Credit Market Sours for Energy-Dependent Europe as War Rages
Ships docked at an oil and chemicals terminal at the Port of Rotterdam in Rotterdam, Netherlands.
Photographer: Peter Boer/BloombergExposure to energy imports is separating winners from losers in the global credit market, with Europe turning to a major pain point as the Iran war shows few signs of ending soon.
Risk premiums on high-grade euro-denominated corporate bonds have climbed 13 basis points, almost triple the widening seen on their US counterparts since the start of the conflict. Investors have been buying more protection against default in European derivatives markets than in the US. And when Goldman Sachs Group Inc. forecast more credit spread widening last week, the firm told investors it will be more significant in Europe.