2023-10-30 14:37

Copyrighted Image by: Reuters. The World Bank has expressed concerns over the potential for a dual energy shock, as the ongoing conflicts between Israel and Hamas and Russia's war in Ukraine continue to escalate. According to the bank, these geopolitical tensions could lead to a surge in oil prices by up to 75%. Today, the World Bank highlighted that economists and policymakers have been closely monitoring the situation since the invasion of Israel by Hamas on October 7. Despite these tensions, energy prices have remained stable so far. However, the current Middle East conflict and Russia's war in Ukraine may exacerbate the economic repercussions on a global scale. The bank's research suggests that global oil prices will average $90 per barrel this quarter, a rise from the current $85 per barrel. Although earlier forecasts predicted a decline in oil prices next year, possible disruptions to oil supplies could significantly revise these projections. In its worst-case scenario, akin to the 1973 Arab oil embargo during the Arab-Israeli war, the World Bank anticipates that as much as eight million barrels of oil per day could be removed from the market. This could push prices up to $157 per barrel. The bank also drew parallels with less severe but still significant scenarios such as the 2003 Iraq war and 2011 Libyan civil war, predicting potential price increases of 35% and 13% respectively. World Bank officials noted that inflation and broader economic impacts would depend on how long these conflicts persist and how high oil prices remain. Sustained high oil prices could lead to increased food prices and higher costs for industrial metals and gold. In response to potential spikes in oil prices, Western nations have implemented a price cap on Russia's energy exports. Additionally, the US has tapped into its Strategic Petroleum Reserve. Despite these measures, US Treasury Secretary Janet L. Yellen acknowledged that there could be more substantial economic consequences if the conflict expands. https://www.investing.com/news/commodities-news/world-bank-warns-of-potential-75-surge-in-oil-prices-due-to-global-conflicts-93CH-3213969

2023-10-30 14:19

Copyrighted Image by: Reuters. The intensifying conflict between Israel and Hamas could potentially trigger a significant surge in oil prices, leading to global food price inflation, according to the World Bank. The organization's Commodity Markets Outlook report outlines three potential scenarios for global oil supply disruptions, each corresponding to different levels of conflict escalation. In a small disruption scenario, prices could fall to $81 per barrel. However, a medium disruption, similar to the supply disruptions witnessed during the Iraq war, could decrease supply by 3-5 million barrels daily and inflate prices by 35%. A large disruption, comparable to the Arab oil embargo of 1973, could see supply drop by 6-8 million barrels daily with prices soaring by 56%-75%. The ongoing unrest has increased fears of an expanded Mideast conflict. Israeli Prime Minister Benjamin Netanyahu has initiated a "second stage" in the war, while Hamas is seeking assistance from Iran-backed Hezbollah. Since the beginning of the conflict, oil prices have risen by approximately 6%, and gold has seen an approximate 8% increase. The World Bank's chief economist highlighted that the continuing effects of Russia’s invasion of Ukraine are still disrupting the global economy. An escalated Mideast conflict would constitute a dual energy shock that could lead to a surge in food prices and exacerbate global food insecurity. US Treasury Secretary Janet Yellen confirmed that the Biden administration is closely monitoring the economic implications of Israel's military operation against Hamas. The International Energy Agency Executive Director underscored the criticality of the situation, questioning the safety and security of oil and gas as energy choices amid Russia's invasion and the ongoing violence in Gaza. https://www.investing.com/news/commodities-news/israelhamas-conflict-risks-unprecedented-oil-price-surge-warns-world-bank-93CH-3213957

2023-10-30 14:19

The ongoing Israel-Gaza conflict, initiated by an attack from Hamas on Israel, may trigger a significant surge in commodity prices, particularly oil and gas, according to the World Bank. Energy prices have already seen a 9% increase since the onset of the conflict, with potential for further shocks. This situation echoes historical events such as the Arab oil embargo, Iranian revolution, and the Iraqi invasion of Kuwait, which caused substantial disruptions in oil supplies. If the conflict escalates significantly, it could disrupt oil supplies extensively leading to an initial surge in oil prices and impacting other markets. The World Bank's commodity price index has already experienced an uptick due to supply-side issues in the oil markets. In Q3, it witnessed a 5% rise. Despite these predictions, market effects have been relatively muted so far. Brent crude prices have remained high following the initial shock. The Washington D.C.-based lender forecasts average oil prices at $90 a barrel this quarter. However, it has also provided three different scenarios based on varying levels of disruption: small-disruption scenario, medium disruption, and regional conflict. The global reliance on oil has lessened with a geographically diverse supply, which could potentially mitigate some effects of escalation. In addition to oil and gas, natural gas and gold prices are also expected to rise due to the conflict. Futures for these commodities are anticipated to cross $2,000 an ounce. https://www.investing.com/news/commodities-news/world-bank-warns-israelgaza-conflict-may-surge-commodity-prices-93CH-3213948

2023-10-30 14:16

Copyrighted Image by: Reuters. The USD/JPY currency pair experienced a rebound this week, testing resistance levels amidst a backdrop of favorable US consumer sentiment and personal spending data. The pair hit a new low at 149.47 before recovering to 149.77, marking a positive start to the week. The pair is currently testing resistance levels, with the previous high of 149.81 forming a significant obstacle. The H1 chart indicates strong demand around the former low of 149.32 and a rebound upwards. However, escaping from the Rising Wedge suggests a possible larger downside movement. While breakouts above the former high could signal potential sell-offs, closing above 149.81 may spur growth toward the uptrend line. On the other hand, bearish closure below 149.32 could indicate a larger downside movement and present a good selling opportunity after retesting broken support levels. These movements come in light of anticipated steady Bank of Japan (BOJ) monetary policy and upcoming economic data releases from both Japan and the US, which could significantly influence the pair's volatility. Earlier this week, the USD/JPY pair saw the dip-buying activity as it bounced back from prior losses due to diverging policies between the BOJ and Federal Reserve (Fed) around yield curve control (YCC). The BOJ is expected to maintain negative rates, contrasting with hawkish expectations for the Fed, providing support for USD/JPY. The US Dollar has been buoyed by high Treasury bond yields and rapid US economic growth, marked as the fastest in nearly two years. This growth has been accompanied by increased consumer spending in September and an elevated monthly inflation print. Despite these robust indicators, investors anticipate a status quo from the Fed's forthcoming two-day policy meeting. Potential forex market interventions by Japanese authorities to counter Yen depreciation and impending central bank event risks may restrict additional USD/JPY gains. However, the fundamental backdrop currently favors bullish traders. https://www.investing.com/news/forex-news/usdjpy-pair-rebounds-tests-resistance-levels-amid-us-economic-growth-93CH-3213947

2023-10-30 14:13

Bitcoin led a significant rally last week, reaching a peak of $35,000, and is now hovering above $34.4k. This comes alongside the anticipation of several key market events this week, including the Federal Open Market Committee (FOMC) meeting on November 1 and the OpenAI conference on November 6, which are expected to impact interest rates and the performance of AI-related crypto tokens. In addition to Bitcoin's performance, four altcoins - Solana (SOL), Optimism (OP), Render (RNDR), and Lybra (LBR) - have been identified by The DeFi Investor as potential movers in the coming week. Solana's SOL token rallied to $33.90 last week. Raoul Pal, a prominent figure in the crypto community, predicted a 66% price increase if SOL convincingly breaks this threshold. The ongoing Solana Breakpoint conference is also anticipated to bring major announcements that could further bolster its price. Render's RNDR token is also expected to make significant strides at the Solana Breakpoint event along with the impending launch of Render 2.0. Optimism's OP token has seen a 14% gain over the past two weeks. However, the upcoming release of $34.8 million worth of OP tokens may introduce market volatility. Lybra's LBR token has experienced a downturn, currently sitting below the critical $1 level, marking a 79% decline from its May peak. Despite this setback, the forthcoming Lybra Grants Program could provide a boost to its value. The project's total value locked (TVL) has grown from $100 million in early September to its current level of $263 million. As these cryptocurrencies prepare for a potentially eventful week, investors will be closely watching these developments and their potential impact on the market. https://www.investing.com/news/cryptocurrency-news/bitcoins-rally-stabilizes-as-altcoins-show-potential-for-growth-93CH-3213940

2023-10-30 14:02

Copyrighted Image by: Reuters. Bitcoin's value surged past the $34k mark last week, driven by expectations of the U.S. Securities and Exchange Commission's (SEC) approval of a Bitcoin exchange-traded fund (ETF). Analyst Michaël van de Poppe predicts that Bitcoin will face resistance at the $38k level, but anticipates a rally to between $45k and $50k in anticipation of the halving event scheduled for April 2024. The halving event, which is a feature of Bitcoin's design that reduces mining rewards by approximately every four years, tends to drive up Bitcoin's price due to supply-demand dynamics. Following this event, van de Poppe expects a period of consolidation before new all-time highs are reached. Meanwhile, TradingShot, another market analyst, paints an even more bullish picture of Bitcoin's future. They predict a 310% price growth that could potentially catapult Bitcoin to hit the $100k mark by October 2024. Both forecasts hinge on the upcoming SEC decision regarding the Bitcoin ETF, which if approved, could significantly boost institutional investment in the cryptocurrency market. https://www.investing.com/news/cryptocurrency-news/bitcoin-on-the-rise-with-potential-sec-approval-of-etf-93CH-3213920