Oil hits two-month high as EU concerns Russia ban

The latest draft of the EU sanctions package Russia Indicating that it will follow the broad details of an earlier briefing — a pipeline delivery waiver wanted by Hungary and other Eastern European countries.

However, it looks like this will be left to EU member state leaders to agree on final details later.

The deal would mean Europe would continue to pay Russia for oil – a highly contentious situation. Not to mention the billions of euros of gas going to Russia.

25 days — and counting — #EU has failed to reach an agreement on banning Russian #oil imports. This #EU summit could represent a hard to recover debacle.

— Silvia Berzoni (@SilviaBerzoni) May 30, 2022

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25 days – and counting – #EU Failed to reach agreement on ban on Russian #Oil import.this #EU The summit could be an irreversible disaster.

— Silvia Berzoni (@SilviaBerzoni) May 30, 2022

Reuters reported that the draft proclamation referred to a gathering of EU heads of government known as the European Council, saying:

The European Council agreed that the sixth set of sanctions against Russia would cover crude oil and petroleum products shipped from Russia to member states, with a temporary exception for crude oil transported by pipeline.

The European Council therefore urges the Council to complete and adopt it without delay in order to ensure a level playing field and a level playing field in the EU single market, as well as solidarity among member states in the event of sudden supply disruptions.

This could be a pretty modest gain FTSE 100, but it still pushed it to its highest point in a month.

The market bounced back over the weekend and continued its upward momentum on Monday (though the U.S. trading desk may be absent later due to the holiday).

Some analysts attribute the market’s optimism to the prospect of China’s economic recovery after a period of severe lockdowns in China disrupted markets that had previously been the engine of world growth.

Richard HuntMarketing Director Interactive InvestorAn investment platform said:

Asian markets added positive momentum as China began to ease lockdown restrictions in Beijing and Shanghai. The prime minister has announced a series of measures to boost the struggling economy, with more details to be announced shortly.

However, the damage has largely been done over the past few months, with an inevitable drop in consumer confidence tied to a spike in unemployment, with many economists predicting a contraction this quarter. Even so, the apparent improvement in tense U.S.-China relations has improved sentiment, especially given the constraints the global economy has had to endure this year.

Countryside, a member of the FTSE 250 index, is building houses in a digital rendering of a project near Peterborough.
Countryside, a member of the FTSE 250 index, is building houses in a digital rendering of a project near Peterborough. Photo: Rural Properties

It’s been a fairly modest start for trading on the London Stock Exchange (which is likely to continue when a rare public holiday in the US means Wall Street is closed). But there are some notable moves.

in midcap stocks FTSE 250 Home Builders rural It’s clear: its share price jumped 29% after San Francisco-based investor Inclusive Capital Partners (which it likes to call In-Cap) made a £1.5bn takeover offer — a second approach in the past. two months.

According to a stock market announcement on Monday, Countryside told In-Cap it would not be negotiating – setting the possibility of a higher bid.

On Friday, In-Cap held a 9.2% stake in Countryside.

Brief: EU plan to embargo on Russia pushes oil prices above $120 a barrel

Good morning and welcome to our live coverage of business, economics and financial markets.

Oil hit a two-month high as traders expected a belated agreement to limit Russian oil imports into the European Union and other factors including a recovery in Chinese demand Lockdown restrictions eased.

On Monday morning, Brent crude futures rose above $120 a barrel for the first time since late March. A gain of 50 cents on the day was equivalent to a 0.4% gain in the North Sea benchmark, while its North American peer West Texas Intermediate was also up 0.7% at $115 a barrel.

Charts showed Brent crude futures rose to a two-month high on Monday as traders expected Russia to impose an oil embargo on Europe.
Brent crude futures rose to a two-month high on Monday as traders expected Russia to impose an oil embargo in Europe. Photo: Refinitiv

Josep Borrell, the EU’s foreign policy chief, said the bloc should be able to agree on new sanctions, including on Russian oil, ahead of a summit of leaders on Monday.

According to Reuters, Borrell told the French broadcaster:

We need a unanimous decision. Intense negotiations took place yesterday afternoon and this morning.

I think that this afternoon we will be able to present an agreement to the heads of state.

However, it remains to be seen whether the proposed ban will take effect, with differences among European governments. Hungary in particular, led by Viktor Orban, who has long maintained friendly relations with Russian President Vladimir Putin, The embargo has been hampered in recent weeksin part because of the country’s reliance on Russian oil.

The European Union is working on a compromise plan to ban Russian oil from arriving by tanker but allow pipeline imports, meaning Hungary, Slovakia and the Czech Republic can continue to receive oil through the Soviet-era Druzhba pipeline. Ukraine.

Asked if the plan, which included a ban on Russian oil imports, would fail due to boycotts by Hungary and other Eastern European countries, Borrell said: “No, I don’t think so … there will be a deal in the end.”

European stocks got off to a leading start to the week, with Europe’s blue-chip Stoxx 600 up 0.7% in open trade. Germany’s Dax rose 0.8% and France’s Cac 40 gained 0.6%.

in England FTSE The 100 gained 0.4% and the midcap FTSE 250 gained 0.9%.

U.S. markets were closed today for the Memorial Day holiday.

agenda

10am BST: Eurozone Economic Sentiment Index (May; previous value 105; consensus: 104.9)

1pm BST: German annual inflation rate (May; prior: 7.4%; consensus: 7.6%)