Most of the Europe Union is currently experiencing a third wave of the pandemic, with mutations of the coronavirus now present in all 27 member states. New warnings from drug regulators could dent trust in its vaccination campaign, which was just beginning to kick into a higher gear after a sluggish start. The European Medicines Agency said there’s a possible link between AstraZeneca's Covid-19 vaccine and a rare type of blood clot in the brain. In parallel, the U.K. also recommended not using Astra's vaccine on those under the age of 30.

Both the U.K. and EU drug agencies reiterated the benefits of the Astra shot outweigh any risks. Though the latest assessments may increase public concern and undermine governments’ efforts to inoculate people quickly. The EU’s already been dealing with a slow vaccine rollout. Unlike Britain and the United States, the EU’s procurement efforts didn’t prioritize domestic deliveries first. As of March, some 77 million doses were exported from the EU to 33 countries, in addition to millions of jabs for lower income countries through the Covax facility. Since January, the EU introduced rules whereby companies need permission to export. So far, only one delivery has been blocked.

(Bloomberg – Continue Reading)

Pound bulls betting on the U.K.’s superior vaccine rollout are getting cold feet, threatening one of the hottest currency trades of the year. The euro recorded its biggest jump against sterling in 2021 on Tuesday, and extended gains above 86 pence on Wednesday. Traders have been selling the pound on concerns relating to AstraZeneca Plc’s shot -- which the U.K. is heavily dependent on -- while the shared currency has been buoyed by projections the bloc will hit immunization targets earlier than expected.

It comes after months of the U.K. currency outpacing that of its nearest neighbor, racking up multi-year records as traders bet Britain’s rapid inoculation program would leave the European Union in the dust. Now, investors risk getting left on the wrong side of the trade with leveraged funds’ long sterling bets close to their highest in a year, according to data from the Commodity Futures Trading Commission.

Hedge funds closed bullish pound positions on Wednesday. “We are observing a reversal of the vaccination euphoria,” said Petr Krpata, a strategist at ING Groep NV. “It is also exaggerated by speculative positioning, with the pound being the biggest speculative long in the G-10 FX space.”

(Bloomberg – Continue Reading)

As Europeans drive less, the price they’re paying for gasoline to power their cars is moving higher as the continent’s oil refineries boost exports -- but make less -- of the fuel. The so-called crack spread, the price at which gasoline trades over crude oil, hit its strongest for the time of year since 2017 at the start of April. That’s helped push retail prices to their highest in years on a seasonal basis in several of the continent’s big consumer nations including Germany, France and Italy.

At least a quarter of the gasoline-making units at northwest Europe’s oil refineries have been offline recently for maintenance, or suffered unplanned disruption. That’s further reduced output at a time when plants are processing less crude oil anyway because of the pandemic. Add in healthy exports, in particular to the U.S., and prices suggest the market has more than offset the lost demand. “There’s a huge pull on European gasoline to other key regions,” said Mark Williams, an oil analyst at Wood Mackenzie Ltd., adding that resurgent demand in the U.S. is boosting the European market. When Europe’s spring lockdowns came into force last year, millions of barrels of gasoline demand disappeared and processing margins sank deep into negative territory. This time that hasn’t happened, despite the continent’s latest wave of mobility-restricting lockdowns limiting road use and perpetuating weakness in two other key transport fuels: diesel and jet fuel.

(Bloomberg – Continue Reading)