Oil ignites a rally in resources stocks
Government bonds are under pressure as rising crude prices stoke higher global inflation expectations, and the dollar is stable
Sydney — Resource stocks were on a roll in Asia on Thursday, as oil prices hit heights not seen since late 2014 and ignited a rally across commodities. But the potential boost to inflation globally also put some pressure on fixed-income assets. Brent crude futures climbed another 29c to $73.77 a barrel, adding to a 2.7% jump overnight. US crude gained 26c to $68.73. The surge came on a Reuters report that oil cartel Opec’s new price hawk, Saudi Arabia, would be happy for crude to rise to $80 or even $100, a sign Riyadh will seek no changes to a supply-cutting deal even though the agreement’s original target is within sight. The leap in oil combined with fear that sanctions against Russia could hit supplies of other commodities to light a fire under the entire sector. Aluminium prices reached their highest since 2011, alumina touched a record peak and nickel jumped the most in six-and-a-half years. Such increases, if sustained, could fuel inflationary pressures, and investors hedged ...
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