NZD/USD: market is waiting for New Zealand inflation data for Q4The NZD/USD pair is showing moderate growth, once again testing the 0.5600 level for an upward breakout. The instrument is supported by technical factors, while trading activity in the US markets is reduced due to the celebration of Martin Luther King Day. Investors are closely watching the inauguration of Donald Trump, waiting for his first decisions as president. The Republican administration previously announced its intention to significantly increase import duties, especially on goods from Canada, Mexico and China, which could provoke retaliatory measures and negatively affect global trade. At the same time, the attention of American market participants is focused on the preliminary December data on the construction sector. Despite a decrease in the number of building permits by 0.7% to 1.483 million and a decrease in the volume of new homes by 15.8% to 1.499 million, the overall picture remains positive, which reduces the likelihood of changes in the monetary policy of the US Federal Reserve.The New Zealand dollar continues to receive support due to positive statistics from China published last week. In the fourth quarter of 2024, China's GDP grew by 5.4% year-on-year against the previous 4.6%, exceeding analysts' expectations of 5.0%. On a quarterly basis, the indicator increased from 1.3% to 1.6%, fully in line with forecasts. The December data also turned out to be optimistic: industrial production increased from 5.4% to 6.2%, and retail sales increased from 3.0% to 3.7%, exceeding expectations of 3.5%. Additionally, the pair was supported by an increase in the index of business activity in the manufacturing sector of New Zealand, which increased from 45.2 to 45.9 points in December.Resistance levels: 0.5607, 0.5641, 0.5672, 0.5700.Support levels: 0.5571, 0.5540, 0.5511, 0.5467.USD/JPY: the Bank of Japan is preparing to set a rate at a 17-year peakThe USD/JPY pair is showing a decline, correcting to the level of 156.12 during the Asian session, after a rapid increase last week. The weakening of the US dollar is related to the expectations of the inauguration of Donald Trump, which will take place today. The new president has already announced plans to promptly fulfill key election promises, including an increase in import duties on goods from Mexico, Canada and China, which is causing concern to market participants.The Japanese yen is supported by positive macroeconomic statistics. The volume of orders for engineering products increased by 10.3% year-on-year in November, accelerating from the previous 5.6%. On a monthly basis, the growth was 3.4%, exceeding analysts' expectations of a decrease of 0.4%. However, industrial production decreased by 2.2% month-on-month and 2.7% year-on-year, which nevertheless turned out to be better than previous values. The index of production capacity utilization decreased by 1.9% after October's 2.6% increase, while the index of activity in the service sector decreased by 0.3% after an increase of 0.1%. In the United States, December statistics on industrial production showed an increase of 0.9%, which significantly exceeded market expectations of 0.3%.On Friday, January 24, the Bank of Japan will hold a monetary policy meeting, at which it is expected to raise the interest rate from 0.25% to 0.50%, the highest level since 2008. Experts believe that the regulator may increase the rate to 1.00% in the future, which corresponds to a level that does not cause overheating of the economy. The acceleration of wage growth should support inflation at 2.0%, which will allow maintaining a tight monetary policy. The consumer price index has already exceeded the regulator's target for almost three years, and the weakness of the yen contributes to high import costs. Bank of Japan Governor Kazuo Ueda is likely to emphasize his willingness to continue policy adjustments if the Trump administration's moves do not lead to market destabilization. Inflation data will also be released on Friday.: The core index, which excludes fresh food prices, is projected to accelerate from 2.7% to 3.0%.Resistance levels: 156.50, 157.50, 158.18, 159.00.Support levels: 155.50, 154.96, 154.50, 153.87.Gold market analysisGold is showing moderate growth, recovering from the decline recorded at the end of last week, when quotes moved away from local highs reached on December 12, 2024. The instrument is testing the 2705.00 level, trying to gain a foothold above this mark.Today, analysts' main attention is focused on the inauguration of US President Donald Trump, who is expected to make key decisions in the first hours after the ceremony. One of the most likely steps is the introduction of increased import duties on most goods entering the United States, especially from countries such as Canada, Mexico and China. These measures could trigger disruption of global supply chains if the affected countries impose retaliatory sanctions. Such actions may force the US Federal Reserve to maintain a tighter monetary policy. This year, the market expects the regulator to make only two interest rate adjustments of -25 basis points or less, with the first reduction expected to take place only in the second half of the year.Additional support for the US currency was provided by macroeconomic data released on Friday. In December, industrial production increased by 0.9% after an increase of 0.2% a month earlier, exceeding expectations of 0.3%. Capacity utilization increased from 77.0% to 77.6%. In addition, the construction sector showed impressive results: the volume of house construction started increased by 15.8% month-on-month, rising from 1,294 million to 1,499 million units, which significantly exceeded the projected 1,320 million.Resistance levels: 2724.70, 2740.53, 2760.00, 2775.00.Support levels: 2700.00, 2685.56, 2670.00, 2655.00.Crude Oil market analysisThis week, WTI Crude Oil prices approached the significant mark of $ 77.00 per barrel. The negative dynamics is explained by the strengthening of the US dollar and expectations related to the beginning of Donald Trump's second presidential term. In his first days in office, he is expected to present initiatives aimed at increasing oil production and allowing the development of fields in coastal areas, which may affect the overall balance in the market.Meanwhile, a new report from the International Monetary Fund (IMF) predicts a decline in oil prices in the coming years. According to analysts, in 2025, prices for "black gold" may drop to $ 69.76 per barrel, and in 2026 to $ 67.96, which is significantly lower than the October forecast of $ 72.84 for the current year. The IMF experts note that the market has undergone significant changes: a slowdown in demand from China and an increase in supply from non-OPEC countries are putting pressure on the value of the asset.According to the latest report from the U.S. Commodity Futures Trading Commission (CFTC), the number of net speculative positions in oil increased from 279.6 thousand to 306.3 thousand over the week, which is the highest since April, indicating increased trader activity.Resistance levels: 79.00, 82.40.Support levels: 75.90, ...
EUR/USD: the pair is moving within the 1.0350–1.0000 channelThe quotes of the EUR/USD pair are in the correction phase, trading around the 1.0305 mark against the background of the weakening of the US currency. After a poor start to the year, the euro is regaining its position, receiving support from the publication of macroeconomic data.Today, key eurozone countries continue to provide information on inflation. In December, the consumer price index in France was 1.3%, remaining at the level of the previous month and coinciding with analysts' expectations. In Spain, inflation accelerated to 2.8% from the previous 2.4%. The consolidated indicator for the eurozone is projected to grow by 0.4% month-on-month and reach 2.4% year-on-year, exceeding the November level of 2.2%. At the same time, the base index, which excludes the cost of food and energy resources, is likely to be fixed at 0.5%. Increased inflationary pressures may adjust the policy of the European Central Bank (ECB), forcing it to reconsider plans to lower interest rates or slow down the pace of their reduction.Support levels: 1.0230, 1.0030.Resistance levels: 1.0350, 1.0530.NZD/USD: New Zealand and the UAE have signed a partnership agreementThe New Zealand dollar is aiming to stay above the 0.5600 level during Asian trading on January 15. The national currency is supported by statistics on the business confidence index provided by the New Zealand Institute of Economic Research (NZIER). According to the report, the indicator for the fourth quarter increased by 16.0%, offsetting the previous decrease by -1.0%.Earlier, the strengthening of the New Zealand currency was driven by positive data from the construction sector and China's foreign trade. The number of building permits in New Zealand increased by 5.3%, which fully offset the 5.2% decrease a month earlier. Meanwhile, exports from China grew by 10.7% year-on-year after the previous growth of 6.7%, significantly exceeding analysts' forecasts of 7.3%. Imports increased by 1.0% after falling by 3.9%, which contributed to an increase in the trade surplus from $97.44 billion to $104.84 billion, against expectations of $99.8 billion.In addition, representatives of New Zealand and the UAE signed a comprehensive economic partnership agreement aimed at increasing trade and investment flows. According to forecasts, the deal will allow to reach a trading volume of 5.0 billion dollars by 2032, providing an annual average of 1.5 billion dollars. At the same time, in the first nine months of last year, the non-oil trade turnover between the two countries amounted to 642.0 million dollars, which is 8.0% higher than the same period in 2023.Resistance levels: 0.5607, 0.5641, 0.5672, 0.5700.Support levels: 0.5571, 0.5540, 0.5511, 0.5467.USDX: dollar loses ground ahead of inflation reportThe US dollar index (USDX) shows mixed sentiment, being near the 109.00 mark and testing it for a breakdown down. Yesterday, the index showed a moderate decline, continuing to adjust from the highs reached earlier in the week. The main driver of the "bearish" dynamics was weak statistics from the United States, which increased doubts about today's inflation data and lowered expectations of new changes in the Fed's monetary policy in 2025. In particular, the producer price index for the month fell from 0.4% to 0.2%, although it was predicted to remain at the same level, and year-on-year the indicator increased from 3.0% to 3.3%, but was lower than the expected 3.5%. At the same time, the base value decreased to 0.0% from the previous 0.2%, maintaining the annual dynamics at 3.5%.Forecasts for consumer inflation suggest that the monthly rate will increase from 0.3% to 0.4%, and the annual rate from 2.7% to 2.9%, while the base value is likely to remain between 0.3% and 3.3%. Such data may signal a slowdown in the pace of the Fed's dovish policy. Central forecasts with a 97.3% probability assume that the interest rate will remain in the current range of 4.25%-4.50%, especially given Donald Trump's policy of reforming import duties, reducing the tax burden and tightening immigration rules, which may increase inflationary pressures.In addition, the monthly economic review of the US Federal Reserve "Beige Book" will be released today at 21:00 (GMT+2). The document covers 12 federal districts, providing up-to-date information on the state of industry, agriculture, corporate and consumer spending, the real estate market and other sectors of the economy.Resistance levels: 109.50, 109.97, 110.40, 111.00.Support levels: 109.00, 108.50, 108.00, 107.50.Crude Oil market analysisBrent Crude Oil prices continue to move within the framework of the local uptrend, remaining above $ 79.0 per barrel during the Asian session. The market is gradually recovering, but participants remain concerned about the possible consequences of new US sanctions that could affect Russian oil supplies to China and India, as well as the overall supply level on the global energy market.The quotes support the latest forecasts of the Energy Information Administration of the U.S. Department of Energy (EIA), according to which global oil production could reach 104.36 million barrels per day in 2025 and increase to 105.89 million barrels in 2026. At the same time, global demand is expected to decrease to 104.1 million barrels per day in 2025 and to 105.15 million in 2026, which will create an oversupply of 260 thousand barrels and 740 thousand barrels, respectively. This will be in contrast to the deficit of 170,000 barrels recorded in 2024. According to experts, the main increase in production is expected in non-OPEC+ countries such as the United States, Canada, Brazil and Guyana.Support levels: 78.30, 74.80.Resistance levels: 80.70, ...
GBP/USD: pound dominates, dollar loses groundThe quotes of the GBP/USD pair continue to strengthen, reaching the level of 1.2533, against the background of the weakening of the US currency.S&P Global business activity data for December supported the pound, despite the fact that the figures are still far from forecasts. The index of business activity in the UK services sector increased from 50.8 to 51.1 points, which pushed the composite indicator to 50.4 points. This indicates continued growth, even despite the Labor government's plans to raise taxes. In response to the increasing pressure, businesses are preparing to raise prices and reduce investments. An additional positive factor was the improvement in retail sales: the index calculated by the British Retail Consortium (BRC) showed an increase from -3.4% to 3.1%. Such dynamics has not been observed since March 2024, when the indicator reached 3.2%.The US currency, on the contrary, showed a significant decline, falling to the level of 108.1 in the USDX index. Analysts' expectations for an improvement in activity in key sectors of the US economy have not been met. The index of business activity in the service sector rose from 56.1 to 56.8 points, but was lower than the projected 58.5. The composite indicator adjusted from 54.9 to 55.4 points instead of the expected 56.6. A slowdown in the national economy may prompt the US Federal Reserve to temporarily freeze monetary policy changes. This is confirmed by CME Group FedWatch data: the probability of maintaining the current interest rate increased from 88.6% to 92.5%.Support levels: 1.2460, 1.2300.Resistance levels: 1.2580, 1.2770.USD/CHF: monetary policy supports the pair's growthThe USD/CHF pair maintains an upward trajectory despite the recent correction. Last week, the quotes reached a nine-month peak at 0.9135, but then retreated to 0.9033 (the Murray level [2/8]). The decline is expected to be temporary, as monetary factors continue to support the pair's growth in the medium term.The Swiss National Bank is likely to maintain a dovish approach this year, lowering borrowing costs to offset a sharp slowdown in inflation, which is putting pressure on the domestic economy. According to December data, the annual consumer price index decreased from 0.7% to 0.6%, remaining below the target range of 2.0%, which reinforces the need for further easing. The head of the Swiss regulator, Martin Schlegel, previously admitted the possibility of negative interest rates, although he stressed that this was not the main strategy.At the same time, the US Federal Reserve is demonstrating a more restrained approach to changing monetary parameters, given the growing inflationary risks associated with the tax and trade policies of the administration of President-elect Donald Trump. At the December meeting, officials cut the forecast for the number of interest rate cuts this year to two instead of four. Fed officials such as Adriana Coogler and Mary Daly point to the need to continue fighting inflation, which may slow down the pace of policy easing, strengthening the position of the US dollar.Resistance levels: 0.9155, 0.9277, 0.93 99.Support levels: 0.8970, 0.8789.USD/CAD: resignation of Canadian Prime Minister shocks marketsThe USD/CAD exchange rate continues to decline, breaking the support level of 1.4350, which signals a possible further deepening of the downtrend. The political instability in Canada is in the focus of market participants' attention.Prime Minister Justin Trudeau has announced his intention to leave office after the election of a new leader of the Liberal Party, which is accompanied by a temporary suspension of parliament. This decision came shortly after a meeting with US President-elect Donald Trump, who criticized the Canadian authorities for the increase in illegal migration and smuggling, as well as for the significant trade imbalance. Trump noted that the trade deficit with Canada is about $ 100 billion, and warned of the possible imposition of duties of 25% on exports if the situation does not change by his inauguration on January 20.Additional pressure on the pair's exchange rate is exerted by the weakness of the US dollar caused by the publication of macroeconomic statistics. The index of business activity in the services sector, calculated by S&P Global, increased from 56.1 to 56.8 points in December, but turned out to be significantly lower than analysts' forecasts (58.5 points). The composite index also showed a more modest increase, from 54.9 to 55.4 points, which is worse than the expected level of 56.6 points. In addition, the volume of industrial orders decreased by 0.4% in November, confirming the continuing difficulties in the American economy.Resistance levels: 1.4466, 1.4550, 1.4665.Support levels: 1.4150, 1.3950.Crude Oil market analysisIn Asian trading, Brent crude oil continues to adjust within the framework of the local uptrend, holding above the level of 76.0 dollars per barrel.Prices were supported by news about the increase in selling prices for energy resources with February deliveries to customers from Asia, Northern Europe and the Mediterranean. In particular, the cost of KSA's flagship brand Arab Light increased by 0.6 dollars for Asian customers and by 1.3 dollars for customers in Europe. These changes followed OPEC+'s decision to extend the voluntary reduction in oil production until the end of March 2025, taking into account changes in energy supplies to Asia from Russia and Iran amid sanctions.The market was also influenced by the statement of the US President-elect Donald Trump about his intention to lift the current ban on the development of oil fields in coastal areas. Trump has designated this decision, which affects an area of 625 million acres, as one of the key priorities of the first days of his presidency. Investors are taking a wait-and-see attitude, assessing the possible consequences of these initiatives.Support levels: 75.40, 72.20.Resistance levels: 77.30, ...
EUR/USD: bearish trend remains in forceThe EUR/USD pair is showing a moderate decline during Asian trading, continuing to develop the downward momentum formed earlier: quotes are testing the 1.0400 level again, declining from local highs on December 18. The activity of market participants and transaction volumes are gradually weakening, which is associated with the approach of the Christmas and New Year holidays, against which investors are taking a wait-and-see attitude.Pressure on the euro remains due to the current monetary policy of the European Central Bank (ECB) and recent comments by the head of the regulator, Christine Lagarde, in an interview with the Financial Times. She expressed concern about the continued rise in prices in the service sector, which remains at around 4.0%. Lagarde also spoke out against possible EU retaliatory measures to impose additional duties from the United States, pointing to their potential negative effect on households and businesses. Against the background of such statements, market participants are reviewing expectations for the rate of interest rate cuts in 2025, but questions about the pace of economic recovery remain open. In December, the ECB cut its key interest rate again by 25 basis points. November inflation accelerated from 2.0% to 2.3%, and forecasts suggest it will rise to 2.4% in 2024 and 2.1% in 2025, followed by a decline to 1.9% in 2026, which is below the target level. Additionally, the ECB confirmed its intention to continue reducing its bond portfolio under the PEPP program by 7.5 billion euros per month.Resistance levels: 1.0400, 1.0450, 1.0500, 1.0554.Support levels: 1.0350, 1.0300, 1.0253, 1.0200.GBP/USD: the pair is moving down, reflecting the medium-term bearish dynamicsIn December, the GBP/USD pair resumed its downward movement within the framework of a medium-term downtrend, testing the level of 1.2490, corresponding to a 50.0% Fibonacci retracement. The pressure on the pound increased after the release of macroeconomic data, which reflected a slowdown in economic activity in the UK.In particular, the gross domestic product (GDP) did not change in the third quarter, contrary to analysts' expectations, which assumed an increase of 0.1%. Industrial production also decreased by 0.7% in October, and the aggregate business activity index fell to 50.5 points, due to business concerns about the growing tax burden initiated by the Labor government. As a result, the country's economy may enter a state of technical recession. At the same time, inflation remains at a high level: in November, the consumer price index was 2.6%, and the base index rose to 3.5%. In such a situation, the Bank of England is unable to continue its soft monetary policy, which limits the incentives for economic recovery and increases pressure on the British currency.Resistance levels: 1.2695, 1.2939, 1.3061.Support levels: 1.2490, 1.2300, 1.2095.USD/CHF: Swiss authorities' investigation reveals reasons for Credit Suisse collapseThe USD/CHF pair is showing a steady upward trend in the morning, developing the momentum that began the day before, and is striving to overcome the 0.8990 level. Despite the low activity in the market ahead of the Christmas holidays, the main attention of bidders is focused on the outcome of the US Federal Reserve meeting, where interest rate changes were discussed.Last week, Switzerland presented statistics on foreign economic activity: exports in November decreased from 27.83 billion to 23.68 billion francs, imports — from 19.80 billion to 18.26 billion francs, which led to a decrease in the trade surplus from 8.025 billion to 5.424 billion francs. On Friday, the bankruptcy report of Credit Suisse Group AG, prepared by the parliamentary commission, was published. The 569-page document contains 30 recommendations for preventing similar crises in the future. Among the proposals: expanding the powers of FINMA, tightening capital requirements for systemically important banks, and introducing a resident qualification for members of the board of directors. The Committee noted that the mistakes of the Credit Suisse management were the key cause of the crisis: from 2010 to 2022, top managers were paid 39.8 billion francs in bonuses, despite cumulative losses of 33.7 billion francs. Additionally, it is indicated that the regulator unreasonably provided capital allowances in 2017, which prevented the timely identification of the bank's financial problems. The Government is invited to consider measures aimed at preventing similar situations in the future.Resistance levels: 0.9000, 0.9037, 0.9100, 0.91 30.Support levels: 0.8957, 0.8929, 0.8900, 0.8865.Crude Oil market analysisBrent Crude Oil prices are trading near the level of 72.00, showing sideways dynamics against the background of changes in global demand for energy resources.According to the latest report from the US Energy Information Administration (EIA), India will become the leader in hydrocarbon consumption in 2024, overtaking China. Forecasts show that India could reach 220,000 barrels per day next year, increasing it to 330,000 barrels per day in 2025. At the same time, China, against the background of an accelerated transition to renewable energy sources, will reduce the growth rate of demand to 90 thousand and 250 thousand barrels per day for the same periods. If in 2023 China accounted for up to 70% of global oil demand, then in 2024 the figure may fall to 20%, while India's share will grow to 25%. Already this year, India has taken a leading position in the supply of petroleum products to the EU, surpassing even the United States.Resistance levels: 73.50, 77.00.Support levels: 71.60, ...
OPEC+ is markedly reducing oil production - in fact, the exporting countries will pump about 1 million barrels less per day. We have written earlier on why this is so.As a result, supply at the market has become lower, so prices have gone up and are approaching $100 per barrel again.What will the U.S. do after the OPEC+ statement?The coming energy crisis and the high inflation it causes are scaring the whole world, but it's the States that are worried the most right now:expensive oil means expensive fuel;it's causing prices of almost all commodities to rise;inflation is going up - the Fed keeps tightening policy;high key interest rates are pushing the U.S. closer to recession;in addition, high fuel prices can cause social discontent.To prevent this, the U.S. is trying to influence the largest oil producers and keep prices down. Otherwise, the Democrats will most likely not win the congressional elections. They are due in a month.The U.S. started to prepare in advance: President Biden flew to Saudi Arabia this summer and persuaded the U.S. to bring down oil prices. But it did not work out very well: OPEC acts in its own way and does not want to listen to Americans. As a result, the failed negotiations with the Saudis have further diminished the credibility of Biden and the Democrats' ability to influence oil, inflation and economic stability in the United States.However, the Biden administration is not giving up; they have a few more options - rather radical ones - on how to lower oil prices.Additional Oil ReleaseThe safest, though least effective, option is to further draw oil from strategic U.S. storage facilities. In response to OPEC+'s decision to cut production, Biden announced that the U.S. would release 10 million barrels of oil, even as storage reserves are depleted.That would be all well and good, but the announcement had little or no effect on oil prices, especially compared to the previous similar decision to release 180 million barrels to the market. No wonder: the volumes are not comparable.In addition, since U.S. storage reserves are running out, there is a risk that they will not be enough for a rainy day: in case of sharp reductions in domestic production (for example, during hurricanes in the Gulf of Mexico) or imports (if OPEC+ countries reduce exports).Reducing military aid to the ArabsDemocrats have drafted a "Tense Partnership" bill in response to OPEC+ and specifically the alliance's leaders, Saudi Arabia and the UAE. They are accused of "a hostile act against the United States" and "siding with Russia in the conflict with Ukraine."As revenge, the U.S. could withdraw its troops from these countries and stop supplying weapons and other military aid to fight neighboring states and terrorists. This includes protecting oil infrastructure from attack.This option also has disadvantages: without U.S. military support in these countries, there could be problems that would inevitably affect the global oil supply. After all, if military actions or terrorist attacks affect the oil fields or storage facilities of Saudi Aramco, oil will cost even more, and such attacks occur quite often.So even if the Saudis and the UAE will not reduce exports in response to the withdrawal of troops and reduction of arms supply, there is a good chance that sooner or later the fighting will make prices go up.In addition, Saudi Arabia has already planned to prepare for a possible conflict with the United States. For example, in the spring the Saudis said they were going to explore ways to move away from the petrodollar - that is, not to use bucks in the black gold trade. In this case, the demand for the dollar could fall dramatically, especially if other oil-exporting countries do the same.NOPEC: Conflict with OPEC+Amid disagreements with OPEC, the U.S. may return to the "oil production and export cartel law," NOPEC, to have more leverage on oil exporters.In this case, U.S. courts will be able to consider antitrust suits against OPEC+ and in general against countries involved in cartel collusion in the oil market. Under the decision of their own courts, the U.S. will be able to impose sanctions, confiscate property of these countries and put pressure on them in other ways. At the same time, the U.S. itself will indicate what is legal and what is not, thus assessing any actions of the countries that regulate oil production and prices.This option also has a disadvantage: sanctions on exporters would also hit the U.S. itself. If oil prices become lower, the U.S. oil industry will also be hard hit: domestic production will decrease and it will have to import more. And since the market is competitive, and the U.S. in this case will be "enemies of OPEC +", they will have to buy oil more expensive.So, even if the U.S. takes a drastic step - provoking a conflict with Saudi Arabia or the UAE, or starting a sanctions war with OPEC+ - all this will have a negative impact on themselves.Can't sanctions be lifted on Venezuela?As we can see, the U.S. has almost no normal options left to influence the oil market. Nevertheless, the U.S. says it is not going to remove sanctions from Venezuela yet, despite the fact that this would help get more oil on the market and lower oil prices. We may see some new rhetoric in this regard, but no change for now.The Iran deal has also been stalled so far: there is no news or movement on it. Although it is possible that disagreements with the Saudis may attract the U.S. to support Iran, because these are the two sides of the Arab conflict.On the one hand, Iranian oil would help to increase supply, but there is a nuance here as well: the reserves in this country are not grandiose, moreover, most of the oil is already exported in circumvention of sanctions.So what to do with Brent and WTI crude oil prices in 2022?If we discard all of the above options, then all we have to do is sit back and watch oil go up in price. The outlook is also bad: even if the world starts a recession and the demand for oil decreases, OPEC+ is already reducing production and adjusting to negative expectations, and also the supply from Russia may decrease if the embargo comes into force.And if that's the case, U.S. inflation will be high. And given the strong labor market, the Fed may raise the rate even more than 1.25% by the end of the year, and it is not certain that it will slow down next year as well. If rates remain high for a long time, the risk of recession in the U.S. is very high, and stocks and cryptocurrencies will have no fuel for growth. As a result, the economy will have a hard time: liquidity is scarce.If the U.S. starts to act sharply, the dollar is at risk: the "oil" countries can give it up to reduce dependence on the United States. But if the U.S. does nothing, tightening Fed policy will keep the dollar very strong - though at the cost of high inflation and recession. 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In 2019, the "sub-sanctioned" Iran began to increase oil supplies in circumvention of sanctions. Mostly tankers went to China and the Mediterranean: Syria and Turkey. And by the beginning of 2022, the fleet for transporting sanctioned Iranian and Venezuelan oil had tripled. It accounted for approximately 400 million barrels per year. And such a "ghost armada" successfully undermines the business of transport companies.Why did Iranian tankers get such a name?Last year, The Mail on Sunday reported: 123 Iranian vessels circumvent sanctions on oil trade. They change their location to GPS and create the appearance that they are anchored at sea, but at this time they are loading/unloading at the port. They also actively forge documents, use flags of different countries, disable identification systems and use front companies. Oil is often loaded onto several vessels and mixed before reaching its destination. This is also the case with "toxic" Russian oil.At the same time, Iran has a whole "underground" financial system for trade bypassing sanctions, writes the WSJ. It includes accounts in foreign banks, intermediary companies outside the country and firms that coordinate prohibited trade. The annual turnover is estimated at tens of billions of dollars.And Iranian banks attract affiliated firms to manage trade under sanctions. They register "daughters" outside the country, become trusted for Iranian traders, and then trade with foreign buyers of Iranian oil in foreign currency through accounts in foreign banks.Will the "Iranian Armada" help Russia?She is already helping her to circumvent sanctions, writes the Daily Mail. The international non-profit organization United Against Nuclear Iran (UANI) accuses the Iranian navy of cooperating with Russian oil companies. Allegedly, Russian oilmen are using "Tehran's black market vessels" to circumvent the export ban. And the US, the EU and the UK are even calling for the formation of a team of "ghostbusters".At least 5 Iranian "ghost armadas" are transporting oil from Russia to China and India, according to UANI. And recently, the WSJ reported that Zamanoil from the UAE was linking Iranian and Russian oil workers. The US Treasury accused her of working with the Russian government and Rosneft on the supply of Iranian oil to Europe.However, at the end of March, Iran denied a "secret offer from Russia" to help it circumvent sanctions in exchange for support in concluding a nuclear deal. And in May, he noted that he could not be a competitor of Russia in the global oil and gas market. The country has its own regular customers, and Iran sells the maximum amount of oil.So officially, Iran does not seem to be planning to use its "army of ghosts" to help for the benefit of Russia, despite the fact that these countries have "converged" before. But then there was no question of an embargo on Russian oil and there was no ban on ship insurance. In the new reality, the actions of the "ghost armada" are quite difficult to ...
The year 2022 on world markets will largely be determined by the tightening of monetary policy in the United States, and the first week of the new year confirmed this. The minutes of the Fed's December meeting published last week showed a significant tightening of the position of the regulator's representatives – Fed members believe that the rate can be raised as early as March, and also see a faster reduction in the balance sheet as appropriate. Representatives of the regulator believe that the current economic conditions are already in many ways conducive to tightening the labor market, some even noted the recovery of the labor market already sufficient for such actions, although the majority still expects further improvement in the labor situation. Against this background, it is worth noting the publication of December labor data in the United States, which came out ambiguous. On the one hand, employment in December increased by only 200 thousand. The Bloomberg consensus forecast assumed an employment growth of 450 thousand, and the actual growth rate of the indicator was the lowest since the beginning of 2021. Nevertheless, in many respects such weak employment growth is explained by seasonal adjustment, and the unemployment rate in December fell more than expected. Thus, the indicator has updated the next lows since the beginning of the pandemic, dropping to 3.90% against the expected 4.10%. The unemployment rate continues to approach a historic low of 3.40%, and labor statistics have further increased fears in the market of an imminent tightening of the PREP in the United States. As a result, on Friday, the yields of ten-year US treasuries at the moment exceeded 1.80% per annum - the maximum since the beginning of the pandemic. Today they have returned to these levels again.This week, the dynamics in the market will continue to be determined by expectations for the actions of regulators - investors will follow the statements of representatives of the Fed and the ECB, as well as the publication of price data in the United States for December. Statistics published last week showed an increase in inflation in the EU to 5.00% YoY. As a result, the topics of price growth in December updated the historical maximum, while analysts expected a slight slowdown in price growth. The situation on the supply side also has high inflation in the United States. The December business activity indices indicated a slight easing of logistical problems, however, the further deterioration of the epidemiological situation again intensified disruptions in logistics chains, which does not lead to a significant slowdown in price growth. The FAO World Food Price index fell in December for the first time since July, but food inflation remains at elevated levels. Against this background, US inflation data is likely to continue to bring the Fed rate hike closer, intensifying the negative in the markets.The main event for the oil market in early 2022 was the OPEC+ meeting. However, as expected, it was decided to stick to the current plan to increase production. Nevertheless, the cartel lowered its forecasts for a surplus in the oil market, which allowed Brent crude futures to exceed the level of $80/bbl. Moreover, against the background of interruptions in the supply of black gold from Kazakhstan and Libya, quotations were close to $83/bbl. However, at the end of the week they declined from these levels, today Brent futures are growing by 0.35% and are trading around $82.05/bbl. The main negative for oil this week may be related to the potential strengthening of the dollar amid expectations of a tightening of the PREP in the United States. However, in the absence of a significant strengthening of the dollar, Brent futures may still exceed the levels of $83/bbl– - the quotes may be supported by another weekly decline in oil ...
Oil is getting more expensive on Friday morning. By 8.25 GMT, the price of a barrel of Brent oil rose to 70 dollars 89 cents, or 1.75%. The price of a barrel of WTI oil rose to 67 dollars 71 cents or 1.22%. According to the results of trading on Thursday, these oil standards rose by 1.2% and 1.4%, respectively. Investors evaluate the results of the last meeting of the countries participating in the OPEC+ agreement. Some market participants expected that the alliance would decide to reduce the volume of oil production. However, OPEC+ retained the current parameters of the deal. This means that the alliance will continue to increase the volume of raw material production by 400,000 b/s every month. At the same time, the participants of the meeting stated that they could make a different decision on the volume of production at any time. Everything will depend on the situation on the oil market and in the global economy. They noted the persistence of uncertainty. It intensified after the appearance of the next coronavirus strain omicron. Investors liked the alliance's statement about the possible holding of an extraordinary meeting, if the situation requires ...