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Good morning. Oil surged on supply concerns overnight, pound traders could be in for another interesting week, and leaders are heading to Davos. Here’s what’s moving markets.

Oil Spikes

Oil looks set to be a key focus on Monday after crude futures surged on threats to supply from two OPEC nations. Libyan commander Khalifa Haftar blocked exports at ports under his control, causing the National Oil Corp. to declare force majeure, which can allow Libya to legally suspend delivery contracts. Meanwhile, Iraq temporarily stopped work on an oil field on Sunday and supply from a second production site is at risk amid widespread protests. Futures rose more than 1.7% in London and New York. 

Pound Excitement

U.K. Parliament is expected to wrap up its passage of the Brexit deal this week, but traders are more interested in how the Bank of England is likely to manage the impact of the divorce. Friday’s data showing a slump in December retail sales fueled even more bets of a rate cut on Jan. 30, and the publication of statistics such as unemployment and industrial production in the coming days could make for another interesting week for sterling. 

Davos Time

The International Monetary Fund releases its World Economic Outlook later ahead of this week’s Davos summit. Major names from politics and markets will mingle in the Swiss Alps — including at least 119 billionaires — in the coming days. U.S. President Donald Trump will deliver opening remarks tomorrow amid a backdrop of the U.S. Senate’s impeachment trial, which is set to open on the same day. U.K.’s Boris Johnson, meanwhile, is staying in Britain to remind voters why he called his new administration the “people’s government.” Here’s some issues that could be raised by those that do attend.

Modest Gains

Elsewhere, Asian stocks saw modest gains as investors continued to bid up prices after seven weekly advances, with one regional benchmark hitting the highest level since 2018. The broad MSCI Asia Pacific Index, however remains more than 7% from its peak, still nursing wounds from the trade war and China’s slowdown. The offshore yuan extended recent gains, rising to the strongest since July.

Coming Up…

There’s a lull in European earnings this morning, but it won’t won’t last long — this week BHP Group Plc gets reporting going for big miners, and UBS AG kicks off the banks tomorrow following a solid run for U.S. peers last week. Meanwhile, keep an eye on U.K. homebuilder shares today after Rightmove data showed asking prices for U.K. homes increased by the most for any January on record.

What We’ve Been Reading

This is what’s caught our eye over the weekend

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