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Trump blocks state climate policies
The executive order issued by U.S. president Donald Trump on Tuesday aims to prevent the enforcement of laws that have been passed in states to reduce fossil fuel use and combat climate changes. This is just the latest effort by Trump's Administration to boost domestic energy production and fight back against policies largely led by Democrats to curb carbon emission. The move came only hours after Trump, the Republican, had issued orders to increase coal output. The order directs the U.S. Attorney general to identify state legislation that addresses climate change, ESG Initiatives, environmental justice, and carbon emissions and take action to block it. The order stated that "Many States are enacting or in the process enacting burdensome, ideologically-motivated 'climate changes' or energy policies which threaten American energy dominance, our economic and national safety, and our economic growth." Trump cited New York's and Vermont's laws that fine fossil-fuel companies for their contributions to climate change. He also cited California's cap and trade policy and lawsuits filed by states seeking to hold energy companies responsible for global warming. The U.S. Climate Alliance is co-chaired by two Democratic Governors, Kathy Hochul of New York and Michelle Lujan Grisham of New Mexico. Climate Alliance – Kathy Hochul from New York and Michelle Lujan Grisham from New Mexico – said that states cannot be stripped of their power and will not be discouraged by the executive order. In a joint press release, they stated that "we will continue to advance solutions to the climate crises which safeguard Americans' right to clean water and air, create well-paying employment, grow the clean energy industry, and make our tomorrow healthier and safer." The Alliance is made up of 24 governors who are committed to climate action. The American Petroleum Institute (an oil and gas trade association) praised the order. API Senior Vice-President Ryan Meyers stated in a press release that "we welcome President Trump's actions to hold states such as New York and California responsible for their unconstitutional attempts which illegally penalize U.S. producers of oil and gas for providing the energy American consumers depend on every day." (Reporting and editing by Nichola Gibbs; Reporting by Nichola.
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As US tariffs against China reach 104%, the offshore yuan is nearing a record low.
Investors worried about the intensifying Sino-U.S. tensions, and 104% tariffs that are coming to China. Analysts say the yuan's decline this week is due to the intensification of a trade conflict between the two world's largest economies and the loosening of the central bank's grip on the currency. In volatile trading, the yuan last moved 0.4% higher to 7.3955 on the offshore market. It had fallen more than 1% the previous day and hit its lowest level ever at 7.4288. The United States announced on Tuesday that duties of 104% on imports from China would take effect shortly after midnight. At the same time, the Trump administration was moving quickly to start negotiations with other trading partners who are targeted by his tariff plan. The move in the dollar-CNH overnight is material. It was triggered by the fact that Trump will move forward with additional tariffs against China, said Carol Kong. Kong predicts that the offshore yuan will reach a low point of 7,7 per dollar at the end of third quarter. However, he said this level could be achieved earlier "if both the U.S. The People's Bank of China set the midpoint exchange rate, around which the onshore currency yuan can trade within a 2% range, at 7,2066 per US dollar on Wednesday. This is the lowest level since September 11th 2023. On Tuesday, the onshore yuan fell to a low of $7.3402 per $1 and finished the session slightly lower at $7.3390. The yuan has lost over 1% in value against the dollar this month. This is a slight decline for the entire year. Fears of the impact of U.S. Tariffs on the economy have pushed the yuan down. Exports would be cheaper, and some pressure from China's economy and trade would be relieved. However, a rapid decline in the yuan could cause unwanted capital outflows and threaten financial stability.
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Oil drops nearly 4% after US imposes 104% tariffs against China
Early trade on Wednesday saw oil prices drop to their lowest level in over four years, due to a looming supply concern, fueled by escalating tensions between the U.S., China and other major economies. Brent futures fell $2.13 or 3.39% to $60.69 per barrel at 0108 GMT. U.S. West Texas Intermediate Crude Futures dropped $2.36 or 3.96% to $57.22. Brent crude oil reached its lowest level since March 2021, and WTI touched its lowest level since February 2021. Both benchmarks have fallen over five consecutive sessions after U.S. president Donald Trump announced sweeping duties on most imports, sparking fears of a global war of trade that would hit economic growth and fuel demand. A White House official told reporters on Tuesday that the U.S. would impose a tariff of 104% on China on Wednesday at 12:01 am EDT (0401 GMT). This is an additional 50% to tariffs imposed after Beijing did not lift its retaliatory duties on U.S. products by the noon deadline set by Trump on Tuesday. Beijing has vowed to not bow to the U.S.'s blackmail, after Trump threatened to impose an additional 50% tariff on Chinese products if China did not lift the 34% retaliatory duty. Ye Lin, vice-president of Rystad's oil commodity markets, said that China's aggressive retaliation has heightened fears about a global economic recession. She said that if the trade conflict continues, China's oil demand growth of 50,000 to 100,000 bpd is at risk. However, a stronger incentive to boost the domestic consumption could help mitigate these losses. The decline in oil prices was exacerbated by the decision made last week by OPEC+ - which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia - to increase production by 411,000 barrels a day in May. Analysts say this will likely push the market to surplus. Goldman Sachs forecasts that Brent oil and WTI crude oil could drop to $58 and $62 per barrel in December 2025, and to $55 per barrel and $51 per bar by December 2026. On Monday, as oil prices fell, the price of Russia's ESPO blend oil fell below $60 per barrel Western cap price level for the very first time. Data from the American Petroleum Institute showed that U.S. crude stocks fell by 1.1m barrels during the week ending April 4. This was in contrast to expectations in a survey for a build-up of about 1.4m barrels. The Energy Information Administration will release official inventory data on Wednesday, 10:30 am EDT (1430 GMT).
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U.S. Steel announces that activist investor Ancora now supports the Nippon Steel merger
U.S. Steel announced on Tuesday that activist Ancora Holdings has "flipped-flopped", and now claims support for the transaction. Ancora recently announced a plan in connection with the proposed transaction that could result in a cash offer at $75 per share. The investor, who owns less than one percent of the company, has said it will not stand in the way for the Nippon deal of $55 per share. U.S. Steel, based in Pittsburgh, called Ancora’s “last-minute plan” inconsistent, and asked, "If Ancora believes that their plan will deliver $75+ per shares, why do they suddenly support a cash deal of $55 per share with Nippon Steel?" Separately, Ancora called on U.S. Steel’s board on Monday to delay the annual shareholders meeting until after June 18 The meeting is currently scheduled for May 6. The decision comes after U.S. president Donald Trump instructed the Committee on Foreign Investments (CFIUS), to conduct and complete a new review within 45 days. Ancora has launched a challenge in the boardroom at U.S. Steel to remove CEO David Burritt. It has nominated 9 candidates for the board of directors. U.S. Steel stated in a press release on Tuesday that the shareholders should vote for each of the 10 nominees for director standing for election, and "discard any materials sent by Ancora." Ancora didn't immediately respond to an inquiry for comment made late on Tuesday. (Reporting and editing by Rishabh J. Jaiswal in Bengaluru, Mr. Mrinmay D. Dey)
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Andy Home: Annual zinc processing benchmark is bullish, but it's not:
Zinc is the underperformer in the London Metal Exchange's (LME's) base metals pack. This year's benchmark treatment charge for smelters reinforces this story. Bloomberg reports that Korea Zinc has agreed to pay $80 per ton of zinc concentrate to the smelter for it to refine. According to CRU, this is a dramatic drop from the benchmark price of $165 per tonne last year and represents the lowest result in at least fifty years. The fact that smelters can charge more during times of oversupply of raw materials and less when there is a shortage of those same materials, might make this year's benchmark seem like a very bullish sign. The benchmark is the last year's deal. This year's benchmark, compared to spot treatment costs, which became negative at the end of 2024 is an indication that both smelters, and mines, expect a strong recovery in the supply of mined zinc by 2025. Unexpected Famine in the Year of 2009 The benchmarking deal negotiated last year by the two companies was outdated almost as soon the ink dried. According to Shanghai Metal Market, the Chinese data provider, spot treatment charges have fallen over the rest of 2024. They reached a record low of minus 40 dollars per ton during the fourth quarter. Zinc concentrates were in short supply, as the glaring disconnect between the benchmark and the actual quantity was shocking. The year that was expected to be a year full of plenty became a year of famine, due to both price-related mine closings in 2023 as well as a series of supply problems such the fire at the new Ozernoye mining facility in Russia. In its meeting in April 2024, The International Lead and Zinc Study Group predicted that global mine production would increase by 0.7% compared to 2023. In reality, the mine production fell by 2.8%, which marked the third consecutive year that output had fallen, according to a February update. Last year, the tightening of raw material availability led to a 2.6% drop in global refined zinc production. This left the market with a 62,000-ton deficit between supply and demand. MINE SUPPLY RANKS UP SMM assessed the last Chinese spot treatment charge for imported zinc concentrates at $35 per ton. The volume of zinc concentrate imported by China is also increasing after it fell 13% in 2024. This was the first decline on a year-to-year basis since 2021. Inbound shipments in January and February increased by 33% compared to the same period last year. The first time in years that China imported zinc concentrate from the Democratic Republic of Congo, this is a testament to the restart of Ivanhoe Mines' Kipushi mine. The imports of Russian coal from January to February more than doubled compared to the same period last year, suggesting that production at the Ozernoye Mine is also increasing. Zinc smelters in China are encouraged to increase their run rates by improved concentrate availability and spot treatment recovery terms. According to ILZSG, the production of refined zinc at the world's biggest producer dropped by 3.4% in 2013. SMM's latest survey indicates that production in March was up 4.0% compared to March last year. Production is expected to increase even more in April. FEEDING THE BEAR NARRATIVE Smelters in China will gladly process more metal if the mined output increases. Zinc is not a popular metal with analysts at the moment. According to ILZSG, global demand grew just 0.1% in the past year. The prospects for zinc this year are not encouraging. Zinc is heavily used in construction, which leaves it vulnerable to a weak global sector. Meanwhile, tariffs imposed by President Donald Trump will affect the demand for manufacturing products. LME zinc three-month fell below $2,600 per ton for the first since August. It is down 13% from the beginning of the year. Another Surprise? The magnitude of the price drop in zinc injects uncertainty into the bear market script. If the zinc price falls further, we would see it return to the low levels that led to multiple mine closures in 2023 and contributed to the scarcity of last year. In recent years, zinc supply has been highly sensitive to price, and the raw material supply chain dynamics can change quickly. This is what causes smelters to be caught off guard. The zinc raw material market was not accurately predicted by the smelter benchmark of last year. This year's is not as reliable. The author is a columnist at
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US licenses for Trinidad-Venezuela gas projects revoked, Trinidad says
Stuart Young, the Caribbean's Prime Minister, announced on Tuesday that the United States had revoked the two licenses they granted in the past for the development offshore natural gas projects, between Trinidad and Tobago, and Venezuela. Trinidad is one of the biggest exporters of liquefied gas in Latin America, and also of ammonia and methane. However, the Caribbean island aims to develop offshore fields near Venezuela's maritime border and to offset its decreasing reserves. These projects are the only way for Venezuela in the short term to begin to export its gas and monetize the vast reserves. This would provide a new revenue stream that is desperately needed. Young stated in a recent press conference that the licenses, which allowed Shell, BP, and Trinidad's National Gas Company, to plan projects as an exemption to the U.S. sanctions regime against Venezuela, have a deadline of May 27 for the companies. Venezuela granted Shell in 2023 a license for 30 years to operate the Dragon Field, which has 4 trillion cubic feet natural gas reserves. The project was to export gas to Trinidad in the next year, to be converted into LNG. Venezuela granted BP a similar license last year for the development of a field that crosses borders called Manakin Cocuina. The sanctions Washington has imposed on Venezuela's state-owned PDVSA and the energy industry in Venezuela require the companies to obtain licenses from the United States before they can negotiate, plan or develop projects. Last month, the administration of U.S. president Donald Trump began to suspend many authorizations related to Venezuela. This included Chevron in the United States, Eni from Italy and Repsol from Spain. They were given until May 27th to end operations and exports. Venezuelan officials claim that the sanctions are an economic war. The United States accuses Venezuelan President Nicolas Maduro for not doing enough to restore the democracy in Venezuela and to secure the return of illegal migrants to the U.S. Shell declined to comment. BP and Venezuelan government didn't immediately respond to requests for comments. Young, the prime minister of Trinidad and Tobago, stated that the cancellation stops all payments to Venezuela in relation to these projects. Trinidad wants to meet with the U.S. Government about the suspensions, as well as the recent tariffs imposed on Chinese shipping that could hurt the Caribbean island.
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Peabody Energy evaluates options for a $3.78 billion Anglo American deal
Peabody Energy announced on Tuesday that it is reviewing all options in relation to its $3.78 Billion acquisition agreement with Anglo American, for some of the Australian steelmaking coal assets. This was after an ignition incident at a mine. The deal was signed in the last year, and it was expected to be completed by mid-2025. Media reports claim that production at Anglo American Moranbah North Mine, located in Queensland's Bowen Basin, Australia, was suspended last week after an underground fire broke-out at the mine. Peabody stated that it is in constant communication with Anglo American, to better understand its impact on the event. It will also preserve all rights under the purchase agreement. The U.S. coal producer said it had begun preliminary discussions with investors about permanent financing of the acquisition. Peabody’s deal to acquire Anglo American assets included a $2.05 billion upfront payment at completion. There was also a $725 million deferred cash amount and a potential $550,000,000. The deal also included an contingent cash consideration of $500 million tied to the reopening the Grosvenor Mine. Anglo American didn't immediately respond to an outside of business hours request for comment on the fire or Peabody’s announcement. Anglo American’s deal with Peabody is its first major divestment as part of a larger restructuring plan. The British company that last year beat back a $49 billion bid by BHP Group is now planning to sell its diamond, platinum, nickel and coal assets in order to concentrate on copper. (Reporting and editing by Shinjini Ganuli in Bengaluru. Reporting by Vallari Shrivastava from Bengaluru)
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Wall Street's tariffs crash resumes following morning recovery failure
The S&P 500 fell below 5,000 for the first time since almost a full year. This was a reversal of a strong morning rally, as expectations faded that there would be any delays or concessions from the U.S. on tariffs before a deadline at midnight. The benchmark index dropped 1.6% on Monday, marking a loss of $5.8 trillion in market value. This is the largest drop since President Donald Trump announced hefty tariffs on U.S. trading partner countries on Wednesday. The biggest percentage drop in four days since the pandemic was more than 12%. It was also on the verge of a 20% drop that would indicate a bear market. The Dow Jones Industrial Average dropped 0.84% and the Nasdaq Composite fell 2.15%. Comment: MARK MALEK, CHIEF OFFICER SIEBERT FINANCIAL NEW YORK. "This kind of market closing is not good. We could, and should, have had a more positive close, even though the rally slowed down in the afternoon. The market has already priced in a possible trade war, and the new news was not enough to cause a further decline in stocks. Many technical traders will be scratching their head tonight. "But I am still somewhat positive, which has been rare for me lately." "I think the body-language coming from the Administration signals that they would rather negotiate. That the 104% tariffs against China that we heard later in the session were a negotiation tactic." Early in the morning, the market had a hint that the tariff issue might be resolved sooner than last week. As the day progressed and news was released, this thought disappeared and uncertainty about the future - earnings, tariffs - grew. The market then sold off. "I have no idea how to estimate (earnings for) many companies at this time. ... Any earnings estimate for many companies, and the S&P 500 is fraught with a huge amount of potential for change. Most likely to the downside. It's hard to value many stocks before you are confident about the future earnings." CHRIS GRISANTI, CHIEF MARKET STRATEGIST, MAI CAPITAL MANAGEMENT, NEW YORK "I found today's market reaction troubling. We were delighted to see a strong market in the morning. But then, it made this end even worse because it turned our joy into sadness. "But from a technical perspective, it makes sense, because you can't make any meaningful investments now, when there is so much uncertainty. You need to have a certain amount of humility to acknowledge that we don't really know everything. At this point, I think 'caution is the better watchword' than 'looking at opportunities'. "I believe it would be very difficult for the economy not to go into a recession even if tariffs were removed tomorrow. Because I believe things are very slowed down, which means that things aren't moving because businesses don't have any idea what to do. They're not taking any decisions. I believe we are just about past the point of return. We will start to see first quarter results on Friday. I wouldn't at all be surprised to see companies rescinding their January guidance. "There's still a lot that could go wrong in the next few weeks."
India states oil prices would have soared without its Russian imports
International oil prices would. have actually hit the roof if huge importer India had not bought oil from. Russia following the Ukraine war, India's oil minister said,. adding that costs would determine where the country buys oil. from.
India, the world's 3rd largest oil importer and consumer,. has actually become the top buyer of reduced Russian sea-borne oil. avoided by Western nations considering that Ukraine's invasion started in. early 2022. Before that, India purchased little oil from its. long-running defence partner, Russia.
New Delhi has consistently defended its purchases from Russia. as essential to keep rates in check in the establishing country. of 1.42 billion individuals.
What numerous around the globe don't seem to realise is that. worldwide oil costs would have hit the roofing system if India had not. purchased oil from Russia, India's oil minister, Hardeep Singh. Puri, wrote on X late on Friday.
We owe it to our people - India will purchase oil from. any place our companies get the very best rates.
India's petroleum imports from Russia increased by 11.7% to about. 1.9 million barrels daily in September, accounting for about. two-fifths southern Asian nation's total crude imports in. the month. Russia was followed by Iraq and Saudi Arabia as. India's biggest suppliers.
(source: Reuters)