Oil declines by 4% US indices post the best


Oil declines by 4% US indices post the best weekly performance since November 2020
The Russo-Ukrainian invasion caused Russia to be subjected to various sanctions by Western countries,
including sanctions to restrict exports of energy goods. Thus, global oil prices continue to fluctuate

Evest follows market developments in the following report


Content :

Oil declines by more than 4%

Russian-Chinese trade relations in trouble

Wall Street posts the best weekly performance since November 2020

Oil declines by more than 4%

On Sunday, global crude oil prices fell more than 4% this week as investors continued to sell oil after the price jumped higher in early March.

The price of Brent oil fell by 4.21% from last week’s closing to $107.93 per barrel. In the meantime,
the price of West Texas Intermediate crude fell by 4.23% to the US $104.7 per barrel this week

Over the past two weeks, the global benchmark crude oil price has fallen,
although the price is still higher than the psychological level of US $100 per barrel.

However, the price of crude oil still tends to fluctuate on a daily basis this week

Oil prices posted a very bad correction from Monday to Wednesday this week.

On the other hand, the price jumped again on Thursday and Friday.

In the meantime, oil prices jumped to new highs earlier this month as investors responded to Western sanctions against Russia regarding crude oil export policies.

This issue reinforces uncertainty regarding oil prices, as expressed by British Prime Minister Boris Johnson 

Russian President Vladimir Putin

Russian President Vladimir Putin’s decision to invade Ukraine caused uncertainty and high oil prices.

Everyone can see the impact on gasoline prices, which are about to rise

The major powers have become dependent on Russian crude oil consumption as the world’s second largest crude oil producer.

Consequently, the impact of the embargo would raise concerns about the decline in crude oil reserves

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Russian-Chinese trade relations in trouble

The increasing complexity of trade relations between China and Russia since the outbreak of the war more than three weeks ago has raised questions about the future flow of energy,
minerals and crops between the two forces

Russia’s importance to China as a supplier of raw materials was growing before the war in Ukraine.

This was cemented in the “borderless cooperation” declared between the two countries prior to the Beijing Winter Olympics,
celebrated through the signing of new agreements to supply China with Russian oil, gas and wheat

Immediately after the invasion, Chinese officials said they disagreed with unilateral sanctions and would continue normal trade relations with Russia.

However, banks have since stopped financing purchases, and traders are struggling with logistics services,
while China’s foreign minister recently said Beijing does not want to be affected by sanctions

The energy field may be the biggest business opportunity.


China’s economy

The growth of China’s economy means that it has an increasing need for coal and gas to heat homes and power plants.

Although the nation is rich in coal, it is still vulnerable to shortages, and it is also relatively lacking in gas,
making imports necessary to keep up with demand

Russia is now the second largest transporter of coal to China after Indonesia,
while its gas exports have grown significantly since the Siberian pipeline began flowing in 2019.

Shipments of crude oil have also increased in recent years – including pipeline oil, China’s No. 2 supplier in 2021, behind only Saudi Arabia


Russian coal

Russian coal has strengthened the filling of the gap caused by the Chinese embargo on Australian shipments since late 2020,
and more recent disruptions in shipments from Mongolia and Indonesia.

In addition, the United States and Australia supply China with just over half of their liquefied natural gas imports,
which are transported by ship, a dependency that Beijing is trying to overcome

However, Chinese buyers and lenders financing their purchases largely avoided Russian shipments of coal and liquefied natural gas as well as crude oil in the aftermath of the invasion.

The unknown final point of international action against Moscow may make this hesitation temporary.

But it may also reflect deep corporate concerns about being drawn into sanctions that could affect global banking arrangements,
as well as government concerns about being excluded from the most important markets for Chinese goods

Logistics is also central concern.

Many Chinese coal importers and Russian miners met this month to discuss increasing volumes, but they pointed to several obstacles,
including whether China’s yuan-based cross-border payment system would be viable, as well as problems with transport capacity and coal quality, according to China 

Wall Street posts the best weekly performance since November 2020

Stocks rebounded after the early decline on Wall Street and closed broadly higher on Friday, posting their biggest weekly gain in 16 months

The S&P 500 index rose for the fourth straight day, adding 1.2% to the line that included consecutive days of gains of 2%.

Dow Jones Industrial Index rose by 0.8% and Nasdaq Composite index rose by 2%.

The three indices had their best week since November 2020

The S&P 500 index rose 51.45 points to 4463.12, bringing its weekly gain to 6.2%.

The Dow Jones index rose by 274.l7 to 34754.93 points, and the Nasdaq added 279.06 points to 13893.84

Stocks of small companies have also risen.

The Russell index rose by 2000 21.12 points, or 1%, to 2086.14 points

This week’s market rally came as Wall Street was encouraged by the Federal Reserve,
which announced a rate hike for the first time since 2018 and signaled more to come 

This move, which the market has been widely expecting for months, points to the central bank’s focus on fighting the highest inflation rate in decades.

Fed Chairman Jerome Powell also emphasized confidence that the economy is strong enough to withstand high-interest rates

Stocks were also boosted by the fall in the price of U.S. crude oil,
which briefly exceeded $130 per barrel last week under fears that the conflict in Ukraine would put energy markets under pressure,
falling below $94 per barrel on Wednesday, and has since hovered below $110 per barrel

The broader market has been volatile over the past few weeks as investors consider a number of concerns including inflation and Russia’s invasion of Ukraine.

This year’s key indicators have declined in a sharp reversal from strong gains over the past several years