A surge on crude oil prices was noted on Monday morning after news that the US President, Donal Trump has signed a document ratifying a series of stimulus measures designed to bolster the country's economy. Moreover, Trump's decision was made bypassing Congress, which was never able to come to a consensus on the size of payments and their deliberate purpose, since the Democrats and Republicans did not manage to agree.
The price of futures contracts for Brent crude oil with delivery in October on the trading floor in London has already jumped up on Monday by 1.10% or $ 0.49, which allowed the mark to move to the level of $ 44.89 per barrel. Bidding on the previous trading day ended in negative territory: Brent oil went down over the weekend by 1.5% or $ 0.69, and its price was at around $ 44.4 per barrel.
On the contrary, the price of futures contracts for light crude oil of the WTI brand for delivery in September on the electronic trading floor in New York has significantly slid down declining by 1.46% or $ 0.6, and the price was $ 41.82 per barrel. It should be noted that Friday's trading also ended in the red zone: the price fell by 1.7% or $ 0.73, which forced it to move to the area of $ 41.22 per barrel.
Positive news in the oil market on Monday is brought by an order from the US President, stating that an additional increase in unemployment benefits will again be paid to those who lost their jobs due to the coronavirus pandemic. However, its size will be slightly smaller than it was previously and will amount to $ 400 per week. The decree also states that 75% of these payments will come from the federal budget and only 25% will be financed by local authorities, that is, state governments.
In addition to this long-awaited and exciting measure for investors, the order contains clauses according to which deferral of tax payments will be provided for employers on the salaries of those employees who have an income of less than $ 100 thousand per year. Moreover, the term of the still existing moratorium on loans for students has been extended, and the important part is that there is an indication of assistance to bona fide tenants of apartments and houses, as well as homeowners.
The risky asset sector has strengthened today thanks to this news from the US, which makes one think that the black gold market will also feel significant support and will begin to strengthen in the coming days. The accepted stimulating payments, according to the US authorities, should have a positive effect on the economy of the state and at the same time provide good support to the citizens of the country.
Among other things, participants in the oil market this week will closely monitor the situation in the negotiation process between the US and China. The talks will focus on, as analysts suggest, a trade agreement on Chinese energy imports. Recently, relations between the countries are very tense, acute conflict situations arise regularly. Therefore, investors cannot calmly ignore any agreements between the US and China that would hint at improving relations or, conversely, at the continuation of the conflict.
