Oil continues to rise and the euro is stable against the US dollar

Oil continues to rise and the euro is stable against the US dollar: Oil managed to continue rising in the midweek session,
where it was supported by OPEC’s continuing plan to phase out restrictions,
and there are strong hopes for economic recovery indicating that demand will soon return to normal.

Evest follows up on what’s happening in the trading market around the world and tries to convey it to you to help you make the right decision.

Oil continues to rise, supported by OPEC’s decision

Oil prices continued to rise today Wednesday after OPEC + decided to commit to the plan to resume oil supplies in June and July, as well as due to an optimistic assessment of the demand outlook.

The price of August London Stock Exchange Brent crude futures reached $70.55 a barrel, $0.30 (0.43٪) higher than the closing price of the previous session.

The price of West Texas Intermediate crude futures in July in electronic trading on the New York Mercantile Exchange (NYSE) increased by $0.23 (0.34%) to $67.95 per barrel.

After a meeting on Tuesday, June 1, OPEC + ministers decided to stick to their plan to gradually ease supply restrictions by July.

The OPEC + group, composed of the Organization of Petroleum Exporting Countries (OPEC) and some non-OPEC producing countries, indicated a strong recovery in demand and remained unchanged in production policy.

The group decided to gradually increase daily oil production for May, June, and July at its April 1 meeting and did not change its production policy by indicating the strong demand outlook despite the expected increase in oil production from Iran, which is one of the member countries which supports the rise in prices.

Saudi Energy Minister

The statements of Saudi Energy Minister Prince Abdulaziz bin Salman after the meeting endorsed the market.

He said had seen a steady recovery in demand in the United States and China, the world’s two largest oil consumers.

The minister added that the pace of vaccine application “could accelerate the process of rebalancing the world oil market.”

According to analysts, the market appears to be focusing on a more constructive outlook for the end of this year.

At the same time, OPEC+ believes that the market will witness a significant decline in stocks
in the period from September to the end of the year.

Taking into account additional voluntary production cuts in Saudi Arabia, which will last until July, OPEC + will increase the supply of raw materials by 700 thousand barrels a day, in June and 840 thousand in July.

According to Bloomberg

Citing delegates, OPEC+ ministers on Tuesday did not discuss the production level after July.

According to the agreement concluded a year ago, after July, OPEC + plans to keep the production level unchanged until April 2022.

Markets are also monitoring all the news coming from Vienna regarding the Iran-US nuclear deal.

The process of negotiating the full implementation of the Iran nuclear deal called the Joint Comprehensive
Plan of Action, and the return of US sanctions to the agreement in Vienna, the capital of Austria,
reinforces expectations in the markets that an agreement between the two countries will be too close.

With the lifting of sanctions, Iran’s official resumption of oil exports
brings fears of oversupply in the market heavily affected by the consequences of the Covid-19 virus.

the statement by the Secretary-General of OPEC

However, the statement by the Secretary-General of OPEC, Mohammad Barkindo,
on Monday, that the return of Iranian oil production and export to the world market is expected to take place in an “orderly and transparent” alleviates concerns and contributes to the upward trend in prices.

On the other hand, the continued economic recovery, especially of the United States and China, remains the world’s largest oil consumer, and the expected increase in summer travel is positively affecting higher prices.

Nikkei turns green after the accelerated vaccination campaigns

The Tokyo Stock Exchange surged to close on Wednesday, after a reluctant start, attracting investors looking for deals, as Japan’s accelerated vaccination campaign boosted hopes for a recovery.

The main Nikkei index rose 0.46% to 28946.14 points and the Topix expanded index rose 0.84% to 1942.33 points.

“Investors are adopting a wait-and-see attitude ahead of Friday’s US employment numbers,”
Bloomberg quoted Ayako Sera of Sumitomo Mitsui Trust Bank as saying.

She added, however,”the deployment of COVID-19 vaccines in Japan accelerated
significantly over the past month,” supporting the market.

The vaccination campaign in Japan

The vaccination campaign in Japan, which has been criticized for being slow since
its launch in February, has moved to high alert, as the country ramped up the
the pace of vaccination, and more than 14 million people have received a single
dose of the vaccine over the past seven days.

However, less than 3% of the country’s population of 125 million have received two doses of the vaccine.

On the other hand, in Hong Kong, the Hang Sang index fell by 0.68%,
and Shanghai and Shenzhen closed down.

The collective rise in European indices

Among the major European stock markets, the German DAX index rose 0.34%,
the British FTSE index rose 0.55%, the French CAC 40 index rose 0.37%,
and the Spanish IBEX 35 index rose 0.12%.

Euro is stable against the US dollar

In the currency market, the euro settled above the $1.22 mark in early trading.

The common currency costs $1.2220, roughly the same price as the previous night.

The European Central Bank set the reference rate yesterday at $ 1.2225.

There is very little economic data to be released today that could move the market.

However, some senior central bank officials, including ECB President Christine Lagarde, will speak during the day.

In the evening, the Fed will publish its economic report, which, as a rule, does not trigger
a strong reaction in the financial markets, but is carefully heeded.

Oil continues to rise and the euro is stable against the US dollar

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