Mark Filipino hosts this Financial Times news briefing covering three major market developments. Miles McCormick, FT's U.S. economics correspondent, discusses energy market volatility and corporate exposure to oil price swings. Antoine Gara, FT's Private Equity and Deals Editor, analyzes stress in the private credit market and potential systemic risks.

The episode examines Oracle's strong earnings performance amid heavy debt loads, volatile oil markets driven by Middle East tensions, and growing concerns about private credit fund stability as investors pull money amid rising defaults.

Oracle Surges Despite Debt Concerns and AI Dependencies

Oracle shares jumped after reporting 22% revenue growth to over $17 billion last quarter, beating Wall Street expectations while boosting next fiscal year forecasts.

Capital expenditures increased more than 50% as Oracle competes to supply AI computing power, but faces criticism over OpenAI customer reliance.

Long-term debt including operating leases rose to $143 billion, raising concerns about the company's borrowing strategy.

Oil Price Volatility Hits Corporate America Hard

Brent crude swung from $80 to $90 per barrel after false claims about Navy escorts through the Strait of Hormuz, which transports 20% of global oil.

"Petrol prices would probably not be back below their pre-war level in forecasts stretching out to the end of 2027" - U.S. Energy Department, with diesel recovery by mid-2027.

Trucking, agriculture, airlines, and maritime industries face sustained input cost increases that "will absolutely" be passed to consumers - Miles McCormick.

Higher energy costs create political pressure for Trump, as pump prices now exceed levels from his previous terms despite campaign promises to slash energy prices.

Private Credit Market Shows Stress Signals

Business development companies (BDCs) trade at substantial discounts to assets as public markets question private credit valuations and future earnings.

Non-traded BDCs see redemption requests exceeding 5% quarterly limits, forcing managers to decide whether to meet full redemptions or impose restrictions.

Default rates rise while AI threatens business models of technology and software companies comprising one-third of private credit portfolios.

"All of this risky lending on Wall Street is outside of the banking system and isn't immediately something that has spilled over into the broader market" - Antoine Gara.

Shipping Insurance Costs Soar Amid Regional Tensions

Lloyd's of London insurance prices for Strait of Hormuz shipping increased 12-fold, though the company pledges to "provide cover to basically anyone who asks."

Higher costs reflect "heightened risk and higher oil prices, which boosts the overall insured value of a ship" according to insurers.

Shipping slowdown stems from "vessel and crew safety" concerns rather than insurance availability, according to Lloyd's head of underwriting.