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Business lobby: Iran conflict has a negative impact on Italy's economic growth prospects
Confindustria, Italy's leading business lobby, forecast that the economy would grow by 0.5% in this year. This is a reduction from the 0.7% it had predicted in October. It also warned of'strong' 'downside risks' if the Iran conflict continues. The third largest economy in the Eurozone saw its gross domestic product rise by 0.5%, marking the third consecutive year of growth below 1%. Confindustria stated in its bi-annual report that the 0.5% growth scenario for 2026 was based on an "optimistic hypothesis" that?the conflict in Iran would be over by March's end. The business group warned that if the hostilities after the?US/Israeli strikes which began on February 28, should continue through the second quarter of this year, Italy's GDP would stagnate. It said that if the conflict continues into the fourth quarter the knock-on effects on energy prices will push the Italian economy back into recession. Confindustria President Emanuele orsini presented the report and said that the main problem for Italy caused by the war is the spiraling energy costs. He told reporters that the price of a megawatt-hour had risen from 106 to 170 euros, and called for an EU response. He called for a united European energy market and joint EU debt issuance. Confindustria's baseline forecast for the year 2027 is a slight acceleration of growth to 0.6%. Next month, the government of Giorgia Meloni, who forecasted growth for this year at 0.7% last autumn, will update its projections. Confindustria, a leading Italian financial services company, said that Italy's budget, which was 3.1% of its gross domestic product (GDP) last year, just over the 3% limit set by the European Union, will decline to 2.8% this and 2.7% in 2027. The projected Italian consumer price increase, driven by energy costs, will accelerate sharply this year to an average 2.5%, up from 1.5% in 2025. It is expected to ease to 2.2% in the following years. The report predicts that if the Iran conflict continues into the second quarter of this year, Italy's inflation rate will increase to 4.3%. (Reporting By Gavin Jones)
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Markets cheered Trump's talk about Iran negotiations, as European stocks rose, oil fell, and markets cheered the rise of European stocks.
The European stock indexes rose on Wednesday and the oil price fell on the day, as a result of reports that the U.S. was seeking a ceasefire lasting a full month with Iran, despite the fact that Iran had rejected the idea. U.S. president?Donald Trump said to reporters on Tuesday that he was?making progress? in negotiations for an end to war. This raised hopes that oil would be exported again from the Persian Gulf. The news of the ceasefire plan and the fact that the U.S. sent Iran a 15 point plan for discussion was welcomed by traders. According to Iranian state media, Iran has denied direct talks and a military spokesman claimed that the United States was negotiating with themselves. Markets made modest gains in Asian trading. The STOXX 600 index rose 1.4% at 1036 GMT, but this was not enough to offset the 7.3% decline in the STOXX 600 for the month of March. London's FTSE 100 rose 1.1% for the day. Amelie Derambure is a senior multi-assets manager at Amundi. She said that the mood was positive. The market is now trading on the belief that peace talks, or a possible ceasefire might be imminent. Derambure stated that traders are positioning themselves in order to not miss out on the "relief rallies" that may occur when markets increase on positive news. She added, however, that more convincing news is needed to sustain this move. Some analysts warned against expecting that the war would end quickly. In a research report, ING's head of global markets Chris Turner said that it was probably too soon to expect a big drop in the price of energy or a softer dollar in this week. OIL EASES AND BOND Yields Fall Brent crude futures fell 5.2% to $99.01 per barrel and the U.S. West Texas Intermediate crude prices fell 5.1% to $87.62 per barrel. Iran said "non-hostile ships" could cross the Strait of Hormuz as long as they coordinated with Iranian authorities. However, the waterway which carries approximately one-fifth of the world's crude oil and gas supply is effectively closed. The yields on European government bonds fell in a move sparked by Italian bonds, which were?particularly hit since the start of the war due to Italy's dependency on fossil fuel imports. The benchmark German 10-year yield was 2.9724%. The euro fell by 0.1% to $1.1598. The data showed that German business morale dropped sharply in march, due to the Iran War, which made companies more sceptical and threatening the recovery of Europe’s largest economy. The dollar index rose to 99.333, indicating a slight increase in the U.S. Dollar against a basket currency. The yield on the 10-year U.S. Treasury note was 4.3302%. As oil prices fell, gold?prices increased. The war has caused the worst energy crisis in history, sparked inflation fears around the world and killed thousands. On Wednesday, Gulf Arab countries told the U.N. that Iran is an existential danger. BlackRock CEO Larry Fink said to the BBC that oil could reach $150 per barrel, causing a global economic recession. (Reporting and editing by Tom Westbrook, Elizabeth Howcroft)
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Copper prices stabilize on stronger demand and talk of an Iranian ceasefire
The copper price jumped on Wednesday, after the U.S. reported that it was seeking a ceasefire during the Iran War and because of a stronger Chinese demand. However, the market remained cautious -after Tehran denied any negotiations. The benchmark three-month copper price on the London Metal Exchange rose 1.3% at 1030 GMT to $12,257 a metric ton, after falling by 0.6% the previous session. Ole Hansen is the head of commodity strategy at Saxo Bank, in Copenhagen. Israel and Iran exchanged strikes on Wednesday after the Iranian military rejected the assertion by President Donald Trump that the U.S. is in negotiations to end this war. The Shanghai Futures Exchange's most traded copper contract snapped a two session losing streak and ended daytime trading up 1.1%, at 95,590?yuan? ($13,864.67) a ton. Prices were also supported by signs of improved physical demand from China, the world's largest metal consumer. Hansen said that the pent-up demands are now coming back to these lower prices, which will help stabilize prices over time. The next battle could take place at the $12,500 technical level. Inventory data showed that stocks in SHFE registered warehouses dropped by 5.2% in the last week for the first time this year. The Yangshan Copper Premium, a measure of China's appetite for importing copper, soared by 33% on Wednesday to $69 per ton, the highest since June last. Aluminium was the only LME Metal in?negative terrain, with a 0.7% decline to $3,236.50 per ton. After the beginning of the conflict, the price of lightweight metals used in transport, packaging, and construction jumped due to supply concerns. The Gulf is a major producer. However, a 'potential end of war' could ease those fears. Other metals include LME zinc, which rose 0.2% to $3.046.50 per ton. Nickel climbed 3.1% to $17.475, while lead gained 0.8% at $1.907.50, and tin grew 1% to $44,675. (1 US dollar = 6.8945 Chinese Yuan) (Reporting and editing by Alexander Smith; Eric Onstad)
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Gulf States tell UN that Iranian strikes are an 'existential danger'
On Wednesday, Gulf Arab'states' told the U.N.?Human?Rights?Council that Iran poses an existential danger to them. They also condemned Iranian attacks against their infrastructure which could be considered war crimes by the U.N. rights head. The U.S. and Israeli war against Iran, which has been ongoing for nearly a month now, has led to a large-scale Iranian response in the form of missile and drone strikes on civilian and energy infrastructure in Gulf states. These attacks have killed 'civilians' and pushed up oil prices. This aggressive approach undermines international law and sovereignty, said Kuwait's ambassador Naser Abdullah H. M. Alhayen to the Geneva-based council. Kuwait's Ambassador Naser Abdullah M. Alhayen said that this aggressive approach undermines international law and sovereignty. The other Gulf states have also condemned Iran's actions, which they claim are designed to spread terror. The 47 member countries will vote on the motion that condemns Iran's attacks, asks Iran to pay reparations and requests the U.N. chief of rights to monitor the situation. Iran has defended their actions by claiming that more than 1,500 people have been killed so far in U.S. and Israeli strikes. Ali Bahreini said, "We fight for all of you, against an enemy who, if restrained today, would be beyond containment by tomorrow." Iran has called for its own emergency meeting on Friday to discuss a deadly strike at a primary-school. Volker Turk, the top UN rights official, called on states to stop the Iran conflict. He described the situation as dangerous and unpredictable. He said, "This conflict has the power to ensnare nations across borders and around the world." Attacks on civilians or civilian infrastructures must stop. These attacks could be considered war crimes if they are planned. Reporting by Emma Farge. Editing by Miranda Murray and William Maclean.
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Mitsubishi Materials will end certain Onahama smelter activities by March 2027
Mitsubishi Materials announced on Wednesday that it would stop processing copper concentrate at its Onahama facility - and all related smelting operations - by the end of March 2027. Mitsubishi Materials stated that the outlook for business was becoming more uncertain due to an intensifying competition with overseas smelters, and a steep decline in treatment and refinement charges (TC/RCs). It is expected to book an impairment loss of 132 million yen (21 billion yen) in the fourth quarter of this year's financial year, which ends on the end of this month. This loss will be mainly due to the fixed assets of the smelter. Fees paid by miner to refine concentrate, known as TC/RCs (Transfer Charges/Refined Metals), are under pressure due to the rapid expansion of global smelting capacities, led by China. This has squeezed margins. Mitsubishi Materials, as part of its structural overhaul, decided to stop concentrate processing at the plant that has been operating since 1965. The Electrolytic Plant will continue to refine scrap copper anodes as well as anodes produced by the group. The 'platinum group' metals recycling plant, as well as the foundry that produces copper ingots will continue to operate. The smelting margins of Japanese copper smelters have been shrinking as TC/RCs are in a downward spiral. JX Advanced Metals, its partners and Mitsubishi Materials announced in November that they planned to integrate Mitsubishi Material's copper concentrats procurement, as well as copper product sales, into Pan Pacific Copper. ($1 =159.0300yen) (Reporting and editing by Christian Schmollinger, Alexander Smith).
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BBC reports that BlackRock CEO Fink has warned of a 'global economic recession' should oil reach $150.
BlackRock CEO Larry Fink stated that oil prices could rise to $150 per barrel and cause a global recession if Iran "remains" a threat even after the end of the war. Fink said on BBC's Big Boss Interview podcast published on Wednesday that "we could have years of oil above $100, closer to $150, which would have profound implications for the economy." When asked what would happen if oil stayed at $150 per barrel, he replied: "We'll have a global recession." Since the U.S. and Israeli war against?Iran started, oil prices have been volatile and sharply risen. Prices fell about 4% Wednesday following reports that the U.S. sent Iran a 15 point proposal to end 'the war,' raising hopes of a possible ceasefire. The Strait of Hormuz is the main route for?oil, gas, and crude oil shipments. It carries one-fifth of global gas and oil supplies.
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Minutes of the March decision show that Swedish rates will remain at 1.75%
The minutes from the most recent meeting of the Riksbank on monetary policy showed that the future is uncertain. Erik Thedeen, Governor of the Riksbank, said that it was difficult to assess?the effects? of war but warned of the dangers of stagflation (higher inflation and lower growth). Thedeen stated in the minutes that "given the length of time the crisis has been going on and the effects already being felt by the energy infrastructure, I am concerned about the long-term impact this may have on the supply of oil and natural gas in the world." On March 19, the Riksbank maintained its policy rate at 1.75 %. Central banks are trying to gauge the impact of U.S. Tariffs, the Ukraine War and AI adoption in countries that still haven't gotten over their pandemic hangovers. "In this case, it's important to not act too quickly and then have to?make a U-turn or?to fall behind and be late," Riksbank Vice Governor Per Jansson said. He added, "For the moment, everyone is in agreement that a wait-and see?approach would be the best approach."
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Valero is preparing to restart Port Arthur oil refinery in Texas after the blast, according to sources
Valero Energy Corporation is preparing to restart the 380,000 barrels-per-day (bpd),?Port Arthur oil refinery in Texas this week. The plant was shut down on Tuesday following a blaze and explosion the day before. Sources said that workers were blocking pipelines feeding the damaged 47,000 bpd Unit 243 Diesel Hydrotreater on early Wednesday morning. They added that the shutdown was necessary to put out the fire that started on Tuesday. In a regulatory filing, Valero stated that no injuries had been reported from the explosion, which was triggered by the release of process fluid on unit 243. The explosion could be felt up to 18 km away from the plant, which is located in east Texas near the Louisiana border. The 'outage' comes at a time when refining margins are high due to the closure of the Strait of Hormuz (by Iran) amid the conflict that has impacted the Middle East region. This has led to a significant reduction in supply of refined products. Sources said that once the feed lines for unit 243 are blocked, Valero would return natural gas to plant, and light the safety flare system and boilers in order to generate steam to drive utilities and heat production units. Once 14 other production units are back to operating temperatures, feedstock can be introduced and the process will begin of getting output to specifications. Refinery production will be brought to planned levels as close as possible to maximum capacity. In compliance with U.S. Environmental Rules, hydrotreaters remove sulfur during production using?hydrogen. (Reporting and editing by Christian Schmollinger, Bernadettebaum and Erwin Seba)
Reports of a 15-point ceasefire proposal sparks hopes for oil to fall
The oil prices fell by about 5% after it was reported that the United States sent Iran a 15-point plan to end the war. This prompted a 'talk' of progress towards a ceasefire, despite Israel and Iran trading airstrikes.
Brent crude futures were down $5.66 or 5.42% to $98.83 per barrel at 1022 GMT after having fallen as low as $97.57. U.S. West Texas Intermediate Crude Futures were down by $4.82 or 5.22% at $87.53 after falling as low as $86.72.
Both benchmarks gained nearly 5% Tuesday before losing some of their gains in the volatile trading that followed settlement.
While oil prices were falling on the prospect that a ceasefire would be reached, PVM Oil Associates analyst?Tamas Vaga pointed out that reports had been made of U.S. troops being deployed in the Middle East.
U.S. president Donald Trump stated on Tuesday that the U.S. is making progress in negotiations to end the war. A source confirmed Washington has sent Iran the 15 point proposal.
Some analysts were, however, sceptical about the progress of these talks and expected markets to remain volatile.
According to the BBC, if Iran continues to pose a threat in Hormuz, the world may face years with oil prices between $100 and $150 per barrel. Larry Fink, CEO of Blackrock, one of the largest asset managers in the world, said this.
Fink replied, "We'll have a global recession" when asked what would happen if oil stays at $150.
OIL SHIPMENTS VIA HORMUD ARE LARGELY?HALTED
Priyanka Sackdeva, senior market analyst at Phillip Nova, said that Middle East developments will remain "the dominant price driver", keeping oil prices in a range of movements in the short term.
The war has almost completely stopped shipments of gas and oil through the Strait. This is a route that typically transports about a fifth of the world’s crude and gas supply. The International Energy Agency called it the largest oil supply disruption ever.
After 25 days, the global supply has been reduced by 500 million barrels or five full days.
"The outlook for the market remains tight, despite the prospect of a war-off-ramp", said Saul Kavonic. He is head of MST Marquee's energy research.
He stated that even if the flow through the strait resumes, "it is not clear whether all production shut down will resume until more clarity is gained on 'the durability of a ceasefire.
According to a Tuesday note, Iran told the United Nations Security Council (UNSC) and the International Maritime Organization (IMO) that "nonhostile vessels" could transit the Strait of Hormuz if coordinated with Iranian authorities.
Shipping data revealed that to offset the disruptions caused by the Hormuz war, Saudi Arabia's Red Sea Yanbu Port saw oil exports rise last week from 1.4 million barrels a day to almost 4 million. This is a significant increase over the levels before the outbreak of the conflict.
Two sources said that the Russian Baltic ports of Primorsk, and Ust-Luga - major 'export terminals' - suspended crude oil and?products?loadings on Wednesday, after Ukrainian drone strikes sparked an?inferno? which could be seen in Finland.
The strike was the biggest against Russia's oil-export facilities during the four-year conflict and will increase the level of uncertainty on the oil market. Reporting by Seher DAREEN in London, Yuka OBAYASHI in Tokyo, and Trixie YAP in Singapore. Editing by Jamie Freed Bernadette BAUME and Jason Neely.
(source: Reuters)