Oil is about to end the week on the rise after a series of positive forecasts regarding fuel demand. On Tuesday, OPEC stuck to its projections for global oil demand growth of 2.55 million bpd this year and 2.25 million bpd next.
On Wednesday, the dollar rate changed after the speech of the head of the Fed Jerome Powell. According to the Fed’s forecasts, in 2023, the borrowing costs will increase at least by 75 basis points.
At the moment, there are significant contradictions in the assessment of the U.S. Federal Reserve (Fed) actions. On the one hand, Fed’s Chair Jerome Powell is talking about further raising interest rates and fighting inflation.
The Swiss National Bank raised its policy rate by 50 basis points on Thursday. It is the third increase this year in terms of curbing inflation. Interest rates in Switzerland are at their highest level since the global financial crisis 14 years ago.
According to economist David Rosenberg, consumer debt payments in Canada are much higher today than in 1990. Interest rates were perceptibly higher at that time, a signal that the debt burden in the economy was extremely high.
Bill Ackman, founder and CEO of Pershing Square Capital, said it would take a severe, job-eliminating recession. After that, inflation could return to the 2% level, what is considered to be the Fed's long-term goal.
Powell spoke at a press conference following a meeting of the Federal Open Market Committee. During his interview, Powell was asked whether the Fed could consider raising its inflation target.
Oil prices keep rising for the third day in a row as part of the shutdown of Canadian pipeline Keystone, being crucial to refineries in western part of the U.S. The cost of fuel continues to rise due to the accident, despite a significant weekly surge in the U.S.crude stocks.
As it became known on December 14, Morgan Stanley analysts suggest crude oil prices to rise back to the level of about $110 per barrel by the middle of the upcoming year.
It is a week before the polar vortex comes to the United States. However, on Wednesday, natural gas still went into a sell-off mode. Players took profits and tried to correct the market, which jumped almost 30% over the past five sessions.
