Gold 1797,875
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EURUSD 1,1832
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DJIA 34987,50
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OIL.WTI 68,515
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DAX 15569,50
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While there has been a relative lull in the financial markets, the energy market is in turmoil. Many different factors, both negative and positive, have driven the price sideways. The market is overheated and an exit is imminent, but where to?
OIL.WTI
As before, buyers are supported by oil supply disruptions in the USA. Due to Hurricane Ida, around 65% of the oil production capacity in the Gulf of Mexico is still not working. Because of this, US inventories will decrease, which will definitely affect the price.
Last Thursday’s OPEC+ meeting decided to leave the current plan to increase production by 400k bpd intact. It is safe to say that this cautious scenario will have a smooth effect on quotations.
The news from Iran does not add to the upside. Teheran government did not allow the IAEA representatives to the nuclear facilities and practically derailed the deal on nuclear programme. This implies that oil traders should not expect Iranian oil in the markets any time soon.
All factors seem to be shaping up to suggest that oil should go up in price, which locally it is doing now. But on Thursday, some very interesting news came out of China. The Middle Kingdom has started selling oil from its reserves. The interesting thing about this news is that last year the Chinese were very active in filling their reserves with oil when prices were collapsing and there was a total lockdown in Europe and the US. Now China thinks oil prices are high and worth selling.
As China is one of the most important oil importers, it is worth listening to this opinion carefully. The statement will not have an immediate impact on the markets, but it could be a strong enough factor to start the decline.
8.00 Germany’s harmonised consumer price index at the start of the year
8.00 UK Monthly GDP
14.30 ECB press conference on monetary policy
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