Prices Steady As Markets Wait For US CPI & OPEC Report

Oil prices are little changed ahead of US CPI later and the OPEC monthly report. Brent is up 0.1% and is trading above $82 again at $82.07/bbl. WTI is also 0.1% higher at $77.03/bbl. Both benchmarks have been trading in a very narrow range as the Lunar New Year holiday drives thin trading volumes. The USD is 0.1% higher.

• Conflicts in the Middle East remain in focus with Central Command reporting that a Houthi missile hit the MV Star Iris and that there was minor damage to the vessel. Also Israel attacked Rafah despite the US requesting they abstain. A number of third parties are saying that a deal is getting closer with US President Biden calling for all Israeli hostages to be released and for a 6-week ceasefire.
• In terms of Russia, the EU is looking to impose trade restrictions on Russian firms who support the war effort. It is also examining how the price cap on Russian oil can be enforced more strictly.
• The OPEC report will be watched closely for the demand and supply outlook and how closely members are complying with quotas. The group will decide if production cuts will be extended into Q2. In terms of supply, US inventory data from the API is also out today.
• Later the focus is on the US CPI (see MNI US CPI Preview) which is forecast to moderate to 0.5pp to 2.9%. There is also US real earnings for January and UK employment/wages are released. The ECB’s Buch and Tuominen make appearances.