Oil’s latest plot twist is not the price slide itself but OPEC+ choosing, again, to do nothing. Sunday’s “mini-ministerial” of eight core members is set to keep the first-quarter output freeze intact despite Brent having already collapsed 18 % in 2025, its worst year since 2020(reuters.com).

Why sit on their hands? Because Saudi Arabia and the UAE are too busy trading air-strikes over Yemen’s Hadramout oil belt to trade barrels in Vienna. Riyadh bombed UAE-backed separatists yesterday, laying bare the alliance’s deepest rift in a decade(apnews.com). History shows OPEC survives wars (Iran-Iraq, 1980s) by ring-fencing politics, but every quarrel erodes credibility—exactly when the cartel faces a “cartoonishly oversupplied” market the IEA says will run a 3.8 m bpd surplus this year(theguardian.com).

The stalemate signals a structural power shift: once-feared supply cuts are losing bite as U.S. shale, Guyana and Brazil ramp up low-cost output, while EV adoption dents demand elasticity. If producers cannot coordinate, prices could fall to the mid-$50s by spring, underscoring the energy transition’s brutal arithmetic: volume without discipline equals value destruction. As analyst Amy Myers Jaffe warns, “In oversupplied markets, geopolitics is noise unless it hits the pipelines.”

— The Gist AI Editor

Dollar Ascendant

The U.S. dollar is starting the year on a stronger footing, posting modest gains as investor expectations for near-term Federal Reserve interest rate cuts cool (WSJ). This recalibration follows Fed meeting minutes suggesting that the central bank, which sets the baseline cost of borrowing, is in no rush to lower rates. A stronger dollar makes U.S. goods more expensive abroad, potentially impacting trade balances, while also making foreign imports cheaper for American consumers and businesses. This dynamic underscores the powerful influence of central bank policy on global capital flows.

EV Market Leadership Shifts

A significant recalibration is underway in the global electric vehicle market, with China’s BYD Co. overtaking Tesla in sales. Tesla’s 2025 vehicle sales fell by 8.6%, with fourth-quarter deliveries dropping 16% to 418,227 vehicles (Bloomberg). This shift highlights intensifying competition and potential market saturation challenges for early industry leaders. From our perspective, this is market-driven creative destruction in action, forcing innovation and likely leading to better, more affordable options for consumers as new players challenge established titans for market share.

Energy and Quant Contrasts

Commodity and investment markets are presenting a mixed picture. Oil futures began the year lower, weighed down by persistent oversupply concerns that even geopolitical risks in key regions cannot fully offset (WSJ). In contrast, the quantitative investment firm AQR Capital Management saw its multistrategy fund deliver a strong comeback, gaining 19.6% in 2025 (Bloomberg). This highlights how sophisticated, data-driven trading strategies can find significant returns even when traditional sectors like energy face headwinds from fundamental supply and demand imbalances.

Stay tuned for the next Gist—your edge in a shifting world.

Oil Futures Open Year Lower on Oversupply Concerns
— Wall Street Journal

Financial Services Roundup: Market Talk
— Wall Street Journal

Pouches give Big Tobacco a shortlived pick-me-up
— Financial Times

Dollar Edges Higher as Near-Term Fed Rate Cut Looks Unlikely
— Wall Street Journal

Tesla Electric Vehicle Sales Decline 8.6% in 2025
— Bloomberg

UK Sets New Heat and Sunshine Records in Boost for Solar Power
— Bloomberg

Carbon Levy Sparks Trade Backlash

The European Union’s flagship climate policy, the Carbon Border Adjustment Mechanism (CBAM), is already creating geopolitical friction. As the levy—effectively a tariff on carbon-intensive imports—took force on 1 January, China and India have decried the measure as “unfair” and “discriminatory”, with Beijing signalling a potential World Trade Organisation complaint (EUObserver). This isn’t just a climate measure; it’s a profound test of the EU’s regulatory power projection and its commitment to open market principles. My read is that this mechanism, while intended to prevent ‘carbon leakage,’ risks sparking a cycle of retaliatory tariffs, complicating supply chains and raising costs for European industry and consumers alike. The move pits climate ambition directly against global trade norms.

European Markets Start Year with Tepid Gains

Investors kicked off 2026 with cautious optimism, as major European bourses closed the first trading session in positive territory. Gains were modest, with Frankfurt’s DAX up +0.2% and Paris’s CAC 40 rising +0.56% (Ansa). Madrid’s IBEX-35 led the pack with a +1.07% jump (Ansa). However, underlying energy pressures persist. Natural gas prices on the Dutch Title Transfer Facility (TTF), the continent’s key benchmark, climbed +2.99% to settle at €29 per megawatt-hour (Ansa). While equity markets may be cheering, the uptick in gas prices is a stark reminder of the energy costs and inflationary risks that continue to stalk the Eurozone’s real economy, a structural headwind that will shape the year.

Catch the next Gist for the continent’s moving pieces.

Il 4 gennaio torna #domenicalmuseo, ingresso gratis nei siti statali
— Ansa

China and India cry foul as EU carbon payments fall due
— EUObserver

David Bowie, the galactic thinker who encouraged us to break new ground
— El Pais

Aktuelles zum Krieg in der Ukraine
— ZDF

Sportvorstand Stefan Kuntz verlässt den Hamburger SV
— ZDF

Il prezzo del gas chiude in rialzo a 29 euro al megawattora
— Ansa