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Russell: The demand for crude oil in Asia is balanced by the ROI-China.
China is reducing crude oil demand across Asia by itself to compensate for the reduced Middle East shipments as a result of the Iran War. The world's largest oil importer reported arriving 8.41 million barrels a day (bpd), up from the near decade-low of 7.12 millions in June but still 24.3% less than July last year. When June and July's "imports" are combined, the average for these two months is 7.78 million bpd. The average for the three-month period ending in February was 11,99 million bpd. This is 4,21 million bpd less. The United States and Israel launched an attack on Iran on 28 February. The conflict escalated to the point that the Strait of Hormuz effectively shut down, cutting off the waterway which carried about 20% of crude oil and refined goods in the world before the war began. Saudi Arabia and United Arab Emirates, two of the Middle East’s largest crude exporters have been able to increase shipments outside the Strait of Hormuz. However, flows have fallen by about 5 million barrels per day. Crude oil exports to Asia have dropped significantly. Asia is the largest importer of crude oil. According to commodity analysts Kpler, Asia's total imports of oil in July reached 22.82 millions bpd. Although this is an increase from April's 18,77 million bpd (which was the lowest since Nov 2015), July's imports are still about 4 million below the average of 26,89 million bpd for the three months before the start of the Iran conflict. The data shows that China's imports have dropped by about the same amount as Asia's imports over the last two months. Price Moves China's reduced imports are partly due to price volatility. Brent futures hit a four-year peak of $126.41 per barrel on April 30 – a date when cargoes for June and July would have been scheduled. China has historically reduced imports as prices increase, but this drop is unprecedented. Analysts estimate that China's crude oil stockpile is at least 1.2 million barrels, and could even be higher. How long will China be able to balance crude oil in Asia with China? Imports from China are expected to show a slight recovery in August as the cargoes which managed to leave the Strait of Hormuz despite the short ceasefire between Iran and the United States are delivered. Kpler estimates that China's Middle East imports?will reach 2.71 million barrels per day (bpd) in August. This is up from the 2.43 million bpd of July, and the 1.42 mbpd of June. Kpler estimates that China's crude oil imports in August will be 5.97 million barrels per day. This is up from 2.43 million barrels per day (bpd) for July and 1.42 millions bpd for June, which was the lowest since 2013. September imports will 'likely be more telling, given that flows from the Middle East are more restricted due to the sharply reduced shipments via the Strait of Hormuz following the failure of the ceasefire agreement between U.S. president Donald Trump and Tehran. Even if recent moves to restore vessel movement through the strait are successful, it will still take several weeks before exports ramp up and for these tankers to arrive at?Chinese port. China's refiners have two options: they can continue to suppress their appetite for import crude and dip into stocks, or bid for cargoes coming from outside the Middle East. You like this column? Open Interest (ROI) is 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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US inflation data is the focus as gold drops from a seven-week high.
Gold prices fell on Monday, despite hitting a seven-week peak in the previous session. The stronger dollar was to blame, and investors are looking forward to inflation data, which will provide new clues about the policy direction of central banks. As of 1122 GMT, spot gold was down 0.2% to $4,332.68 an ounce. After weak U.S. payroll data, prices hit their highest level since June 17, on Friday. U.S. Gold Futures dropped 0.2% on Monday to $4,391.60. Dollar gained 0.2% making greenback bullion prices more expensive for holders of other currencies. Gold remains capped by the U.S. - Iran conflict and tensions along the Strait of Hormuz. This is keeping the threat of inflation and higher energy prices alive. It also shields the greenback against further losses. Oil prices rose a little on optimism about talks to reopen the Strait of Hormuz. However, gains were limited by Iran's demand that the United States meet several conditions before the waterway could reopen. Increased oil prices may cause inflation fears and interest rates to rise for longer. Gold is often seen as a hedge against inflation, but it becomes less appealing in an environment of high interest rates. The U.S. economy unexpectedly lost jobs in July. Previous job gains reported for the previous two months have been revised dramatically lower. According to the CME FedWatch Tool, traders now price a 44% chance of a rate increase in September, down from 57% prior to the jobs report. Investors will now be waiting for the U.S. producer and consumer price data, due Wednesday, to get a better idea of what the Fed is thinking about interest rates. Economists surveyed by predict that the consumer price index for July will have increased 3.4% on an annual basis, compared to 3.5% in June. Evangelista said that a headline figure lower than the consensus forecast of 3.4% would further decrease expectations of a Fed rate hike before the end of the year. This could weaken the dollar, and create upside potential for gold. Silver spot rose 0.6%, to $63.94 an ounce. Platinum fell 0.5%, to $1736.20 and palladium dropped 1.5%, to $1357. (Reporting and editing by Leroy Leo in Bengaluru, with Pablo Sinha reporting from Bengaluru)
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What is the identity of Iran's Mohsen Rezaei?
Iran has named Mohsenrezaei secretary of the Supreme National Security Council. This is a promotion of a prominent hardliner, and close ally to Supreme Leader Ayatollah Mojtaba Khamenei. The move comes more than five months after the conflict began with the United States. Rezaei succeeds Mohammad Baqer Zolqadr in the position of second-in command at the body that coordinates Iran’s security and foreign policy and is presided over by President Masoud Peshkian. Zolqadr has been appointed to be Khamenei's political advisor. What you need to know about Rezaei 71 COMMANDED RELATIONAL GUARDS AGE 27 Rezaei, who was 27 years old when he joined the Islamic Revolutionary Guard Corps in 1981, became its commander shortly after the Islamic Revolution. He was the IRGC's commander for 16 years and led it during the Iran-Iraq War, 1980-88, for the majority of that time. He belongs to a group of IRGC leaders who rose from the revolutionary underworld and became'senior figures within Iran's security apparatus. He has been a prominent figure within the political and security establishment of the country since he left his role as IRGC Commander. He is a perennial 'candidate' for the presidency of the Islamic Republic. He was vice president for economic matters from 2021-2023 under the hardline President Ebrahim Raisi. He has a Ph.D. in economics from University of Tehran. MOJTABA ADVISOR TO MOJTABA Rezaei became Khamenei's military advisor in March, after he was elected Iran's Supreme leader, replacing his late father, Ayatollah?Khamenei. He was killed during the U.S. and Israeli war against Iran. He has frequently made public statements throughout the war, in which he expressed a?deep doubt about negotiations? and threatened?the United States. Rezaei stated in April that it would be "great", if the U.S. invaded Iran on foot, because "we could take thousands of hostages, and for each hostage, we would receive a billion dollars". He said, "I'm not in favor of extending ceasefire. This is my personal opinion." Rezaei stated that the agreement was ambiguous and needed clarification in June before Iran signed the memorandum of Understanding aimed at ending war on June 17. He accused Washington of violating a deal on June 27 by creating tensions along the Strait of Hormuz. The Supreme Leader, reflecting his close ties with Mojtaba issued a Sunday decree appointing Rezaei to be his representative at the SNSC. Khamenei cited Rezaei's?valuable experience? in making the appointment. This includes his long military service. OPPOSED TO THE SHAH Rezaei, a teenager at the time, was a leader in the opposition against the Pahlavi monarchy that was overthrown in 1979. He was also imprisoned in 1973 by SAVAK (the security service of the Shah). He was instrumental in the formation and development of the Mansouroun group that was active in the 1970s against the monarchy. Rezaei and other members of the Mansouroun militant group, who were all imprisoned at the same time, became part of the senior leadership of the IRGC. CONTROVERSY OVER RECORDS IN IRAN-IRAQ WOAR His record in the Iran-Iraq War has caused controversy in Iran. His role in expensive offensives that resulted heavy Iranian casualties has been questioned by critics. In 2018, Rezaei stirred up new controversy when he tweeted that Karbala-4 was carried out in order to deceive enemies ahead of Karbala-5. Later, he clarified that initially the operation was intended to be a real offensive but that Iran used its failure in order to deceive the enemy ahead of Karbala-5. His remarks drew criticism from veteran groups, bereaved family members and political leaders. (Editing by Tom Perry and William Maclean).
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The share of Chinese copper in LME stock available fell to 42% by July
Data from the London Metal Exchange showed that in July, the share of Chinese-origin stocks was down to 42%, down from 59% one month earlier. The total amount of inventories available also nearly halved. The total available copper stocks in LME warehouses 0#MCUSTX_LOC> fell to 101.42 metric tons by the end of July. This is the lowest level seen since January. Metal continues to flow into the U.S. ahead of potential import tariffs. The total volume of?copper in China fell by 75,600 tonnes to 43,050, while stocks of other 'key suppliers' such as Chile and Zambia, or the Democratic Republic of Congo, showed a?more modest drop. The share of Russian-origin aluminum stocks available in LME storages remained at 95% after a small decrease in July. The total available or on-warrant aluminium inventories (0#MALSTXLOC>) fell by 0.5% to?245,250 tonnes in July, the lowest level since April 2025. The available Russian aluminium stock fell by 1,225 tonnes to 232 800 tons. Many traders shun Russian aluminum, even though it is still eligible for trading if produced before April 13, 2024. After that date, all aluminium produced in Russia was banned from the LME's warehousing system. At the end of December, the share of "Chinese-origin Nickel" remained at 70% of LME stock. Reporting by Tom Daly. Mark Potter (Editing)
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TechMet, a mining investor, forms a US subsidiary to attract additional capital
TechMet, a mining investor, announced on Monday that it would 'form a U.S. based subsidiary in order to attract capital from both public and private partners for critical minerals projects. The U.S. Government is a major shareholder in Dublin-based TechMet. This new subsidiary will help the company boost the mining industry of the United States, which was highlighted by President Donald Trump last week. Brian Menell is the CEO of TechMet. He said, "This is a significant acceleration in TechMet's commitment towards building out its U.S. critical minerals production platform." Menell will be appointed chairman of the U.S.-focused company, which will hold TechMet's stakes in the lithium startup EnergySource Minerals and the U.S. Vanadium is partnering with Momentum Technologies, Xerion Advanced Battery and battery recycling company Momentum Technologies. TechMet is the largest shareholder of all four companies, having invested over $400 million in them. Menell stated that the U.S. subsidiary would be based in Washington, D.C., with an initial goal to get those four companies into commercial production before considering other investments. He said that there was no question about spinning off the company, distributing it, or realizing its value. "We see billions of dollars in value and relevance that we must make happen in the U.S., and want to be a part of it in 'the long-term." TechMet, a privately-held company, also holds stakes in other mining companies outside of the U.S. including Brazilian Nickel and South Africa’s Rainbow Rare Earths. (Reporting and editing by David Gaffen; Ernest Scheyder)
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Gold gains as Fed hike expectations fade and US inflation data is in focus
Gold prices climbed a little higher on Monday, after hitting a seven-week high the previous day. Weak U.S. job data dampened expectations for Federal Reserve interest rate hikes. Investors are now looking forward to inflation data as they seek new clues about the central bank's future policy. As of 0856 GMT, spot gold was up by 0.1% to $4,345.09 an ounce. After weak U.S. payrolls data, prices hit their highest level since June 17 last Friday. U.S. Gold Futures rose 0.1% on Monday to $4,404.80. The gold price continues to benefit from the positive momentum of last week, after the disappointing U.S. "Gold prices continue to benefit from last week's positive momentum, following the disappointing?U.S. The data showed that the U.S. economy shed unexpected jobs in July. Previous job gains for the previous two months were sharply revised lower. This has weakened expectations of a Federal Reserve rate increase next month. According to the CME FedWatch Tool, traders now price a 44% probability of a rate increase in September. This is down from 57% prior to the jobs report. Bullion does not earn interest, so a lower interest rate environment makes gold more attractive than income-generating assets. Investors will now be waiting for the U.S. producer and consumer price data, due Wednesday, to get more clues about the Fed's outlook. Economists surveyed by predict that the consumer price index for July will?have increased?3.4% on an annual basis, compared to 3.5% in June. "A headline number below the consensus forecast, 3.4%, could further reduce expectations that the?Fed will increase rates before the end the year. This would weaken the?dollar while creating upside potential for the gold price," said Evangelista. Iran has said that it is close to a?final pact? with Oman defining?new shipping?lanes? between them via the Strait of?Hormuz. However, the U.S. still needs to meet certain conditions before this strategic waterway can be reopened. Silver spot rose by 0.9%, to $64.14 an ounce. Platinum fell 0.4%, to $1737.42 and palladium dropped 1.2%, to $1360.75. (Reporting from Bengaluru by Pablo Sinha;)
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Officials say that Ukraine killed 13 people, including a child, in a drone attack on the Russian city of Nizhnekamsk.
Authorities said that at least 13 people, including a child, were killed and 39 others injured by a Ukrainian drone strike on industrial and civil targets in Nizhnekamsk. This is the highest civilian death toll in Russia for months. According to Russian media, the attack also targeted a major oil refinery in the Tatarstan Region, located about 800 km (497 mi) east of Moscow. In a press release, Russian investigators announced that they had opened a criminal investigation into the attack they deemed a terrorist act. They said that Ukraine struck residential areas in which a child was killed. Radmir Belyayev said that Rustam Minnikhanov has declared a day of mourning in the Tatarstan region of Russia, Radmir Belyayev is the mayor of Nizhnekamsk. Russian media reported that the region's oil refining facility, which is one of Russia's most technologically advanced refineries, was targeted in this attack. Unverified videos posted on social media show smoke rising above what appears to an oil refinery. The footage could not be independently verified. Ukraine did not comment immediately. Tatneft’s TANECO, which was also struck by Ukraine in June, processed 17 millions tons of crude oil - producing 2.7million tons of gasoline, and 8.5million tons of diesel fuel - in 2024. Ukraine intensified its attacks on Russian oil refineries over the past few months, leading to fuel shortages across Russia. Ukraine claims it wants to pass on the cost of Russia's conflict to ordinary Russians. Moscow imported fuel to boost supplies. Both sides claimed lethal attacks on?Sunday. In a Russian attack on Kharkiv in eastern Ukraine, 37 people were injured and three were killed. Meanwhile, authorities in Belgorod, Russia, reported that five people had been killed and 25 others wounded by an Ukrainian drone attack. Both Ukraine and Russia claim they don't target civilians. (Reporting and writing by Gleb Stlyarov/Andrew Osborn, Editing by Andrew Osborn & Sharon Singleton).
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Hungary switches one Paks generator back on as Danube levels rise
After a rise in the water level on the Danube River, which cools the plant, Hungary began to turn back on a generator at the Paks nuclear power plant on Monday. This will provide some relief for the facility that supplies nearly half of the country's electricty. In recent weeks, the Danube reached record lows amid a heatwave and a drought that lasted across most of Europe. The plant was forced to run at just 10% of its full capacity. Only one of eight turbines remained operational. The droughts in Europe this summer have already caused havoc with the power, shipping, and health systems. The economic impact on the region is estimated at hundreds of billions. In 'Romania, for example, similar problems forced the declaration of an energy emergency for the entire month of August. The flow of the Danube was redirected so that its single nuclear plant could continue to 'operate for the next couple of days. DANUBE RISE MIGHT BE ONLY TEMPORARY Peter Magyar, the Hungarian prime minister, said that on Monday work had begun to restart a second Paks turbine after the Danube climbed 19 centimetres over its low of last week. He said that the second turbine would start producing electricity by Monday evening. Magyar warned last week that rain in Austria might raise the Danube level, but that it would only be temporary. Magyar said that last week, the government was working on a longer-term solution. This included reviewing the Paks 2 expansion as the current design makes the new?plant dependent upon cooling water from Danube. Magyar, who spoke last week, said that it was important to keep the nuclear power plant running, because "the Hungarian economic system cannot function without the plant for months." Magyar said that the government would also tender 700 megawatts by August 31, and develop four gigawatts by 2030. (Reporting and editing by David Holmes; Anita Komuves and Krisztina than)
Morning Bid - Americas- Fed's Cook grills again
What's important in U.S. and Global Markets Today By?Mike Dolan Editor-at-Large for Finance and Markets
The surprise drop in U.S. July payrolls did not affect interest rates as much as initial reactions might have suggested.
The markets are still pricing a 50-50 chance of a Federal Reserve rate hike next month. Meanwhile, Treasury yields only ended marginally lower for the day.
Below, I'll go into more detail. Listen to the Morning Bid podcast to hear about the recent soft jobs report and President Trump’s renewed efforts to fire Fed Governor Lisa Cook. Subscribe to the Morning Bid daily podcast and hear our journalists discuss all of the latest news in finance and markets seven days a weeks.
FED'S COOK GREENED AGAIN After the soft numbers on jobs, there were several reasons why the markets were cautious, including a drop in unemployment rates that was equally surprising, oil prices that remained edgy, and fresh political pressures on the Fed. In addition, the Treasury issuing $125 billion of new debt this week. On Wednesday, the consumer price index for July will be released. This is a report that could prove to be more important than any other. The annual headline and core rates will likely be lower this month, though the first is expected to remain above 3%. Brent crude rose above $84 a barrel on Monday as Tehran demanded that Washington make concessions before the Strait of Hormuz was reopened. This is not helping to lift spirits, and hopes of a deal with Iran were dampened by this. Concerns about Fed independence were reignited on Friday when President Donald Trump ordered that Lisa Cook respond to mortgage allegations made against her in three weeks or face dismissal, which the Supreme Court had already ruled was not appropriate.
LSEG data show that stock markets continue to bask in the glow from a second quarter earnings season which has seen an aggregate annual profit increase of 51% among S&P 500 firms. Asia's stock markets rose on Monday in line with Wall Street's gains from Friday. U.S. equity contracts were also slightly higher before the bell. China's July Inflation numbers were below expectations on Monday. There is little else on the agenda for today, as the earnings season has slowed down this week, even though there are updates from Applied Materials Cisco and CoreWeave.
Chart of the day Payrolls fell unexpectedly by?23,000 in July, and the economy added 103,000 less jobs than originally estimated in May and June. Over the last three months, job growth has averaged 20,000 jobs per month. The President Donald Trump fired Erika McEntarfer, the BLS Commissioner, last year after he downgraded?May's and?June's data. Trump accused McEntarfer, without providing any evidence, of manipulating data. The Senate confirmed Brett Matsumoto, a career economist, to be the BLS commissioner on Friday.
Watch today's events
* U.S. Conference Board Employment Trends Index for July (10 am EDT)
* Beth Hammack, Cleveland Fed (3:00 p.m. Eastern)
Want the Morning Bid delivered to your inbox each weekday morning? Subscribe to the newsletter by clicking here. Follow us on LinkedIn, X and ROI. The opinions expressed by the author are their own. These opinions do not represent those of News. News is committed, as part of the Trust Principles to independence, integrity and a lack bias. (By Mike Dolan).
(source: Reuters)