Daily market commentary: Brent oil prices rise, as the markets weigh the possibility of a Western embargo on Russian oil exports


Brent oil prices rose on Monday, as the markets weigh the possibility of a coordinated Western embargo on Russian oil exports as retaliation for the escalation of the conflict in Ukraine, which has seen the indiscriminate bombing of civilian targets. According to some reports, The EU is considering following the lead of the US and move to block Russian oil purchases. A scenario that would exacerbate the ongoing supply issues and be likely to trigger a fresh spike in oil prices. The market jitters weren’t helped by an attack on a Saudi oil terminal this weekend, claimed by Houthi rebels, which caused a temporary drop in output and helped raise the price of the barrel of Brent to levels not seen in more than a week.

Ricardo Evangelista – Senior Analyst, ActivTrades

European Shares

European shares opened without clear direction on Monday, extending the mixed sentiment spotted overnight in Asia, as global risk appetite seems to be taking a break following record gains registered on last week. This week is likely to be crucial, as investors discover if last week’s solid rebound was just a volatile move or the start of a new trend. Diplomatic talks between Russia and Ukraine will remain as one of the top market drivers this week, with traders still monitoring slow but real progress towards a ceasefire, which should help sustain market sentiment. In addition, investors will also pay attention to monetary policies with today’s speech from Federal Reserve Chairman, Jerome Powell, where more details on the new tightening cycle are expected to be provided. From a technical point of view, European markets remain in a short-term bullish trend with prices trading inside a bullish channel since beginning of March. The Stoxx-50 index has even broken-out its mid-term bearish trendline, with prices now consolidating below the 3,925 pts (61.8% Fibonacci retracement), close to the lower band of the bullish channel. A clearing of this resistance level would be likely to pave the way for an extended bullish move towards 4,070 pts and 4260 pts by extension, for a full trend reversal.

Pierre Veyret– Technical analyst, ActivTrades

Disclaimer: opinions are personal to the authors and do not reflect the opinions of LeapRate. This is not a trading advice.

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