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Brent increases by nearly 2% after US strikes Iranian missile launchers and boats
Brent crude futures jumped nearly 2% on early Asian trading on Tuesday, after the U.S. military launched strikes in southern Iran. The U.S. described these as defensive actions. This kept markets on edge because a deal that would 'end the war' eluded both sides. Brent?futures rose $1.40 or 1.5% to $97.56 per barrel as of 0006 GMT after falling 7% in the previous session. The price of U.S. West Texas Intermediate Crude was $91.25, slightly higher than Monday's closing price, but lower by $5.30 or 5.5% compared to Friday's closing. Due to the U.S. Memorial Day Holiday, there was no settlement Monday. The U.S. Central Command has confirmed that it conducted strikes in southern Iran, including on boats trying to lay mines as well as missile launch sites. They added that they were intended "to protect our soldiers from threats posed by Iranian forces." Iranian media reported that on Monday, explosions had been heard in Bandar Abbas (Iran) and the nearby coastal areas along the Strait of Hormuz. Since the start of the Gulf War, Tehran has effectively stopped all non-Iranian ships from entering and leaving the Gulf. This has resulted in a stifling of about a fifth global oil and natural gas flows. Prices have risen by as much as 50%. Iran's chief negotiator and its foreign minister met with Qatar's Prime Minister in Doha to discuss a possible deal with the U.S. Washington and Tehran both said that they had made progress in negotiating a memorandum-of-understanding to end the war. The document would give negotiators a 60 day window to come up with a final agreement. Nikkei, citing an Middle East diplomatic source, reported earlier that Iran would remove mines within a 30 day window, under the agreement. After this, vessels from all nations could navigate safely and freely, with Tehran also ceasing to collect transit fees. Tim Waterer is the chief market analyst for KCM Trade. He said that traders are heavily betting on a breakthrough to finally free up the tankers that have been paralyzed in the Strait of Hormuz. Three liquefied natural gas tankers headed to Pakistan, China and India passed through the Strait in recent days. A supertanker transporting Iraqi crude oil to China, after being stuck for almost three months, also made it across. Donald Trump, the U.S. president, reiterated his call on Monday that Iran should hand over its enriched uranium for destruction to the U.S. Tony Sycamore is a market analyst for IG. He said, "It's a stark reminder that the deal can still fall apart at the last minute, just like five other attempts before." (Reporting and editing by Cynthia Osterman in Bengaluru & Shri Navaratnam.)
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The mining hub in Chile is shaken by a strong earthquake, but the damage is minimal
Authorities said that a'strong earthquake' struck Chile’s mining region?Antofagasta?on Monday afternoon, disrupting operations at?some mines, but ultimately saving lives and critical infrastructure. Major miners have reported minimal damage from the magnitude 6.9 quake that struck the heart of the largest copper producing country in the world. The U.S. Geological Survey measured the depth of the earthquake at 109 kilometers (68 miles). A spokesperson for Chilean copper miner Codelco said that some activities were halted due to a?lack of visibility or disruption of electricity in certain?areas. BHP and Antofagasta, both mining companies, said that their operations were not affected by earthquake. Ricardo Munizaga is the regional director of Chile's disaster agency SENAPRED. He told the local news channel 24 Horas there were no injuries or major emergencies reported despite the fact that the earthquake triggered landslides. Munizaga stated that residents in the city of 'Calama', which is home to many miner families, lost power, and saw some water cuts, but other key infrastructures were not affected. He added that mining companies had activated their emergency protocols and temporarily stopped some operations in order to inspect the facilities. The Antofagasta region is responsible for a large part of Chile's production. Reporting by Fabian Cambero, Rishabh Jaiswal, Brendan O'Boyle, and Cynthia Osterman in Mexico City.
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Australia's MinRes Jiangxi Ganfeng invests $351 million at Mt Marion Lithium project
Mineral Resources, Australia, announced on Tuesday that it had reached a 'final investment decision' with its joint venture partner Jiangxi Ganfeng Lithium to invest approximately A$490 million ($351.38 millions) into developing the Mt Marion lithium exploitation in Western Australia. The investment is a major step towards expanding the project. It will boost the supply of lithium in response to the growing global demand for electric vehicles and battery storage. MinRes stated that the 'investment, which will be spent between 2027-2028, includes A$240,000,000?for an underground pre-production facility, A$220,000,000 for underground development, and A$30,000,000?for infrastructure. Upgrades would extend mine life, and increase plant recovery by 70% by accessing deeper resources. The miner announced that it would be tendering for an underground mining contractor. Central underground development is expected to start in the first quarter 2027. Mt Marion will transition from a combined underground and open-pit operation by 2028. The flotation circuit construction is expected to start in the first quarter of 2027. It will be managed by MinRes Mining Services. The plant will be commissioned and ramped up in the second half of 2028. MinRes attempted to sell stakes at Mt Marion and Wodgina in 2025 but lost momentum when prospective buyers from India or Japan balked at a price of more than $2 billion. MinRes website stated that 'the company operates Mount?Marion via a joint venture of 50-50 with Jiangxi Ganfeng Lithium', one the world's biggest lithium producers.
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Britain bakes on the hottest May day ever recorded
The national weather service of Britain reported that the temperature in Britain reached a record high for May, averaging?nearly 35 degrees Celsius (95 degrees Fahrenheit). Met Office reported that the temperature in west London's?Kew?Gardens reached 34.8 C (94.64 F), surpassing Britain's 32.8 C (91.1 F) May record, set both in 1922 and 1944. Met Office stated that a study conducted 'last year showed that human greenhouse gas emissions were responsible for three times as many 'changes in climate. It said that "this heat would be extraordinary in the UK, even mid-summer. Let alone in May." Monday was the hottest day since 1884 when Met Office UK began keeping records. It exceeded the previous high of 33.3 C recorded in August 2019. Swimming pools were crowded with swimmers and fountains were crowded with pedestrians. Near Brockworth, in the south-west of England, cheese-rolling competitions took place in spite of the heat. (Reporting and editing by Alexander Smith, Isabel Infantes added additional reporting).
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Fire officials confirm that a chemical tank overheating in California is no longer a danger of exploding.
They said that a crack in the industrial tank of a hazardous chemical, which was dangerously overheating in Southern California, had eliminated the possibility of it exploding. Orange County Fire Authority: Although the worst-case scenario for the tank containing highly flammable methacrylate has been ruled out by the Orange County Fire Authority, dangers still remain and tens thousands of people are under evacuation orders. The tank overheated on Thursday in the GKN Aerospace plant in Garden Grove. This city has about 172,000 residents and is located roughly 20 miles south of Los Angeles. California Governor Gavin Newsom declared a state emergency on?Saturday and issued evacuation orders for an area that is home to tens or thousands of residents. Fears mounted the tank could rupture?and spill up 7,000 gallons of toxic material (26,500 litris) or explode?and threaten nearby tanks. Firefighters celebrated the appearance of the crack in the tank on the weekend. This helped relieve the pressure and the tank has cooled to 93 degrees Fahrenheit from over 100 F. Craig Covey said in a video that "that is incredibly good news" Officials?said that firefighters have cooled the tank by drenching it with water. They have also taken the risk to approach the?tank only when the sun had set to measure the temperature. According to the?website of GKN (a British?) company, its Garden Grove facility makes windows and canopies that are used on commercial and military aircraft. It has also apologized for the inconvenience caused by its overheating trough. Officials have also expressed concern that the toxic chemical could leak and that vapors released?from tank might cause respiratory problems to people after prolonged exposure. However, air-quality monitors did not detect vapors as of the last health update, cited by the officials at the weekend. Reporting by Jonathan Allen; editing by Deepa Babyington and ChizuNomiyama
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Residents of a Belgian town evacuated because of explosion risk in burning building
Residents of a town southwest of Brussels living near a burning textile warehouse were evacuated Monday because of a high risk that nearby canisters could explode, according to the mayor in a radio interview. On its website, the?council of Tubize advised residents to keep their windows and doors shut to avoid being exposed to toxic fumes. These fumes contain asbestos, among other substances. The mayor of the city, Samuel d'Orazio, told RTBF that "right now, we are evacuating everyone in the street" because there is a risk of explosion to the houses nearby due to the gas canisters within the building. The town hall opened up its sports hall in order to accommodate the evacuated people. Due to the fire, Tuesday will be a holiday in Belgium. As toxic fumes spread, Belgium's crisis centre issued an alert to those who live in a wide area south and west of Brussels. (Reporting and editing by David Holmes and Rod Nickel; Inti Landauro)
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Aramco will transfer PRefChem shares to Malaysian Petronas
The Saudi state oil giant Aramco has announced that it will transfer its equity stakes in joint ventures for petrochemicals and refining in Malaysia to Petronas. This ends an eight-year partnership between the two companies. In a joint press release, the two companies said that the deal is subject to closing conditions and will turn PRefChem into a fully owned subsidiary of Malaysia's state energy company. The financial terms of the deal were not disclosed. The?deal highlights how the Iran War is reshaping Asian energy partnerships. Since late February, the Strait of Hormuz has been effectively closed, reducing crude oil flows into Asia. This has forced refiners to reduce their production, causing shortages of products such as jet fuel, diesel and gasoline, all of which are produced by PRefChem. Petronas will be able to'source crude outside the Gulf of Mexico and to direct production to meet the soaring regional fuel demand. Aramco, on the other hand, has been forced by the conflict to reduce its production. According to OPEC's secondary sources, Saudi production fell by about a third from its pre-war level in April. Aramco supplied 50% to 70% PRefChem crude feedstock. The statement said that the transaction was completed on terms mutually agreed upon, reflecting the changing strategic priorities of both parties. PRefChem is a joint venture consisting of Pengerang Refining Company (PRC) and Pengerang Petrochemical Company (PPC), which operates an integrated refinery-petrochemical facility within the Pengerang Complex?in southern Malaysian Johor. The refinery produces jet fuel, diesel and gasoline, and supplies feedstock to the petrochemical plant, which has an annual capacity of 3.4 million tonnes. Aramco signed a share purchase contract with King Salman in Malaysia during his state visit. The investment was one of Aramco's biggest downstream investments overseas. In March 2018, the two joint ventures formally came into existence. The companies stated that they will continue to explore cooperation, including crude supply and technology exchange. Yousef SABA, Yousef is the reporter; Cynthia Osterman, the editor.
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Nornickel, a Russian company, recommends that the 2025 dividend be cancelled due to instability
Norilsk Nickel's board recommended that there be no dividend payouts in 2025. It added on?Monday, it was prioritising the financial stability of its company during a time of "elevated economic instability". Nornickel, if approved, would withhold?its annual dividend for the fourth consecutive year. In 2022 the Russian metals manufacturer's finances deteriorated because of geopolitical forces. On June 30, shareholders in one of world's largest nickel producers and the largest palladium producer will discuss the proposal. Nornickel hasn't paid a full-year dividend since 2024, nor for 2022, 2023 or 2024, due to Western sanctions and the falling price of its main metals. The company stated that it was taking into consideration "the cyclical market for the metals it produces as well as the need to maintain high creditworthiness". Nornickel uses free cash flow to guide dividend payments since a shareholder agreement that protected payouts at the end 2022 expired. Sergei Malyshev, CFO, said that although EBITDA increased 9% in 2025 to $5.7 billion and adjusted free cash flow reached $1.5 million, it was "appropriate" to use the free funds to strengthen the company's resilience financially, to invest in the reliability and security of production and to reduce debt levels. Nornickel CEO Vladimir Potanin said in December that he believes the conditions will be right in 2026 to allow dividend payments to resume. Potanin now owns 33,51% of Nornickel. He previously owned 37%. Aluminium giant Rusal is its second largest shareholder, with 26.39 percent. Nornickel may not be subject to direct sanctions but Western measures have led some foreign buyers to avoid Russian metals. They also complicate payments and restrict access to Western equipment. This has caused Nornickel to redirect its sales to Asia. (Reporting and writing by Anastasia Lyrchikova, Alessandra Prrentice; editing by Vladimir Soldatkin & Alexander Smith).
Oil rises, stocks mixed as new US strikes dampen peace deal optimism
Investor optimism about a U.S. peace deal with Iran was tempered by the recent U.S. strikes across the Middle East.
An official who was briefed about the visit revealed that Iran's top negotiator, as well as its foreign minister, were in Doha to discuss a possible deal with the U.S. for the end of the war. This came after Washington and Tehran had played down expectations for an immediate breakthrough.
Separately, The Nikkei reported that the two parties were discussing plans to open up the Strait of Hormuz around 30 days after a ceasefire agreement was reached.
Even as the talks continued,?U.S. Forces conducted strikes in southern Iran on Monday against targets such as boats that were attempting to place mines, and missile launch sites in what they called?defensive actions.
Brent futures rose more than 1% to $97.32 per barrel in early Asian trading. U.S. West Texas Intermediate Crude was up slightly from Monday's closing price, but down 5.5% since Friday. Due to the U.S. Memorial Day Holiday, there was no settlement Monday.
"I'm a little sceptical...?We're told that a deal is near. But what will it look like?" This is what matters most. When will the Strait of Hormuz reopen? Joseph Capurso is a strategist with Commonwealth Bank of Australia.
The stock markets were mixed. MSCI's broadest Asia-Pacific index outside Japan gained 0.8% while Japan's Nikkei fell 0.2%.
Nasdaq Futures pared earlier gains and traded 0.9% higher. S&P 500 Futures gained 0.68%.
The EuroStoxx 50 futures declined by 0.36%. The FTSE futures gained 0.4%, and the DAX futures fell 0.43%.
The market wants to think that the war will end soon because it is bad for the global economy. Capurso said that the world economy has had buffers by running down inventory, but it is not possible to keep doing this.
DOLLAR STEADIES
The dollar was stable on Tuesday, despite renewed demand for safe havens. It is still some distance from the six-week high reached last week.
The dollar slipped to $1.3498, while the euro fell 0.06% to $1.1 636.
The dollar's value against the yen was unchanged at 158.95.
After a week of turmoil, bonds were mostly stable. Investors were concerned that rising energy prices would spark a rise in inflation. This could lead to rate increases across developed and emerging markets.
The yield of the two-year U.S. Treasury Note was little changed last week at 4,0612%. Meanwhile, the yield for the 10-year Treasury Note fell to 4.5024%.
Standard Chartered's Deputy Chief Strategist and Head of Global Research, Eric Robertsen said: "We will likely see periodic yield retracements when geopolitical risk?falls, but inflation and fiscal risk are likely?"to be more persistent."
"Commodity dislocations are expected to take several months to resolve. Fiscal support measures will likely lead to a sustained deterioration of sovereign balance sheets, which will require more borrowing at a time when funding costs are higher."
Other than that, spot gold fell 0.5% to $4,545.90 per ounce. (Reporting and editing by Rae Wee)
(source: Reuters)