The Ukraine war roars back into importance for investment markets, not that it should have gone away, and there is little doubt it is inspired by Donald Trump winning the US election. Would President Biden really have given permission for Ukraine to use US made long-range ATACMS missiles and anti-personnel mines if the status quo had prevailed in the White House?
A very real and genuine supply issue and elevated geopolitical temperature led to a rise in anxiety level amongst investors as the week kicked off and helped oil prices rally with Brent finishing the day $2.26/bbl higher. It is not entirely clear whether yesterday’s forces at work will be able to provide protracted price support, but the closure of a significant North Sea oil field coupled with a policy U-turn by the US administration were more than sufficient to force bears to cover their positions
Although there is no singular oil current affairs influence that will see Brent prices scuttle to $60/barrel and below, there is however, a convergence of market forces that put paid to any ideas of a reclamation of $80/barrel. This is why oil prices had struggled all last week and staying with Brent, ended nearly $3/barrel lower. Picking any of the debilitating guards against rallies as the most important is subjective, it is the influence in the round that is all-important, and different drivers will jockey to the front of bearish considerations as and when appropriate.
Copyright © 2024 TP ICAP