US West Texas Crude oil price tumbled 4% after reports about Saudi Arabia being prepared to tolerate current low oil prices, and could even announce production hikes next week.

On Wednesday, Reuters was told by five unnamed sources that the Saudis don’t intend to bolster the market with more supply cuts, as Riyadh’s advantage of being able to tolerate low prices is sustainable.

In fact, reports indicate the Saudis might even try to expand their market share after sacrificing for OPEC+ voluntary production cuts for too long.

Earlier this month, OPEC+ announced plans to accelerate the cartel’s plan to gradually remove voluntary production cuts through an aggressive output hike in May, amounting to 411 thousand bpd.

It also seems that the Saudi are trying to appease the Trump administration, which called on OPEC to intervene and reduce fuel prices through increasing production.

IMF’s Position

The International Monetary Fund expects recent gains in non-oil sectors in the Gulf region to compensate for the impact of lower prices.

In its latest report, the IMF expects the Gulf Cooperation Council’s countries to grow by 3% in 2025, and by 4.1% in 2026.

In order to stabilize the markets, OPEC+ has cut its total output by nearly 5.85 million bpd, or 5.7% of total global supplies, since 2022.

In March however, the organization went ahead with decisions to start hiking production from April and abandon the drive to reduce supplies.

Regional Outlook

The IMF expects the Middle East and North Africa region to grow by 2.6% in 2025, and 3.4% in 2026.

It’s a marked reduction from previous forecasts of a 4% growth rate in 2025, and 4.2% in 2026.

The IMF expects Saudi Arabia’s GDP to grow by 3% this year, and 3.7% next year, which is higher than its neighbors. 

Bahrain is expected to grow by 2.8% in 2025, with Qatar estimated at 2.4% this year, and Oman at 2.3%.

In another sign of brisk growth, the S&P ratings company raised Saudi Arabia’s credit rating from A to A+ with a stable outlook.

The fastest growing economy in the region is expected to be the UAE at 4% this year and 5% in 2026.

Facing Challenges

In its report, the IMF identified different challenges that could impact growth negatively, including trade tensions, geopolitical struggles, and climate shocks. 

Geopolitical tensions could disrupt trade, tourism, supply lines, and increase refugee dispersions in the region.

The IMF noted that the Middle East and North Africa remain highly exposed to extreme weather conditions, including drought and floods, which could impact growth.

Bitcoin rallied on Thursday to a three-month peak, resuming gains after a two-day hiatus amid a positive outlook as positive momentum dominates the crypto market. 

The currency is targeting the coveted $100,000 once more with strong cash inflow into bitcoin exchange funds in the US, boosting liquidity. 

The Price

Bitcoin rose 2.4% today at Bitstamp to $96,399, the highest since February, with a session-low at $94,141.

On Wednesday, bitcoin lost 0.2%, the second loss in a row under pressure from the stronger dollar.

Market Value 

The market value of cryptocurrencies rose by over $50 billion today to $3.110 trillion, the best since February.

Bullish Outlook

The crypto market moved within a limited range last week, which opened the way for a strong higher breakout in upcoming sessions.

Periods of calm sideways trading in the crypto market are usually followed by aggressive one-sided breakouts, with bitcoin likely surpassing $100,000 soon.

Bitcoin Exchange Funds

US bitcoin funds had inflows of over $3 billion over the past 9 days, with the series of increasing inflows capped by a drop of $56 million on Wednesday.

The US dollar rose in European trade on Thursday against a basket of major rivals, expanding the gains for the third straight session and hitting a two-week high amid positive developments for the US trade negotiations with major partners.

The dollar is also boosted as the odds of a US interest rate cut in May receded, with investors now awaiting important US unemployment claims and industrial data later today.

The Index

The dollar index rose 0.45% today to 100.08, marking a two-week high, with a session-low at 99.61.

On Wednesday, the index rose 0.45%, marking the second straight profit amid a positive outlook for trade negotiations.

The index lost 4.4$ in April, marking the third monthly loss in a row, and the heftiest since November 2022 as investors lost confidence in US assets.

Trade Developments

Chinese reports said the US has communicated with China recently to discuss tariffs, with President Donald Trump saying there’s a high probability of reaching a deal with China.

He also pointed to potential trade deals with India, South Korea, and Japan soon, as he seeks to utilize his tariffs to force beneficial results.

US Rates

Several Fed officials don’t believe there’s an urgent need to review monetary policies soon.

According to the Fedwatch tool, the odds of a Fed 0.25% rate cut in May stood at just 8%.

The odds of such a cut in June stood at a healthier 65%.

Gold prices fell in European trade on Thursday on track for the third loss in a row, plumbing two-week lows under pressure from the stronger US dollar.

The dollar’s rebound comes as global trade tensions receded, while the odds of a Fed rate cut in May dropped as well.

The Price

Gold prices fell 2.05% today to $3221 an ounce, the lowest since April 15, with a session-high at $3290.

On Wednesday, gold lost 0.9%, the second loss in a row as the dollar muscled up.

Gold surged 5.3% in April, the fourth monthly profit in a row on haven demand as the US-China trade war flared back then.

The Dollar

The dollar index rose 0.4% on Thursday, expanding the gains for the third straight session and scaling a two-week high at 100.03 against a basket of major rivals.

A stronger dollar makes the greenback-denominated gold futures less attractive to holders of other currencies.

Trade Developments

Chinese reports said the US has communicated with China recently to discuss tariffs, with President Donald Trump saying there’s a high probability of reaching a deal with China.

He also pointed to potential trade deals with India, South Korea, and Japan soon, as he seeks to utilize his tariffs to force beneficial results.

US Rates

Several Fed officials don’t believe there’s an urgent need to review monetary policies soon.

According to the Fedwatch tool, the odds of a Fed 0.25% rate cut in May stood at just 8%.

The odds of such a cut in June stood at a healthier 65%.

SPDR

Gold holdings at the SPDR Gold Trust fell 2.87 tons yesterday to a total of 944.26 tons, the lowest since April 9.