By Timothy S. Snyder, Matador Economics

Markets are settling down a bit this morning in early trade. But, we have seen this the last couple days, and somehow they ended up lower on the day.

This week’s CPI and PPI showed prices did not begin to rise again last month as the media has been reporting, but the markets still had some of the worst days since 2022. Many have asked why these two macros did not help to calm the markets. The answer is risk. Risk has a premium and every discussion about increasing tariffs raises risk. Traders are nervous, so expect the need for more positive macros to calm the fear!

Tariff talks are still driving the markets crazy, and even with all the noise in the markets, the price for crude oil in the U.S. and abroad continues to fall. Yesterday’s WTI close was $66.55 and Brent closed at $69.88. WTI is down over $6 per barrel and Brent is down over $5 per barrel since the beginning of the year.

A story this morning from Irina Slav, in Oilprice.com said, “Yesterday, the U.S. announced additional sanctions, with Treasury Secretary Scott Bessent saying that the Iranian regime continues to use the proceeds from the nation’s vast oil resources to advance its narrow, alarming self-interests at the expense of the Iranian people.”

Apparently the Russians have decided to move away from settling their transactions for crude oil in U.S. dollars, to a crypto currency. Here’s what Irina Slav says in her story titled, “Russia Switches to Crypto in Oil Trade:”

Russia is increasingly using cryptocurrencies in its oil trade with top clients China and India amid U.S. sanctions, Reuters has reported, citing unnamed sources, who said Russian oil traders were using the cryptocurrencies to facilitate the conversion of yuan and rupees into rubles. For now, the amount of oil traded with cryptocurrencies is a small portion of Russia’s total, the sources told Reuters, but it is growing.”

U.S. winter weather

A massive wind event is beginning to blow-up in the Central U.S. and runs from the Rio Grande to the High Plains of North Dakota! Today winds in the Texas Panhandle and South Plains are expected to blow sustained to 50 mph, with gusts up to 80 mph. Even Dallas is expecting wind of 45 mph with gusts of up to 60 mph. Expect power outages from Mexico to Canada.