WORLD: What’s happening with oil price?
Oil price rally continues responding to Trump’s decision to reimpose the highest level of economic sanctions against Iran, with immediate effect. In brief, the US President pulled out the States out of the “defective” international 2015 Iran nuclear Deal (JCPOA).
The oil markets are very sensitive to market uncertainty and geopolitical tensions. This is the reason that oil is now trading at the highest levels in almost four years. Of course, this is not the only issue but anyway it is a highly considerable factor which we can add to the following:
- Upcoming Trump – Kim Jong-un summit.
- Trade talks between USA and China to smooth the risk of a trade war.
At the same time, weekly U.S. crude oil production increases. The production is approaching that of Russia, which is the top producer.
OTHER HIGHLIGHTS:
Apart from oil price rally, consequences of Trump’s decision over Iran include escalation of conflicts in Middle East. After the attack of Israel in Iranian bases in Syria, shortly after the U.S. announcement, Iranian forces targeted Israeli bases across Syrian frontier early on Thursday.
Donald Trump personally welcomed home 3 Americans released from detention in North Korea. He personally thanked the North Korean supreme leader for this move which is considered as another effort to pave the way ahead of the two leaders summit.
England’s Super Thursday: BOE is simultaneously releasing its inflation and growth projections in the concurrent release of its Quarterly Inflation Report, followed by BOE’s Governor Mark Carney speech, which is the main event for GBP traders.
MARKETS
Boosted by higher yields, the US Dollar hit a 4-1/2-month high against a basket of six major currencies overnight. Furthermore, greenback remained firm on Thursday supported by gains in long-term U.S. Treasury yields ahead of U.S. consumer price data later in the day.
New Zealand Dollar came under some pressure after the release of lowered central bank growth and inflation forecasts. The Reserve Bank of New Zealand kept interest rates unchanged. Therefore, NZDUSD falls to a new yearly low of 0.69018.
USDCAD traded softer over the last day after yesterday posting a seven-week high at 1.2997. The increase in oil prices has returned some demand for the Canadian dollar.
The euro hit a 4-1/2-month low, its lowest since late December. It continued its fall in six of the last seven sessions.
EURUSD slowdown for the fourth consecutive week was extended again yesterday.
Sterling floated over Monday’s four-month low $1.3484 ahead of Bank of England’s meeting on interest rates. Traders expect the BoE to keep rates unchanged due to weak UK economic data and renewed worries about Brexit.
Gold prices held steady boosted by a firmer Dollar.
Oil price rally continues hitting its highest in years. Traders responded to the announced US sanctions against Iran by rising sharply oil prices. Oil prices hit over $71.60 pb, almost 0.7% from last session.
Sources: Reuters, WSJ, CNN Politics
PLEASE NOTE The information above is not investment advice.