Oil declines amid easing supply-disruption fears
On Thursday, oil prices tumbled following an ease in fears of supply disruption. Investors’ sentiment recovered on the news that the Group of Seven nations (G7) agreed a plan to impose a high price cap on Russian oil.
The rise in U.S. gasoline stocks also added to downward pressure. The recent data turned out to be greater-than-expected.
Brent and WTI oil prices fell by over 3% on Wednesday on the report that a price cap on Russian oil may be set above the current market price.
As noted by a European official, G7 is discussing a price cap on Russian oil between $65 and $70 a barrel.
According to the report of the Commonwealth Bank commodities analyst Vivek Dhar, the potential price cap on Russian seaborne oil exports exceeds market expectations. He believes that the G7 decision may result in easing concerns of supply disruption.
Another factor that contributed to the decline in oil prices was the introduction of extra COVID restrictions in China on Wednesday. Such measures were taken to curb the spread of the disease. Such news is a cause for more concerns across investors about the economy and demand for fuel.
The issue of inflation is currently of less importance in the foreign exchange market. Thus, according to economists at Commerzbank, dollar bears will not suffer losses even on the release of optimistic nonfarm payrolls.
Yesterday at 12:16 PMObviously there has been a structural shift in the markets toward a bearish dollar position. According to economists at Internationale Nederlanden Groep (ING), current U.S. nonfarm payrolls data may not cause an inversion of this trend.
Yesterday at 12:10 PMEuropean Central Bank President Christine Lagarde stated that inflation expectations should not change. People should be confident that price growth will return to the target level.
Yesterday at 11:56 AMCentral banks have recently been stepping up measures to combat global inflation. Investors, meanwhile, are actively discussing the continuation of high price levels amid limited supply.
Yesterday at 11:30 AMThe focus is on the OPEC+ meeting and the entry into force of bans related to the import of Russian oil.
Yesterday at 12:59 PM