Oil prices and stocks rise after EU opposes Russian oil ban
Crude prices were higher on Friday and stock markets made decent gains after European countries decided not to ban imports of Russian oil following its invasion of Ukraine – but Germany said that it would reduce its energy purchases in Moscow.
European stocks, which had been firmly higher earlier in the session, ended the day with only modest gains, but on Wall Street, the Dow Jones and S&P 500 emerged from a midday slump to both earn less than 1% at close.
“It looks like the commodity price boom has taken a breather and this has allowed investors to reinvest in stocks,” said Edward Moya of Oanda.
“Geopolitical risks remain very high and the rally in equities over the past two weeks is impressive.”
However, unstable commodity prices such as oil kept markets volatile, while investors will remain cautious about the economic impact of the war in Ukraine, which is now entering its second month, analysts said.
“We don’t really get a lot of news on the Russian-Ukrainian situation,” said Tom Martin of Globalt Investments.
“In two to three weeks we’re going to start getting some revenue and…that’s going to give us a sort of window into this new world we find ourselves in, after the Russian invasion of Ukraine.”
The United States and the European Union have announced a desire to wean Europe off Russian gas imports and thus choke off the billions in revenue that fuels Moscow’s war.
Europe’s biggest economy, Germany, has said its own imports of Russian oil will be halved by June and coal deliveries will stop by autumn this year.
“Concerns over the increasingly entrenched conflict in Ukraine” are dampening share price gains, said Hargreaves Lansdown analyst Susannah Streeter.
Russia launched its assault on Ukraine on February 24, sending shockwaves through global markets that continue to reverberate.
Germany’s business climate deteriorated in March, the Ifo business confidence index showed, amid fears over soaring energy prices and worsening supply chain problems.
The crisis in Eastern Europe has forced investors to reassess their outlook for the global economy due to an expected spike in already rising prices, which some commentators say could lead to a recession.
Bitcoin surged above $45,000, boosted by rumors that the Kremlin may accept the world’s largest cryptocurrency in exchange for Russian gas.
Updated: March 26, 2022, 04:37