Gasoline Prices Hit Two-Year Highs

Euro Rises To Two And A Half Year High

E.U. Markets Slide

Mon, August 28: In Today’s Markets…

1. Gasoline Prices Hit Two-Year Highs After Harvey Hits Petroleum Industry

Last Friday gasoline futures surged 4% as Hurricane Harvey threatened to disrupt oil and gas production along the Gulf Coast. On Monday the tropical storm knocked offline about 22% of Gulf of Mexico oil production reducing output by 380M barrels according to the U.S. Department of the Interior’s Bureau of Safety and Environmental Enforcement. Specifically, Exxon Mobil (XOM) closed its Baytown refinery due to severe flooding while Royal Dutch Shell (RDSa) has stated that its Deer Park refinery and chemical plant complex may be shut for an entire week. Brent oil held on to last week’s gains adding 0.2 percent this morning, as Harvey continued to threaten production, and was last seen trading at $52.05 as of 7:55 GMT.*

2. Euro Rises To Two And A Half Year High

The euro extended gains to a 2-1/2-year high against the dollar (EUR/USD), following ECB President Mario Draghi’s Jackson Hole speech. Draghi did not downgrade the union’s currency maintaining a rather hawkish stance which pushed the euro higher. The U.S. dollar slipped in contrast, after disappointing comments by Fed Chair Janet Yellen gave the euro even more momentum. The Federal Reserve Chair Janet Yellen disappointed the markets as she made no reference to U.S. monetary policy at Jackson Hole.**

3. European Markets Slide Ahead of Brexit Talks

European markets started the day on a bearish note on Monday, as Brexit talks dominated market interest. Monday marks the kickoff of the U.K. and European Union’s third round of talks on the Article 50. EU and UK officials are set to meet in Brussels for a third round of talks which is expected to shed more light on where the U.K. stands on key issues such as the trade union and imminent financial settlements on the U.K.’s “exit bill”.***

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