The Organization of the Petroleum Exporting Countries (OPEC) and its allies are expected to resume previously suspended crude oil production on Tuesday, after OPEC lowered its global oil market supply forecast. OPEC+ representatives said that the Tuesday meeting is expected to approve a moderate increase of 400,000 barrels per day, restarting production capacity temporarily offline during the new crown epidemic. At the preliminary meeting held on Monday, OPEC analysts lowered their forecasts for excess supply in the oil market for the first quarter, as the supply of competitors is expected to weaken. The production capacity that OPEC and its allies suspended in 2020 has so far recovered about two-thirds. They are seeking to restore surplus capacity at a speed that can just meet the recovery of oil demand, so as to avoid price surges or plunge the market into a new downturn. So far they have achieved the desired results, and the international crude oil price is close to 78 US dollars per barrel.

On Monday, the Fed's overnight reverse repurchase operation usage fell from a record high at the end of the year, the largest drop on record. 76 participants used the overnight reverse repurchase agreement tool and invested a total of US$1.58 trillion, far below the record of US$1.905 trillion in the previous trading day. The decline of approximately US$325 billion was the largest on record in 2013.

Dennis Gartman predicts that due to the Fed's stronger hawkish stance (which may raise interest rates four times), the U.S. stock market may face a "slow and difficult" decline in 2022. The chairman of the University of Akron Endowment Foundation said in an interview with Bloomberg Radio on Monday that the stock market may fall by 10% to 15% this year. Gartman has long predicted a bearish stock market. He said that in the case of rising inflation, the Fed's interest rate hike may be a catalyst for the stock market to fall. Although most people on Wall Street predict that the Fed will raise interest rates three times in 2022, Gartman expects the bank to adopt a more aggressive approach, partly because the newly appointed commissioners tend to be hawkish.

European natural gas prices soared on Monday, and the reduction in the supply of natural gas from Russia once again led to uncertainty about the safety of European winter supply. The European benchmark natural gas delivered next month rose by 20% to 84.50 euros/MWh, which had fallen earlier. Russia's gas transmission through a key pipeline in Ukraine has fallen. At the same time, the potential growth in natural gas demand in Asia may result in more LNG vessels serving the region, and the European market will once again fall into a supply shortage situation. These factors have exacerbated supply concerns.

As the latest move by the authorities to increase reserves and support the local currency, Turkey will require exporters to convert a quarter of their income into Lira. The Central Bank of Turkey stated in a decree on Monday that once exporters receive payments in U.S. dollars, euros or pound sterling, the central bank will buy 25% of them. This measure aims to increase Turkey’s foreign exchange reserves by forcing companies to convert part of their export earnings into domestic currency. The Turkish lira has depreciated severely this year, depreciating nearly half of its value against the U.S. dollar, as Turkish President Erdogan called on the central bank to lower its benchmark interest rate. At 3:54 pm Istanbul time, the lira fell 0.3% against the US dollar to 13.3430 lira, a drop of more than 44% in the past year, the largest decline among the major currencies tracked by Bloomberg.

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