In what is one of the quieter weeks on the economic data side, oil has once again taken the spotlight after WTI crude dipped briefly below $40 a barrel last week for the first time in almost four months. Oil entered into a bear market at the end of last month and even now remains just under 20% below its highs from June as oversupply continues once again resurfaced.
It’s been a truly historic night for the UK as it appears that the people have voted to leave the European Union after a number of news channels confirmed that a win for remain is all but impossible. This comes after financial markets were convinced that the result would be a comfortable win for the remain side and betting odds supported it, with implied odds close to 90% for remain on Thursday.
European equity markets are expected to open a little lower this morning following a subdued session in Asia overnight and some selling in the afternoon in the United States on Wednesday, as investors sought shelter from the wild swings that could lie ahead.
Brent and WTI crude are coming under pressure again on Wednesday after oil workers in Kuwait agreed to end their strike against wage and job cuts and work to return output to pre-strike levels. Despite an initial sell-off on Monday, the strike in Kuwait which wiped out the 1.5 million barrels of excess supply each day, had managed to more than offset the disappointment at the lack of a deal in Doha over the weekend that would have seen a number of major oil producers freeze output.