Oil prices fell further earlier this morning after a release by the Wall Street Journal suggested the International Energy Agency was planning its largest ever emergency oil reserve release to attempt to offset the impact of the Iran war. Brent Oil Futures for May fell close to 1% off the back of this report, falling to just shy of $87 per barrel.
Member countries of the International Energy Agency are set to consider the proposal later today. It’s reported the reserves being released will be larger than the record 182 million barrels of oil which were released back in 2022 when Russia invaded Ukraine. The aim of the release is to help limit potential supply disruptions off the back of the U.S – Iran war, however an extended closure of the Strait of Hormuz could continue to severely disrupt energy supplies across Asia.
Earlier this morning there was another drone attack on Dubai International Airport as Iran went further to warn they would now begin targeting economic institutions across the region linked to both Israel & The U.S – as the current tensions show no sign of coming to an end any time soon.
Elsewhere, the Australian Dollar has climbed to a near four-year high due to increasing confidence that The Reserve Bank of Australia will raise interest rates next week. This was after Deputy Governor Andrew Hauser stated yesterday that there will be a genuine debate whether to hike or not, simply due to the economy struggling with the increased uncertainty over potential energy-fuelled inflation. Analysts now expect the Reserve Bank of Australia to hike interest rates by 25 basis points at next weeks meeting, and again in May.
On the economic front, the main focus turns to U.S Inflation due out this afternoon. Yearly figures are set to stay stable with no change expected at 2.4%, however the monthly number is expected to increase by 0.1%. It’s highly unlikely that this will have been impacted by the Oil price surge, but we can expect to see elevated inflation over the coming months which will only lead to further debate by the Federal Reserve when it comes to deciding whether to hike rates or not.
GBP/EUR 1.1559 GBP/USD 1.3407 GBP/AED 4.9264
GBP/AUD 1.8748 GBP/CHF 1.0435 GBP/CAD 1.8196
GBP/NZD 2.2644 EUR/USD 1.1584 GBP/ZAR 22.9765