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Andy Home: The new metals trading environment is a result of the breakout in Shanghai nickel.
Metals trading and the world it operates in is constantly changing. Political and military conflict has shattered what was once a highly globalised supply chain into regionally different parts. Metals are moving away from the single benchmark global set by the 149-year old London Metal Exchange (LME), which is now owned by Hong Kong Exchanges and Clearing. This changing reality is evident in the opening of the Shanghai Futures Exchange (ShFE) nickel contract for overseas firms. Shanghai has already become the leading force in China in terms of establishing benchmark metals price in its domestic market. ShFE wants to expand its?reach? across the?Asian region by capitalising on the Chinese Nickel Ecosystem that connects mines in Indonesia and refineries on China's mainland. It is not a fight to the death between London and Shanghai, or even the CME Group of the United States. This more fragmented trading environment offers opportunities to all. NICKEL BREAKOUT Beijing has been trying to internationalise renminbi for years, and the ShFE is part of that effort. Nickel is a good choice for a test run. In less than a decade, Indonesia became the world's largest supplier thanks to Chinese investment. Nickel products are shipped to China to feed the huge stainless steel and battery industries. The Sino-Indonesian Nickel Trade offers the ideal forum for a regional shift of pricing towards China and the Chinese Yuan. This is also a timely boost for the Shanghai Nickel contract which, after the2022 Crisis, suffered a bigger volume hit than London, when the melt-up of prices forced both exchanges into suspension. Shanghai nickel futures volumes have tripled from 2025 to the first half of the year, but the comparison is inflated by the 30.5"metric tons that were traded in January when the markets were gripped with a feverish speculative exuberance. What's the impact on LME? Volumes of London nickel futures also increased by 22% on an annual basis. Nickel, including options, registered the highest growth rate amongst the LME's core base metal products from January to June. It seems to be a situation that the Chinese would call a win-win. While LME Nickel stocks have peaked, Shanghai nickel inventories continue to grow at levels last seen in 2017. The surplus Chinese metal is now gravitating to ShFE storage and away from LME, suggesting the emergence of two distinct physical pricing centers. Steel Ties The LME, while capturing a portion of the nickel market in China, is also capturing a piece of the steel market. This is done through a U.S. Dollar futures contract that is settled against the Shanghai Hot-Rolled Coil (HRC). Trading will begin in October. The LME has a Chinese HRC Contract, which was settled against the price reports of Argus for export cargoes at Tianjin port in China. Shanghai's contract is dwarfed in volume by the domestic contract because China is the largest steel market in the world. Last year, the LME's China HRC Contract traded 1.4 millions tons of steel. The Shanghai contract dealt with 1.7 billion tonnes. This LME-ShFE tie-up looks like a test run of future collaboration, just as Shanghai's Nickel foray could be a model for other metals. FRACTURING Landscape The opening of Chinese prices is a reflection, of course, of China's centrality in both production and demand for metals. The eastward drift of the global markets reinforces this sense. Copper traders are already familiar with the feeling. Since President Donald Trump announced the possibility of U.S. tariffs on imports last February, the CME's U.S. price has been wildly different from the LME. Two Doctor Coppers are in existence, one in Washington and the other trying to assess what is happening around the globe. Three Doctor Coppers may be on the way if Shanghai also goes international with copper contracts. Everyone's a winner? The nickel market is experiencing a realignment of trade patterns, and this has led to an increase in regional arbitrage. The global trading volume of base metals has been increasing. The LME achieved a record volume year in 2025, and the turnover increased by 18% in the first half of 2026. Shanghai's base-metals contracts saw a significant increase in activity during the first half of the year, with zinc being the exception. CME is also enticing investors to invest in metals. Volumes of its micro-copper contract increased by 76% in the first half 2026. The contract was only a tenth of the size as its flagship contract, but the turnover reached 3.5 millions tons. Trading activity on CME's weekly Copper Options Suite has increased by more than fourfold compared to last year. The world's three biggest metals exchanges are not fighting for a fixed?pie. Instead, they appear to benefit equally from a pie that is expanding as more participants trade metal in more places around the globe. Andy Home is a columnist at. This column is great! Open Interest (ROI) is your new essential source of global financial commentary. Follow ROI on LinkedIn and X. Listen to the Morning Bid podcast daily on Apple, Spotify or the app. Subscribe to the Morning Bid podcast and hear journalists discussing the latest news in finance and markets seven days a weeks.
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After Ukrainian drones attacked Russia's largest refinery, motorists queue up for fuel in Omsk
After a drone attack on the largest oil refinery in Russia, motorists in the city of 'Omsk are lining up for fuel. This is one of the most serious attacks by the Ukrainians inside Russia since?the start of the war. Video showed a?but orderly? line of cars waiting at a fuel station on Monday evening, just hours after the terrorist attack. Witnesses in the Siberian City reported that there were longer queues Tuesday, but they were still manageable -- only around 20 minutes. Fuel was also available. Some people on the social network VKontakte complained about drivers who they called "morons" buying things out of panic. Vitaly Khotsenko, regional governor, said that local authorities have discussed the fuel situation. All necessary measures are being taken to "normalise", logistics and deliveries at private filling stations. NGS55.RU, a local media outlet, reported that a large private network has completely halted the sale of petrol to individual motorists. Ukraine has intensified its attacks on Russian energy infrastructure in the last few months, primarily to cripple the source of funding Moscow's war efforts. This will lead to widespread fuel shortages for the Russian people. According to sources, the Omsk refinery owned by Gazprom Neft that was affected processed approximately 23 million metric tonnes last year or about 460,000 barrels per daily. Any disruption in its operations will likely lead to fuel shortages. Russia has, over the past four years, targeted Ukraine's energy sector and power grid. In the last week, Russia has launched two massive attacks against Kyiv which have resulted in dozens of deaths. The attack on Monday damaged the facilities at the Omsk oil refinery. No one was injured at the?plant. Anatoly Seryshev said that damage assessment was underway and that competent services had organized restoration work. Alexander Novak, Putin's energy point man, said that the fuel market in Russia was tight due to the summer peak and "unscheduled refinery repairs." Mark Trevelyan, Tomasz Janowowski and Mark Trevelyan edited the report.
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Dangote will fund the proposed Kenya refinery through cash, bonds, and an IPO
Nigeria's Dangote Group plans to finance a ?proposed 700,000-barrel-per-day oil refinery in Kenya through ?internal cash flow, bonds and an initial public offering, a ?senior company executive told ?. It is estimated that the refinery will take three years to complete. The project would provide refined petroleum products for Kenya and other neighbouring countries. This would reduce East Africa’s dependency on imported fuels. It would also fulfil Dangote's ?ambition to expand fuel-processing capacity across Africa following the start-up of its 650,000-barrel-per-day refinery ?in Lagos. The site has been chosen, soil testing is underway, and the design?and engineering has begun. Edwin Devakumar is Dangote Industries vice president for oil and natural gas. The refinery would be the largest refining investment made by Dangote Group outside Nigeria. It will be located on a small island called Lamu off Kenya's coast. Devakumar stated that the refinery will be funded by a mixture of cash generated internally, bonds and proceeds derived from a planned IPO. He didn't disclose the exact cost of the project, but said that it would be similar to the Lagos refinery. The 'Lagos refinery', built by?Aliko dangote - ranked by Forbes as Africa’s richest man - cost more than 20 billion dollars by the time the facility began operation in 2024. The initial estimate was $9 billion, but costs increased due to a relocation of the site, challenges with engineering, currency weakness, COVID-19 and global inflation. Dangote has been expressing interest in building a large refinery?in East Africa for several months. The company had previously looked at the port city of Tanga in Tanzania before switching to Kenya citing logistics, infrastructure and market concerns. (Reporting and editing by Barbara Lewis; Isaac Anyaogu)
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Fed minutes: Gold remains stable as attention turns to Middle East tensions
Gold prices remained steady on Tuesday as investors watched the escalating violence in the Middle East. They also awaited the minutes of the U.S. Federal Reserve meeting from June to get an idea about the outlook for monetary policy. Spot gold was unchanged at $4168.62 an ounce as of 09:01 am ET (1301 GMT), but U.S. gold futures for delivery in August rose by 0.3% to $4180.50. Bullion reached a two-week-high on Monday, as markets lowered their expectations for a near-term rate hike due to softer than expected U.S. jobs data. Peter Grant, senior metals strategist and vice president at Zaner Metals, said, "I believe the Fed's focus is on inflation, so higher prices for a longer time seems to be the most likely Fed path." According to the CME FedWatch tool, traders still expect a 60% probability of a rate increase in September. The Fed's minutes of the meeting, due to be released on Wednesday, are now the focus. Two tankers were struck in the Strait of Hormuz, and Iran announced that there would be no peace talks until U.S. president Donald Trump stopped his repeated threats of re-starting the war. Following the news, oil prices rose. When inflation worries keep interest rates high, gold is often under pressure. China's central banks has continued to purchase gold for the 20th consecutive month. Its reserve reached 75.44 millions fine troy pounds?by June 30, up from 74.96 one month earlier. Hong Kong has launched a central clearing system for gold and re-opened gold futures trades as it seeks to be a regional hub for gold. Silver spot fell 1%, to $61.48 an ounce. Palladium rose 0.8%, while platinum rose 1.2%, to $1.650.47. (Reporting by Sukanya Mitra in Bengaluru; Editing by Diti Pujara)
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WHO: Ebola outbreak still spreading in Congo
A World Health Organization official stated on Tuesday that the Ebola outbreak in Congo is not stabilised yet and continues to spread as population movements fuel transmission. The Democratic Republic of Congo confirmed 1,561 cases and 506 deaths in the worst outbreak of the rare Bundibugyo?Ebola species, for which no cure or treatment has been proven. Unfortunately, it is still in an expansion phase. "We would like to be able to say that it has stabilized, but we can't say this yet," Anne Ancia told reporters via video link, WHO representative for Congo. She was in Bunia at the epicenter of a swine flu epidemic. She stated that there were still major challenges, including the fact some Ebola treatment centers are?90% filled. She said that another problem is the fact that workers who fall ill in Mongbwalu, a mining town, do not seek treatment locally but rather travel and spread the disease to other regions. She said that the people who were returning too late, and dying with their families, are those who should be stopped. Many of the victims of the epidemic are healthcare workers. This includes those who contracted the virus before the outbreak was declared mid-May. Some healthcare workers do not have the necessary equipment to protect themselves against Ebola. The virus is spread through bodily fluids. Recently, healthcare?workers from the hardest-hit province Ituri went on a strike to protest delayed salary payments. Most?of the healthcare workers resumed work yesterday. Ancia said that there are still "a few groups" who are not satisfied. She added that those on strike were in charge of the transmission within a camp for displaced people. (Reporting and editing by Miranda Murray, Kevin Liffey and Emma Farge)
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Three people are killed in Gaza by Israeli strikes, say medics
Health officials in Gaza said that Israeli airstrikes on Tuesday killed at least 3 Palestinians. Medical personnel reported that an Israeli airstrike killed a man in Khan Younis' Mawasi neighborhood and injured two children. The Israeli military claimed they had targeted Hamas militant. In the evening of Tuesday, another Israeli strike?hit near an encampment that housed displaced families west of Gaza City. One person was killed and five others were injured, according to medics. A third airstrike took place in Khan Younis, where one person was killed and three others wounded. The Israeli military has not commented on the two incidents. Israel has "repeatedly conducted strikes" in Gaza since an October ceasefire mediated by the U.S. was reached. It says it targets militants that threaten its forces, or those who participated in the attack of October 2023 on Israel. Hamas accuses Israel of violating a ceasefire. Nikolay Mladenov is the Board of Peace envoy for Gaza appointed by U.S. president Donald Trump. He has stated that both sides have broken the agreement. According to the figures released by both sides, since the ceasefire came into effect eight months ago more than 1,070 Palestinians - many of whom were civilians - and four Israeli soldiers, have been killed in Gaza. Hamas doesn't reveal the number of its soldiers killed. Israeli troops control over 60% of Gaza. They patrol what Prime Minister Benjamin Netanyahu calls a buffer zone designed to prevent Hamas attacks. Netanyahu has said that Israel will not withdraw from the territory. Israel's aerial and ground bombardment on Gaza has displaced almost?the whole population of 2,000,000 people. Most of them now live in tents, or in damaged buildings along a small coastal strip of territory controlled by Hamas. (Reporting and editing by Gareth Jones. Nidal al Mughrabi)
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Kyrgyzstan will rely on fuel supplies from China and Belarus to compensate for the Russian shortage
Kyrgyzstan said it was awaiting fuel deliveries from China and Belarus to help deal with the 'knock-on effect' of a fuel shortage in its main supplier Russia. According to local media, Deputy Premier Daniyar Amangeldiev said that Kyrgyzstan has signed contracts with Belarus and China for 3 metric tons jet fuel and 10 metric tons diesel. Last week, Kyrgyzstan - which gets more than 90% its fuel from Russia - appealed for help to ensure stable fuel supplies. It asked Kazakhstan, Belarus and Azerbaijan as well as Uzbekistan and Turkmenistan. Fuel?shortages are affecting Russia following an attack by Ukrainian drones on the country's refineries. Officials in Russia have stated that they are 'considering a ban on the export of diesel. Ukraine attacked Russia's biggest oil refinery in Omsk on Monday. The facility is located in deep Siberia around 2,700 km from Ukrainian territory, and near the border of Russia with Kazakhstan. Kayirkhan Tutkyshbayev, deputy energy minister of Kazakhstan, told reporters that his country will consider its response to Kyrgyzstan's request. We are presently?reviewing this. Tutkyshbayev stated that all decisions would be taken with the national?interests in mind, as well as?the balance of domestic supply and demand. The deputy minister didn't specify the amount of?fuel involved or when it would be decided. Kazakhstan is the largest oil producer in Central Asia, according to Energy Information Administration statistics. The country also has several large refineries. Reporting by Tamara Vaal and Aigerim Turkunbaeva, writing by Felix Light. Editing by Barbara Lewis.
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Two people are killed in Gaza by Israeli strikes, say medics
Health officials in the Gaza Strip said that Israeli airstrikes killed at least 2 Palestinians on Tuesday. Medical personnel reported that an Israeli airstrike?killed? a man in the?Mawasi neighborhood of Khan Younis, in southern Gaza. Israeli military claimed they targeted a Hamas terrorist. In the evening of Tuesday, another Israeli strike hit a tent camp housing displaced families. One person was killed and five were injured, according to medics. The Israeli military didn't immediately comment on the incident. Israel has carried out repeated strikes in Gaza after a U.S. mediated 'ceasefire' with Hamas last October. It claims it targets militants that threaten its forces or took part in the october 2023 attack on Israel. Hamas accuses Israel of violating a ceasefire. Nikolay Mladenov is the Board of Peace Envoy for Gaza appointed by Donald Trump, who has stated that both sides have violated this agreement. According to the figures released by both sides, since the ceasefire went into effect eight months ago more than 1,070 Palestinians - many of whom were civilians - and four Israeli soldiers, have been killed in Gaza. Hamas doesn't disclose how many of its fighters were killed. Israeli troops patrol what Benjamin Netanyahu, Prime Minister of Israel, describes as a 'buffer zone to deter Hamas attack. Netanyahu has said that Israel will not leave the territory. Israel's aerial and ground bombardment of Gaza has displaced almost the entire 2 million-strong population. Most of them now live in tents, or in damaged buildings on a small coastal strip governed by Hamas. (Reporting and editing by Gareth Jones. Nidal al Mughrabi)
Saudi Arabia cuts crude oil prices but is this enough? Russell
Saudi Aramco slashed crude oil prices in Asia for August-loading shipments, a move which appeared to indicate an intention?to recover market share and volumes after the Iran War. Even the record-breaking cut in the official?selling prices (OSPs) for August may not be sufficient, since crude oil from other Middle East producers and exporters from Africa and the Americas will likely remain more competitive than Saudi grades. Aramco, world's largest?oil exporter set its OSP at a $1.50 discount per barrel compared to the regional benchmark of Oman/Dubai for August.
It was a drop of $11 per barrel from the OSP for July and the largest cut since 2003.
The OSP also fell to its lowest level since the month of June 2020. At that time, the crude oil market in the world was massively oversupplied. Prices were at their lowest levels for decades due to the COVID-19 locksdowns.
The current situation is reminiscent of 2020, in that the market narrative has changed dramatically to expect a surplus of oil. This is largely due to the belief that the conflict between?Iran and the United States of America has ended.
This assumption could be tested in the future by the events, and the two parties are still far from an agreement that would cement the ceasefire of 60 days agreed on last month.
Saudi Arabia and other Middle Eastern producers are working under the assumption that the Strait of Hormuz will remain open, and that any vessel seeking to pass through the narrow waterway can do so even if it is under Iranian control.
Aramco's decision to reduce the OSPs, which take about 80%, to Asia is likely an attempt to regain market share.
According to Kpler's data, Saudi Arabia exported 4.53 million barrels of oil per day in June.
The June shipments were higher than the 3.74 million bpd that was shipped in May. This was the lowest Kpler has ever seen, dating back to 2013. However, they are still 2 million bpd lower than the 6.55 million average bpd of the three months before the U.S. & Israeli attack on Iran.
CHINA MOVES
Aramco's key market is China. It's the largest crude importer in the world, but one where Saudi Arabia has lost market share.
China's imports of Saudi Arabia were estimated at 705,000 barrels per day (bpd) in July. This is up from the 12-year low 626,300 barrels per day in June, but less than half what they averaged for the three-month period leading up to Iran conflict, which was 1.48 million barrels per day.
Aramco's massive increase in OSPs was a response to the closure of the Strait of Hormuz which impacted Middle East crude supply. It is not surprising that China reduced its imports of Saudi Arabian crude.
Aramco was also able to redirect a large portion of its exports through Yanbu, a port located on the Red Sea. However, this came at a huge cost to Asian refiners. The OSP for Arab Light reached a record-high of $19.50 over the average Oman/Dubai price for May-loading shipments.
China has also reduced its imports of other exporters, as well. The seaborne arrivals in June of 5,91 million?bpd were the lowest since Kpler data began in January 2016, and approximately half the levels before the Iran conflict.
China is known to cut?imports during a sharp rise in prices, but to also?increase arrivals during a fall in prices.
It may be that the size of Aramco's cut in August-loading cargoes is enough to entice China's state-controlled major refiners to buy full allocations.
It's still not certain, since crude from other Middle East countries such as Kuwait and Iraq, or the United Arab Emirates, is offered at a greater discount. The UAE is offering discounts of up to several dollars per barrel. This is much higher than the $1.50 Aramco announced in August for its August shipments.
Abu Dhabi National Oil Co., the main oil producer in the Emirates, is aiming to increase its crude output capacity to 5,000,000 bpd next year, allowing it to boost exports to a level of 3.5,000,000 bpd during the three months prior to the Iran War.
Overall, crude oil market seems to be returning rapidly to growth in supply and price wars for market share.
This outcome is still dependent on the Strait of Hormuz being fully and sustainably opened.
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These are the views of the columnist, an author for.
(source: Reuters)