves it better placed to deal with any prolonged volatility and while BP’s buybacks remain on pause, we’re expecting Shell’s generous payouts are likely to continue this year. Continue reading...