FX.co ★ 13.01.2021: RUB eases on internal factors (Brent, USD/RUB).

13.01.2021: RUB eases on internal factors (Brent, USD/RUB).

Oil moved higher on bullish industry data. The report from the API showed a bigger-than-expected drop in the US crude stockpiles. Markets await the official data from the US Energy Department. The ruble is strong thanks to higher oil prices. The focus of the ruble bulls is shifting between the rising oil market and the risk of sanctions. Oil closed Tuesday session at its highest level since last February. On Wednesday, crude prices were higher by 1%. Apart from the bullish data on oil supply, the commodity gains support from a weaker US dollar and a quick response of the Chinese authorities to a new virus outbreak in the north of the country. This has eased concerns over a new COVID-19 wave and a possible drop in fuel demand in China. Brent quote moved above the level of 57 dollars per barrel but failed to settle there. In the mid-session, oil prices slowed down the pace of growth. However, the bullish momentum is still in place. Investors seem to be shrugging off the situation around pandemic in the US and Europe. They hope that the global crude supply will rapidly decline thanks to Saudi Arabia’s decision to cut its output. Brent oil futures for March were trading at 56 dollars 80 cents per barrel. WTI futures contract with the nearest expiration ended up at 53 dollars 50 cents per barrel. Today, markets are looking ahead to the official data on oil inventories in the US. Another optimistic report will boost the rise in oil prices and may even push Brent above 57 dollars a barrel. The energy market looks quite stable today, while analysts continue to upgrade their outlook for this year. The US Energy Information Administration has also revised its forecast. According to it, global crude stockpiles will decrease in the first quarter thanks to the output cuts introduced by Saudi Arabia. So, the EIA expects Brent to rise to 56 dollars per barrel on average. At the same time, Goldman Sachs sees oil prices surge to 65 dollars per barrel by July. The forecasts have become more optimistic now as experts see the conditions for a possible deficit in the market in the near future. Meanwhile, the ruble was trading mixed in the morning session. On the one hand, it benefits from higher oil prices and the approaching tax payment period in Russia. However, the remaining risks of sanctions limit the ruble’s growth. As the negative factors have finally prevailed, the dollar/ruble pair moved to the upside. Still, the Russian currency is holding at comfortable levels. By the end of the Tuesday session, the ruble appreciated notably against all major currencies. The US dollar lost 1.5% and retreated to the level of 73.6 against the ruble. If the energy market enters the phase of correction, the ruble may again hit the level of 73. Amid more negative factors, the US dollar may easily rise above the mark of 74 rubles. The easing of the ruble could be also explained by some internal factors. The Russian currency declined on the decision of the Russian Ministry of Finance to purchase foreign currency within the budget rule. The last time the purchase of foreign currency was carried out in March 2020.

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