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Oil prices rise as economic data and expectations of demand lift sentiment
Oil prices rose on Thursday, reversing declines in the previous three sessions, buoyed by stronger-than-expected economic data from the world's top oil consumers and signs of easing trade tensions. Brent crude futures increased 24 cents or 0.35% to $68.76 per barrel at 0457 GMT. U.S. West Texas Intermediate Crude Futures rose 33 cents or 0.5% to $66.71. Both benchmarks dropped more than 0.2% the previous session. U.S. president Donald Trump said that letters informing smaller countries about their U.S. Tariff rates would be sent out soon. He also said on Wednesday that there would likely be a 10% or 15% blanket tariff for smaller countries. This week, new agreements with Indonesia and Vietnam have been announced. Trump expressed renewed optimism in regards to the prospects of a drug deal with Beijing and hinted at a very near-term trade agreement with India. He also suggested that an agreement with Europe could be possible. Tina Teng, an independent analyst, said that Trump's softer tone towards China and his proposal to lower tariff rates for smaller countries are positive developments in global trade prospects. Oil prices have been boosted by China's better than expected economic data, and the U.S.'s higher-than-expected draw in oil inventories. The Energy Information Administration reported that U.S. crude oil inventories dropped by 3.9 millions barrels, to 422.2 million last week. This was a greater decline than the forecast of a 552,000 barrel draw. This suggests increased refinery activity, tighter supplies, and higher demand. The price increases were capped by higher-than-expected gasoline and diesel stock builds. This led ANZ analysts to worry about a weakening of demand due to summer travel. The central bank's latest snapshot, released on Tuesday, shows that activity has picked up in the last few weeks. The outlook, however, was "neutral or slightly pessimistic", as businesses reported higher import tariffs pushing up prices. China's data also showed that growth in the second quarter was slower than previously thought, partly due to the fact that the country had accelerated its exports in order to avoid U.S. duties. This eased concerns about the economy of the world's biggest crude importer. The data also showed China's crude oil throughput in June was up 8.5% compared to a year earlier, which indicates a stronger fuel demand. John Paisie, President of Stratas Advisors said: "Support comes from the positive news pertaining some easing of the trade tensions between China & the U.S. With President Trump lifting his ban on the sale AI chips to China as well as the announcement of a new trade agreement with Indonesia." (Reporting from Anjana Anil and Emily Chow, both in Singapore; editing by Sonali and Rachna uppal)
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Couche-Tard withdraws its $47 billion bid to buy Japan's Seven & i
Alimentation Couche-Tard, a Canadian retailer, withdrew a $47 billion takeover bid for Japan's Seven & i Holdings. It blamed the Japanese retailer for ignoring its offer. The 7-Eleven operator's "konbini stores" would have been the largest foreign acquisition of a Japanese firm. Here is the timeline for a bid: AUGUST 19, 2020 Couche-Tard says that it has contacted Seven & i regarding a possible takeover. Both companies do not disclose the value of their offer. Seven & i shares surged almost 23%, to 2161 yen, valuing it at approximately 5.6 trillion yen (about 38 billion dollars). SEPTEMBER 6, 2020 Seven & i rejected Couche-Tard’s offer of $14.86, valuing the business at $38.5 billion. SEPTEMBER 13TH, 2024 Seven & i is classified as "core" by the Japanese finance ministry, leading to speculation that it could be protected from a takeover. The 9th of October 2024 Sources say that Couche-Tard has increased its bid for Seven & i to $47 billion. This is a 22% increase. 10 OCTOBER 2024 Seven & i announces plans to restructure its business and focus on convenience stores while evaluating Couche-Tard’s revised bid. 16 OCTOBER 2024 Artisan Partners, a U.S.-based fund, urges the Seven & i Board to allow Couche-Tard to do due diligence, and negotiate a purchase price. They call the Japanese retailer’s restructuring plan “too little, late”. NOVEMBER 13TH, 2024 Seven & i has announced that a member of the founding Ito family made a white knight bid for $58 billion. NOVEMBER 14TH, 2024 Artisan Partners encourages the company to use a competitive bid process to ensure that it receives the best offer. DECEMBER 25, 2020 Sources say that Seven & i received bids in the first round of over $5 billion for its non-core asset from private equity firms KKR Bain Capital, and Japan Industrial Partners. FEBRUARY 26TH, 2025 Two sources claim that Itochu, a Japanese company, has withdrawn from the proposed buyout of Seven & i by the founding family. Couche-Tard, meanwhile, has reaffirmed its commitment to a purchase. FEBRUARY 27TH, 2025 Seven & i founder Ito family's $58 billion bid to buy out Seven & i fails to secure funding. MARCH 6, 2020 Seven & i appoints Stephen Dacus as its first foreign CEO. He is tasked with overhauling the business in order to engineer a turnaround and respond to Couche-Tard’s takeover offer. 10 MARCH 2025 Seven & i has confirmed that it is in discussions with Couche-Tard about a plan for the sale of stores to overcome U.S. Antitrust concerns over a merger between two major players in its convenience-store market. 11 MARCH 2025 Couche-Tard is frustrated with Seven & i’s “limited engagement”, but expresses confidence in a “clear path” to overcome U.S. regulations hurdles. 13 MARCH 2025 Alain Bouchard, the chairman of Couche-Tard, says that if Seven & i would cooperate and reveal more financial data to Couche-Tard it could enhance its offer. MAY 1, 2025 Seven & i and Couche-Tard sign a non-disclosure (NDA) agreement, giving the Canadian retailer access to financial data of the Japanese retailer. JULY 17, 2020 Couche-Tard pulls out of its $47-billion offer, citing a failure to engage constructively by Seven & i's management and founding family. Seven & i states that it is "fully committed" to its standalone value creation plan. The company's shares have fallen to a low of 1,997.5yen, a three-month high. $1 = 148.5700 yen (Compiled and edited by Clarence Fernandez).
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Russell: China's mixed commodities data shows soft steel and strong iron ore
China's June industrial output data and commodity imports have produced contrasting figures that make it difficult to get an accurate read on the second largest economy in the world. Iron ore imports and steel production appear to be telling contrasting stories. While imports of this key raw material surged to their highest level in the year, the decline in steel production was evident. The first six months of this year saw a 5% increase in coal production compared to 2024. However, thermal power generation - which is mostly coal-fired – dropped by 2.4%. The output of aluminium rose by 3.4% from the previous year and by 3.3% for the first six months, while construction materials like cement and glass fell by 5%. Decoding the mixed signals in the data requires determining whether they are a part of long-term trends or driven by shorter-term factors. China's crude output of steel fell by 3.9% from May to June and by 9.2% compared to the same month 2024. This was the biggest drop year-on-year since August. Last month, the world's biggest steel producer produced 83.18 millions metric tons crude steel, which brought first-half output to 514.83 tons, a decrease of 3% compared with last year. The story of the still-struggling residential construction sector is accompanied by a softening steel production, but this does not explain the robust iron ore imports. China, which imports 75% of the global seaborne ore, saw its arrivals increase by 8% from May to June, with 105.95 millions tons of iron ore. This is the highest month of 2025. Iron ore imports, however, are down 3% to 592.21 millions tons in the first half 2025. The recent rise in iron ore prices can be explained by the Singapore Exchange contracts, which have shown a downward trend after reaching their highest level in 2025 at $107.81 per ton on 12th February. Steel prices dropped to as low as $97.95 in July, but recovered since then. They ended the day at $97.95 Wednesday amid hopes that Beijing's stimulus plans will boost demand for steel in the second half. If the annual output of steel is to stay around the informal cap of 1 billion tons, then the second half production will be lower than the first-half's 514.83 millions tons. SteelHome consultants SteelHome monitor port stocks to ensure that iron ore inventory levels are still high. The weekly total of 131.9 millions tons, down from 150.02 in the same period last year, is a drop. COAL MINING The coal production grew 5% to 2.4 billion tonnes in the first half of 2025, a seemingly contradictory increase. Thermal power, which is predominantly coal-fired and uses only a little natural gas, has dropped by 2.4%. The total power generated in the first half of the year increased by 0.8%, while hydropower dropped by 2.9%. It is clear that renewables like wind and solar have gained more share. Why would China produce record coal volumes at a moment when the consumption is declining? Two main reasons are at play. The first is that the domestic coal price remains relatively low. This keeps the downward pressure on the electricity cost, especially when the major users of power, such as the manufacturers, are experiencing uncertainty due to the US trade war. Thermal coal prices in Qinhuangdao In June, the yuan fell to a low of 610 ($84.96). Although it has recovered to 625 on Wednesday, this is still almost 20% below its January 2025 peak of 775 yuan. Second, the increased domestic coal production will reduce the need for imports from abroad. China is the largest importer of coal in the world. This has put pressure on seaborne prices. You like this column? Open Interest (ROI) is your new essential source of global financial commentary. ROI provides data-driven, thought-provoking analysis on everything from soybeans to swap rates. The markets are changing faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, X. These are the views of a columnist, who is also an author.
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New Zealand weather events prompt government housing protection to be re-thought
New Zealand's government may end bailouts to homeowners who have been affected by floods or landslides, as it works on a climate change framework. In recent years, as severe weather events caused by climate change have increased in frequency and intensity, the government has spent billions on buying properties. Christopher Luxon, New Zealand's Prime Minister, told Radio New Zealand that the government "won’t be able" to continue bailing people out in this manner. We need to figure out how to handle these events in the future and who is responsible. Is there a shared or individual responsibility? He made his comments as local authorities in the South Island began cleaning up areas affected by floods that occurred this month. The flooding, according to authorities, affected approximately 800 homes. On Wednesday, the government announced a compensation package of NZ$600,000. ($356,700.) for farmers, growers, and forest owners who were affected by floods. Climate Sigma research estimates that by 2060, at least 14,500 homes, worth about NZ$12.5b, could be affected by at least one damaging flooding, or around 300 to 400 homes per year. Climate Minister Simon Watts stated in an email the government is working to gain bipartisan support for a national adaption framework to give New Zealand confidence. He said, "This is a challenging and complex work." "It's important that any changes are durable." It is likely that any policy changes will be implemented slowly. The Ministry of Environment released an independent report that suggested a 20-year transition to allow for pricing adjustments as the expectations of government bailouts become tempered. When it rains hard, flooding occurs on Graham McIntyre's property. Water rushes through the house. He said that the three rivers that run through his land, which he purchased 25 years ago in Auckland, are like a "wave" coming through. He wants the authorities to purchase his house in Taupaki, and relocate the town centre nearby. Both towns were inundated in 2023. "I can't do anything" Researchers, policymakers and property experts in New Zealand as well as Australia have warned for some time that climate change is an issue homebuyers haven't priced in. The Ministry of the Environment released an independent report that recommended providing more information on the impact of natural hazards, so that owners could make their own decision about whether or not to stay in place and pay the associated costs. In New Zealand, property records increasingly include information about flood and landslide risks or histories of these events. Homeowners in areas at risk are concerned that their homes will lose value. McIntyre replied, "You cannot do anything." You can't give up. You can't change it." Kelvin Davidson said that it was hard to estimate the impact of climate risk on property prices because of limited data about events such as flooding and different acceptance of risks by buyers. He said that "the rubber hasn't hit the road" in terms of price.
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Trump eases Powell's uncertainty as gold prices fall.
Gold prices fell on Thursday as a result of a stronger dollar and the easing of market tensions following Donald Trump's statement that it was "highly likely" that he would fire Federal Reserve chair Jerome Powell. As of 0400 GMT, spot gold was down by 0.2%, at $3,340.79 an ounce. U.S. Gold Futures dropped 0.4% to $3347.10. The dollar index rose 0.1% against its competitors, making greenback bullion prices more expensive for holders of other currencies. Jigar Trivedi is a senior commodity analyst with Reliance Securities. He said that gold dropped by $3,340/oz after the Federal Reserve Chair's decision eased the uncertainty. A source said that Trump was open to the idea firing Powell. Trump, however, said that he does not plan to fire Powell. He left the door open, though, and reiterated his criticisms of Powell for not lowering the interest rates. The data showed that U.S. Producer Prices were unpredictably unchanged in June, as an increase in goods due to tariffs on imported goods was offset by a weakness in services. Trivedi stated that "June’s flat U.S. PPI was indicative of steady wholesale prices and may indicate tariffs are having a less significant impact on the economy than originally feared." EU trade chief Maros SEFCIOC is heading to Washington for tariff negotiations on Wednesday, according to an EU spokesperson. He will also meet U.S. Trade Representative Jamieson GREER and U.S. Commerce Sec. Howard Lutnick. SPDR Gold Trust said that its holdings increased by 0.33% on Wednesday to 950.79 tonnes from 947.64 in the previous session. Silver spot edged up 0.1% to $37.98 an ounce. Platinum climbed 0.2% to $1.419.67, while palladium dipped 0.1% to $1.230.14.
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Iron ore prices rise on China's steel demand and production restrictions
Iron ore futures prices rose on Thursday, boosted by robust steel production and demand in the top Chinese steelmaking regions. By 0337 GMT, the most traded September iron ore contract at China's Dalian Commodity Exchange rose 1.3% to reach 781.5 Yuan ($108.87). The benchmark iron ore for August on the Singapore Exchange rose 0.66% to $100.6 per ton. Broker Galaxy Futures stated in a report that steel production in China has recovered due to the rapid accumulation of building material, robust manufacturing demand and continued strength in exports. Galaxy reported that the two main steel-producing regions of Shanxi, and Tangshan had begun to implement output restrictions. Analysts report that iron ore shipments have dropped from the top suppliers Australia, and Brazil after an increase at the end of last quarter. Rio Tinto's second-quarter output of iron ore was the highest since 2018. However, shipments fell short of analyst expectations and were at their lowest levels for the first half since 2014. This is due to weather-related disruptions. ANZ analysts stated in a report that improving mill margins have started to boost the optimism about demand. BHP has said that the costs associated with establishing an "eco-iron" industry in Australia are still too high. This is despite Australia and China reaching a deal this week on collaborating to decarbonise their steel supply chains. Australia, which provides 60% of China's needs for iron ore, produces lower grade iron ore that cannot be processed directly into steel using renewable energy. Coking coal and coke, which are used to make steel, also fell on the DCE. They were down by 0.66% each. The majority of steel benchmarks at the Shanghai Futures Exchange have gained ground. Rebar rose by 0.26%; hot-rolled coils grew by 0.68%; wire rod increased by 0.39%, and stainless steel fell 0.08%. ($1 = 7.1780 Chinese yuan) (Reporting by Lucas Liew; Editing by Subhranshu Sahu)
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MODEC, Eld Energy Advance FPSO Offshore Fuel Cell Pilot
MODEC has entered into a contract with Eld Energy, a Norwegian fuel cell system company, to design and manufacture a solid oxide fuel cell (SOFC) system pilot unit intended for installation on one of the MODEC-operated floating production, storage and offloading (FPSO) units.In February 2025, MODEC awarded a feasibility study contract to Eld Energy, marking the beginning of Phase 1 activities of SOFC development as one of the critical decarbonization initiatives.Following the successful completion of Phase 1, MODEC decided to proceed with Phase 2 activities with Eld Energy, which include engineering, manufacturing, installation, and offshore pilot testing of a 40 kW SOFC system.The unit, to be manufactured by Eld Energy at its facility in Norway, is scheduled for installation in 2026.This deployment marks a significant step toward demonstrating the viability of solid oxide fuel cells in offshore environments – offering a cleaner, more efficient alternative to traditional power sources.This phase follows the successful feasibility study, during which the two companies collaborated on system design and integration studies. As part of the study, a successful laboratory test was conducted using simulated produced gas, including heavier hydrocarbons – a critical milestone that enabled the progression to Phase 2.Eld Energy’s solution is said to offer high-efficiency power generation with low emissions, aligning with the maritime and energy sectors' drive toward more sustainable operations.By integrating advanced SOFC systems into offshore infrastructure, the companies aim to reduce environmental impact while maintaining operational reliability. The Phase 2 pilot test represents the first real-world implementation of SOFC technology on an FPSO.“We are thrilled to take this step-ahead with Eld Energy in the innovation of SOFC as an alternative power generation system.“Although we foresee technical hurdles to overcome in this R&D journey, we are committed to pioneering into it with a strong will to provide solutions that deliver stable energy with low GHG emissions,” said Koichi Matsumiya, Chief Technical Officer of MODEC.
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Saab Delivers Another Seaeye Falcon ROV to Subsea Specialist
Saab UK has delivered its 600th Seaeye Falcon remotely operated vehicle (ROV) produced in Fareham, built for international subsea specialist DISA International.The latest addition joins DISA’s growing fleet of Saab Seaeye vehicles and contributes to DISA’s high-performance inspection and survey operations across Europe.The newly delivered Falcon is already at work supporting offshore wind energy operations in Germany, where it is conducting balance of plant inspections and general visual inspections (GVI).The vehicle will soon be deployed to further projects in the Netherlands and Belgium, playing a key role in offshore inspections and measurement tasks.This latest purchase brings DISA’s fleet of Saab Seaeye vehicles to eight, including the Panther XT Plus, Cougar, Lynx and multiple Falcons.“DISA International’s decision to continue investing in the Seaeye Falcon is a testament to the trust our customers place in the reliability, performance and flexibility of our systems. Delivering our 600th Falcon to a long-term partner like DISA International is a suitable milestone in the manufacturing of British designed and built subsea vehicles,” said Jon Robertson, Managing Director at Saab Seaeye.“The Falcon is our go-to vehicle for operations from smaller vessels. It’s compact, easy to set up, and can be launched with an onboard crane, making it ideal for rapid mobilization. Performance-wise, we’ve always been very satisfied,” added Didier De Graaff, Managing Director at DISA International.
Oil prices rise as economic data and demand expectations lift sentiment
Oil prices rose in early trade on Thursday, reversing the previous session's losses, buoyed by stronger-than-expected economic data from the world's top oil consumers and signs of easing trade tensions.
Brent crude futures were up 27 cents or 0.39% to $68.79 per barrel at 0000 GMT. U.S. West Texas Intermediate Crude Futures rose 31 cents or 0.47% to $66.69. Both benchmarks dropped more than 0.2% the previous session.
The Energy Information Administration reported that U.S. crude oil inventories dropped by 3.9 millions barrels, to 422.2 million last week. This was a greater decline than the forecast of a 552,000 barrel draw. This suggests increased refinery activity, tighter supplies, and higher demand.
The favorable margins associated with the refinery sector provide "some support". John Paisie of Stratas Advisors said that product spreads are still wide across all regions.
The price increases were capped by the fact that gasoline and diesel inventories rose more than expected.
The latest snapshot of the U.S. economy released by the central bank on Wednesday showed that activity has picked up in recent months. The outlook, however, was "neutral or slightly pessimistic", as businesses reported higher import tariffs pushing up prices.
Data from China showed that growth in the second quarter slowed, but not as much as was previously thought. This is partly due to front-loading in order to beat U.S. Tariffs.
Data also revealed that China's crude oil throughput in June was up 8.5% compared to a year earlier, suggesting a stronger fuel demand.
John Paisie said that "the positive news regarding some easing in trade tensions between China & the U.S., with President Trump lifting his ban on the sales of AI chips to China as well as the announcement of an Indonesian trade agreement" has also been supportive.
Donald Trump, the U.S. president, expressed renewed optimism regarding the prospect of a drug-related deal with Beijing. He hinted at a very near-term trade agreement with India, and that an agreement with Europe could be possible.
Tariffs on trade could dampen global economic growth and, in turn, put downward pressure on fuel prices. (Reporting by Anjana Anil in Bengaluru; Editing by Sonali Paul)
(source: Reuters)