World stock markets fall and gold, oil and gas soar due to the war in Ukraine

A possible Western embargo on Russian energy sector shot this Monday the price of Petroleum and natural gas, causing stock markets to fall, which fear a slowdown in the world economy.

The price of a barrel of Brent from the North Sea touched 140 dollars on Sunday night, close to his all-time high of $147.50 from July 2008.

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This came after the US Secretary of State, Anthony Blinkenwould say that Washington and its allies discuss banning energy imports from Russia.

This Monday, the price of natural gas once again broke a historical record in the European market, rising more than 60% to 345 euros per megawatt-hour (MWh). Russia, which can also be sanctioned in this sector, supplies 40% of European gas imports.

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For his part, the Gold — a safe haven in times of uncertainty — briefly topped the $2,000 an ounce mark.

After registering falls of 4% to 6% on Friday, European stock markets reopened in the red this Monday. By 0930 GMT, Frankfurt was down 3.11%, Paris 3.33%, Milan 3%, London 1.58% and Madrid 3.32%.

This Monday, Asian stock markets have already recorded heavy losses due to the effect of the conflict in Ukraine. Tokyo lost 2.94%, falling to its lowest level since November 2020, while Shanghai lost 2.17%. Losses in Hong Kong were even worse: -3.87%.

Disturbed world supply

Although Russian oil and energy are not directly sanctioned, for the moment, they hardly find buyers anymore, which seriously disturbs world supply.

“Unless there is a ceasefire, there is nothing in the offing to stop” the rise in prices of Petroleumindicates a National Australia Bank note published on Monday.

“The rise in oil and raw material prices will probably force European economies to ration consumption and this will weigh on the economic recovery and company profits in 2022”, estimates Ipek Ozkardeskaya, an analyst at Swissquote bank.

On your side, The International Monetary Fund (IMF) had warned that an escalation of the conflict in Ukraine would have “devastating” consequences worldwide.

“While the outlook for economic growth is bleak, the inflation situation is even worse, as energy and agricultural commodity prices have soared since the beginning of the year, and this toxic cocktail poses a huge problem for consumers. central banks”, estimates Michael Hewson, an analyst at CMC Markets.

Metal prices did indeed continue to rise, with aluminum and copper posting record prices on Monday.

Around 8:00 GMT, the ton of aluminum for delivery in three months reached 4,073.50 dollars in the London metal market (London Metal Exchange, LME).

Hours earlier, the ton of copper reached the historical price of 10,845 dollars, before reaching 10,777 dollars around 08:00 GMT.

The nickel price did not break its 2007 record, but rose 25% to $36,800.

In this context, traders will watch the US consumer price index for February on Thursday and will pay close attention to the conclusions of the European Central Bank’s (ECB) monetary policy meeting later that day.

In this context of geopolitical uncertainty in Europe, in the currency market the euro fell sharply against the dollar, falling to 1.0867 dollars (-0.56%).

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Source: Elcomercio