Oil spikes after OPEC’s shock production cuts: Brent crude prices jumped 6.4% to almost USD 85 per barrel yesterday — its largest single-day gain in a year — on the back of Sunday’s surprise decision by the OPEC+ oil cartel to further restrict supply.

Back to the days of USD 100+ per barrel? Brent could soar as high as USD 110 per barrel by the summer on the cartel’s move to slash output more than 1 mn barrels per day (bpd), Reuters reports, citing Rystad Energy forecasts. The last time oil prices hit similar highs was in the aftermath of the outbreak of war in Ukraine, which drove a wedge between Western nations and Moscow that set in motion an ongoing realignment of the world’s energy map.

The West is not impressed: OPEC’s move is likely to fuel tensions between cartel leader Saudi Arabia and the US, which has repeatedly pleaded with oil-rich nations to ease supply as its central bank battles high inflation. The Paris-based International Energy Agency said the production cuts “risk exacerbating” strains on the market, “pushing up oil prices at a time when strong inflationary pressures are hurting vulnerable consumers around the world.”

OPEC’s move sent ripples through the financial markets: The picture was mixed for global stock markets on Monday as traders digested the news. Energy companies were the unsurprising benefactors, while growth stocks took a hit as investors worried that higher inflation could spur the US Federal Reserve to continue with rate hikes. The S&P 500 gained 0.4% and the Dow Jones Industrial Average was up 1%, while the Nasdaq fell 0.3%.

The fallout is everywhere in the international business press: Bloomberg | Wall Street Journal | Financial Times | AP | Washington Post.

EGX30

17,057

+2.2% (YTD: +16.8%)

USD (CBE)

Buy 30.84

Sell 30.96

USD at CIB

Buy 30.85

Sell 30.95

Interest rates CBE

18.25% deposit

19.25% lending

Tadawul

10,807

+1.6% (YTD: +3.1%)

ADX

9,501

+0.6% (YTD: -7%)

DFM

3,437

+0.9% (YTD: +3%)

S&P 500

4,125

+0.4% (YTD: +7.4%)

FTSE 100

7,673

+0.5% (YTD: +3%)

Euro Stoxx 50

4,311

-0.1% (YTD: +13.6%)

Brent crude

USD 84.93

+6.3%

Natural gas (Nymex)

USD 2.12

-0.1%

Gold

USD 2,002

+14.2%

BTC

USD 27,569

-1.8% (YTD: +66.5%)

THE CLOSING BELL-

The EGX30 rose 2.2% at yesterday’s close on turnover of EGP 2.4 bn, (21% above the trailing 90-day average). Foreign investors were net buyers. The index is up 16.8% YTD.

In the green: GB Auto (+9.4%), Qalaa Holdings (+8.8%) and Abu Qir Fertilizers (+6.8%).

In the red: Taleem (-3.0%), CIRA Education (-1.5%) and Juhayna (-0.4%).

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