Morning Brief: From Stock’s Ups and Downs to Oil and Gas Prices

Down. Up. Down. On Wall Street, it was another wild trading afternoon, with stocks finishing Tuesday deeper in correction territory after briefly surging into the green from stock's volatility with roughly an hour remaining until the closing bell. The Dow Jones Industrial Average plummeted 185 points, or 0.6%, following Monday's 797-point plunge into correction territory. The S&P 500 fell 0.7 percent, while the Nasdaq Composite fell 0.3 percent following Monday's bear market close.

Oil rose 4% to roughly $124 per barrel, considerably below the $130 level reached Sunday night in response to threats of a ban. Much of the anticipated drop in oil production has already been reflected in the commodity's price. Asia's stock markets were in the red, with the Nikkei 225 down 1.7 percent. Continue reading

Consumers worldwide are feeling the pinch of record-high gas pumps, as the Ukraine crisis drives up oil prices. According to the American Automobile Association, the national average price of a gallon of gasoline in the United States reached a record high on Tuesday. The average price of a gallon of normal unleaded gasoline was $4.173, up little more than $1.40 from a year earlier. AAA said that the average had not been this high since July 2008.

In Europe, a benchmark Dutch natural gas contract reached a record high last week and has since maintained that level. Experts believe that these rises will continue and will have a harmful effect on the economy. "The situation is bad and is unlikely to change anytime soon," said Patrick De Haan, head of petroleum research at fuel-saving app GasBuddy. Continue reading

Oil prices soared to their highest level since 2008 on Tuesday as the United States declared the main artery on Russian oil imports. "Today, I'm announcing that the United States will strike Russia's primary economic artery. We are prohibiting all imports of Russian oil, gas, and energy," President Joe Biden announced during a news conference. This implies that Russian oil would be rejected at US ports, Biden stated.

That appeared to change over the weekend when Secretary of State Antony Blinken stated on CNN that the US and its allies were considering "the possibility of prohibiting the purchase of Russian oil while ensuring an adequate supply of oil on global markets." Oil prices have increased by more than 60% thus far this year. On Tuesday, West Texas Intermediate crude reached a high of $128 per barrel, while Brent crude reached a high of $132 per barrel.

What may happen now that the US has slapped sanctions on Russia's oil exports? What Is Covered by the Oil Ban? Continue reading

As commodity prices rise and equities fall as a result of Russia's conflict with Ukraine, some analysts believe the monetary system will undergo dramatic changes. Zoltan Pozsar, Credit Suisse's global head of short-term interest strategy, has stated that the present market chaos may finally help Bitcoin.

"We are witnessing the emergence of Bretton Woods III – a new international (monetary) order focused in the East on commodity-based currencies that will likely damage the Eurodollar system and also contribute to inflationary tendencies in the West," Pozsar said in a research note. Pozsar argued that the growing crisis — exacerbated in part by punishing Western sanctions on Russia — is increasing the "allure" of alternative kinds of money. Continue reading

Modern jet jets include a significant amount of lightweight, ultrastrong titanium metal. Titanium is lighter than steel and increases fuel economy. That is encouraging news. The bad news is that Russia is a significant titanium supplier. This might become a problem for Boeing (BA) stock and jet production, depending on how long the Russia-Ukraine crisis continues, how long Russia remains sanctioned, and how long alternative titanium suppliers take to ramp up output. According to the US Geological Survey, Russia is the third biggest producer of titanium in the world, accounting for between 15% and 20% of total output.

According to The Wall Street Journal, while Boeing has ceased some of its operations in Russia, its relationship with titanium supplier VSMPO AVISMA remains uncertain. Boeing's shares fell around 1.7% in premarket trade. However, stock markets are expected to begin in the red. Futures on the S&P 500 and Dow Jones Industrial Average fell around 0.6 percent and 0.7 percent, respectively. Continue reading