Oil gains while Russia announced production cuts

Oil prices eased after rising 1% in early Monday’s session as many market participants focused on near-term demand concerns stemming from an expected U.S. inflation report and refinery maintenance in Asia and the U.S. . Brent crude futures fell about 86 cents a to trade nearby. $85.53 a barrel at 0715 GMT after rising more than 2.2% on Friday, while U.S. West Texas Intermediate crude was at $78.83 a barrel, or about 89 cents, after rising 2.1%. last session “Crude oil prices are falling as energy traders anticipate a possible weakening of the outlook for crude oil demand as a key inflation report could push the Federal Reserve to tighten policy much more aggressively,” said Edward Moya, senior analyst at OANDA, referring to. American consumers. price data up to February 1 th. “This week could provide a moment when prices on Wall Street fall.” The US Federal Reserve raised interest rates to curb rising inflation, raising concerns that its actions could slow economic activity and reduce demand for oil. In addition, Azerbaijani oil exports continued at Turkey’s Ceyhan terminal on Sunday, helping to ease supply problems, according to CMC Markets analyst Tina Teng. The terminal was damaged by the earthquakes in Turkey and Syria last week. It is a storage and loading point for pipelines transporting oil from Azerbaijan and Iraq. Oil prices rose on Friday after Russia said it would cut oil production by 500,000 barrels a day in response to Western sanctions. Russia is one of the world’s largest oil producers. In the currency market, the US dollar traded near five-week highs against other major currencies on Monday morning, as many economists await key inflation data on Tuesday. The Japanese yen weakened as the government appoints a new president of the Bank of Japan, supporting the central bank’s current policy sentiments. Australian and New Zealand dollars also fell on fears that higher US interest rates will slow economic growth, while the British pound traded weaker. “The dollar has been heavily supported since the stronger-than-expected US jobs report earlier this month and comments from the Federal Reserve have tended to be more dovish, but the focus is naturally on tomorrow’s CPI,” says Shinichiro Kadota. , senior currency strategist at Barclays in Tokyo. “I think the market is more concerned about the risks of an acceleration of inflation than a slowdown.” The Bureau of Labor Statistics January consumer price index (CPI) of , , which is expected to be published on Tuesday, is being watched especially after the Chairman of the Federal Reserve Powell commented that the American economy has started an inflationary process. The consumer price index rose by around 0.5% per month in January, which is a significant increase compared to the indicators of recent months. , US Stock Markets Main US futures were slightly lower in the early session on Monday, after one of the worst weeks in two months for the S&P 500 and the Nasdaq. The three major US indexes ended last week lower, with the Dow down 0.17%, while the S&P 500 and Nasdaq were down 1.11% and the Nasdaq was down 2. 1%. After the Fed chairman, Powell’s comments caused losses in the stock market, as he said that the Fed’s efforts to fight inflation still have some way to go. Powell also said that interest rates could rise more than expected if inflation rates do not fall, reversing some of the market’s initial optimism that rates could slow. “However, there is a risk that a premature deterioration of the financial situation and, in turn, an acceleration of growth expectations could be detrimental to the fight against inflation. After a warm January payrolls report, many Fed speakers this week talked about interest rate expectations , delaying Powell’s eulogy.” According to a note from Barclays analyst Emmanuel Cau. “As a result, the gap between the Fed’s own rate forecasts and market prices narrowed significantly, hurting US stocks.”

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