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Oil Bounces as Ukraine Ceasefire Deal Remains Elusive 

An oil tank and an oil pumpjack are pictured in the Permian basin, Loco Hills regions, New Mexico, US, April 6, 2023. (Reuters)
An oil tank and an oil pumpjack are pictured in the Permian basin, Loco Hills regions, New Mexico, US, April 6, 2023. (Reuters)
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Oil Bounces as Ukraine Ceasefire Deal Remains Elusive 

An oil tank and an oil pumpjack are pictured in the Permian basin, Loco Hills regions, New Mexico, US, April 6, 2023. (Reuters)
An oil tank and an oil pumpjack are pictured in the Permian basin, Loco Hills regions, New Mexico, US, April 6, 2023. (Reuters)

Oil prices rebounded on Friday to recover some of their more than 1% losses in the previous session, partly due to diminishing prospects of a quick end to the Ukraine war that could bring back more Russian energy supplies.

Brent crude futures rose 46 cents, or 0.7%, to $70.34 a barrel by 0406 GMT after settling 1.5% lower in the previous session. US West Texas Intermediate crude was at $67.03 a barrel, up 48 cents, or 0.7%, after closing down 1.7% on Thursday.

Russian President Vladimir Putin said on Thursday that Moscow supported a US proposal for a ceasefire in Ukraine in principle, but sought a number of clarifications and conditions that appeared to rule out a quick end to the fighting.

"Russia's tepid support of a 30-day ceasefire proposal with Ukraine has reduced confidence around a ceasefire in the short term," IG market analyst Tony Sycamore said.

"The feeling is that US won't lift sanctions until they agree a ceasefire."

However, the global trade war that has roiled financial markets and raised recession fears is escalating with US President Donald Trump on Thursday threatening to slap a 200% tariff on alcohol imports from Europe.

The International Energy Agency warned on Thursday that global oil supply could exceed demand by around 600,000 barrels per day this year, due to growth led by the United States and weaker than expected global demand.

"The macroeconomic conditions that underpin our oil demand projections deteriorated over the past month as trade tensions escalated between the US and several other countries," the IEA said, prompting it to revise down its demand growth estimates for the fourth quarter of 2024 and the first quarter of 2025.

The Trump-driven trade war woes and demand worries dented oil prices on the previous day, though the possibility of less Russian oil in the global markets in the near term provided some cushion during Friday's trade.

"Most price projections were to the downside in the short term, but geopolitical tension could still cause supply disruptions," ANZ analysts said in a note to clients.

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Positive Outlook for Saudi Stock Market Next Week

A trader monitors the screen at the Saudi Exchange in Riyadh. (AFP)
A trader monitors the screen at the Saudi Exchange in Riyadh. (AFP)
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Positive Outlook for Saudi Stock Market Next Week

A trader monitors the screen at the Saudi Exchange in Riyadh. (AFP)
A trader monitors the screen at the Saudi Exchange in Riyadh. (AFP)

Saudi Arabia’s Tadawul All Share Index (TASI) ended the second week of March with a slight decline for the third consecutive week, closing down 0.73% at 11,725.88 points, compared to the previous week's close of 11,811.11 points.

In an analysis of the market performance during the week ending March 13, Dr. Suleiman Al-Humaid Al-Khalidi, a financial market analyst, told Asharq Al-Awsat that the market experienced a sharp decline not seen in years, coinciding with a drop in global markets, particularly in the US, where $2 trillion in value was wiped out in a single day.

This accounted for roughly 60% of the total market value of the Saudi stock market.

Al-Khalidi noted that the key player in the Saudi market is the banking sector, especially Al-Rajhi Bank's shares, which showed resilience and did not follow the downward trend. This was attributed to the strong profits reported by the banking sector in 2024.

The primary factors contributing to the market’s decline include global economic pressures, particularly US tariffs on most global economies, ongoing global uncertainty, and the Federal Reserve's tight monetary policies, he explained.

These factors have significantly impacted liquidity flows into financial markets. Additionally, fluctuations in global oil prices, despite recent stability, have also played a role.

This downturn has been accompanied by caution among sovereign wealth funds, investment institutions, and some portfolios in injecting new liquidity or altering their positions until there is more clarity in the financial markets, he went on to say.

Moreover, Al-Khalidi said that the Saudi stock market has not accurately reflected the true strength and size of the Saudi economy, which has grown to SAR 4 trillion, up from SAR 600 billion in 2016, before the launch of Vision 2030.

Additionally, the country’s GDP has reached approximately $1.1 trillion.

Looking ahead to the market's performance in the coming week, he noted that there are strong support levels at 11,550 points, followed by 11,450 points.

These levels could help shift the market toward an upward trajectory and better reflect the robust growth of the Saudi economy.

Al-Khalidi emphasized that the banking and energy sectors could play a leading role in driving the market higher, pushing the index beyond this week’s closing levels.

He also pointed out that some stocks are hitting new lows, presenting significant investment opportunities for those seeking safe havens with steady returns in the Saudi market.