Oil is weakening after the previous rally when the major oil producing countries had finally agreed on additional output cuts. Oil opened today’s session trading moderately lower. Market participants remain sensitive to the trade news and are currently focused on the progress of trade negotiations between the US and China. The ruble is gaining ground as the currencies of the emerging markets are slightly recovering. Oil demand in China was stable despite the ongoing trade conflict. The Brent quotes have surged above 64 dollars per barrel, so some profit taking is highly possible. Today, WTI oil futures have edged lower by 0.25% and WTI crude is currently trading at 58 dollars 87 cents per barrel. Another benchmark brand is showing similar dynamics. In the early trade, Brent oil slipped to 64
dollars 19 cents a barrel. The outcomes of the OPEC+ meeting did not influence the forecast of the International Energy Agency regarding the global oil prices. According to the IEA, the oil prices will remain stable until the end of this year and early in the next year. The head of the IEA noted that oil quotes
may shift considerably due to the rising geopolitical tensions. Oil needs more drivers to continue its growth. However, no new signals are expected in the nearest future as the main issue of the year – the US-China trade talks – still remains
unresolved. It is yet not clear whether new tariffs on
Chinese goods will be imposed on December 15. It seems now that the two parties will not go to further to escalate the conflict. However, the uncertainty remains holding the markets back from further actions. Traders are hoping to get more clues on the topic. The ruble started the week advancing against its major counterparts. The dollar/ruble pair closed yesterday’s trade at the level of 63.59. On Tuesday, the pair continues to trade near this mark. External factors remain largely unchanged, except the statistical data from China. In November, the consumer price index in China soared to 7-year highs. The risk of a devaluation of the yuan during the day can weigh considerably on the currencies of the emerging markets. Otherwise, Tuesday promises to be good for the ruble. The Russian currency is expected to strengthen slightly against the major foreign currencies. On Wednesday, the US Senate is planning to discuss the imposition of new sanction against Russia. Traders may consider to sell the ruble ahead of the upcoming sanctions. Moreover, the Federal Reserve is due to announce its monetary policy statement tomorrow. Investors do not expect any changes in the Fed’s policy, and Jerome Powell is likely to follow the neutral rhetoric. In this case, the market’s reaction to this event will be weak and short-term.