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Russell: China added crude oil to its massive stocks in March. But the outlook has changed.
China built the largest crude oil stockpile in the world during March, even as the rest of the world began to use up its inventories to make up for the millions of barrels lost due to the closure of the Strait of Hormuz. According to calculations based off official data, China, the largest crude importer in the world, had a surplus of 1,74 million barrels a day (bpd). China's excess crude for the first quarter was 1,41 million bpd. This is down from the?record-high of 2.67 millions bpd set in December, but it is up from the 2025 average of 1.13million bpd. China does not reveal the volume of crude oil flowing in or out of strategic and commercial stocks, but it can be estimated by subtracting the amount processed from total crude produced domestically and imported. Not all of the excess crude is likely to have gone into storage. Some was processed in plants that are not included in the official data. Even if you ignore these gaps, the fact remains that China imported crude oil at a rate far greater than was necessary to meet its domestic fuel needs. In March, China imported 11.77 million barrels per day of crude oil while its domestic production was 4.49 million barrels per day. Refinery processing reached 14.52 million barrels per day, leaving an excess of 1.74 millions barrels per day for storage. China's crude oil stockpiles continued to grow in March, despite the fact that imports were not affected by the conflict?in the Middle East. The conflict began on February 28, when Israel and the United States launched an aerial attack against Iran. Oil delivered to China before the start of the conflict would have left the Strait of Hormuz, but imports from April will likely be affected. It is important to ask how China will respond to the lower crude imports that are expected to begin in April. These may be further restricted if the U.S. The military will be able to carry out President Donald Trump's order to blockade Iranian ports. Kpler, a commodity analyst, estimates that China's seaborne oil imports for April were 8.7 million barrels per day. While this number is likely to rise as more cargoes arrive before the month's end, arrivals are likely to be at their lowest level since August 2022, when 7.97 million barrels per day arrived. Options If it wants to maintain domestic refinery rates at current levels, China can use some of its vast crude oil stockpile. Beijing has not revealed the exact number of commercial and strategic stocks, but analysts estimate that at least 1.2 million barrels are in these inventories. It would take two years to exhaust the stockpile if China released up to 2,000,000 bpd from reserves to maintain refinery output. It is clear that this is an extreme situation, but the truth is that crude oil flow from the Middle East is likely to return at some point to levels similar to those prior to the start of the conflict. China can easily continue to refine fuels and increase the amount of processing that is done, allowing for the export of fuels. Beijing has imposed informal restrictions on this since the beginning of the conflict. Kpler tracked shipments of 524,000 bpd in April. Jet fuel and diesel prices in Asia reached record highs during March due to the loss of refined fuel exports from China. Beijing probably expects the Iran conflict will end within the next few weeks, and the flow of crude oil and other products from the Middle East to resume. If the Strait of Hormuz is closed for a long time, China faces increased risks. China can keep its domestic fuel supplies for a long time because it has a large amount of crude oil reserves. However, if Asian neighbours experience shortages or their economies begin to shut down, it won't be long before this will affect China's export industries. You like this column? Check out Open Interest, 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 the columnist, an author for.
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The Financial Times reports that Repsol, a Spanish oil company, has regained control over Venezuelan oil operations.
The Financial Times reported that the Spanish energy group Repsol was poised to regain operational control of its Venezuelan oil assets and?boost their production after a deal had been signed with the South American Government. FT reported that Repsol could announce the deal as soon as Thursday. According to the report, the agreement will include plans to triple the production of its Venezuelan oil operations within three years. It will also establish a "guaranteed payment" system to avoid the pitfalls that led to previous failures by the capital city 'Caracas to pay up. Could not verify the report immediately. Repsol didn't immediately respond to the request for comment. Venezuela has one of the world's largest oil reserves, but a dilapidated infrastructure. Repsol and Venezuela reached an agreement in 2023 to continue operating their facilities there. Later, the deal expired after the?U.S. The deal lapsed after a revocation of the licences by President Donald Trump. Washington eased sanctions on Venezuela's energy industry after capturing President Nicolas Maduro, in January. It issued general?licences allowing?global companies to operate oil & gas projects in Venezuela.
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Oil prices remain unchanged despite scepticism about US-Iran peace negotiations to ease Hormuz disruption
On Thursday, oil?prices remained unchanged, reversing previous declines. This was due to skepticism about the peace talks between?the U.S. Brent crude futures rose 9 cents at 0427 GMT to $95.02 per barrel. U.S. West Texas Intermediate Crude Futures rose 44 cents to $91.73 per barrel. Both benchmarks traded with a wide range on Wednesday, but settled little-changed. U.S. and Israeli war with Iran resulted in the biggest ever disruption of oil and gas supply due to Iran's blocking of traffic through the 'Strait of Hormuz', which typically carries around 20% of world oil and liquefied gas flows. Toshitaka Takawa, an analyst with Fujitomi Securities, said that while there is hope for de-escalation many investors remain sceptical. This is because U.S.Iran talks have failed repeatedly, even when they appeared to be making progress. He added that WTI prices will continue to fluctuate between $80 and $100 until a peace deal is reached, allowing free navigation across the Strait. In a note published on Thursday, analysts from ING estimated that the closure of the strait has disrupted oil flow by roughly 13 million barrels a day, taking into account pipeline diverts and the trickle tankers which have passed through. The disruption may increase with the U.S. blocking Iranian ports after the failure of the peace talks at the weekend. The ING analysts stated that "the physical market is tightening every day without a restart of oil flow through the Strait of Hormuz". Iran's source told a source that if an agreement was reached in order to avoid a renewed conflict after a two-week truce began on April 8, Iran would consider allowing ships free passage through the Omani side of Strait of Hormuz. U.S. officials and Iranian officials are considering a trip to Pakistan this weekend for more talks. The Pakistani army chief was in Tehran as a mediator on Wednesday to try and prevent a resurgence of the conflict. Treasury Secretary Scott Bessent announced on Wednesday that Washington would not renew waivers that allowed some Iranian and Russian oil to be purchased without facing U.S. sanction. The Energy Information Administration reported on Wednesday that U.S. inventories for oil, gasoline and distillate fuels dropped last week. This was due to a decline in imports and a rise in exports as countries searched for barrels to replenish the interrupted flows. (Reporting from Yuka Obayashi, in Tokyo and Siyi Lu in Singapore; editing by Lincoln Feast & Christian Schmollinger).
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China's aluminium production increased 2.7% in March due to the Iran war driving prices higher
Official data released on Thursday showed that China's primary aluminum production rose 2.7% from the previous year, as fears of supply due to the Iran conflict boosted prices. According to the National Bureau of Statistics, aluminium?production increased?to 3,85 million metric tonnes in March. The data shows that in the first quarter of this year, China produced 11.41 million metric tonnes of primary aluminum, an increase of 3.1% compared to the previous period. Around 9% of the global supply of aluminium comes from the?Gulf Region. Aluminium prices rose after the 'Iran's move to disrupt traffic in the Strait of Hormuz, and a number of major regional producers including Aluminium Bahrain, and Emirates Global Aluminium faced increased risks. In March, the benchmark three-month aluminum price rose 10.41%. This was its best month since 2024. The most active aluminium contract at the Shanghai Futures Exchange gained just over 4 percent in March. Due to price volatility in March, domestic demand for this light metal was low. This led to the stock of aluminium monitored by SHFE reaching a six-year high early in April. Analysts however said that China's export of aluminium is now poised for growth as the Iran War tightened up availability and boosted margins through higher prices. The production of 10 non-ferrous metals, including copper, aluminum, lead, zinc, and nickel, rose by 2.2 % from the previous year to 7.07 metric tons. The year-to-date production was up by?3.6% to 20.53 millions metric tons. Other non-ferrous materials include tin and antimony. Mercury, magnesium, titanium, and mercury are also available.
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China's crude steel production drops in March due to lower margins and falling exports
China's crude output of steel in March fell 6.3% compared to the previous year, the lowest for the month since the middle of 2020. Margins were thinned out and exports dropped amid the Middle East conflict. National Bureau of Statistics reported on Thursday that the world's biggest steel producer produced 87.04 metric tons of crude "steel" last month. According to data-based calculations, the March volume represents an average daily output of 2,81 million tonnes, down from 2,99 million tons in March 2020. Steel margins were hit by rising feedstock prices in the first quarter, which was partly due to higher fuel?prices because the Iran War choked shipping via the Strait Of Hormuz. Xin Ge is a deputy director of Lange Steel. He said that the Middle East conflict has caused freight costs to rise, which in turn helped support prices for raw materials, including iron ore. Steel gains, however, were curbed due to high stock levels. Ge said that the squeezed margins had discouraged some steelmakers from increasing production. According to data compiled by Mysteel, an average of 41% of steelmakers will be able to make a profit this March. This compares with 53% in the same time period in 2025. Iron ore prices rose?8.7% last month while steel reinforcing bars, which are typically used in construction, only grew by 2.3%. Steel production was also affected by the weak?demand of the?embattled?property market as China's new-home prices continued to decline in last month. China's steel exports in March fell?by 12.6% on an annual basis, impacted by the Middle East conflict and a?export license regime it implemented as a response to escalating global protectionist sentiment. The World Steel Association cut its forecast on global crude steel demand this year. This is partly because the war in Iran has reduced consumption across the Middle East. The data shows that in the first quarter 2026, Chinese crude-steel output dropped by 4.6% on an annual basis to 247.55 millions tons.
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Iron ore prices rise on positive China economic data
Iron ore futures rose on Thursday, boosted by?positive economic data from China. Meanwhile, falling domestic 'crude steel production' fueled hopes that global steel prices would rise and Chinese steel mill margins would improve. As of 0243 GMT, the most-traded contract for?September?iron ore on China's Dalian Commodity Exchange was trading 2.04% higher. It was valued at 774.5 Yuan ($113.60). The benchmark iron ore for May on the Singapore Exchange rose 1.09% to $105.35 per ton. The Trump administration expressed optimism on Wednesday regarding a possible deal to end the conflict with Iran, but warned of increased economic pressure if Tehran continues to be defiant. Positive sentiment on the metals market was fueled by hopes of an end to Iran's war. China's economy grew by 5.0% from a year ago in the first three months of this year, according to official data released on Thursday. This was better than analysts expected, as policymakers prepare for the aftermath of the Iran War. China's crude-steel output also fell 6.3% year-on-year in March, to its lowest monthly level since 2020. Margins were thinned out and exports decreased amid the Middle East conflict. National Bureau of Statistics (NBS), which released its statistics on Thursday, revealed that the world's biggest steel producer produced 87.04 millions metric tons crude steel in January. The lower Chinese steel production will 'lift steel prices globally', because China has historically slashed steel prices due to its large export volumes, making it difficult for steel mills to make a profit. In March, the country pledged to curb its overcapacity of steel. Coking coal and coke, which are used to make steel, also gained on the DCE. They rose by 0.93%?and?1.16% respectively. The benchmarks for steel on the Shanghai Futures Exchange have largely advanced. Rebar rose 0.52%; hot-rolled coil rose 0.67%; wire rod rose 0.09%, while stainless steel dropped 0.34%. ($1 = 6.8177 Yuan) (Reporting and editing by Ronojojo Mazumdar).
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Gold rises on the back of a weaker dollar as US-Iran hopes for peace deal rise
Gold prices increased on 'Thursday', supported by a falling?dollar. Investors also weighed a?growing optimism over a possible U.S.Iran agreement to end the conflict that has pushed energy prices up and fueled fears of inflation. By 0301 GMT, spot gold had risen 0.7% to $4821.44 an ounce. U.S. Gold Futures for June Delivery gained 0.4%, to $4844.40. The U.S. dollar hovered ?near its lowest level in six weeks, making greenback-denominated commodities including bullion more affordable for ?holders of other currencies, while benchmark 10-year U.S. Treasury yields eased 0.1%. Kelvin Wong is a senior analyst at OANDA. He said that the primary reason for gains in 'gold' was optimism over a U.S.Iran ceasefire. "If we begin to see a breakout above $4,900, potential further upside can't be ruled out towards the next?intermediate resistance?zone which is at a psychological level of $5,000." On Wednesday, the Trump administration expressed optimism about a possible deal to end war with Iran. However, it warned that if Tehran continues to be defiant there would be increased economic pressure. Donald Trump believes that the war with Israel he started in late February is almost over. This, despite the fact that a shipping ban he had announced was now in effect and the traffic through the Strait of Hormuz remains well below the normal level. The spot gold price has fallen by more than 8% since the 'Iran war' began late in February, amid fears that high energy prices will feed inflation and raise global interest rates. Gold is considered to be a hedge against inflation. However, rising interest rates are affecting the demand for this non-yielding material. The traders in the U.S. now expect a '29%' chance that interest rates will be cut by 25 basis points this year. There were two expected reductions in interest rates for this year before the?war. Silver spot rose 1.7%, to $80.41 an ounce. Platinum gained 1.2%, to $2,135.58, while palladium increased 0.9%, to $1,587.39. (Reporting by Noel John in Bengaluru; Editing by Subhranshu Sahu)
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Asia markets advance on peace deal hopes, corporate earnings
Stocks rose in Asian trading Thursday, as traders digested economic data and crucial earnings reports. MSCI's broadest Asia-Pacific share index outside of Japan rose 0.9%. The benchmark is on track to gain for the third day in a row. Japan's Nikkei gained 2.2%, setting a new record. S&P 500 futures rose 0.2%. Goldman Sachs analysts wrote in a report that they "remain constructive" about emerging market stocks, as the "underlying profit growth will likely be strong". The region's earnings will be driven by AI-related demands, which are relatively protected from the direct effects of the oil crisis. The S&P 500 gained 0.8% on Wednesday and the Nasdaq Composite rose 1.6% as Bank of America's and Morgan Stanley's strong quarterly earnings pushed the indexes up to "record highs". Around 6% of companies reported earnings for the third quarter. 84% surpassed analysts' expectations. As we enter the earnings season, our focus shifts back to fundamentals. A more idiosyncratic and stock-driven climate is beginning to take root," said Scott Rubner. He is the head of equity derivatives at Citadel Securities, based in New York. This reset offers a more positive entry point in equities. This is especially true for large-cap growth companies. Taiwan Semiconductor Manufacturing Co. (TSMC), a pillar of the AI industry, will report its quarterly earnings on Thursday. A 50% increase in net profit is expected, as demand for TSMC's "advanced" chips soars. Brent crude oil rose 0.3% on the oil market to $95.23 per barrel. A source briefed from Tehran said that Iran might consider allowing ships to'sail freely through the Omani-side of the Strait of Hormuz, without the risk of being attacked as part of the proposals it offered in negotiations with United States. A refinery fire in Australia has also caused supply concerns. The U.S. Dollar Index, which measures the strength of the greenback against a basket six currencies, remained flat at 98.02, as geopolitical concerns eased, and traders moved forward expectations of monetary policies being loosened by the Federal Reserve. The U.S. president Donald Trump warned on Wednesday that he would fire Fed chair Jerome Powell if he did not give up his separate seat in the Board of Governors of the U.S. Central Bank when his term as Fed head ends on May 15. This heightened a complex standoff which has upset the Fed's normally smooth transfer of power, and renewed concerns about its independence. The euro is now within sight of reaching its highest level at $1.1809 since the beginning of World War I, and has extended its recent winning streak to a ninth straight day. Chinese shares rose 0.7% as data revealed that Asia's biggest economy grew by 5.0% in the first quarter of this year compared to a year ago, beating analysts' expectations. Policymakers were preparing for the aftermath of the Iran War. Junyu Tan is the regional economist at Coface Hong Kong for North Asia. She said, "The direct impact of the Middle East Conflict remains contained?for the time being." He added, "But the outlook for China is not all rosy?despite its relative resilience in the face of disruptions to energy supply chains." If the conflict continues, it could be that global demand is weaker and this would affect exports. Australian shares fell 0.2%, and the Aussie Dollar was unchanged after data showed that employment in Australia rose in line with expectations. Firms hired more full-time employees in March. Capital Economics analysts wrote in a report that the Reserve Bank of Australia's assessment of the inflation risks is reinforced by the latest data. Gold recovered 0.6%, reaching $4,819.55, and in cryptocurrency, bitcoin fell 0.2% to $74,718.47, while ether dropped 0.4% to 2,355.27. (Reporting and editing by William Mallard, Kim Coghill, and Gregor Stuart Hunter)
Morning Bid Europe-Truce Trades Increase as Trump Touts Israel-Lebanon Talks
Gregor Stuart Hunter gives a look at what the European and global market will be like today. Global equities are setting new records, and the dollar has been falling for a ninth day in a row to its lowest levels since the Iran War began. Traders have increased their bets that the conflict in the Middle East may end soon.
In a post posted on Truth Social, U.S. president Donald Trump added to the optimism by saying that direct talks between Israel & Lebanon "will take place tomorrow".
The MSCI All-Country World Index rose 0.3%, reaching a new record. Meanwhile, the Nikkei225, the broadest measure of Asia-Pacific stocks outside Japan, grew 1.2%. S&P 500 futures rose 0.2%.
Early European trades saw pan-regional futures?up 0.3%. German DAX Futures grew by 0.2%, and FTSE Futures were up by 0.1%.
Chinese shares rose 0.9%, and the yuan remained steady in Hong Kong offshore trading after data revealed that Asia's biggest economy grew by 5.0% in the 1st quarter of this year compared to a year ago. This was a surprise for analysts as policymakers prepared themselves for the aftermath of the Iran 'war'. In Taiwan, the AI sector's linchpin, TSMC, will report quarterly earnings on Thursday. A 50% increase in net profit is expected due to the booming demand for advanced chips.
The U.S. Dollar Index fell 0.1% on the currency markets as traders lowered their expectations for a Federal Reserve easing of monetary policies.
On Wednesday, President Trump 'threatened' to remove Fed Chair Jerome Powell if he did not resign from his separate position on the Board of Governors of the U.S. Central Bank when Powell's term as Fed Chief ends on May 15th. The intensifying'standoff' has disrupted the Fed's normally smooth transfer of power, and raised concerns about its independence.
Mark Mobius, 89 years old, died on Wednesday. This marked the end of a era in emerging markets. Even as late as January, the veteran investor was still touting new investment opportunities. He speculated that Nicolas Maduro’s ouster would lead to Venezuela opening to investors.
On Thursday, key developments that may influence the markets include:
Earnings of corporations
TSMC, Netflix, PepsiCo, Tesco, Schroders
Economic Events
UK:?GDP estimates, services, industrial production, manufacturing output, and goods trade balance for Feb.
Euro zone: final HICP for the month of March
Debt auctions:
France: Government debts of 3, 5, 6, 7, 12, 13, 17, and 27 years.
UK: 23-year government debt
(source: Reuters)