Oil Prices Stabilize Amid Ukraine Peace Talks and Mounting Oversupply Concerns

Economic

Commodity

Summary:

Oil prices are holding recent gains as markets cautiously monitor ceasefire negotiations in Ukraine, while a growing global supply glut continues to suppress long-term bullish sentiment....

Crude Oil Gains Tempered by Uncertainty and Surplus Dynamics

After a two-day rally, global oil benchmarks Brent and West Texas Intermediate (WTI) are treading water, reflecting the market’s indecision amid geopolitical developments and structural oversupply. Brent crude remained above $63 a barrel, following a 0.9% increase in the prior session, while WTI hovered near $60.

These modest gains are partly tied to diplomatic optimism as Ukrainian representatives prepare for renewed peace talks in Florida. Despite this, Russian President Vladimir Putin has publicly rejected aspects of the US-backed ceasefire plan, casting doubt on the viability of a near-term resolution.

The oil market's response to these developments reveals a primarily correlational relationship: hopes for de-escalation may lift sentiment temporarily, but no causative shift in supply dynamics has occurred. Traders are positioning based on scenarios rather than outcomes.

Prospect of Sanctions Relief Weighs Heavily on Forward-Looking Expectations

Should a peace agreement progress meaningfully, it could lead to the lifting of sanctions on Russia, a major global supplier, thereby unlocking additional crude exports. However, with no binding resolution in place, this remains a speculative risk factor rather than a concrete price driver.

Even without new Russian volumes entering the market, the outlook is already bearish due to current surplus levels. Crude inventories are rising globally, and leading producers are adjusting their pricing strategies accordingly.

Saudi Aramco, the world’s largest oil exporter, has announced a reduction in its flagship Arab Light crude price for January delivery, marking the lowest level since 2021. Simultaneously, Canadian crude benchmarks have fallen sharply, reinforcing the broad-based nature of this pricing pressure.

These shifts are not incidental but reflect a clear causal chain: excess supply leads to competitive price cutting among exporters, which in turn caps any upward momentum in futures markets.

Analyst Sentiment Reinforces the Bearish Narrative

Zhou Mi, a commodities strategist at Chaos Ternary Futures, argues that the current market environment is fundamentally oversupplied. He views the Ukraine talks and US rhetoric on Venezuelan sanctions as “market noise,” suggesting that geopolitical headlines are failing to alter the underlying supply-demand balance.

Zhou's assessment points to a continuation of the bearish trend, unless major supply disruptions occur—an unlikely scenario given current conditions. His commentary suggests that while short-term volatility may be driven by headlines, the dominant force in the market remains structural oversupply.

Russia-India Energy Diplomacy Adds Another Layer of Complexity

Amid the backdrop of peace negotiations, Russian President Putin has also arrived in India for his first state visit since the full-scale invasion of Ukraine began. This bilateral engagement is likely to include discussions on energy cooperation, potentially deepening Russia's oil ties with India, one of the largest non-Western buyers of Russian crude.

Though speculative at this stage, any expansion in Russia-India energy agreements could further shift global supply flows, particularly if India secures preferential terms in response to Western isolation of Russian exports. This geopolitical realignment could sustain Russia’s export volumes even in the face of sanctions, indirectly pressuring other oil-exporting nations to remain competitive on price.

Volatile Near-Term, Bearish Long-Term

While oil prices are temporarily supported by geopolitical speculation and ceasefire hopes, the broader market remains mired in oversupply. Saudi pricing adjustments and falling Canadian crude benchmarks reflect a real-time response to weak demand signals and saturated inventories.

Unless a binding geopolitical resolution materializes or OPEC+ enacts deeper cuts, the structural imbalance will likely maintain downward pressure on prices. For now, the crude market remains range-bound, swayed by diplomatic optimism but tethered by a fundamental supply excess.

Source: Bloomberg

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Samantha Luan

Cryptocurrency

Forex

Binance announced it will cease support for deposits and withdrawals on selected networks as of December 12, 2025, according to its latest operational update.

The decision affects user operations and liquidity, as certain tokens may have no alternative network support, potentially impacting market activity for those assets.

Binance Ceases Transfers on Specific Networks

Binance announced cessation of token transfers on specific networks. This operational update follows similar changes like the Neo Legacy network shutdown, often due to infrastructure and risk management. The official announcement is made through Binance's support portal. The network shutdowns are part of Binance's routine risk and infrastructure management initiatives. Founder Changpeng Zhao and the Binance team regularly conduct such changes, not marking them as strategic hostilities towards any specific blockchain hosting or network provider.

"Binance has treated network and token support changes as routine risk and infrastructure management decisions for the exchange rather than strategic hostility toward any specific chain." — Changpeng Zhao (CZ), Founder and Former CEO [2]

User Migration Expected Amid Network Changes

The changes underscore Binance's ongoing network management efforts. Discontinuing support may result in direct operational impacts, especially for users needing to migrate. Historically, short-term disruptions precede long-term asset balance as alternative network routes become available. Market reactions to Binance's actions are primarily operational. The decision may trigger users to seek alternative networks, though trading generally continues. Historically, such changes have led to only limited shifts in network liquidity and asset support.

Expert Insights on Risks and Solutions

Similar scenarios like the Neo Legacy withdrawal cessation suggest temporary disruptions. Binance frequently manages such asset re-routing without significant market impact, retaining trading capacities. Such cases reinforce the company's approach to risk and infrastructure management. Experts noted that while these transfer halts represent operational risks, the long-term availability of alternative network routes minimizes financial impacts. Binance's transparency and communications highlight a well-structured approach to complex network infrastructures. R

Source: CryptoSlate

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Justin

Forex

Economic

Political

Central Bank

The Reserve Bank of Australia will hold its cash rate at 3.60% on Tuesday and keep it there through 2026, according to a Reuters poll, a shift from last month when a majority of economists expected at least one rate cut next year.

After lifting rates to a 12-year high of 4.35%, the RBA has cut 75 basis points this year, but expectations for another cut faded after inflation in the latest monthly data rose to 3.2%, above the central bank's 2%-3% target range, suggesting policy may not be as restrictive as thought.

Australia's economy grew at its fastest annual pace in two years, and a strong labour market should allow policymakers to keep rates on hold to focus on taming inflation.

All 38 economists in the December 1-4 poll expected the central bank to leave its official cash rate unchanged at the end of its two-day meeting on December 9.

"Given recent data...the RBA is likely to remain on hold for an extended period. We no longer expect another 25bp cut to the cash rate. Inflation has risen above the 2-3% target band and is too challenging for the RBA to look through," said Craig Vardy, head of Australia fixed income at BlackRock.

"The prudent course of action for the foreseeable future would be to keep the cash rate on hold."

MOST ECONOMISTS EXPECT RATES TO REMAIN UNCHANGED

In the November poll, over 60% expected at least one more cut to come by April-June, a view held by less than one-third in the latest poll.

Among economists who had a rates forecast until the end of 2026, a strong majority 19 of 33 expect rates to stay unchanged at 3.60%, and 10 forecast at least one cut. The remaining four expected the RBA to hike at least once.

That minority view aligns with a broader shift in sentiment, with many now saying the balance of risks has tilted toward a hike. Interest rate futures are pricing in over a 70% chance of a hike by the end of next year.

"Our base case remains a pause in 2026...However, in the near term, risks are skewed to hikes as inflationary pressures continue to rise. If inflation accelerates sustainably above the RBA's forecasts, and the labour market tightens, we anticipate that the RBA may hike, but the hurdle for a hike is high," said Nick Stenner, head of Australia and New Zealand economics at BofA.

Source: Investing

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Samantha Luan

Stocks

Forex

Nifty futures point to a cautious start for local equities this morning after the benchmark index snapped a four-day slide on Thursday to hop back above 26,000. There was some respite for the rupee as well, and traders will be closely watching the RBI governor's comments on the currency at the policy call today.

Also in the spotlight will be the usual rate-sensitive corners of the market: banks, autos and developers. And to keep things interesting, Russian President Vladimir Putin is meeting Prime Minister Narendra Modi in New Delhi today. What comes out of that discussion might even influence India's long-awaited trade deal with the US. Meanwhile, regional markets are down ahead of a key US inflation data release.

Reliance readies Jio IPO, awaits regulatory change

Reliance Industries has quietly begun work on the initial draft prospectus for what could be India's biggest-ever IPO — the long-anticipated listing of Jio Platforms. The company is informally speaking with a couple of banks to prepare the document, aiming to file as soon as the market regulator SEBI notifies its new rules allowing minimum dilution as low as 2.5% for companies valued above 5 trillion rupees ($55 billion). SEBI approved the relaxed norms in mid-September, but they have yet to be implemented — a crucial step before one of the world's most-watched IPOs can proceed.

Indian stocks may be catching Russia's eye

While some of the country's largest companies gear up to raise capital, new investors are eyeing India. On Thursday, Russia's biggest lender, Sberbank, said it's giving its clients a way to invest in Indian equities through a passive product linked to the Nifty Index. The benchmark is up around 10% so far this year and is on track to notch its 10th straight year of gains. The market still looks pricey, but investors seem hopeful that earnings will grow to justify those valuations. Sberbank isn't stopping at equities. The bank's top executive said they're also eyeing government securities and even have plans to expand into retail banking in the country.

Mumbai apartments at Manhattan prices show luxury boom

This interest in high-value markets echoes in Mumbai's property market, where ultra-luxury spending is booming while affordable segments lag behind. In the financial capital, high-end apartments are priced as much as 100,000 rupees ($1,109) per square foot — on par with prices in New York's Lower Manhattan — according to a report by Anarock Group and wealth management firm 360 One Wealth.

For markets, the message is mixed. Strong luxury demand is still boosting jewelry and premium consumption stocks, despite worries about slower economic growth. But if real estate prices keep rising, affordability could erode and dent demand. After a two-year rally in which a gauge tracking realty stocks more than doubled, 2025 has been a dampener, with the gauge falling over 15% as affordability and valuation concerns take center stage.

The struggling rupee strengthened on Thursday after six straight days of losses that pushed it below the psychologically crucial 90-per-dollar mark. The rebound, which made the rupee the best-performing Asian currency on the day, comes as some analysts say that it now appears undervalued. Analysts from Yes Securities cite that as a factor that may comfort foreign funds, while Elara notes that equity inflows typically pick up after the valuation gauge bottoms out. Traders also said the Reserve Bank of India — set to announce its policy decision later today — has intermittently stepped in to support the currency. Although the rupee's recent slide has been steep, positive developments in US trade talks or fresh RBI measures to attract inflows could trigger a sharp rally.

Source: Bloomberg Europe

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Daily News

[Quick Facts]

1. U.S. Treasury Debt exceeds $30 trillion, doubling since 2018.

2. Russian Foreign Ministry: Russia will respond if the EU seizes Russian assets.

3. Japan's 10-year government bond yield hits 17-year high, Finance Minister pledges close monitoring.

4. Despite a drop in initial jobless claims, the U.S. labor market may be weakening.

5. Cooling labor market becomes key driver for Fed rate cut in December.

[News Details]

U.S. Treasury Debt exceeds $30 trillion, doubling since 2018

The total amount of sovereign debt issued by the U.S. Treasury has surpassed $30.2 trillion for the first time, more than doubling since 2018. Data released Thursday show that as of November, the outstanding amount of U.S. Treasury bills, notes, and bonds reached $30.2 trillion. This $30.2 trillion constitutes the main component of the federal government's total debt.

Russian Foreign Ministry: Russia will respond if the EU seizes Russian assets

On December 4th, Russian Foreign Ministry spokeswoman Maria Zakharova said Moscow will respond to any potential seizure of frozen Russian assets by the European Union. Speaking at a press conference in St. Petersburg, Zakharova stated that if the EU proceeds to confiscate Russia's frozen assets, it will get a surprise. She did not specify what form Russia's response would take. Zakharova also said that Russia considers the relevant actions by European Commission President Ursula von der Leyen inappropriate.

Japan's 10-year government bond yield hits 17-year high, Finance Minister pledges close monitoring

Japanese Finance Minister Satsuki Katayama said at a press conference today that authorities will continue to monitor movements in long-term bond yields closely. She declined to comment on recent specific fluctuations.

On Thursday, Japan's 10-year government bond yield rose to 1.905%, the highest level since 2007. Katayama noted that bond yields are determined by the market and reflect multiple factors, including domestic economic conditions, prices, monetary policy, national fiscal status, and global financial markets.

She emphasized that the Ministry of Finance will maintain close communication with market participants and implement appropriate debt management policies to ensure confidence in Japan's fiscal position is not lost. She expressed belief that fiscal sustainability has been maintained. Regarding specific monetary policy management, she pointed out that this falls under the jurisdiction of the Bank of Japan and noted that communication with BOJ Governor Kazuo Ueda has been smooth.

Despite a drop in initial jobless claims, the U.S. labor market may be weakening

Subadra Rajappa of Société Générale said that although initial jobless claims unexpectedly fell last week, the U.S. labor market is gradually weakening. Rajappa indicated that the labor market feels largely unchanged. In the Thanksgiving week, initial jobless claims dropped from 218,000 to 191,000. She said automation driven by artificial intelligence has offset the reduction in labor supply caused by former President Trump's tighter immigration policies. Rajappa expects the Federal Reserve to cut rates next week and then hold steady, because more reliable data will become available before the January meeting, showing a moderate uptick in inflation.

Cooling labor market becomes key driver for Fed rate cut in December

BlackRock's research institute stated in its latest article that delays in data releases due to prolonged U.S. government shutdowns have made it harder for the Fed to assess the economic situation. The Fed is concerned that the labor market could weaken further, making a "risk management" style rate cut necessary.

This year, the Fed has implemented two rate cuts and continues to treat a persistently weak labor market as a core consideration in its decisions. BlackRock believes that the September employment report and other related data indicate the U.S. labor market is in a stagnant state of neither hiring nor firing. Since the beginning of the year, U.S. employment growth has slowed, with both labor demand and supply declining—the supply-side decline mainly stemming from a sharp reduction in immigration. The breakeven level of job growth needed to keep unemployment stable has also fallen, which explains why wage growth remains robust and why the unemployment rate has risen only slightly this year, remaining near historic lows.

[Today's Focus]

UTC+8 21:30 Canada November Employment Change

UTC+8 23:00 U.S. September PCE

UTC+8 23:00 U.S. December Preliminary University of Michigan Consumer Sentiment Index

UTC+8 23:10 ECB Chief Economist Philip Lane to participate in a seminar

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Gerik

Economic

Debt Milestone Reflects Pandemic-Era Fiscal Legacy

For the first time in U.S. history, total outstanding Treasury debt including bills, notes, and bonds has exceeded $30 trillion, reaching $30.2 trillion in November 2025. This marks a twofold increase from 2018, largely driven by emergency fiscal measures taken during the COVID-19 pandemic. According to Bloomberg data, Treasury debt rose 0.7% last month alone, continuing a trend that is now deeply embedded in U.S. fiscal dynamics.

This expansion is not merely a coincidence but stems directly from the federal government’s response to the pandemic in 2020, when it borrowed a record $4.3 trillion to fund economic stimulus and relief programs. That year’s federal deficit ballooned beyond $3 trillion, according to the Securities Industry and Financial Markets Association (SIFMA). Although the deficit has since narrowed dropping to approximately $1.78 trillion in fiscal year 2025 total debt has continued to rise, revealing a persistent structural imbalance between government revenues and expenditures.

Interest Costs Becoming the New Fiscal Anchor

One of the most pressing consequences of this debt growth is the soaring cost of servicing it. In 2025 alone, the U.S. government spent $1.2 trillion on interest payments. Despite the recent increase in tariff revenues estimated at $300 to $400 billion from newly imposed import duties these earnings remain insufficient to offset interest obligations. As Jason Williams, interest-rate strategist at Citigroup, put it, “We’re drowning more slowly, but we’re still drowning.”

This dynamic reveals a causal relationship: higher borrowing at elevated interest rates directly increases debt service costs, which in turn exacerbates the federal deficit. What was once a manageable budgetary component is now a leading factor in fiscal stress. As older, lower-rate debt matures and is replaced by higher-rate issuances, the fiscal burden will only intensify unless there is a structural change in spending or revenue generation.

Treasury Auction Stability May Be Short-Lived

Despite this mounting debt, the U.S. Treasury has kept the size of its longer-term debt auctions largely unchanged for the past two years. However, officials signaled last month that they have begun “preliminary considerations” for future increases in auction sizes a reflection of growing funding needs and the lack of near-term relief from either deficit reduction or interest cost moderation.

These potential changes, though still tentative, signal an underlying pressure that is likely to influence bond market dynamics in the coming quarters. Investors may begin to demand higher yields if they anticipate larger debt issuances, which could further amplify borrowing costs a feedback loop that turns fiscal vulnerability into a market-driven concern.

National Debt Nears Statutory Ceiling

While the $30.2 trillion in Treasury debt is alarming, it represents only part of the national debt, which totaled $38.4 trillion in November. This broader figure includes obligations to entities like the Social Security Trust Fund and holders of Savings Bonds. The current statutory debt ceiling is $41.1 trillion, leaving less than $3 trillion in borrowing headroom.

This proximity to the debt ceiling adds another layer of risk. While Congress has repeatedly raised the limit in the past, political tensions around debt ceiling negotiations often create economic uncertainty, risking disruptions in federal operations or credit rating downgrades.

A Fiscal Path Dependent on Structural Change

The U.S. crossing the $30 trillion threshold in Treasury debt is more than a symbolic moment it is a stark reflection of years of emergency spending, structurally weak revenue growth, and rising interest rate burdens. While efforts like tariff imposition have narrowed the deficit, they have not meaningfully altered the fiscal trajectory.

Unless future policy shifts can stabilize interest expenses or improve the balance between government inflows and outflows, the U.S. risks entering a prolonged period of fiscal drag, where a growing share of taxpayer dollars are allocated not toward public investment but merely to service past borrowing. In the absence of reform, the debt spiral may become harder to contain, making the current figure less of a peak and more of a stepping stone.

Source: Bloomberg

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Michael Ross

The Federal Reserve's December meeting is set to be contentious, with multiple dissents likely on a widely expected rate cut, but it is unlikely to mark the end of the easing cycle as the data backdrop still points to more cuts ahead rather than a one-and-done pivot, Wells Fargo said.

"We expect the FOMC to proceed with returning policy toward a more neutral stance and reduce the fed funds rate by another 25 bps to 3.50%-3.75% at its upcoming meeting on December 9-10," Wells Fargo economists said in a recent note, noting that "the latest available labor market data suggest that conditions have continued to slowly soften" while inflation shows "few signs of inflationary pressures bubbling up further."

While nonfarm payrolls growth firmed in September, the unemployment rate reached 4.4%, which was "above the Committee's central tendency range for 'maximum employment' and PCE inflation running at 2.8% on both a headline and core basis.

The interest-rate decision will be accompanied by an updated summary of economic projections that will likely reinforce the case for further easing beyond December, the economists said. Adjustments to the 2025 SEP will likely be "in the direction of higher unemployment and lower inflation," a combination Wells Fargo calls "consistent with another 25 bps rate cut at this meeting."

Looking to 2026, the economists believe the SEP medians are more likely to drift "up a tenth or so for GDP growth and the unemployment rate, while edging down a tick for inflation," with risks to the 2026 fed funds "median dot as skewed to the downside" if those trends are confirmed.

That somewhat dovish backdrop comes even as the FOMC is increasingly split, with "multiple dissents" expected in December. The economists expect that the Fed will manage dissent by serving up a "more hawkish post-meeting statement" that would raise the "bar to additional rate cuts," perhaps even hinting that a hold in January is the base case despite the underlying projections still pointing toward higher unemployment and lower inflation over time.

For Wells Fargo, that mix means December's move is part of an ongoing recalibration, not a final cut. The median dot for the 2026 fed funds rate is expected to stay at 3.375% for now, underscoring the simmering hawkish tilt at the Fed, the economists forecast, though add that "it would take just one participant at the current median… moving their dot lower for the median to fall."

"Given the potential for a slightly higher unemployment rate and slightly lower inflation in the 2026 projections, we see the risks to the 2026 median dot as skewed to the downside," Wells Fargo added.

Ahead of the Fed's December meeting, odds of rate cut remain nearly fully priced in at about 85%, according to Investing.com's Fed Rate Monitor Tool.