OIL TAKES A STEP BACK ON CALM START OF FRESH WEEK
- WTI Oil slips back below line in the sand at $74.
- Tensions in the Middle East and Asia are not enough to demand a bigger risk premium in Oil.
- The DXY US Dollar Index holds above 102, with the US closed for Martin Luther King Day.
Oil prices are retreating further despite several geopolitical events taking place over the weekend. The main risk event is a possible retaliation or action from China against the election outcome in Taiwan where the ruling Democratic party won with its demands for more sovereignty and independence. Meanwhile several world leaders are joining Davos for the World Economic forum, with several side meetings to discuss hot topics like Ukraine, Taiwan, the Red Sea and Gaza tensions.
Meanwhile, the DXY US Dollar Index is drifting sideways with markets on edge on any change in equilibrium in any of the above mentioned hot topics. Intrinsically US Dollar strength is abating a bit as US economic data no longer beats estimates on all fronts, with several indicators starting to fall in contraction while the US labor data remains strong (for now). Traders have a holiday in the US, ahead of US Retail Sales and University of Michigan Consumer Sentiment later this week.
Crude Oil (WTI) trades at $72.27 per barrel, and Brent Oil trades at $77.61per barrel at the time of writing.
- WTI Oil slips back below line in the sand at $74.
- Tensions in the Middle East and Asia are not enough to demand a bigger risk premium in Oil.
- The DXY US Dollar Index holds above 102, with the US closed for Martin Luther King Day.
Oil prices are retreating further despite several geopolitical events taking place over the weekend. The main risk event is a possible retaliation or action from China against the election outcome in Taiwan where the ruling Democratic party won with its demands for more sovereignty and independence. Meanwhile several world leaders are joining Davos for the World Economic forum, with several side meetings to discuss hot topics like Ukraine, Taiwan, the Red Sea and Gaza tensions.
Meanwhile, the DXY US Dollar Index is drifting sideways with markets on edge on any change in equilibrium in any of the above mentioned hot topics. Intrinsically US Dollar strength is abating a bit as US economic data no longer beats estimates on all fronts, with several indicators starting to fall in contraction while the US labor data remains strong (for now). Traders have a holiday in the US, ahead of US Retail Sales and University of Michigan Consumer Sentiment later this week.
Crude Oil (WTI) trades at $72.27 per barrel, and Brent Oil trades at $77.61per barrel at the time of writing.
Oil News and Market Movers: Tension on high alert
- A second batch of airstrikes unfolded against Houthi rebels in Yemen by the US and UK on Friday and Saturday.
- Despite rising tensions in the Middle East, Red Sea and between China and Taiwan, Oil flows are still expected to stay normal and undisrupted.
- The monthly OPEC report is due on Tuesday with no big changes expected as crude prices remain unable to jump and stay above $74.
- Several companies in Europe are starting to report shortage of supplies due to longer routes along Africa while freight ships are no longer passing the Red Sea passage. This could unfold as stuck Oil supply in certain dependent regions
- A second batch of airstrikes unfolded against Houthi rebels in Yemen by the US and UK on Friday and Saturday.
- Despite rising tensions in the Middle East, Red Sea and between China and Taiwan, Oil flows are still expected to stay normal and undisrupted.
- The monthly OPEC report is due on Tuesday with no big changes expected as crude prices remain unable to jump and stay above $74.
- Several companies in Europe are starting to report shortage of supplies due to longer routes along Africa while freight ships are no longer passing the Red Sea passage. This could unfold as stuck Oil supply in certain dependent regions
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