London (AFP) – Oil prices surged on Wednesday after US President Donald Trump ordered a blockade of “sanctioned” oil tankers heading to and leaving Venezuela. Both Brent and WTI contracts jumped more than two percent before paring gains.
“The big news is the oil-price rally after President Donald Trump announced an oil blockade on Venezuela,” said Forex.com analyst Fawad Razaqzada. “The news lifted shares in energy stocks in Europe — the likes of BP and Shell helping the UK’s FTSE 100 to outperform,” he added. Shares in both companies were up around two percent in afternoon trading in London.
The gains for crude pared some of the 2.7 percent in losses suffered Tuesday after the US president said a deal to end the war in Ukraine was closer than ever. Such a development could ease sanctions on Russian oil, adding to oversupply concerns already weighing on the market. But Razaqzada noted there are reports that the Trump administration is preparing further sanctions on Russia’s oil sector in the event Russian President Vladimir Putin rejects a Ukraine peace deal.
Stock indices opened higher on Wall Street, while Europe and Asia were mixed. London’s stock market rallied as the pound faltered on expectations of cuts to Bank of England interest rates, after data showed UK inflation falling faster than forecast. Britain’s annual inflation rate slowed to 3.2 percent in November, cementing expectations that the Bank of England will cut its main interest rate on Thursday and again on more than one occasion in 2026. Analysts had expected inflation to have cooled only slightly to 3.5 percent from 3.6 percent in October.
Eurozone inflation remained at 2.1 percent in November, hovering just above the target set by the European Central Bank, slightly revised official data showed Wednesday. The ECB is expected to hold interest rates steady Thursday for its fourth straight meeting with inflation in check, although debate is heating up about the path forward.
Investors continued to study Tuesday’s release of US non-farm payrolls reports, which showed that unemployment in the world’s biggest economy had jumped to a four-year high of 4.6 percent in November. Analysts said the data did little to change expectations that the Federal Reserve would likely keep key US interest rates unchanged in January. Investors are now looking to consumer price inflation data due to be released on Friday.
In corporate news, the share price of Chinese chipmaker MetaX Integrated Circuits Shanghai soared more than 550 percent on its home-city debut Wednesday. Shares in Netflix jumped 2.1 percent after Warner Bros. Discovery rejected a hostile takeover bid by Paramount in favour of being acquired by the streaming giant. Shares in Warner Bros. Discovery shed 1.1 percent and shares in Paramount tumbled 3.6 percent.
– Key figures at around 1430 GMT –
New York – Dow: UP 0.1 percent at 48,170.24 points
New York – S&P 500: UP less than 0.1 percent at 6,803.94
New York – Dow: UP 0.1 percent at 23,135.61
London – FTSE 100: UP 1.5 percent at 9,832.58
Paris – CAC 40: DOWN 0.2 percent at 8,087.19
Frankfurt – DAX: DOWN 0.1 percent at 24,050.58
Tokyo – Nikkei 225: UP 0.3 percent at 49,512.28 (close)
Hong Kong – Hang Seng Index: UP 0.9 percent at 25,468.78 (close)
Shanghai – Composite: UP 1.2 percent at 3,870.28 (close)
Euro/dollar: DOWN at $1.1730 from $1.1747 on Tuesday
Pound/dollar: DOWN at $1.3349 from $1.3422
Dollar/yen: UP at 155.62 yen from 154.80
Euro/pound: UP at 87.87 pence from 87.52
Brent North Sea Crude: UP 1.5 percent at $59.80 per barrel
West Texas Intermediate: UP 1.5 percent at $55.96 per barrel
burs-rl/jhb
© 2024 AFP
