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The oil executives expect a rebalancing of the market from surplus to deficit in the medium term
A range of oil executives in London said this week that the global oil market would tighten on a medium-to-longer term. They remained optimistic despite an immediate glut caused by increased production. The executives stated that the production decline rates could increase as oil prices drop, helping to rebalance a market where demand will be supported in the long-term by the rising consumption of emerging economies. In its monthly oil report, published on Tuesday, the International Energy Agency said that the global oil surplus would reach 3.6 millions barrels per day by the end of the fourth quarter. This compares to a 1.9million bpd daily average for the first three months of this year. The rising production of both OPEC+ and non-members, as well as the Organization of Petroleum Exporting Countries (OPEC+), has held oil prices in check this year. Brent futures traded at around $62 per barrel on Tuesday, down $15 from the same day last. TIGHTNESS MEDIUM-TERM Patrick Pouyanne, CEO of TotalEnergies, said that oil production by producers outside OPEC would start to fall if the price of crude drops to $60 per barrel. Pouyanne, speaking at the Energy Intelligence Forum in London, said that the short-term market was a bit bearish, but the medium-term outlook is quite positive. He cited the decline in production rates and the fact that global oil demand has not peaked. ExxonMobil's CEO Darren Woods said on Monday, at the same conference that if investment is not made in unconventional oil fields and gas, decline rates may reach 15% per annum. He also stated that he believes that oversupply would be a short-term problem. Amin Nasser, Saudi Aramco's CEO, said on Monday that the company sees a resilient demand and a pressing need to invest in long-term supply. ConocoPhillips CEO Ryan Lance stated that the key question for companies such as mine is where will the conventional oil come from in order to meet the growing demand, given the plateauing or peaking of U.S. unconventional supplies. Lance said that oil prices may recover to $75-$80 a barrel in mid-cycle, since supply must be increased to meet demand.
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Copper prices fall on US-China Trade Tensions
Copper prices dropped on Tuesday as a result of concerns about trade tensions between China and the United States, two of the world's largest economies. These tensions could have an impact on the demand for metals that are dependent on growth. The price of three-month copper at the London Metal Exchange fell 2.6%, to $10544.50 per metric ton as of 1004 GMT. The price of copper, which is used for power and construction, has dropped 4% after concerns about a reduced mine supply following disruptions in Indonesia and the Democratic Republic of Congo. Dan Smith, managing Director at Commodity Market Analytics, said that despite the supply issues, copper demand is still not good. The 21-day moving average is currently $10,375. On Tuesday, the U.S. & China began charging additional fees to ocean shipping companies that transport everything from holiday toys and crude oil. U.S. U.S. Treasury Sec. Scott Bessent stated on Monday that Donald Trump is still on track to meet Chinese Leader Xi Jinping at the end of October in South Korea. The Yangshan copper premium is a major metals consumer in China. The price of copper, which is a reflection of demand, dropped 8%, to $45 per ton, a new low for two months. The yuan fell against the dollar, which made metals priced in dollars more expensive for Chinese buyers. Due to the activity leading up to this Wednesday when holders of short positions will have to reduce or rollover contracts, the spreads between LME cash contracts and the three-months contracts for copper, zinc, and aluminium widened on Monday. On Monday, the premium for cash copper compared to the three-month contract reached its highest level since June at $227 per ton. LME aluminium dropped 0.8% to 2,739.50 per ton. Zinc fell 2.4% to 2,946.50. Nickel fell 0.2% to $16,175. Tin and lead both declined 0.4%, to $35,505 a ton and $1,980.50 a ton respectively. Lead, nickel and zinc all reached their lowest levels since September 10, 11, and 30, respectively. (Reporting and editing by Leroy Leo; Polina Devtt)
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LMEWEEK - Copper producer Aurubis has held discussions with US about support for a new smelter. CEO of Aurubis says
Aurubis, a German company, has had preliminary discussions with the U.S. Government about the support of a new copper-smelter there following the launch a recycling facility. The biggest copper producer in Europe is looking at three options to capitalize on a U.S. push to increase domestic production of the metal. President Donald Trump announced a tariff of 50% on copper products, but excluded ores, concentrates, and cathodes. We need to first lay out our options and make more concrete proposals. Toralf Haag, CEO of the metals industry's LME Week, said that there were positive signals from the U.S. Government. The US is a big demand for reducing capacity Aurubis began production last month at its new recycling facility in Georgia, U.S.A., the first greenfield site it built in 115-years. The plant will eventually ramp up to an annual output of 70,000 tons of high grade blister copper. Aurubis said that the U.S. can only supply half of its 1.7 million ton refined copper demand from domestic production. The gap will widen in the coming years, as the demand is expected to increase by two thirds, to 2.3 millions by 2035. "There are 60 Smelters in China and 15 in Europe. Now, there are only three smelters left in the U.S." Haag explained that there is a high demand for smelting capacities. He said that building a new smelter is a long-term undertaking, but two alternatives could be realized in as little as three to four year without the support of government. Haag explained that the first step would be to expand recycling operations in the United States by building an anode smelter and tank house for cathodes, and perhaps rods. The second option would be to build a new recycling plant in the U.S. West Coast to take advantage higher scrap availability following the tariff ruling that limited exports. Aurubis said that the U.S. Recycling Market is expected to grow by 26% in the next decade, to 555,00 metric tons per year. A COMPANY PLAN HIGHER PLATINUM AND ANTIMONY PRODUCTION Haag stated that Aurubis plans to increase platinum and antimony production by building in Hamburg a complex recycling plant and a new precious-metal refinery, which will cost about 500 million euro ($577.7 millions). Aurubis, citing a strong demand and concerns about a shortage of supply, increased the premium that it would charge European customers in 2019 to $315 per metric tonne, a 38% increase from last year. Last week, supply concerns from mine disruptions occurring in Indonesia and Chile as well as the Congo pushed benchmark copper at the London Metal Exchange up to $11,000 per ton. This was a 16-month high. On Tuesday morning, it was down 2.7% to $10,525 per ton.
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EU looks to US alliance against China's rare earth crackdown
Trade ministers and officials of the European Union said that they were seeking to coordinate their response with the United States, and other G7 members to the tighter Chinese controls over the export of rare-earth minerals. China, which is the world's biggest rare earth producer has dramatically increased controls in recent weeks, adding new elements and refining technology, and extra scrutiny to semiconductor users, ahead of scheduled talks between Presidents Donald Trump & Xi Jinping. Maros Sefcovic, European Trade Commissioner, called the measures unjustified. He said EU Ministers who met in Denmark to discuss issues of trade described them as "critical concerns". Prior Chinese controls announced in early April led to shortages worldwide, including for automakers. A series of agreements with Europe and the U.S. helped ease the supply crunch. Sefcovic stated that the G7 finance ministers would likely discuss options on Wednesday. He also said he had spoken with U.S. commerce secretary Howard Lutnick about this issue. He said, "We brainstormed last night that it would make sense to have a G7 Video Call pretty soon after this first conversation," before the EU Ministers' meeting. Sefcovic also said that he would likely speak with his Chinese counterpart in the first week of next year. Danish Foreign Minister Lars Rasmussen stated that the EU must respond in a "uniform and tough" manner and show its strength as "the largest trading bloc in the world". We also need to be realists. It is a common area of interest for us and our American friends. We can better press China to behave fairly if we work together. Trump's first response was to threaten China, threatening them with a 100% tariff. This sparked a Wall Street crash. Rasmussen was not in favor of tariffs and instead advocated frank, open and honest discussions with Beijing. Sefcovic said that coordination between G7 partners can take on the form of a coordinated effort to diversify supplies, for example by advancing joint projects aimed at extracting or processing critical minerals. He said: "Of Course these projects take a long time. But with this message we received from China, it's obvious we need to accelerate these processes as much possible." (Reporting and editing by Susan Fenton; Reporting by Philip Blenkinsop)
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Draft shows that EU leaders will demand greater industry support in order to achieve the new climate goal
By Kate Abnett BRUSSELS - European Union leaders will agree to set a new target for climate change for 2040 but insist that the EU do more to help industries such as steel and automaking meet this goal, according to draft conclusions for a EU summit taking place next week. The EU was planning to adopt its new climate goal by the U.N. deadline of last month. The talks broke down when France, Poland, and other countries demanded that the government leaders debate the 2040 target first, expressing concerns about how to finance the low-carbon transformation alongside priorities such as defence and revitalising the local industries. Draft conclusions from the 23 October summit of EU leaders, as seen by, stated that leaders would agree to allow EU countries and legislators to proceed with setting the 2040 goal for climate. The draft conclusions for an EU leaders' summit on 23 October, seen by, said that leaders would agree to allow legislators and countries in the EU to proceed with setting the 2040 climate goal. The draft conclusions dated 13th October stated that "special attention should be given to traditional industries such as automotive, shipping and aviation, and energy-intensive sectors, like steel, metals, and chemicals so they can remain competitive and resilient in a global marketplace." The draft conclusions did NOT demand any specific funding or changes in EU policies to be made as a condition for the leaders to support the goal of reducing emissions. Some countries want to change the carbon border tariff of the EU, but others want to weaken the 2035 phase out of new combustion engines cars. The draft conclusions stated that the EU must achieve its climate goals "in a technology-neutral manner". This phrase is often used by government officials to oppose EU policy which restricts certain technologies such as the phase-out of combustion engine cars. Last week, German chancellor Friedrich Merz pledged to work to prevent a hard cap in 2035 on CO2-emitting vehicles. If EU leaders approve the conclusions, then their climate ministers will meet on 4 November to approve the target climate, just in time for COP30, the U.N. climate summit. (Reporting and editing by Frances Kerry.)
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Investors shun risk as stocks plummet and gold soars
As investors became uneasy about the mounting tensions between China and the U.S., they sold global shares, while bonds and gold rose. This was due to the growing anxiety over the upcoming trade talks between China and the U.S. The markets had earlier reacted to Monday's positive cash session, after U.S. Treasury secretary Scott Bessent stated that President Donald Trump is still on track to meet Chinese Leader Xi Jinping for a two day summit in South Korea starting October 31. In an interview with the Financial Times, he accused Beijing in particular of trying to harm the global economy. The U.S. will be charging port fees to ocean shipping companies that transport everything from toys and crude oil. "ESCALATE TO de-ESCALATE" Marc Velan said that both Washington and Beijing were posturing ahead of the November summit – escalate to deescalate. "Neither side can afford a war of words as we head into the U.S. midterms." The European stock markets, which hit record highs earlier this month, are down by 0.7%. This echoes the weakness on Asian markets where technology stocks were hit hard. Futures for the S&P 500 sank by 1%. This suggests that the rally of Monday may not repeat itself, but also indicates that a complete reversal is unlikely. Investec's chief economist Philip Shaw stated that "if one looks at recent history, it can be interpreted more as a path to negotiation than a new outbreak of hostilities between the U.S. "Yes, there's uncertainty. But you've seen a big rally not only in U.S. indices, but also a lot of other global indices." While there are some questions about the U.S. China trade friction, I would interpret this latest sell-off more as a slight correction than an increase in investor uncertainty. Wall Street's major indexes ended up as much as 2,2% higher on Monday. Chipmakers led the way, as Trump struck a more accommodative tone regarding trade tensions with China. This reversed some of Friday's panic when Trump announced 100% tariffs against China. Market risk barometers flash red Reflecting increased investor anxiety, gold reversed overnight loss and rose 0.7%, to $4,140 per ounce. This was just short of the new record set on Tuesday of $4,179.48. Bitcoin, which is more likely to follow other risky assets, dropped 3.5% to $111 793. The dollar has gained an advantage over other currencies, including the Australian and British dollars, which have fallen by 0.5% or 0.9% against the greenback. The yen has historically been a safe-haven currency. It gained 0.1% against the dollar to reach 152.04 after Japan's Finance Minister said that the country needed a new strategy to deal with inflation, rather than deflation. The yield of the 10-year Treasury Bond in the United States was 4.02%. This is a 3 basis point decrease. The U.S. Bond Market was closed Monday due to a public holiday. The yield on two-year bonds, which is more sensitive to changes in expectations of U.S. interest rate, was down 4.6 basis points at 3.48%. They had fallen 12 basis points since Friday. This marked their biggest two-day drop since early August. Analysts at Danske Bank stated that any escalation of the trade war will only increase the likelihood that the Federal Reserve will front-load planned rate reductions. The Fed is expected to reduce rates in the coming months and even into next year, to combat a slowing labour market. The euro fell 0.1% to $1.1554 on Monday after French President Emmanuel Macron refused to resign, despite two motions of no confidence being brought against his government. Brent crude dropped 1.7% to $62.63 a barrel following an OPEC report that showed the world's oil supply and demand are expected to be in line next year. This is a change from last month, when a shortage was predicted.
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IEA: World oil surplus will increase as OPEC+ increases.
The International Energy Agency (IEA) predicted that world oil supply would rise faster than expected in this year, and a surplus may expand by 2026 as OPEC+ and other producers increase output while demand remains sluggish. In a report published each month, the IEA - which provides advice to industrialised nations - said that supply will increase by 3,0 million barrels a day in 2025. This is up from 2.7 millions bpd, as previously predicted. It said that next year, the supply will increase by another 2.4 million barrels per day. OPEC+ has added more crude oil to the market since the Organization of Petroleum Exporting Countries (OPEC), Russia, and other allies decided that they would unwind some production cuts faster than originally planned. This extra supply has led to concerns of an excess and pressure on oil prices in this year. According to the IEA, supply is increasing much faster than demand. The IEA lowered its forecast on Tuesday for the world's demand growth to 710,000 bpd. This is 30,000 bpd less than their previous forecast. They cited a more challenging economy backdrop. The IEA stated in a report that "Oil consumption will remain subdued for the rest of 2025 and 2026. This is expected to result in gains estimated at 700,000 barrels a day each year." This is below the historical trend as the harsher macro-climate and transportation electrification cause a sharp decline in oil consumption growth. IEA's demand forecasts are lower than other forecasters, such as OPEC. This is because the agency anticipates a quicker transition to renewable sources of energy. The IEA had predicted that the demand for oil would rise by 1.3 millions bpd in this year. OPEC, however, said that the global economy is doing well. IEA says the world market appears oversupplied. The report released on Tuesday showed that global oil production in September increased by 5.6 millions bpd compared to a year earlier, with OPEC+ contributing 3.1 million bpd. The report suggested that the global supply could exceed demand next year by 4 million bpd due to the growth of OPEC+, as well as producers outside the group, such the U.S. Canada, Brazil, and Guyana. It also said there was a limited increase in demand. This compares with about 3.3 millions bpd in the previous month. (Reporting and editing by Kirsty Donovan, Jan Harvey and Alex Lawler)
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Shanghai copper reverses its gains amid trade war concerns
Shanghai copper fell on Tuesday, as concerns about escalating tensions in trade between China and the United States overshadowed long-standing worries over mine disruptions. The Shanghai Futures Exchange's most active copper contract closed the daytime trade down 0.59%, at 84400 yuan per metric tonne ($11,818.74). Prices rose to 86.790 yuan a tonne in the morning, with hopes of a deescalation in tensions between world economic giants growing after U.S. Treasury Sec. Scott Bessent stated that President Donald Trump was still on track to meet Chinese Leader Xi Jinping at the end of October in South Korea. After the Financial Times published an interview with Bessent, who claimed that China was attempting to harm the global economy, tensions returned. China said that it has also begun to collect port fees. Charges On U.S. linked vessels, this is a counter-measure to Trump's levying of fees on Chinese ships. The copper trader in China said that everyone was focused on the sudden escalation of trade tensions, and they were afraid about the uncertainty. They backed away from the market. Mine disruptions such as the suspension of operations in Grasberg, Indonesia, late last month limited losses despite expectations of a shortage of supply in 2026. As of 0755 GMT on Tuesday, the benchmark three-month contract for copper on the London Metal Exchange was down 2.8% to $10.517 per ton after a gain of more than 2% on Monday. Nickel, lead, tin, aluminium, and zinc all saw little change. The price of aluminium fell by 0.65%. Zinc dropped by 1.13%. Nickel declined by 0.27%. Lead was down 0.35%. Tin was down 0.62%. $1 = 7.1412 Chinese Yuan Renminbi (Reporting and editing by Subhranshu sahu and Kate Mayberry).
Constellation Energy nearing $30 bln offer for Calpine, Bloomberg News reports
Constellation Energy is nearing an acquisition of Calpine Corp. that would value the latter at about $30 billion consisting of debt, Bloomberg News reported on Wednesday pointing out individuals familiar with the matter, sending Constellation's shares down 8.2%.
A deal could be revealed in the coming weeks, the report said.
Considerations were ongoing and might even be delayed or fail, and the last rate of the offer might still alter, the people cited in the report said.
Calpine, a natural gas and geothermal energy business, runs 78 centers throughout 22 U.S. states and Canada, according to its website.
The business was taken personal in 2017 by Energy Capital Partners, Canadian Pension Plan Investments and Gain Access To Industries for a total of $17 billion, consisting of debt.
Reuters reported specifically in May in 2015 that the 3 financial investment companies had actually been considering different choices, including a sale or a stake divestment, at an assessment of about $30. billion, consisting of debt.
The news comes as data centers powering artificial intelligence along with extreme. weather condition events driven by climate change stimulate electricity demand in a few of Calpine's secret. markets, including Texas, where it operates 12 power plants.
Constellation and Calpine did not immediately react to Reuters requests for remark.
(source: Reuters)