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The strong dollar and ample supply of oil weigh on the price of crude oil, which is expected to fall for a third consecutive month.
The oil prices fell on Friday and are heading towards a third consecutive monthly decline as the stronger dollar has capped gains in commodities, while a rising global supply from major producers offsets the effect of Western sanctions against Russian exports. Brent crude futures fell 33 cents or 0.51% to $64.67 per barrel at 0027 GMT. U.S. West Texas Intermediate was $60.22 per barrel, down by 35 cents or 0.58%. In a recent note, ANZ analysts stated that a stronger USD impacted investor appetite for commodities. The greenback gained after Federal Reserve Chairman Jerome Powell stated on Wednesday that a rate reduction in December is not guaranteed. Brent and WTI prices are expected to drop by about 3% this October, as the Organization of the Petroleum Exporting Countries (OPEC) and other major producers will be increasing production to gain market shares. The increased supply will also help to cushion the impact on Russian oil exports, which are currently restricted by Western sanctions. These include China and India. Sources familiar with the discussions said that OPEC+ was leaning toward a modest increase in output for December. The group will meet on Sunday. Eight OPEC+ member countries have increased their monthly production targets by a combined total of 2.7 million barrels a day - about 2.5% global supply – in a series. The data released by the Joint Organizations Data Initiative on Wednesday showed that crude exports in August from Saudi Arabia, which is the world's top oil exporter, reached a six-month record of 6.407 millions barrels per day. They are expected to continue rising. The U.S. Energy Information Administration's (EIA), in a report, also reported a record production of 13,6 million bpd for the week. Donald Trump, the U.S. president, said that China had agreed to start the process of buying U.S. Energy. He added that an extremely large transaction could take place regarding the purchase of oil from Alaska. Analysts are unsure whether the U.S. - China trade agreement will increase Chinese demand for U.S. Energy. Michael McLean, Barclays' analyst, said that Alaska produces less than 3% of the total US crude output. "We think Chinese purchases would likely be driven by market forces," he wrote in a Barclays note. (Reporting and editing by Jamie Freed; Florence Tan)
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Australian shares snap a three-day losing streak as Banks and miners drive the Australian share price upward
Australian shares rose Friday, ending three consecutive sessions of losses. Banks and miners saw gains, while Origin Energy shares fell to a new two-month-low after the company reported a sequential decline in its first quarter revenue. By 0004 GMT, the S&P/ASX 200 Index had risen 0.5% to 8,930.80. The benchmark closed Thursday 0.5% lower. Origin, a power producer, was one of the biggest losers in the benchmark index after it reported a 12% decline in revenue from its stakes in the Australia Pacific LNG Project. This was due to lower LNG prices and volumes. The firm's shares fell 6.3% to A$11.81 in their lowest trading session since April 7. Separately shares of insurance broker Steadfast Group were the biggest losers on the benchmark index, dropping up to 18.9% to A$5.03, their lowest level since November 16, 2022. After the company's bell rang on Thursday, Robert Kelly, its CEO and managing director, announced that he would temporarily step down from his position while an investigation was conducted by an outside party into a complaint lodged against him. On the local stock exchange, the banks rose 0.8% while the "Big Four", which includes the four largest banks, rose between 0.1% to 1.3%. Gold miners rose on the backs of higher gold prices, which boosted their gains by 1.2%. The shares of gold miners Evolution Mining (up 3.5%) and Northern Star Resources (up 3.8%) rose respectively. JB Hi Fi continued to fall for the second consecutive session. The firm had posted on Wednesday a dramatic sequential decline in sales growth for its Australia and New Zealand segment in the first quarter. Shares of Mayne Pharma, a potential acquirer, fell to their lowest intraday performance ever after it was revealed that Australia's Treasurer would block the A$672 ($436.67$) takeover. The benchmark S&P/NZX50 index in New Zealand rose 0.4% to 13,509.0.
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Electric vehicles end China's annual holiday spike in gasoline consumption
Tianyu Jiang drove his electric car from the southwest Sichuan basin in China to Beijing during the national holiday week this month. "I used a petrol vehicle and never took an EV on such a long trip. But driving an EV over a distance doesn't seem like a problem any more," Jiang said. The expansion of the charging infrastructure has helped to reduce the use of gasoline during the "Golden Week" holiday in October. According to Chinese consultancy Sublime China Information, China's gas demand has fallen by 9% on an annual basis in October, to 12.5 millions tons. The average daily consumption is roughly the same as September. The sagging holiday demands are symptomatic for the broader decline of Chinese fuel consumption due to the wider adoption of EVs, which signals the end of China's decades-long role of being the primary driving force behind new global oil demand. The peak in gasoline consumption was reached in 2023 in the world’s largest importer of crude oil. According to the research division of the state oil company Sinopec, the demand is expected to drop by more than 4% in this year compared with 2024. During the nine-month period of this year, EVs accounted for almost half of new car sales. Transport ministry reports that a fifth of the 63.5 millions car trips made during the eight-day break was in hybrid or electric vehicles. The daily use of electricity at charging stations - a proxy for the use of EVs - increased by 45,73% during Golden Week in this year compared to 2024. China's drive to build charging infrastructure has led to a 54.5% increase in the number of charging ports at the end September. Jiang said that both charging and refuelling during peak travel times means waiting. If you need to charge your car, you can find a charging station within 10km (6 miles) of the highway. It's also cheap. (Reporting and editing by Clarence Fernandez in Beijing, Sam Li and Lewis Jackson)
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Brazil's Gerdau saw its adjusted Q3 profit fall due to domestic market.
The Brazilian steelmaker Gerdau reported on Thursday a 23.9% drop in its adjusted quarterly net profit compared to the same period a year ago, as its booming business in North America has been offset by poor results in its home market. In the quarter July-September, Gerdau's net profit adjusted fell to 1,09 billion reais (201.71 millions). The company's adjusted earnings before taxes, depreciation, and amortization (EBITDA), which is a measure of its profit, came in at 2,74 billion reais. This was down 9.2% from the previous year, but in line with what analysts expected in a LSEG survey. The company stated that the results were impacted heavily by steel oversupply, which drove prices down despite constant production. Its second largest market is Brazil, just behind North America. The domestic market's gross profit fell 70.1% from a quarter earlier, to 403 millions reais. This is despite the fact that the steel production was only down 0.4% during the same period. Gerdau's gross profits in North America jumped 48.9% from the previous year to 1.5 billion reais during the third quarter. The total revenue for the quarter was 18 billion reais. This is up 3.5% compared to a year ago and higher than analysts' expectations of 17.6 billion. $1 = 5.4039 Reais (Reporting and editing by Brendan O'Boyle).
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Miner Vale beats net profit for the third quarter
Vale Rio de Janeiro-headquartered Vale posted a $2.69 billion net profit for the July-September period, up 11% year-over-year and above the $2.1 billion expected by analysts polled by LSEG. The adjusted earnings before interest taxes, depreciation, and amortization (EBITDA), which was $4.4 billion, represented a 21% rise, beating the estimates of $4.1billion. Vale published its sales and production data last week. Iron ore production reached the highest level since the fourth quarter 2018 with 94.4 million metric tonnes. The company's net revenue increased by 9% from the same quarter last year to $10.4 billion. Analysts expected a revenue of $10.3 billion. Vale has also reduced its estimate of copper costs per ton this year from $1,500 to $1,000. Previous projections ranged between $1,500 to $2,000 per tonne. The company projected that its nickel costs would range between $13,000 to $14,000 per ton. This is a significant increase from the previous range of $14,500 to $15,500. (Reporting and editing by Brendan O'Boyle; Roberto Samora, Andre Romani)
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Deforestation in Brazil’s Amazon reaches 11-year low before COP30
Data released by the government on Thursday showed that deforestation rates in Brazil's Amazon rainforest dropped 11.08% between January and July of last year, a record low. The data was released days before Brazil hosts the United Nations Climate Summit known as COP30. This is a victory for President Luiz inacio Lula Da Silva who wants to highlight his government's achievements on the environment at the conference. Lula has committed to ending all deforestation within the country by 2030. Amazon destruction has decreased by half since the start of his tenure in 2023. Inpe, the Brazilian space agency, released a report that showed the Amazon had been destroyed by approximately 5,796 square kilometers in the past year, the lowest number since 2014. Even in my best laid plans, I never would have imagined we would be at this point where there is a 50% decrease in deforestation," said Environment Minister Marina Silva during a press briefing. Deforestation in Brazil's Cerrado Savanna fell by 11.49% to 7,235 sq km, the lowest in six years and the second consecutive decline following four years of increasing deforestation, including Lula's inaugural year in office. Environmentalists have criticized the government for its support of Petrobras plans to drill near Amazon River's mouth. (Reporting and writing by Lisandra Pagaguassu, Brasilia. Editing and editing by Leslie Adler & Matthew Lewis.)
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Sloviansk's Zelenskiy, Ukraine: two dead in Russian attack against power station
Volodymyr Zelenskiy, the president of Ukraine, said that a Russian bomb attack on a Ukrainian power plant in Sloviansk killed two people on Thursday and injured several others. In his video nightly address, Zelenskiy described the attack on the Donetsk Region near the frontline as "strictly terrorism". He claimed that energy sites are the primary targets of Russian drones and missiles. Could not independently verify this account. According to prosecutors in Donetsk Region, Russians attacked private homes in the city Kramatorsk and killed one person. They also injured three others. Sloviansk, Kramatorsk, and other Russian targets will be the main Russian targets as Russian troops slowly advance through Donetsk. (Reporting and editing by Cynthia Osterman, Ron Popeski, and Bogdan Kochubey)
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Sugar prices hit five-year lows as surplus forecasts swirl
Investors weighed the news of an U.S. China trade truce as they analyzed the world sugar price's fifth-year-low for a forth consecutive day. The raw sugar futures traded on the ICE, which are used to price physical sugar all over the world, settled down by 0.14 cents, or 1%. They had previously hit their lowest level since October 2020, 14.07 cents per lb. After touching their lowest level since December 2020, white sugar futures dropped 0.9% to $414.00 per metric ton. Michael McDougall, an independent sugar analyst, noted that the weather forecasts for key sugar-producing areas are still benign and boosting crop prospects. Meanwhile, oil prices continue to be under pressure due to a lack details in the U.S. China trade agreement. The sugar price in Brazil is still two to three cents lower than the parity for ethanol, so the message to Brazil's cane mills should be to produce more ethanol and less sugar. McDougall stated that "the trend is lower, and some are talking about 10-13cents. But when too many people look further down, it is a preliminarily signal that we will not see that." Sugar production in Brazil, the world's largest producer, grew faster than expected during the first half October. It increased by 1.25%, versus a 0.6% expected increase. Mills have reduced the cane they allocate to sugar production, and increased ethanol production. Datagro, a Brazilian consultancy, had forecast last week that the global sugar deficit would turn into a surplus in 2025/26 of 1,98 million tons from a 5,000,000-ton surplus. To limit sugar losses, the state of Uttar Pradesh in India has increased the price mills have to pay for their new crop. This should make sugar exports more difficult. Other soft commodities also rose, with arabica coffee up 0.3% or 1.3 cents per lb to $3.92, and robusta coffee rising 0.7% to $4.641 per ton. London cocoa increased 0.4%, reaching 4,374 pounds a ton. New York cocoa also rose 0.2% to $6,058 per ton. (Reporting and editing by Ed Osmond, Alan Barona and May Angel)
QUOTES-What are they saying at the COP29 environment summit?
World leaders are speaking at the U.N. environment summit in Baku on Wednesday.
Here are the most recent remarks:
ALBANIA PRIME MINISTER EDI RAMA
I decided to leave aside my well ready speech because ... yesterday I was viewing the silent TV in the leaders' lounge, where the organizers have attentively added green plants above the comfy couches.
People there eat, consume, satisfy, and take images together, while images of voiceless speeches from leaders play on and on and on in the background.
To me, this appears exactly like what takes place in the real world everyday. Life goes on with its old routines, and our speeches, filled with good words about battling environment modification, modification nothing.
IRAN VICE PRESIDENT SHINA ANSARI (through translator)
We hope that (the) global neighborhood, devoid of political concerns, will stand together, exchange understanding, transfer innovation and help with accessing financial resources without discrimination, and totally lift unilateral sanctions versus nations, particularly the Islamic Republic of Iran.
Nevertheless, we can not forget the truth that the current climate situation of the world is the result of the industrial policies of (a) few developed countries and developing states will not be deprived of their right to development due to the fact that of what others have done.
Once again, we highlight that if this conference needs to plan to prove its goodwill in pursuing a better future for all, while continuing on avoiding double requirements to attain significant actions by all nations to achieve these objectives.
VATICAN SECRETARY OF STATE CARDINAL PIETRO PAROLI
A real eco-friendly debt exists, particularly in between the global north and south, connected to business imbalances, which impacts on the environment and the disproportionate usage of natural deposits by certain countries over long periods of time.
For that reason, it is important to look for a new worldwide monetary architecture that is human-centered. and based upon the concepts of equity, justice and solidarity. A financial architecture that can really guarantee for all countries, especially the poorest and those most vulnerable to environment catastrophes, both low carbon and high sharing development paths.
BAHAMAS PRIME MINISTER PHILIP DAVIS
Already, devastating climate occasions worldwide have resulted in considerable death, property, and infrastructure. And yet, we persist in reacting to these events as though they are simply unfortunate, separated, and nationwide occurrences. I ask you to look beyond borders, beyond flags: the fires that devour your forests and the cyclones that devastate our homes are not distant misfortunes however shared tragedies.
What we sustain, you endure. What we lose, you lose. And if we fail to act, it will be our kids and grandchildren who bear the concern, their dreams lowered to memories of what might have been.
GREECE PRIME MINISTER KYRIAKOS MITSOTAKIS
Europe and the world must be more sincere about the trade offs involved in the energy transition. Yes, the energy shift will, in the long run, lower costs, however this transition will not be painless.
We need to ask hard questions about a course that goes very fast at the cost of our competitiveness, and a path that goes somewhat slower but enables our market to adapt and to grow. It is our responsibility to weigh these trade offs carefully, not to blend them away.
Our citizens are faced with unmatched climate shocks, we require more resources to prepare to respond in time, in order to save lives and incomes and to help individuals and communities rebuild after catastrophe. We can not focus so much on 2050 that we forget 2024.
(source: Reuters)