Crude oil rises in early trade

20 Mar 2023 , 08:12 AM

After suffering their greatest weekly loss in months, oil prices increased on Monday as UBS announced plans to acquire Credit Suisse and some of the major central banks in the world worked to reassure and stabilize the world’s financial markets.

Brent oil futures were up 35 cents, or 0.5%, to $73.32 per barrel after suffering a loss of nearly 12% the previous week, the largest weekly loss since December.

After falling 13% last week, the most since last April, US West Texas Intermediate crude was up 37 cents, or 0.6%, to $67.11 per barrel.

In a historic transaction, Switzerland’s largest bank, UBS, said late on Sunday that it will acquire Credit Suisse, the nation’s second-largest institution. The US Federal Reserve, European Central Bank, and other significant central banks made commitments to help other banks and increase market liquidity in the wake of the announcement.

Markets are pricing a 60% chance that the Fed will increase rates by 25 basis points on Wednesday, but some executives are urging the central bank to temporarily suspend tightening its monetary policy while preparing to do so in the future.

The dollar could decline due to a pause in interest rate increases, making goods priced in dollars more accessible to holders of other currencies.

Separately, Goldman Sachs lowered its predictions for Brent crude after the price fell due to concerns about the banking sector and the recession.

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