Oil prices wobble ahead of OPEC
|Trading in positive territory since the beginning of December and following a drop of 22% in November, oil prices appear on the verge of a comeback, as OPEC’s meeting in Vienna kicks off. The market expects an output cut of 1 million barrels/day (current production: 33.13 million bpd). However, the Russian Energy Minister noted that there are diverging opinions: current oil prices are comfortable for Russia (lower oil prices mitigate the impact of a weaker rouble). This poses the question: will OPEC compensate for Russia’s lack of cuts? Saudi Arabia has made clear it won’t carry the cuts on its own. Both Brent crude and West Texas Intermediate prices dropped 1% in morning session, trading at USD 60.92 and USD 52.34 per barrel.
Huawei CFO arrested: equities tank
Asian shares continue down, after Canadian authorities confirmed the arrest of Huawei Technologies’ CFO Wanzhou Meng on charges of violating the USA’s sanctions on exports to Iran. Japan’s Nikkei 225 dropped by 1.91% while Hong Kong’s Hang Seng and China’s CSI 300 declined 2.47% and 2.16%, their most in two weeks. European shares are also dropping, as the UK Parliament mutinies over the Prime Minister May’s Brexit plan. The Euro Stoxx 600 has hit a 2-year low while Germany’s DAX and France’s CAC 40 slid 1.90% and 1.85%. Trade discussions between the USA and China officially started this week and are expected to continue for the coming 3 months. Investors are worried, especially about semiconductor manufacturers being hard hit.
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