Crude oil prices rose by about 2.5%, at the end of trading today, Tuesday, March 21 (2023), in an attempt to compensate for some losses after a week of banking unrest, which cast a shadow on the markets.
Oil is seeking to recover from a 15-month low hit the day before, as the Credit Suisse bailout eased concerns about risks to the global banking sector that could hurt economic growth and slash demand for fuel.
The closing of transactions yesterday, Monday, March 20, witnessed slow attempts to recover oil prices, as Brent crude approached the barrier of $ 74 a barrel, affected by the state of collapse witnessed by some banks in the US banking sector, according to what was published by Reuters.
Sentiment improved in the financial markets after the UBS acquisition of Credit Suisse, after the major central banks said that they would enhance market liquidity and support the banking system, in conjunction with the European countries and the Group of 7 continuing to impose their strict measures in the face of Russian crude oil and oil derivatives, according to what I learned. it specialized power platform.
Crude oil prices today
At the end of the session, the price of Brent crude futures – for May 2023 delivery – increased by 2.1%, to record $75.32 a barrel.
At the same time, US West Texas Intermediate crude futures, for April 2023 delivery, increased by about 2.5%, to $69.33 a barrel, according to what was seen by the specialized energy platform.
The two main crudes, Brent and West Texas, fell by about $3 a barrel during the previous sessions, before settling on a slight increase that did not compensate for the continuous losses, in light of attempts to save the “Credit Suisse” bank, through measures to enhance liquidity and support the banking system.
Investor confidence affected
Analysts from Haitong Futures said that crude oil prices are now mainly based on the effects on investor confidence at the macro level. If the banking crisis does not spread further, market sentiment may stabilize and prices will recover.
Among those effects, according to analysts, is the Federal Reserve’s decision on whether and how much to raise interest rates after concluding a two-day meeting on Wednesday, according to the analysis seen by the specialized energy platform.
It is noteworthy that the market’s estimate of the most likely size of the interest rate move by the Federal Reserve, since the beginning of the banking crisis this month, has decreased to 25 basis points from 50 basis points.
At the same time, officials of the Group of Seven said that the group is unlikely to proceed with the planned review of the Russian oil price ceiling at $60, explaining that the European Commission has told ambassadors of EU countries that there is no urgency on the part of the group for an immediate review.
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