Crude Stabilises But Struggling With Global Uncertainties

Oil prices have stabilised during APAC trading today after slumping around 3.5% on Wednesday, supported by more positive equity sentiment as S&P e-minis increase 0.3%. WTI is flat at $74.40/bbl while Brent is 0.3% higher to $77.90. The USD index is down slightly.

• Prices are about 4.5% lower this week, as crude has struggled given renewed concerns around the US banking system and the possible impact it will have on US and global growth. The market has also become less worried about supply following shipping indicators pointing to robust Russian exports. Today and tomorrow’s US data are likely to influence oil prices given that they should be key in shaping the Fed outlook.
• Declining refining margins and uncertainty regarding the economic situation in China, the Fed outlook and output from Russia continue to dampen oil prices.
• Later there is important US Q1 GDP data which according to Bloomberg is expected to rise 1.9% q/q saar. The price components are also likely to be watched closely and the core PCE price index is forecast to rise 4.7% q/q saar – more than Q4’s 4.4%. There are also jobless claims and pending home sales for March and the European Commission survey for April.