Oil prices continued to fall in Tuesday’s session as concerns about interest rates and continued Russian crude exports offset expectations of a recovery in Chinese energy demand. April , Brent crude futures lost about 25 cents to trade near $8 .65 a barrel, while US West Texas Intermediate (WTI) crude futures fell about cents to settle at $77. 6 a barrel. According to CMC Markets analyst Tina Teng, the oil market is under pressure. The outlook for demand remains questionable as Russian exports appear to be unaffected by sanctions, although China is opening up again, he added. Many economists expect the Federal Reserve to raise interest rates by 25 basis points on Wednesday, while the Bank of England and the European Central Bank expect to raise interest rates by 50 basis points on Thursday. Higher interest rates could lead to a slowdown in the global economy, which in turn could reduce demand for oil. Focus also shifts to a virtual meeting scheduled for February 1 at 11:00 GMT between the Organization of the Petroleum Exporting Countries (OPEC) and other ministers of a group called OPEC, including Russia. According to Reuters sources, the committee is expected to propose keeping current OPEC production unchanged. In a meeting last October, OPEC decided to cut production by 2 million barrels per day, or about 2% of global demand, from November until the end of 2023. And although the European Union and the G7 countries have set a price ceiling for Russia, supplies from Russia still find their way to the world market. In currency markets, the US dollar posted its fourth monthly loss as the Federal Reserve began its two-day monetary policy meeting on Tuesday. Currency trading may be a little calm before the FED decision on Wednesday and the decisions of the Bank of England and European Central Bank on Thursday, but risk mapping supported the US dollar. , The euro traded up to $1.0913 on Monday after higher than expected inflation data from Spain, before settling near $1.08 5 against the US dollar. , The euro is up about 1.3% this month and remains at a nine-month high, while the US dollar index fell about 1.3% in January, trading near 102.28 early Tuesday. , GBP and the Australian, New Zealand and Canadian dollars fell against the US dollar, but monthly gains are also on the way. “Technically, I think they look a bit tired,” said Tony Sycamore, an analyst at Sydney-based broker IG Markets, pointing to the currency’s rise against the US dollar. Project market expectations of interest rates for a 25 basis point (bp) hike by the Fed to the bottom of the Fed’s target range of .5% to .75% as the Fed begins to taper at the end of the year, with two more 25 basis points. expected “According to Chris Weston, head of research at Melbourne brokerage Pepperstone, traders will have to match the tone of the statement and (Fed Chair Jerome) Powell’s press conference with its price structure. “If the Fed makes it less likely. that it may stop after this week’s rise, the US is easily selling the dollar and riskier assets are rising.” In the stock market, major US futures rose slightly late in the evening, while the S&P 500 is on track for some of its best. January 2019 performances. , SandP 500 futures rose about 0.26%, while Dow Jones futures traded about 9 points higher. Nasdaq 100 futures also added about 0.28%. Many stocks have rallied since the start of the year after a disappointing 2022, one of the worst years for the stock market since 2008. However, it is expected to be a tight earnings week, with many economists looking at some of the biggest companies doing well because inflation remains high and worries about a slowdown in spending. Companies reporting earnings on Tuesday include McDonald’s, Caterpillar, General Motors, Pfizer and Advanced Micro Devices, while Apple, Amazon, Alphabet and Meta will report quarterly results later this week.
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