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Oil extends decline by 1.5% on hopes for Russia-Ukraine peace deal
Oil prices dropped 1.5% on the Friday, continuing a downward trend for the third consecutive session. The United States was pushing for a Russia/Ukraine agreement that could increase global supply while investors were hesitant about its rate reductions. Brent crude futures dropped 93 cents or 1.5% to $62.45 per barrel at 0416 GMT after falling 0.2% the previous session. U.S. West Texas Intermediate fell 1.7% or 98 cents to $58.02 per barrel after ending the previous session down 0.5%. The two contracts will fall by more than 2.5% on the back of concerns about oversupply, wiping out most of last weeks gains. The market sentiment has turned negative as Washington pushes for a plan of peace between Ukraine and Russia that will end the three-year conflict. Meanwhile, sanctions against top Russian oil producers Rosneft & Lukoil set to go into effect on Friday. Oil prices continued to fall as Zelenskiy, the Ukrainian president, agreed to collaborate with Russia on a peace plan. U.S. sanctions against two Russian oil companies are due on Friday. The slim chances of an agreement, which would eliminate much of the geopolitical premium for the war baked into crude, are weighing down on prices. Some analysts, however, were skeptical about how quickly a peace agreement could be reached. Analysts at ANZ told their clients that an agreement was far from being certain. They added that Kyiv had repeatedly rejected Russia's requests as inacceptable, preventing any breakthrough. The market is becoming increasingly sceptical about the effectiveness of the new restrictions on Russian oil firms Rosneft, and Lukoil. Lukoil still has until the 13th of December to sell off its vast international portfolio. Oil prices were also impacted by a stronger dollar, as the commodity denominated in dollars is more expensive to holders of other currencies. UOB analysts stated in a client letter that the dollar strength against Asian currencies became very apparent after investors further reduced the odds of a rate cut being made at the FOMC meeting scheduled for December, after the minutes of its highly divided October meeting were released. Investors bet that the Federal Reserve will not cut rates in January.
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Copper prices fall on week-end dollar firm as traders evaluate US employment data
Copper fell on Friday, and it was likely to be a loss for the week, as investors were cautious before the Federal Reserve's interest rate decision in December, and China's low demand added further pressure. As of 0330 GMT the most active copper contract at the Shanghai Futures Exchange fell 0.82%, to 85,670 Yuan ($12,045.16) per metric ton, resulting in a weekly decline of 1.42%. The benchmark three-month price of copper at the London Metal Exchange fell 0.39%, to $10,696.5 per ton. It is expected to finish the week with a loss of 1.41%. The September job data on Thursday, which was delayed due to the government shutdown, offered mixed signals to the Fed, with policymakers pondering the December rate decision, showing stronger-than-expected growth in new hiring but a rise in the jobless rate to a near four-year high. The September delayed data will be last official employment data before December's interest rate decision. The dollar remained strong, as Fed officials remained hawkish. This weighed on commodities that were traded in greenbacks by making them costlier for investors who used other currencies. Prices are still high this year, and demand is weak from China. Shanghai copper is expected to increase by more than 16 percent in 2025. London copper will rise by 22 percent this year. Yangshan Copper Premium The latest price of copper in China, which is a measure of Chinese appetite, was $33 per ton, down from the peak of over $100 at the beginning of May. Lead fell 0.43%. Nickel tumbled 1.70%. Tin lost 1.27%. Aluminium fell 0.73% among other LME metals. Zinc dropped 0.86%. Lead shed 0.45%. Nickel lost 0.59%. Tin was down 1.01%. Friday, November 21, DATA/EVENTS - (GMT) 0700 UK retail sales MM,YY Oct 0700 France Business Climate Mfg Overall Nov 0815 France HCOB Mfg Svcs Comp Flash PMIs Nov 0830 Germany HCOB Mfg Svcs Comp Flash Svcs PMIs 11 0900 EU HCOB Svcs Comp Flash Svcs PMIs 11 0930 UK Flash Svcs Comp PMIs - Nov 0930
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China warns its citizens that they could become'mining slavery' in the Central African Republic gold rush
The Chinese embassy in Central African Republic (CAR), has warned that its citizens could become "mining slaves", in the gold trade of the politically insecure nation. Chinese workers are now looking to sub-Saharan Africa for work as gig economies in Asia dry up. The embassy released a statement Thursday stating that Chinese nationals were killed or kidnapped, and some even scammed of large sums and deported because they illegally mined. China has sent workers to resource-rich sub Saharan Africa in search of fortune. Gold prices have soared amid massive Chinese state purchases, while factory and construction jobs are disappearing as China's economy slows. Illegal mining has exploded in Ghana, Mali, and the Democratic Republic of Congo (nearby), as a result of lax regulations and enforcement. The Chinese Embassy in Bangui warned that Chinese citizens involved in gold mining in Central African Republic faced significant security risks. It had heard reports of Chinese nationals whose documents were confiscated and who became "mining slaves." The embassy didn't say how many Chinese workers sought to work in illegal mines in CAR. The statement stated that "some were killed in a rampant antigovernment militia activity; others were tragically attacked after becoming embroiled in conflicts between forces and countries and some succumbed fatal illnesses such as malignant malaria." The embassy warns that "others met violent ends through staged accidents such as 'car crashes,' or hangings' after disputes with other shareholders." The Central African Republic embassy in Beijing has not responded to a comment request immediately. CAR is a country in civil war for over a decade. It's one of the poorest in the world but it has huge reserves of oil, diamonds, and gold. Analysts say that China's principle of non-interference is designed to protect its economic interests abroad. Beijing has increased its public diplomacy in recent years to protect Chinese nationals abroad. The Wolf Warrior 2 film, one of China's most popular films, is about a former Chinese Special Forces soldier who rescues Chinese workers from a war-torn African nation. It ends with an image a Chinese passport, and the message "Don't quit if you find yourself in danger abroad." Please keep in mind that a strong motherland is always there to protect you. China has for years deemed areas outside of Bangui, the capital city of the CAR, as "extremely high risk" and urges its citizens to evacuate. The U.S. State Department continues its "Do Not Travel "highest advisory. The Chinese Embassy quoted a mother who had lost her son as saying, "The biggest regret I have in my life is that I did not stop him from going to Central African Republic to search for gold."
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Japan's largest nuclear power is awaiting a key decision from the regional governor
On Friday, a Japanese regional governor will be expected to announce whether he is willing to allow a partial restart at the Kashiwazaki Kariwa nuclear plant, which is the largest in the world, as Japan attempts to revitalize its nuclear sector while reducing fossil fuel imports. The approval of Niigata Prefecture governor Hideyo Haazumi will remove the final major obstacle for Tokyo Electric Power Co. (TEPCO) in its plans to restart Kashiwazaki and Kariwa's two biggest reactors. TEPCO would be able to restart its power plant for the first time since March 2011, when the tsunami destroyed Fukushima Daiichi. This would be a major breakthrough for Japan which, after the disaster, shut down all 54 reactors. Sanae Takaichi - the new Prime Minister of Japan, who was appointed last month - has stated that she is in favor of more nuclear relaunches, both to improve energy security and reduce the cost of imported electricity, which makes up 60% to 70% or Japan's total electricity production. On Friday, Chief Cabinet Secretary Minoru K. Kihara stated that "the restart... is extremely crucial from the perspective to reduce power supply and prices and secure decarbonized energy sources." Japan has restarted fourteen of the remaining 33 reactors that were in operation prior to Fukushima. Governor Hanazumi will announce his decision on Friday at 4:00 pm (07:00 GMT). It was unclear whether the report released by Japan's nuclear regulator on Thursday about inadequate security management at Kashiwazaki Kariwa would affect his decision. TEPCO plans to restart unit No. 6 and No. TEPCO, if approval is granted for both, plans to restart units No. 7 can together produce 2,710 Megawatts, which is about a third the total power of Kashiwazaki Kariwa (8212 MW). TEPCO plans to decommission a few of the five other units. In July, Kansai, Japan's largest nuclear power company, announced that it would start conducting surveys in order to study the possibility of building a new reactor west of Japan. This would be the country's first new unit built since the Fukushima catastrophe. TEPCO's shares fell 1.3% on the Friday after the Nuclear Regulation Authority report. This was better than the Nikkei Index, which dropped 2.3%. (Reporting and editing by Tony Munroe, Tom Hogue, and Kaori Kaneko. Additional reporting by Katya Glubkova.
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Iron ore continues to fall due to softer China demand. Set for second weekly gain
The price of iron ore futures fell on Friday, for the second consecutive session. This was due to signs of weaker demand in China and the shrinking margins within steel. As of 0301 GMT, the most traded January iron ore contract at China's Dalian Commodity Exchange shed 0.25%. It was 786 yuan (US$110.52) per metric ton. As of 0251 GMT, the benchmark December iron ore traded on Singapore Exchange was down 0.24% at $103.7 per ton. The average daily hot metal production, which is a measure of iron ore consumption, decreased by 0.3% compared to the previous week, reaching 2.36 million tonnes on November 20. According to Mysteel, the steel margins have continued to shrink. Only a little over one-third of steel mills are operating at a loss, as opposed to nearly a quarter a month ago. Both benchmarks have gained 1% this week, which is a second consecutive weekly gain. Prices of seaborne iron ore The average price has remained well above $100 in November, despite expectations that it would be between $90-95. According to a report on Wednesday, long-running negotiations between China's iron ore buyer, the state, and BHP, a miner, have reduced availability of iron ore. This has led to lower prices, despite a decline in demand for this key ingredient. Exclusively reported, the state-run buyer of iron ore has ordered steel mills to stop buying a specific type of BHP ore. This ban is in addition to another one already in place, and escalates a dispute about a new contract. Coke and other steelmaking materials, such as coking coal, fell by 0.98% each and 0.28% respectively. The benchmarks for steel on the Shanghai Futures Exchange are mixed. Rebar was flat; hot-rolled coil fell 0.12%; wire rod increased 0.09%; and stainless steel rose 0.28%. ($1 = 7.121 Chinese Yuan) (Reporting and editing by Amy Lv, Lewis Jackson)
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Gold prices fall as US jobs data boosts rate-cut expectations
Gold inched down on Friday as a stronger-than-expected U.S. jobs report reinforced expectations that the Federal Reserve will refrain from cutting interest rates at its December meeting. As of 0242 GMT, spot gold was down by 0.1%, at $4,072.87 an ounce. U.S. Gold Futures for December Delivery edged up 0.3% to $4,071.90 an ounce. GoldSilver Central MD Brian Lan stated that "gold prices are currently consolidating and we can see the dollar has gained quite a bit. Behind it, there's a lot speculation about whether or not the Fed will cut interest rates further." "I think the market is uncertain and, especially now that we are approaching the end December, we expect many traders to take profit from their positions, as we saw last week and this week." On Friday, the dollar was set to have its best week in over a month. Gold priced in greenbacks becomes more expensive for those who hold other currencies. The U.S. Labor Department's closely-watched report was delayed due to the shutdown of the federal government. It showed that nonfarm payrolls in September increased by 119,000. This is more than twice the expected increase of 50,000. The traders now expect a Fed rate reduction next month. Gold is a non-yielding investment that tends to perform well in low interest rate environments. The minutes of the Fed's meeting in October, released on Wednesday, showed that it had cut interest rates despite warnings by policymakers that this could lead to inflation entrenched and a loss in public confidence. Chicago Fed President Austan Goolsbee reiterated on Thursday that he was "uneasy' about the frontloading of interest-rate reductions, especially with the progress on inflation toward the Fed's goal of 2% looking to be stalling and going the wrong direction. The price of palladium remained unchanged at $1,377.50. Platinum rose 0.4% to 1,521.41 and silver fell 0.5% to 50.35 cents per ounce. (Reporting and editing by Sherry Phillips, Rashmi aich, and Brijesh patel in Bengaluru)
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Oil extends decline on possible Russia-Ukraine peace deal
Oil prices continued to fall for the third consecutive session on Friday, as the U.S. sought a peace agreement between Russia and Ukraine that could increase oil supplies on the global market. Meanwhile, uncertainty about interest rate reductions in the U.S. curbed investors' risk appetite. Brent crude futures dropped 71 cents or 1.12% to $62.67 per barrel at 0212 GMT, after falling 0.2% the previous session. U.S. West Texas Intermediate Crude was trading at $58.29 per barrel, down by 71 cents or 1.12%, after closing the previous session 0.5% lower. Both contracts will fall by more than 2% on concerns about oversupply this week. The market sentiment has turned negative this week, as Washington continues to push for a plan of peace between Ukraine and Russia that will end the three-year conflict. At the same time, sanctions against top Russian oil producers Rosneft & Lukoil should be implemented on Friday. Lukoil's huge international portfolio has to be sold by December 13. The slim chances of an agreement, which would eliminate much of the geopolitical premium for the war baked into crude, are weighing down on prices. The price of oil was also affected by a stronger dollar, as holders of other currencies were forced to pay more for the commodity. Investors bet that the Federal Reserve will not cut rates in January. Helen Clark is reporting; Lincoln Feast is editing.
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Sources say RPT-China has expanded the BHP iron ore product ban to include a new product, as discussions drag on.
Sources said that China's state owned iron ore purchaser has ordered steel mills to stop buying a specific type of BHP ore. This ban is in addition to another one already in place, and escalates a dispute about a new contract. China Mineral Resources Group, set up in 2020 to centralise the purchasing of iron ore and to win better terms for miners, has asked Chinese steel mills to not buy new cargos of Jinbao Fines, a low-grade ore produced by the world's largest iron ore mining company, BHP. Sources said that CMRG had told mills they were not allowed to receive Jinbao Fines from ports for three days. "There may be a lot of activity at the ports during these days," one source stated. It is not possible to determine the number of iron ore traders, steel mills and other companies that received an order from CMRG in this week. This is the second time CMRG has asked Chinese steel mills to stop purchasing BHP's Jimblebar blend fines. Both parties are in long-term negotiations about a contract for 2026. BHP responded to questions regarding the Jinbao Ban by saying that it doesn't comment on commercial negotiation. Earlier that day, the miner had said they were still in negotiations with CMRG. CMRG didn't immediately answer questions. Small Trade Volumes CMRG could have targeted the fines from Jinbao instead of other BHP cargos, because the trade in lower-grade ore is so small, and the ban wouldn't disrupt the market too much, according to both sources and analysts who spoke under condition of anonymity due to the sensitive nature of the issue. The three sources all said that the trade was so small, they didn't track it regularly. Prices have been supported by the tightening of supplies at ports after the first ban on medium-grade ore, such as Pilbara Blend fines. This is despite a weakening in demand for this key ingredient. The price of iron ore rose to a record high in less than a week on Wednesday, even though crude steel production fell to its lowest level since December 20,23. This was due to bad weather that forced some northern mills into reducing their output. (Reporting and editing by Louise Heavens and Aidan Lewis.
As tensions in Venezuela rise, US Senators are seeking answers about the 'anti-drug strategy'
The Republican and Democratic leaders in the U.S. Senate Armed Services Committee stated on Friday that the Trump administration has yet to provide any details about its operations against the drug cartels or their legal basis.
Since early September, U.S. airstrikes on suspected drug-trafficking boats in the Caribbean have resulted in the deaths of dozens of people. This has caused tension between Washington DC and Caracas.
In a rare instance of bipartisanship on the strikes, Republican senator Roger Wicker and Democrat Jack Reed stated in a joint statement that they had not received the information requested from the administration regarding its strategy to combat drug cartels.
Reed of Rhode Island is the top Democrat in the committee that oversees the U.S. Military. Wicker of Mississippi is its chairman.
The Trump administration claims that the targeted boats were carrying drugs without proving it or explaining publicly the legal justification of the decision.
Donald Trump, the president of the United States, has also ordered an extensive military buildup on the Caribbean.
In a letter dated September 23, Wicker and Reed stated that they had requested "Execute Orders", relating to anti-drug trafficking activities. In a second letter dated October 6, Wicker and Reed asked for any written opinions regarding the legal foundation for the anti-drug trafficking operations.
The legislators said that they did not receive the requested information before Friday.
Kingsley Wilson, Pentagon Press secretary, responded in an email when asked for a comment: "Several of these documents were made available yesterday to the Chairman, Ranking Member, and their respective staffs." The Department also provided its fourth bipartisan update on these operations yesterday to Senate staff.
Trump denied that he would consider strikes in Venezuela on Friday, contradicting his own remarks from last week amid increasing expectations that Washington could soon expand its operations relating to drug trafficking. (Reporting and editing by Daniel Wallis, Clarence Fernandez, and Patricia Zengerle)
(source: Reuters)