Oil prices fall as tensions ease

By: AFP
Published: 08:31 PM, 8 Feb, 2022
Oil prices fall as tensions ease
Caption: Oil prices fall as tensions ease.
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Oil prices fell Tuesday on easing geopolitical concerns surrounding major crude producers Iran and Russia while stock markets traded mixed.

French President Emmanuel Macron said he had convinced Russia's Vladimir Putin not to escalate the crisis around Ukraine, ahead of talks in Kyiv aimed at defusing fears Moscow could invade. 

At the same time, talks to revive a deal with Iran on its contested nuclear programme were set to resume Tuesday after Washington and Tehran signalled their willingness to clinch an agreement as soon as possible.

Edward Moya, analyst at trading group OANDA, said signs of progress in US-Iran nuclear talks -- which could see Tehran sell oil internationally again -- would likely not have much long-term impact on the oil price rally towards $100 per barrel.

"Energy traders locked in some profits over optimism that the US and Iran might be able to salvage a nuclear deal," he said.

"The oil market still remains heavily in deficit and whatever weakness happens to prices will likely be short-lived."

Surging oil prices -- Brent crude hit the highest level for more than seven years at $94 per barrel on Monday -- saw BP swing back into a big profit last year, the British energy giant announced.

The expected turnaround -- after huge losses in 2020 as the pandemic slammed oil prices -- saw BP's share price rise only modestly before turning lower.

The price of aluminium surged to the highest level in 14 years -- $3,236 per tonne -- on stretched supplies after China placed the city of Baise -- a key producer of the base metal -- in Covid lockdown.

Chips race 

In Asia, SoftBank announced that the $40-billion sale of chip powerhouse Arm to Nvidia had collapsed because of "significant regulatory challenges" over competition concerns.

The Japanese telecoms firm-turned-investment giant also reported net profit of $251 million in the third quarter.

In Europe, the EU unveiled a 43-billion-euro plan to quadruple the supply of semiconductors in the region by 2030, hoping to limit the bloc's dependence on Asia for a key component used in electric cars and smartphones.

However shares in leading European chipmakers, STMicroelectronics and Infineon, both fell.

On Wall Street, share prices were higher as investors await key US inflation data Thursday tipped to show more painful price rises in January after a four-decade high in December.

But sentiment was more muted in Europe, where stock markets in London and Frankfurt were lower by mid-afternoon trading while Paris was tentatively higher. 

Investors are bracing for central banks to raise interest rates to tame inflation, a move that could weigh down on the global economic recovery. 

Categories : Business
AFP

Agence France-Presse is an international news agency.