​EBC Markets Briefing | Oil higher before sanction deadline; yen in freefall

Oil prices edged higher on Thursday as markets assessed the latest US proposals to end the war in Ukraine and prepared for a deadline to cease operations with two major Russian oil firms.

Rosneft has reduced its stake in the Kurdistan Pipeline Company, Iraqi Kurdistan's main oil pipeline and a major oil exporter, to less than 50% to protect the oil-exporting subsidiary from sanctions.

Producers have found some support in buying from China and India as unsold cargoes in the Middle East at the start of November from the prior month's trading cycle found buyers in Asia eventually.

Despite that, in regions where Chinese and Indian refiners do not typically source crude, weakness is more apparent. Furthermore, traders are not counting on OPEC+ to cut production next year.

Crown Prince Mohammed bin Salman is due to meet this week with Trump, who has called for lower fuel prices in order to halt Russia's war machine and bring inflation back to 2%.

If OPEC+ can withstand oil market weakness early next year, it may be in a stronger position by late 2026. Supply growth from non-OPEC producers could stall as soon as early next year, said BP.

Brent crude remained firmly pressed by 50 SMA, but bullish MACD divergence suggests a moderate rally might on its way. We expect it to flirt with $64 before easing again.

Asset recap

As of market close on 19 November, among EBC products, United States Natural Gas Fund ETF led gains. US gas prices rise as weather forecasts turn colder for the last few days of November.

Morgan Stanley analyst questioned the value to Netflix from potentially bidding to acquire Warner Bros. Discovery and prized properties like DC Comics and the Harry Potter and Lord of the Rings franchises.

The yen fell to a 10-month low, while Finance Minister Satsuki Katayama declared that Japan's new government was closely monitoring markets "with a high sense of urgency."

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