Ignacio Teson•Monday, January 20, 2025•2 min read
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The most actively traded WTI contract for March fell $1.12, or 1.4%, to $76.27. U.S. oil benchmarks did not trade on Monday due to a holiday.
Trump, whose campaign slogan included “drill, baby, drill,” is also expected to sign an executive order focusing on Alaska, according to an official. The state is considered critical to U.S. national security and could facilitate liquefied natural gas (LNG) shipments to other parts of the country and allied nations.
UKOIL
On Monday, Trump also reiterated his plans to impose tariffs and tax foreign countries while pledging to overhaul the current trade system.
Markets are closely watching which executive orders Trump will sign in the next 24 hours. Oil prices are trending lower amid expectations that Trump might ease energy-related sanctions on Russia in exchange for an end to the war in Ukraine.
Additionally, Trump is expected to lift a moratorium on U.S. liquefied natural gas (LNG) export licenses as part of a broader strategy to strengthen the economy.
Easing tensions in the Middle East also kept oil prices in check. On Sunday, Hamas and Israel exchanged hostages and prisoners in the first day of a ceasefire after 15 months of conflict.
Economic Optimism Drives Oil Prices
Beyond geopolitical factors, oil prices are also responding to economic growth expectations, which are providing upward momentum.
According to PwC’s annual survey, 58% of CEOs from the world’s largest companies believe global economic activity will continue to improve. This marks the second consecutive year of increasing optimism regarding the global economy.
Only 21% expect economic growth to remain unchanged, the lowest proportion recorded since 2022, when it stood at 15%. Meanwhile, 20% of CEOs anticipate a decline in economic activity.
The survey, conducted between October and November 2024, highlights that the biggest risks businesses are facing include macroeconomic volatility, inflation, and cybersecurity threats.
Now in its 28th year and traditionally released at the start of the Davos Forum, the survey also reveals that four out of ten CEOs have expanded into at least one new sector over the past five years.
Ignacio Teson
Economist and Financial Analyst
Ignacio Teson is an Economist and Financial Analyst. He has more than 7 years of experience in emerging markets. He worked as an analyst and market operator at brokerage firms in Argentina and Spain.
www.fxleaders.com