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January 25. Nikkei falls to 5-month low

The Japanese Nikkei stock index closed near a five-month low on Tuesday due to investor caution amid the situation on the border with Ukraine, the expansion of inflation risks and concerns about a faster-than-expected increase in the US Federal Reserve interest rate.

The current index value is 27.131.34 points, which was the lowest since August 20. During the trading session, the Nikkei declined to 26.890.94 – the lowest since December 29.

The broader Topix index dropped to 1.862.62. The Mothers Index of startups has fallen to its lowest level since April 2020.

Analysts note that the main driver of the downward dynamics of the index was the decline in the value of shares in the Japanese technology sector. In particular, the securities of the investor in startups SoftBank Group fell by 5.34%, shares of the manufacturer of equipment for creating chips Tokyo Electron – by 2.69%. NIDEC lost 4.44%.

The monetary policy of the US Federal Reserve also has an important impact on the index. A two-day meeting of the US regulator starts today, and investors assume that there is a small chance that the central bank will unexpectedly announce a rate hike from January.

Additional pressure on the Nikkei is also exerted by geopolitical tensions related to the buildup of Russian troops on the border with Ukraine. Yesterday it became known that NATO is putting its troops on alert and strengthening its positions in Eastern Europe with additional ships and fighters.

 

January 26. The US will release another 13.4 million barrels of oil from strategic reserves

The US Department of Energy has announced plans to release an additional 13.4 million barrels of oil from the country's strategic reserves.

The release of reserves will be distributed among seven companies: Shell will buy 4.2 million barrels, Trafigura – 3 million, Phillips 66 Company – 2.3 million, Macquarie Commodities Trading – 2 million, Chevron – 0.885 million, ExxonMobil – 0.515 million and BP Products North America – 0.5 million barrels.

Recall that US President Joe Biden in November 2021 announced the release of 50 million barrels of oil from reserves due to high oil prices in the world and gasoline in the States themselves. The first deliveries were made in December, and the rest will be carried out gradually until April. The return of reserves to the strategic reserve is planned for 2022-2024.

Today, oil quotes are showing growth again. The current Brent quote is $88.00 per barrel. Raw materials are getting more expensive after the release of yesterday's report from the American Petroleum Institute (API), according to which stocks decreased by 872 thousand barrels after rising by 1.4 million barrels a week earlier.

Today, we should pay attention to similar statistics from the US Department of Energy. Experts expect that oil reserves in the country decreased by 2.1 million barrels last week, gasoline reserves increased by 2.2 million barrels, and distillate reserves decreased by 1.6 million barrels.

 

January 27. The US economy in 2021 showed the highest growth rate since Reagan

According to the Bureau of Economic Analysis of the US Department of Commerce, the country's gross domestic product increased by 5.7% for the whole of 2021 after falling by 3.4% in 2020. Such economic growth has become the most impressive in the last almost 40 years, since the presidency of Ronald Reagan.

In the last quarter of 2021, US GDP increased by 6.9% on an annualized basis, which exceeded analysts' expectations of 5.5% growth.

In 2020, the American economy shrank for the first time since 2009 (by 3.4%), and the reason for this was the global coronavirus pandemic. However, by the middle of 2021, the economy had recovered and returned to the pre-pandemic level.

Analysts note that high economic growth in the United States is accompanied by high inflation – it is also at multi-year highs. In particular, in 2021, inflation accelerated to 7%, which was the largest indicator since 1982.

In response, the US Federal Reserve announced that it was curtailing anti-crisis measures, and in March it could raise the base interest rate for the first time in four years. Representatives of the regulator note that a tougher monetary policy is able to restrain price growth significantly exceeding the target level of 2%.

 

February 1. Gold is rising on Tuesday morning on political tensions

The value of gold is steadily growing on the first day of February. The current quote of the precious metal is $1.803 per ounce. Analysts call the main reason for the growth of the asset the strengthening of foreign policy tensions in the international arena caused by the contradictions around Russia and Ukraine.

And since gold is a «safe haven asset», increased tension successfully supports demand for it, somewhat leveling the recent weakening from the $1.850 level due to the tightening of the monetary policy of the US Federal Reserve System. Traditionally, gold acts as a resource that investors prefer to acquire in the event of difficult and questionable situations.

The markets are also focused on the meetings of the European and British central banks on Thursday. If both regulators agree to increase interest rates, the demand for national currencies will grow, and for the precious metal will decrease.

Analysts also presented a report on the global demand for gold by the end of 2021. According to statistics, demand reached the level of 4,021 tons, which was facilitated by a 50% growth in the fourth quarter. In annual comparison, the indicator increased by 10%. It is noted that such indicators are caused by the recovery of the jewelry and technology sectors of the industry, as well as active purchases of gold from central banks.

January 31. Oil remains near highs at the beginning of a new trading week

On Monday, oil prices remained stable at $89 per barrel after jumping to seven-year highs last week.

The current Brent quote is $88.90, North American WTI oil is trading near $87.30 per barrel.

Both brands of oil rose in price for the sixth week in a row. Since the beginning of the year, their cost has risen by about 16%, while the growth rate at the end of the month may be the highest since February 2021.

The main support for commodity assets is provided by concern due to problems with oil supplies, coupled with continuing geopolitical risks. An additional growth factor was a sharp cold snap in the United States, which increases the demand for fuel.

This week, on February 2, an important event for the oil market will take place – a meeting of OPEC+ ministers. Market participants expect that the alliance countries will decide to continue to increase their total production by the planned 400 thousand barrels per day on a monthly basis.

 

February 2. OPEC+ countries will increase oil production in March by 400 thousand barrels per day

A meeting of OPEC+ ministers was held today, at which it was decided to jointly increase oil production in March 2022 by 400 thousand barrels per day. Russia's quota in the March increase remains the same – 109 thousand barrels per day.

The alliance's ministerial meeting was a record short one and the decision to maintain the terms of the deal was made in half an hour. The next OPEC+ meeting, where the alliance's policy for April will be discussed, will be held on March 2.

After the announcement of the results, the price of Brent oil jumped to around $90.50 per barrel, declining some time later to $89.30. WTI crude oil is trading near $88.10 per barrel. Since the beginning of the year, oil quotes have increased by more than 17%.

The OPEC+ decision not to increase the production recovery rate above the planned rate may contribute to a further rise in the price of hydrocarbons

 

February 3. The Bank of England may raise the key rate for the second time in a row

A regular meeting of the Bank of England will be held today, at which, as expected, the regulator may raise the key rate for the second time in a row – from the current 0.25% to 0.5%, against the background of record inflation in the UK for 30 years. The last time the British Central Bank raised rates at two meetings in a row was in 2004.

It is worth noting that consumer prices in the UK in December 2021 jumped by 5.4% compared to the same month of the previous year, showing record growth rates since March 1992.

The British regulator raised the rate in December last year to 0.25%. At the same time, the Bank of England became the first among the world's central banks to take such a step, noting that some moderate tightening of monetary policy will be necessary to achieve the 2% inflation target.

In addition, in December, the Central Bank decided to leave unchanged the volume of the asset repurchase program at the level of 895 billion pounds, including the repurchase of government bonds in the amount of 875 billion pounds. However, it is possible that today the Bank of England will stop all reinvestments in the framework of asset purchases.

According to experts, the main message of the British regulator will be that a moderate tightening of monetary policy is necessary to maintain the stability of the economy. They also expect that inflation may peak at 6.5% and will slow down for a longer time than previously expected, remaining above the 2% target for two years.

 

February 7. Oil market declines after reaching multi-year highs

Brent oil started today with an increase to the level of $93.99 per barrel, continuing to update multi-year highs. The last time the price of oil reached the area of $94 in 2014. The price of North American WTI oil is located near $92.70.

Analysts note that the main support for quotes is provided by expectations of maintaining a limited supply against the backdrop of recovering demand.

An additional growth factor is the continuing concern due to geopolitical risks, as well as doubts about OPEC's ability to supply in sufficient volume and the cooling in the United States. Experts believe that the deterioration of the geopolitical situation in Eastern Europe may lead to an increase in the price of oil to the region of $ 120 per barrel.

However, following the highs, a technical correction is possible. That's what we see on the charts of the movement of oil quotes today. After the morning growth to the level of $94 per barrel, prices fell to $91.20. However, the reason may lie not only in the correction. Today it became known that negotiations between the United States and Iran on the resumption of the nuclear deal are probably close to completion, which will lead to an increase in the level of oil supply.

 

February 8. Gold is getting cheaper on the expectation of a faster Fed rate hike

On Tuesday, the price of gold was declining as the US dollar rose in anticipation of inflation statistics. Investors predict that the Federal Reserve will signal an aggressive tightening of monetary policy and multiple interest rate hikes this year.

The spot price of precious metals in the morning declined to $1816 per ounce, recovering during the day to $1820.

Inflation data in the United States will be published on Thursday. The consumer price index for January is expected to show an annual growth of 7.3%, which would be the highest jump since 1982. And as experts note, high inflation may force the Fed to tighten policy faster, which will lead to an increase in the opportunity costs of owning non-profitable gold.

Additional support for gold is provided by the ongoing tensions around Russia and Ukraine, as the precious metal is used as a safe haven asset.

As for the other metals, palladium fell today to $2200, silver declined to $22,777, and platinum fell to $1004.25 per troy ounce.

 

February 10. Oil reserves in the United States unexpectedly fell, production increased

According to the weekly report of the Energy Information Administration of the US Department of Energy, commercial oil reserves for the week ended February 4 unexpectedly decreased by 4.8 million barrels to 410.4 million barrels. Analysts, on the contrary, expected an increase of 400 thousand barrels.

At the same time, the strategic reserve of oil in the country decreased by 1.4 million barrels to 587.5 million barrels. And oil reserves at the country's largest terminal in Cushing decreased during the reporting period: from 30.5 million barrels to 27.7 million.

In addition, the report indicated a decrease in gasoline inventories by 1.6 million barrels to 248.4 million. Analysts had expected an increase of 1.6 million barrels. Distillate stocks decreased by 0.9 million barrels to 121.8 million barrels. A decrease of 1.7 million barrels was predicted.

Oil production

The Ministry also shared statistics on oil production in the United States. Its indicators increased by 100 thousand barrels per day to the level of the previous week – up to 11.6 million barrels.

On average, over the past four weeks, production in the United States amounted to 11.6 million barrels per day.

It is worth noting that on February 8, the Ministry of Energy raised the forecast of average oil production in the country by the end of this year to 11.97 million, and next year to 12.6 million barrels per day.

February 9. ECB on the verge of tightening monetary policy

German Central Bank Governor Joachim Nagel suggested that the European Central Bank could raise interest rates this year, as inflation is likely to remain high for longer than expected.

Nagel, who headed the Bundesbank in January, also said that if the inflation picture does not change by March, Germany will advocate the normalization of monetary policy. And the first step to this is to stop net bond purchases during 2022.

The head of the European regulator itself, Christine Lagarde, also said last week that inflation in the eurozone will remain at an elevated level for longer than the ECB expected. Moreover, Lagarde said that the regulator can no longer rule out the scenario of a rate hike in 2022. Such a «hawkish» bias, following December comments that the ECB is unlikely to raise rates in the new year, had an immediate impact on European debt yields.

At the same time, Lagarde tried to reassure investors, assuring that any changes in the ECB's policy would be gradual.

Experts believe that the first ECB rate hike is likely to occur in the fourth quarter of the year, and the next round will take place in early 2023. Inflation in the eurozone is expected to be around 4% throughout the year. The current inflation rate is 5.1%.

 

February 11. The US stock market fell on inflation data

US stock indexes fell sharply after the publication of statistics on inflation in the United States.

According to the Ministry of Labor, consumer prices (CPI) jumped 7.5% in January compared to the same month in 2021, which was a record inflation rate since 1982. In December last year, the growth rate of consumer prices accelerated by 7%.

After the release of the data, the yields of American government securities jumped sharply. The interest rate of ten-year US Treasuries has risen above the 2% mark for the first time since 2019.

The stock market did not stand aside either: indicators of all 11 S&P 500 industry groups ended trading in the red on Thursday, the subindex of technology companies most sensitive to interest rate hikes fell by 2.1%. The value of Qualcomm Inc. shares decreased by 5.3%, Advanced Micro Devices Inc. – by 5.3%, Adobe Inc. – by 5.1%, Apple Inc. – by 2.3%.

The Dow Jones Industrial Average index fell by 526.47 points (1.47%) to 35241.59 points by the close of the market on Thursday.
The Standard & Poor's 500 declined by 83.1 points (1.81%) to 4504.08 points.
The Nasdaq Composite lost 304.73 points (2.1%) to 14,185.64 points.

Analysts expect that high volatility in the stock market will continue until the March Fed meeting, at which the key rate is likely to be increased.

 

February 14. Gold has risen to a maximum of three months due to geopolitics

Gold prices jumped on Monday amid increased demand for protective assets due to high geopolitical tensions on the border of Russia and Ukraine.

In particular, the precious metal quotes reached the level of $1.864.85 per ounce, which became a three-month high.

Over the weekend, it became known that the adviser to the American president on national security, Jake Sullivan, said that Russia has the opportunity to attack Ukraine without waiting for the end of the Olympics in Beijing. After that, a telephone conversation took place between the Presidents of the United States and Russia Joe Biden and Vladimir Putin, but he could not ease the tension.

The American president ruled out the possibility of sending American soldiers to Ukraine, but threatened Moscow with large-scale sanctions in the event of an invasion. At the same time, Russia continues to deny its intention to attack Ukraine.

Despite the departure of investors in the assets of the «safe haven», the growth of gold is restrained by the strengthening of the dollar. The dollar is also considered a reliable asset, plus it receives support due to expectations of an imminent increase in the base interest rate of the US Federal Reserve System.

 

February 15. Japan's GDP growth was 5.4%, worse than forecast

In the fourth quarter of 2021, Japan's economy grew by 5.4% compared to the same period in 2020. Experts expected the growth to be 5.8%.

The quarterly growth of the Japanese economy in October-December amounted to 1.3% compared to the previous three months – and this was the maximum growth rate for the year. Analysts had forecast the figure at 1.4%.

In the third quarter, according to the revised data, the volume of GDP decreased by 0.7%, and not by 0.9%, as previously reported.

Business investment in the last quarter increased by 0.4%, exports increased by 1%, imports decreased by 0.3%. Government spending decreased for the first time in 3 quarters – by 0.3%.

Experts note that despite the fact that the Japanese economy returned to growth in the last quarter of last year, the increase in the incidence of Covid-19 in the first quarter of this year is likely to limit further recovery.

It is noted that the expansion of the Japanese economy in the fourth quarter is mainly due to an increase in consumer spending by 2.7%. Costs have increased as the lifting of quarantine restrictions in Tokyo and other cities of the country since September 30 has led to a sharp increase in demand for services. It is also worth noting that in the current quarter, new quarantine measures were re-introduced, as another spike in morbidity is observed in the country.

 

February 16. Inflation in the UK has reached an almost 30-year high of 5.5%

UK consumer prices rose at their fastest annual pace in nearly 30 years in January, putting more pressure on households and increasing the chances that the Bank of England will raise interest rates for the third consecutive meeting. Since December, the regulator has already raised interest rates twice: from 0.1% to 0.5%. Analysts expect that the rate may be increased to 0.75% or 1% as early as March.

According to the Office for National Statistics, the annual rate of consumer price inflation rose to 5.5% – the highest level since March 1992. Analysts predicted that inflation would remain at the December 5.4% level.

Core inflation (excluding volatile prices for energy, food, alcohol and tobacco) rose to 4.4% in January from 4.2% in December, which is the highest since 1997.

Earlier this month, the Bank of England revised its inflation forecasts and assumed that inflation would peak at around 7.25% in April (amid a 54% increase in electricity costs). High energy prices have so far been the strongest contributor to rising inflation in the UK, although supply chain problems have also driven up prices for many other goods.

The British central bank does not expect inflation to return to the 2% target until early 2024, although most economists believe that inflation will still fall faster.

The UK is not alone in the sharp rise in the cost of living. Consumer price inflation in the US reached a 40-year high of 7.5% in January, while inflation in the eurozone was 5.1% (which is the highest since the creation of the single European currency).

 

February 17. Oil prices are highly volatile on news of negotiations with Iran

On Thursday, the price of oil accelerated its decline amid expectations that the United States and Iran will soon be able to return to a nuclear deal that will allow Iranian oil to come back to the world market.

April Brent futures declined during the day to the level of $91.40 per barrel, recovering later to $93.35. WTI crude oil fell to $90.30, also recovering during the day to $93.15 per barrel.

Yesterday it became known that the parties in the negotiations on the nuclear program are «closer to an agreement than ever.» This was stated by the chief negotiator from Tehran, Ali Bagheri Kani, on Twitter.

In addition, Iran and South Korea held a meeting of representatives of oil refining companies to discuss possible supplies, which suggests that Iran is definitely preparing the ground for a return to the market.

Experts note that the positive dynamics of negotiations between the United States and Iran somewhat calms the oil market. And although there is no agreement yet, prices are declining on the news of progress in negotiations and expectations of a potential return to the oil market in the amount of up to 900 thousand barrels per day by December.

At the same time, today oil prices are supported by another increase in geopolitical tensions due to the situation on the Ukrainian border. The White House said yesterday that Russia had increased the concentration of troops on the border by an additional 7 thousand people.

 

February 22. Germany decided to block Nord Stream 2

German Chancellor Olaf Scholz announced the suspension of the Nord Stream-2 certification after Russia recognized the independence of the Donetsk and Lugansk People's Republics (DPR and LPR).

In addition to the announcement of the blocking of the project, Scholz announced a decision on the first package of additional sanctions against Moscow.

Against the background of this news, the cost of gas in Europe has started to rise sharply. The current quotes of «blue fuel» are again located near the level of $1,000 per thousand cubic meters.

Recall that the Nord Stream-2 gas pipeline was planned to be put into operation at the end of 2019. At the same time, Ukraine, Poland, the Baltic states, as well as many European countries opposed the new supply route. Opponents of this Russian project have repeatedly stated that the gas pipeline is not an economic project, but a geopolitical lever of Russia's influence on Ukraine.

However, Russia has repeatedly denied these claims, emphasizing the need for reliable gas supplies to European countries, which the Ukrainian gas transportation system cannot provide.

In September 2021, the pipeline was fully completed, after which an application for certification was submitted. However, today Germany still refused the certification process against the background of a sharp deterioration in the geopolitical situation on the border with Ukraine. At the same time, Russia doubts that the European Union will be able to survive without Russian fuel: with such a policy, Europeans will have to pay about 2,000 euros per thousand cubic meters of gas.

February 21. Bitcoin collapsed below $38 thousand

The value of the most popular cryptocurrency collapsed again on Monday, reaching $37,400. Bitcoin and other cryptocurrencies have been under pressure lately mainly due to the situation around Ukraine.

However, the impetus for a sharp drop in the exchange rate today was the news of an attack on the OpenSea NFT exchange, as a result of which attackers stole hundreds of non-interchangeable tokens with a total value of more than $1.7 million. However, the OpenSea platform itself stated that it was not hacked, and users were attacked by scammers and gave them their tokens themselves.

«As far as we can tell, this is a phishing attack. We don't think it's related to the OpenSea website,» OpenSea Executive Director Devin Finzer said.

As a result of today's collapse in prices, the capitalization of the cryptocurrency market fell by about $70 billion per day. During the day, the value of bitcoin recovered somewhat – to the level of $39200.

Ethereum, the second largest cryptocurrency by capitalization in the world, dropped by about 3% to $2,666. Other popular digital currencies, such as BNB, XRP and Cardano, lost about 5% in price on average.

 

February 24. Brent exceeded $101 on the news about the military operation in Ukraine

On Thursday morning, the price of benchmark oil is steadily rising amid the escalation of the military situation in eastern Ukraine.

In particular, April Brent futures rose today to $101.27 per barrel, updating the highs since September 2014. Futures for North American WTI crude oil rose to the level of $96.84 per barrel.

Today it became known that Russian President Vladimir Putin announced the decision to conduct a special military operation in connection with the situation in Donbass in order to protect the residents of the DPR and LPR. President of Ukraine Volodymyr Zelensky, in turn, announced the introduction of martial law throughout the country.

Experts note that the military conflict significantly increases the risks of interruptions in Russian oil supplies and the introduction of diverse sanctions. At the same time, the US authorities announced that they are considering the option of re-selling oil from the country's strategic reserves (SPR) if prices for these energy resources rise sharply «as a result of Russian aggression.»

At the end of 2021, the United States already resorted to selling oil from the SPR (about 70 million barrels). This was done in coordination with other major players in the market.

 

February 25. What is the risk of the Ukrainian crisis for investors?

Since the beginning of 2022, the main «headache» of investors has been the return of volatility to the market: the oil market is showing growth to multi-year highs, as well as gold, stocks and indices are rising and falling, and the crypto market has reached a minimum where bitcoin can no longer serve as a reliable «safe haven asset».

At the same time, investors have been worried about another news in recent days – Russia's invasion of the territory of Ukraine, which led to a fall in the ruble exchange rate and the suspension of the Moscow Stock Exchange. Analysts are closely monitoring the development of events and advise only one thing so far – not to give in to panic.

«Although Russia and Ukraine will dominate the news in the near future, they will not determine the medium– and long-term direction of the market,» says Tom Essey, founder of the newsletter The Sevens Report.

The United States and its allies have so far announced a modest first stage of sanctions, to which the market reacted rather restrainedly. However, in the event of an escalation of the conflict, consumers and companies may refrain from loans, which will undoubtedly hit the banks.

In addition, the shares of the tourism sector and the leisure sector may suffer, since during global crises, customers are usually not interested in travel and entertainment.

Analysts believe that US Treasury bonds and Japanese government bonds may become the most resistant to the shock. Experts also suggest that the investment portfolio is likely to suffer due to a possible tightening of the policy of central banks and a slowdown in economic growth, and not because of the Ukrainian conflict itself.

 

March 1. Oil continues to rise in price

The price of oil continues to rise on Tuesday amid the continuation of military operations on the territory of Ukraine. Prices are increasing, even despite reports from the United States about the further release of oil from strategic reserves.

As it became known, the United States and other members of the International Energy Agency (IEA) may soon decide to release about 70 million barrels of oil from reserves. An emergency meeting of the organization will be held today.

However, analysts believe that any release of oil from reserves will only be a short-term solution, especially if the supply of raw materials from Russia decreases. Warren Patterson, who is responsible for commodity markets strategy at ING Groep NV, said that it is unlikely that today's market expects a significant change in Russian exports, which suggests the likelihood of an even greater price increase in the event of a deterioration in the situation in Ukraine.

The current Brent quote is $100.17 per barrel. The price of WTI oil futures is hovering around $97.40 per barrel.

February 28. China does not intend to stop trade cooperation with Russia

The Ministry of Foreign Affairs of China has announced its intention to continue mutually beneficial trade cooperation with Russia.

The country has no plans to join the Western sanctions imposed in response to Russia's special operation in the Donbas. The United Kingdom, the European Union, the United States and Canada have imposed sanctions against Russia aimed at Russian banks, members of the State Duma who supported the recognition of the DPR and LPR, some businessmen, as well as personally against Vladimir Putin and Russian Foreign Minister Sergei Lavrov.

In addition, the European Union has closed its airspace to Russian aircraft and banned aircraft from landing, taking off or flying over the territory of the Union.

The EU has also decided to prohibit operations related to the management of reserves and assets of the Central Bank of Russia, including transactions with any legal entity, organization or body acting on behalf of or on behalf of the Central Bank.

China has stated that it opposes unilateral sanctions that are not based on international law. In addition, the PRC demanded that the United States not harm the legitimate rights and interests of China and other parties in resolving the Ukrainian issue.

 

March 3. Brent rose to $118 per barrel for the first time in nine years

The oil market continues to grow, updating all new highs. Today, Brent oil quotes have reached the level of $118.20 per barrel for the first time since February 2013. The cost of North American WTI oil rose to $114.35 per barrel.

Oil is getting more expensive against the background of a shortage due to the refusal of customers to purchase Russian raw materials. Analytical companies report that almost 70% of Russian oil trade has been frozen to date. Buyers are boycotting Urals oil, despite the large discount to the market (about $19) and the fact that the sanctions did not directly affect the energy sector.

Further deterioration of the situation in Ukraine will lead to the fact that an increasing number of major players in the oil market will withdraw from oil and gas projects in Russia and look for alternative sources of supply. And this will contribute to the continued growth of oil prices. To date, the American company Exxonmobil, the British-Dutch Shell, the British BP and the Norwegian Equinor have left the Russian market.

To reduce high prices, members of the International Energy Agency (IEA) have agreed to sell 60 million barrels of oil from national reserves. The US Department of Energy also decided to release 30 million barrels from the country's strategic reserve.

At the same time, the OPEC+ countries at yesterday's meeting decided not to accelerate the pace of increasing oil production and decided to maintain the plan to increase production quotas in April by 400 thousand barrels per day. The organization noted that the current fundamental indicators of the market and its future prospects indicate a good balance, and the current volatility is only a consequence of current geopolitical events.

March 2. Buyers are boycotting Russian oil, despite a huge discount

According to analysts, large oil buyers are boycotting Russian Urals oil because of the situation in Ukraine, despite the fact that Russia offers a discount to the market of up to $20 per barrel. Experts note that about 70% of Russian oil exported is difficult to find buyers.

And although American and European sanctions do not restrict energy exports from Russia, ordinary buyers prefer to look for alternative sources of supply. To date, only a few refiners and traders buy Russian oil, but a sharp increase in the cost of freight and the appearance of «military» premiums for risk insurance significantly complicate transactions.

Europe is mainly switching to oil from the Middle East. Until now, European countries were the largest export market for Russian oil (the region accounted for about 53% of supplies). Another 39% of exports go to Asia.

At the same time, it has already become known that Asian countries are also gradually abandoning Russian oil. In particular, the Times of India newspaper reported that the country's largest oil refining company ****** Oil Corp. it will no longer purchase Russian oil, as well as oil from Kazakhstan on FOB terms (the costs of cargo delivery to the port of shipment are taken into account), since these conditions do not take into account the increase in the cost of freight and risk insurance.

The pressure on the energy sector is also exerted by gas, the cost of which has soared by 57% in Europe today – to $ 2,227 per thousand cubic meters. German Economy Minister Robert Habeck said that the worst-case scenario of sanctions against Russia has not yet materialized, as the country continues to export gas. At the same time, he added that it is necessary to prepare for the worst-case scenario. It is worth noting that Russia provides about 40% of gas supplies to Europe.

 

March 9. Bitcoin jumped by 8% after the statement of the US Treasury

Bitcoin and other cryptocurrencies jumped sharply in price after details of the executive order of President Joe Biden appeared on the website of the US Treasury Department. The order calls for an integrated approach to digital assets, and notes that government agencies will coordinate their work in this area.

It is noteworthy that this statement was removed from the Ministry's websites a few hours after it was made public. However, this was enough to increase optimism in the cryptocurrency market.

According to CoinDesk, the current price of bitcoin is $42,361.30. Other cryptocurrencies, including ether, also rose sharply. The cost of the ether is $2747.32.

Analysts note that while some countries, for example, China, seek to destroy the cryptocurrency trade, others, in particular, El Salvador, accept it as a legal means of payment. In the USA, there is no structure of a sufficiently high level for the development and regulation of cryptocurrencies.

«The leaked Treasury statement has been welcomed by the crypto market as it seems to focus on development of the industry, rather than on imposing unrealistic regulations,» said Yuya Hasegawa, market analyst at the Japanese cryptocurrency exchange Bitbank.