Oil prices edge up amid Russia-Ukraine tensions, but weak demand outlook – Century Financial
- Crude Oil
Oil prices edged up on Monday after fighting between Russia and Ukraine intensified over the weekend, although concerns about fuel demand in China, the world’s second-largest consumer, and forecasts of a global oil surplus weighed on markets. In a significant reversal of Washington’s policy in the Ukraine-Russia conflict, President Joe Biden’s administration has allowed Ukraine to use US-made weapons to strike deep into Russia, two US officials and a source familiar with the decision said on Sunday. There was no immediate response from the Kremlin, which has warned that it would see a move to loosen the limits on Ukraine’s use of US weapons as a major escalation. In Russia, at least three refineries have had to halt processing or cut runs due to heavy losses amid export curbs, rising crude prices and high borrowing costs, according to five industry sources.
Brent and WTI slid more than 3 percent last week on weak data from China and after the International Energy Agency forecasted that global oil supply will exceed demand by more than 1 million barrels per day in 2025 even if cuts remain in place from OPEC+.
As per John Helms report, Crude WTI Dec, Resistance levels are at $69.97 and $70.23, while Support levels are at $66.80 and $66.32. Brent Jan, Resistance levels are at $73.24 and $74.14 while Support at $71.08 and $69.68.
- Gulf Markets
The ADX General is rising for the third day, climbing 0.2%, or 22.21 to 9,465.35 in Abu Dhabi in early trading. International Holding Co. PJSC contributed the most to the index gain, increasing 0.2%. Ras Al Khaimah Co. for White Cement & Construction Materials PSC had the largest increase, rising 2.5%.
The DFM General Index opened 0.2% lower at 4,730.27 in Dubai. Emaar Development PJSC contributed the most to the index decline, decreasing 1.3%. Commercial Bank of Dubai PSC had the largest drop, falling 1.4%.
The Tadawul All Share Index opened 0.2% lower at 11,785.14 in Riyadh. Acwa Power Co. contributed the most to the index decline, decreasing 1.3%. Al-Baha Development & Investment Co. had the largest drop, falling 3.2%.
Oil held a weekly loss on concerns over plentiful global supply and the outlook for demand in China, the world’s biggest crude importer.
Brent traded above $71 a barrel after tumbling 3.8% last week, while West Texas Intermediate was near $67. Weak Chinese consumption has impacted sales of Angolan crude for December, while forecasters including the International Energy Agency see the prospect for a sizeable supply glut next year.
- Gold
Gold is up 1.08% on Monday, breaking its 6-day losing streak. This was driven by safe-haven flows due to geopolitical tensions that developed over the weekend. US President Joe Biden authorized Ukraine to use US-supplied long-range missiles to strike Russia. Moreover, the Gaza-Israel war continues, with Israel also continuing its operation in Lebanon after assassinating Hezbollah’s top media relations officer, Mohammad Afif. Further, markets seem convinced that President-elect Donald Trump’s policies of high tariffs and low taxes are expected to increase inflation, further driving safe-haven demand.
However, Fed Chair Jerome Powell said last Thursday that there’s no rush to cut interest rates as the economy is resilient, the job market is strong, and inflation is still above the 2% target. This has reduced the December rate cut probability from 76.8% to 61.6% over a month and is expected to keep yields and the dollar high, putting downward pressure on gold’s prices and capping its rally.
Gold is currently trading at $2,593.2 and is below the 9 SMA of $2,618 on the daily chart. The yellow metal has immediate support at the 70.8% Fibonacci retracement level of $2,586.1 and has immediate resistance at the 61.8% level of 2,612.0.
Gold prices in the UAE today are as follows:
24 Carat – AED 313.75
22 Carat – AED 290.50
21 Carat – AED 281.25
18 Carat – AED 241.00
Last Updated on 2 months by News Desk 1
