Oil starts the week with more upward pressure, after jumping over 7% on Friday as Israel renewed attacks on Iran, and retaliation over the weekend. The developments will overshadow key central bank meetings this week, set to hold clues for further rate moves.
In our deep dive interview, ANZ Head of Asia Research Khoon Goh says while front-loading of Asian exports has supported trade numbers, the surge in activity is set to ease.
5 things to know in 5 minutes:
Markets were rocked on Friday by news Israel had launched attacks on Iran, with back-and-forth retaliation through weekend. ANZ Group Chief Economist Richard Yetsenga says the oil price looks set to rise further than Friday’s 7% jump. The week had been set to be dominated by central bank meetings in the US, Japan and UK.
ANZ Senior Commodities Strategist Daniel Hynes says further price rises will come off the back of attacks on energy infrastructure over the weekend.
Daniel says the LNG market and broader energy markets are also set to be affected.
Even if tensions do de-escalate, prices likely won’t fully fall back fully to where they were. Daniel says a geopolitical risk premium will remain in the oil market.
Looking to the key US Federal Reserve meeting this week. Richard says the market will be looking for any clues that FOMC members are thinking about hopping off the fence.
Cheers,
Alex (standing in for Bernard).
PS: Catch you tomorrow with market reaction to escalating tensions in the Middle East.
