Oil.

Oil stocks have had a nice run up on the uncertainty surrounding Iraqi production with WTI at 9 month highs. Barring a shock they're probably fairly valued at these levels. However, a shock may be what we get if fundamentalist militias export their vision into Jordan or Lebanon and elicit an Israeli response. Time to lighten but not go aggressively short. Rosneft, Lukoil and Gazprom have made up their post-Crimea sell off. The hidden story here may be the purchasing by Israel of Kurdish oil shipped via Turkey through Ceyhan to Ashkelon. For Turkey in particular the benefits of such a transshipment agreement could be meaningful in equity and FX terms. Some 2 million barrels are already said to have been transported this way with exports forecast to reach an annual rate of 20 million tonnes, some of which will be re-exported to Asia. 

In Europe the British Prime Minister seems to be failing in his attempt to stop the arch-federalist Jean-Claude Juncker from taking over the top slot at the European Commission. There are rumours that at Friday nights dinner in Ypres ( oh the irony of it ! ) he will use the '' Luxembourg Option " and demand that nothing perceived to be of such vital national importance can be taken without a unanimous vote. As they say in France ' bon chance '. Europes real problem is one of adjustment. Britain and France, the old Imperial powers, are seeing their economic and geo-political importance slip away. The Brits are ahead of the French in recognizing this. Germany is the natural aspirant to pole position but its recent ( ie last 150 years ) history makes it loathe to trumpet its ascendancy too loudly. Russia and China are of course delighted to see the EU rocked by a lack of unanimity; America less so.

Despite the Scottish Referendum and the increased likelihood of a British Exit from the EU entering the mainstream , Sterling continues to stick resolutely north of $1.69. The Canadian Dollar is also motoring against signs that further rate cuts are firmly off the table.