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Oil prices rose on supply concerns and stock markets were mixed after the troops of Yevgeny Prigozhin withdrew from Russia, ending the warlord’s armed uprising but raising doubts about the stability of Vladimir Putin’s regime.
Brent crude, the international benchmark, rose as much as 1.3 per cent to $74.80 a barrel in early trading in Asia on Monday, while US marker West Texas Intermediate rose as much as 1.4 per cent to $70.11 a barrel.
The gains for crude oil benchmarks came after Prigozhin and his Wagner mercenaries reached a deal with Moscow over the weekend to withdraw from southern Russia following comments from Putin likening the crisis to the revolution of 1917.
Traders said the shortlived mutiny raised serious questions over the outlook for Putin’s regime, but the immediate impact on crude output from one of the world’s top suppliers remained uncertain.
“There’s a possibility of supply disruption any time you get a serious geopolitical event in a major oil supplier,” said Stephen Innes, managing partner at SPI Asset Management. “It opens up a can of worms and we’re going to have to see how that plays out.”
Gold and the yen also notched slight gains on Monday following the revolt as risk-off sentiment rippled through markets. Gold rose 0.4 per cent to $1,928 a troy ounce, while the yen rose 0.1 per cent to ¥143.5 against the dollar.
The yen was also buoyed by comments by a board member of the Bank of Japan suggesting the central bank should debate tweaks to its yield curve control policy.
Bond markets benefited from the flight to havens, with the yield on 10-year US Treasuries falling 0.01 percentage points to 3.727 per cent.
China’s renminbi fell as much as 0.5 per cent to a seven-month low of 7.2153 against the dollar as the country’s markets returned from a long holiday and as concerns grew over the country’s economic growth.
Equities markets in Asia were mixed on Monday, with Japan’s benchmark Topix index up 0.2 per cent and Hong Kong’s Hang Seng falling 0.3 per cent. China’s CSI 300 index shed 1.5 per cent.
Australia’s S&P/ASX 200 index fell 0.4 per cent after analysts at Goldman Sachs downgraded the country’s equities to underweight due to dimming prospects for Chinese economic growth.
Futures markets pointed to minor gains at the open on Wall Street, where the benchmark S&P 500 was tipped to rise 0.2 per cent and the tech-focused Nasdaq was set to gain 0.3 per cent. The FTSE 100 was expected to rise 0.1 per cent in London.
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