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Indian retailers increase fuel prices for the fourth time in a row to curb losses
Dealers said that India's state-owned fuel retailers raised diesel prices by 2.71 rupees ($0.0283) and petrol by 2.61 rupees per litre, marking the fourth increase in a month to recover some losses caused by higher crude oil costs as a result of the Iran War. Indian state fuel retailers who control 90% of the Indian market began increasing pump prices on May 15, after elections were completed in certain key states. Since then, the state companies have increased?the price of petrol and diesel by approximately 7.8% and 8.6% respectively. New Delhi petrol will cost 102.12 rupees per litre, and diesel 95.20 rupees. India, which is the third largest oil consumer and importer in the world, has been hit by rising crude prices as well as supply disruptions following the closure of Strait of Hormuz. New Delhi also implemented austerity measures in order to curb fuel consumption and control its oil import bill, as policymakers prepare for a prolonged shock. Prices vary across states because of local taxes. State retailers have also suffered a rise in?fuel losses as customers switch to retail pumps that are cheaper, leading to shortages. IOC said in a statement on Saturday that its retail sales for the period of May 1-22 were up?by 18% compared to a year earlier and petrol sales had increased by 14%. $1 = 95.6890 Indian Rupees (Reporting and editing by Christian Schmollinger, Sonali Paul and Nidhi Palyekar from New Delhi)
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Russell: China's thermal coal production drops, but prices of imported coal in Asia rise amid the Iran war.
Although the Iran war has impacted crude oil and natural gas prices, its impact on coal has been muted. Prices for thermal grades are quietly rising to multi-year heights. The conflict between the United States of America and Iran has led to the loss of about 10% of world crude oil, and a fifth of LNG, but thermal coal supplies remain largely unaffected. Even though the cost of shipping and producing has increased due to higher fuel prices. Coal prices are not solely driven by the?Iran War. Other factors, such as low Chinese production and Indonesian regulations, may be more influential. According to commodity analysts Kpler, Asia's seaborne thermal coal imports are expected to have their best month since December in May. The imports of thermal coal in Asia are expected to hit 76.26 millions metric tons by May, up 23 percent from April. This is also higher than the 72.83 million that were imported in May 2012. All of the top buyers in the region have seen gains. China, the largest coal importer in the world, is on course to receive 22.63 millions tons of seaborne thermal coal, up from 16.3 million tons in April, and the highest since January. China's appetite to import is driven by a weaker domestic production. April production was 385.63 millions tons, down from 440.62 in March and also 1% lower than April of last year. China's first four-month output fell by 0.1%, to 1.58 billion tonnes. The fact that China's thermal electricity production, which is largely coal-fired?rose by 3.6% during the first four month of the year suggests that the supply-demand balance in China has been tightened, encouraging imports. The Shanxi coal mine disaster, the worst in 17 years at a metallurgical mine that killed 82 people last Friday may cause a further shortage of coal as authorities increase safety inspections in both thermal coal and coking coal mining. China's increasing import demand has helped to lift prices?of grades it seeks. The commodity price reporting -agency Argus assessed Indonesian coal, which had an energy content 4,200 kilocalories/kilogram (kcal/kg), at $64.43 a tonne in the week ending May 22. This was a three year high and up by 42% from the end of last. Kpler predicts that India, as the second largest importer of thermal coal, will see arrivals of 13,78 million tons in May. This is the highest since June last years and 7.3% more than the 12,84 million recorded in April. Last week, heat waves drove electricity demand to new records. This boosted demand for coal-fired generators. INDONESIA CHANGES The world's largest coal exporter, Indonesia, announced regulatory changes last week that will have a significant impact on the way cargoes are traded. Indonesia intends to "take control" of the coal trade, by directing exports via a state-owned company that will control contracts and price. The government has said that it will honor existing long-term agreements, but it has also stated it reserves the rights to review the prices of such deals. By implementing a state control on exports, the government hopes to?stop under-invoicing' and collect more revenue. It's possible that the trade flow will be affected if there is still uncertainty about how the new system works in practice. Japan's thermal coal imports are expected to increase from 6.63 millions tons in April to 7.59 million tonnes in May. South Korea's arrivals will be 6.73 million tons, which is the highest since January, and up from 4.79 million tons in April. Both countries in North Asia are among the top four coal importers, and they are also the best positioned to switch from LNG imported natural gas to coal-fired electricity generation. Due to the Iran War, both spot and contract LNG prices are likely to rise sharply. Japan and South Korea may therefore seek ways to maximize coal-fired power generation. The price of high grade Australian thermal coal has risen as a result. The weekly assessment of Newcastle?Port rose to $133.09 per ton during the week ending May 22. This is up from $131.80 and only slightly below the 18-month-old high of $140.53 set in early April. Australia is the second largest coal exporter and may be in a better position to capitalize on any disruptions to Indonesian coal shipments due to regulatory changes. Its lower-grade coal could replace Indonesian coal. 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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New Zealand Pro surfers halted by 'wildlife injury' to photographer
The World Surf League event was put on hold for several hours after a photographer who was shooting the event suffered an injury from what organizers believe to be a shark or sea lion bite. The WSL announced that the New Zealand Pro semi final between Brazilian world champions Yago Dore and Italo Fereira in Raglan had been halted because the in-water camera needed medical attention after suffering puncture wounds. Renato Hickel, WSL Tours and Competition Vice President said that "this morning one member of the water photography group suffered a wildlife injury." He's fine, he is on his way to a hospital. He is in stable condition. We're in constant contact with him." Hinkle told the?event broadcast earlier that they weren't sure what type of animal caused the injury. At this point, we are not sure if it was a sea-lion or a shark. He said that the doctor who was on scene was inclined to believe it was a seal instead of a large shark. "Nevertheless, it was very frightening." The organizers will assess the situation on Monday and aim to resume competition at 1 p.m. (0100 GMT). Animal attacks at surf events are not uncommon, but they do happen. In 2015, world champion Mick Fanning famously wrestled with a shark during the final of WSL event in South Africa's Jeffreys Bay. Raglan, which hosted a world championship tour event for the first time ever, was short of its famously long left hand point break waves?for the majority of?the ten days leading up to the event. Monday's conditions were some of the best during the waiting period. Dora was ahead with a 6.33 to Ferreira's 3 pointer when their match was stopped. Morgan Cibilic, an Australian, had earlier defeated Griffin Colapinto of California with a total of '15.34' to a score 12.20. This earned him a place in the finals. Carissa Moore, Hawaii's Olympic champion and five-times world champion will face California's Sawyer Lindblad for the women's title. (Reporting and editing by Nick Mulvenney; Lincoln Feast)
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Oil and dollar decline on Middle East Peace Hopes
U.S. Stock Futures climbed on Monday, while oil and the dollar fell. The prospect of an agreement to end the Iran War boosted risk appetite. However, a lack of clarity about when the 'Strait of Hormuz' would open kept enthusiasm in check. Energy prices have soared in response to the nearly three-month war in the Middle East. Worries about inflation and the closure of the Strait of Hormuz, through which most world energy passes, has impacted global rates. Donald Trump, the U.S. president, said that he told his representatives on Sunday not to rush any deal with Iran. His administration also played down expectations of an imminent breakthrough. Trump said just a day before that Washington and Iran had "largely" negotiated a peace agreement that would reopen this waterway that, prior to the conflict, carried about one-fifth the global oil and LNG shipments. Brent crude futures fell over 4%, to $98.83 per barrel. U.S. West Texas intermediate CLc1 also dropped over 4%, to $92.03 per barrel. The euro rose 0.37% to $1.1646 while the Japanese yen climbed to 158.85 U.S. dollars in early trading, as the safe-haven dollar lost some of its recent gains. Nasdaq and S&P were both up 0.6%. Nick Twidale is the chief market analyst for ATFX Global. He expects that on Monday, investors will embrace more risk, but they won't surge higher until it has been confirmed that reopening of?the Strait?of?Hormuz. He said, "We need to reach an agreement in the next sessions because we know that there are still major sticking points." Nikkei, the Japanese stock market index, was positioned for a strong opening to Monday's trading session. Commonwealth Bank of Australia's strategists stated in a recent note that the most important issue for financial markets is when the Strait of Hormuz will reopen. They asked: "Under which conditions will the?Strait reopen, and how long will it take to repair production and infrastructure in order to ramp up energy production and other goods back to pre-war level?" (Reporting and editing by Stephen Coates in Singapore, Ankur Banerjee)
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Oil drops to 2-week lows as US-Iran is seen moving closer towards peace deal
Oil prices fell to a 'two-week low' on Monday, despite the fact that U.S. President Barack Obama and Iranian President Hassan Rouhani remain at odds on key issues. These include the blockades of the Strait of Hormuz which continue to limit oil supplies from the Middle East. Brent crude futures fell $4.71 or 4.55% to $98.83 per barrel at 2234 GMT. U.S. West Texas Intermediate was $92.03 per barrel, down $4.57 or 4.73%. Both contracts reached their lowest levels since May 7 earlier in the session. On Saturday, U.S. president Donald?Trump stated that Washington and Iran had "largely" negotiated a memorandum of agreement on a deal to reopen Strait of Hormuz. Before the conflict, the Strait of Hormuz carried one-fifth of the world's oil and LNG shipments. Trump said on Sunday that he told his representatives to not rush into any Iran deal. MST Marquee Analyst?Saul Kavonic? said: "Despite all the caveats, risks, and concerns that remain with the peace deal, and Strait of Hormuz?there is some light at?the?end of?the tunnel, which may bring some relief to oil prices in the near future." Analysts 'expect it to take months for oil flow through the strait to return back to normal, and for damaged oil-and-gas facilities to be repaired. Reporting by Florence Tan, Editing by Cynthia Osterman & Edmund Klamann
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There are 21 missing people in the Philippines after a building collapse that has left at least one person dead.
Authorities confirmed that at least one person died after a building collapsed on Sunday in the Philippines. Rescuers were searching the rubble to find 21 people listed as missing. Officials have launched an investigation into the collapse of a multi-storey structure in Angeles, north of the capital, Manila. Rescuers were seen scrambling over concrete slabs and mangled metal as they searched for survivors. The sifting was done with the help of'rescue dogs', heartbeat detection devices, and heavy equipment. RESCUE EFFORT CONTINUES The authorities confirmed that the 65-year old Malaysian had died. His body was recovered from the neighbouring hotel, which had also been damaged by the collapse. Maria Leah Sajili told a media briefing that five of the 21 people reported missing were trapped. The status of two of the five was immediately unclear. Sajili warned, however, that the operations will become more difficult after dark. Officials informed reporters that the building's planning records indicated that it was to be a "nine-storey condominium-hotel" under the permit approved, but that a swimming pool was being built on the 10th floor. (Reporting and editing by Christian Schmollinger; Additional reporting and Eloisa Loza; Editing and rewriting by William Mallard, Helen Popper and Christian Schmollinger)
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China reduces the death toll of Shanxi coal mining disaster to 82
Local officials announced at a press conference held late Saturday that the death toll had been revised to 82. The explosion at the Liushenyu mine in China's north province of Shanxi on Friday night killed 82 people. Initial reports from state media said that at least 90 people had been killed. Even if the number is lower, it remains China's most deadly mining accident since 2009 when a gas exploding at the Xinxing Mine, in Heilongjiang Province, killed 108. At a press conference, local officials stated that the initial death count reported by state media was incorrect. Guo Xiaofang said that the situation was chaotic after the incident, and the company had a difficult time calculating the number of employees, leading to the inaccurate initial number. At the time of explosion, there were 247 workers underground. Guo reported that two people were still missing, 128 had been injured and were hospitalised, and 35 were not hurt. Local officials stated at the press conference that Shanxi Tongzhou Coal Coking Group owns Liushenyu Mine and that all four mines of this company have been closed, and executives detained. The People's Daily, a state-run newspaper, published an editorial about the accident on its front page Sunday morning. It called for more?attention to safety?in production as well as to "completely revert the tendency to prioritize development over safety." Xinhua reported that President Xi Jinping had on Saturday called for authorities to "spare nothing" when it came to treating the injured, and executing search and rescue operations. He also ordered a probe into the incident. Officials stated at the press conference that the mine has a production capacity of 1,2 million tons of coal annually. Last year, China mined 4,83 billion tons of coal. This fuel is the foundation of its energy sector. (Reporting and editing by Christian Schmollinger; Luoyan Luu, Colleen Howe)
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California searches for novel solution to chemical tank heating up and threatening catastrophe
The incident commander revealed on Saturday that firefighters were bringing in outside experts from other countries to prevent a disaster. This was because some shelters nearby had run out of space to accommodate evacuees. The evacuation orders were still in effect for an area covering tens and thousands of residents in the Garden Grove suburban Los Angeles. California Governor Gavin Newsom has declared an emergency in Orange County. His office has urged residents to evacuate. Craig Covey said, in a social media video, that "we brought in subject-matter experts from across the state to help us think outside the box. We had some very productive conversations today." He did not elaborate on potential solutions. As the risk grows, shift to offensive from defensive Anaheim, Fountain Valley La Palma, and Huntington Beach all reported full evacuation shelters. Covey had earlier stated that crews returned to the danger zone over night after drone readings suggested on Friday that water sprayed onto the tanks helped stabilize the situation. When crews arrived at the gauge of the tank, they discovered that the temperature inside was 90 degrees Fahrenheit. (32 degrees Celsius) This is up from the 77 F (25 C), when responders pulled back. He said that the temperature was rising by one degree per hour. "That's bad news." Since Friday, officials have warned that the tank containing methyl methacrylate (a flammable chemical commonly used in plastics and manufacturing) could rupture, spilling 'up to 7,000 gallons of toxic material or explode, endangering nearby tanks. Covey, a firefighter from Covey Fire Protection Services, said that on Saturday they were investigating whether a large flow of cooling could slow down the curing inside the tank to the point where it would reduce the pressure and prevent an explosive explosion. Covey stated that it was unacceptable for him to let the device blow up and fail. The incident occurred on Thursday, at the GKN Aerospace plant in Garden Grove. This city has a population of 172,000 and is located about 30 miles (50 kilometers) south of Los Angeles. According to its website, the site is specialized in manufacturing and testing windows and canopies of commercial and military aircraft. GKN stated that it was working closely with "all relevant specialists" to resolve the issue. GKN apologized for the inconvenience caused to local residents and businesses. Covey stated that crews switched from a defensive to offensive stance overnight, with the help of chemists in the manufacturer's emergency response teams. The aim was to neutralize the 15,000-gallon nearby tank and reduce its potential explosiveness if it failed. Covey said, "We put people in danger last night." Officials from the Department of Health have expressed concern that prolonged exposure to vapors could lead to severe respiratory problems. Air-quality monitors did not detect vapor at the time of the last health update, according to officials. Dr. Regina Chinsio - Kwong, of the Orange County Health Care Agency, said that Friday: "You're safe so long as you stay out of the area that has been designated as an?evacuation zone". Covey stated that crews are?also prepared for a potential spill, by looking at ways to dike, dam, and divert liquid into a holding zone at the commercial site rather than allowing it to reach storm drainage, river channels, or the ocean. Covey stated, "We will not give up." (Reporting in New York by Rodrigo Campos, with additional reporting by Dan Catchpole, and editing by Sergio Non. David Gregorio, William Mallard, and Sergio Non.
No rate cuts if oil prices rise? No problem for US stocks
Investors say that the U.S. Stock Market is back where it was six weeks ago when the Iran War began. This is because they bet on a short-term conflict. What if this thinking is incorrect? The S&P 500 benchmark's round-trip comes despite a dramatically different investing environment compared to February?27. This was just before U.S. and Israeli military strikes started the Middle East?"conflict". Oil prices have risen by about 40%. The fear of inflation has driven up the benchmark yields on?Treasuries. These same concerns have led the markets to rule out interest rate cuts in this year.
If they continue, all of these factors can affect the performance of stocks.
There's a lot complacency about this. Brad Conger is the chief investment officer of Hirtle Callaghan. The company manages endowments and other foundation assets. "I don't think we are as well off as we were on February 27th. And we're paying the same price."
Investors seize on what they perceive as a solid economy, and in particular a positive outlook for corporate profit that has improved since the start of the war. Investors are aware of the stock market’s resilience in this three-year bull market, and they don't want to miss out on any rallies.
WAR RISKS VIEWED A FLEETING S&P 500 has recovered after initially dropping after the crisis started. In late March, the index had fallen over 9% since its all-time January high. This was close to a 10% drop that would indicate a correction. S&P 500 closed Monday up 0.1% from the start of the war, and only a little over 1% off its record high. The S&P 500 was up 1% for the day on Tuesday. The optimism about a possible resolution increased after a ceasefire agreement was reached last week. Investors were bracing themselves for the possibility of war-related developments that could cause asset volatility.
Peter Tuz of Chase Investment Counsel Corp. said that the market is looking at "temporary risk" which will be resolved in a short time, as opposed to a new regime of higher energy prices, interest rates, and inflation.
OIL HIGHER NOW OR LESS LATER?
Oil prices are a major factor in the performance of the stock market. Oil prices that continue to rise will increase costs for both businesses and consumers.
Angelo Kourkafas is a senior global investment analyst at Edward Jones. He said that the markets are showing that oil prices will be moderated by the end of the year. According to LSEG, the front-month contract of U.S. Crude is hovering around $95 a bar, and the December contract at $77.
Kourkafas stated that the markets now see energy disruptions as being near-term. "There's this idea that there are a lot near-term disruptions, but they're temporary," Kourkafas said. Once we get past this, we will return to the economic resilience we enjoyed before. Oil prices have already affected U.S. inflation. The Consumer Price Index rose in March at the highest rate in almost four years.
Investors have lowered expectations of Federal Reserve rate reductions due to inflationary concerns. This was a major source of optimism for U.S. stocks heading into the new year. According to LSEG data, as of Tuesday, Fed funds futures had priced in only 6 basis points of easing for December. This is less than a standard 25-basis point cut. Prior to the war, roughly two such quarter-percentage-point cuts had been expected by December.
The rise in Treasury yields is also due to oil-driven inflation. The benchmark 10-year Treasury rate was around 4.3% last, up from 3.96% in February.
The higher benchmark yields can have a negative impact on equity performance. This could be due to the fact that they translate into higher borrowing costs, both for consumers and companies.
BUY STOCKS FOR OUTLOOKED EARNINGS
Since the start of the war, estimates for U.S. company profits have increased. According to LSEG IBES, S&P 500 companies will increase their earnings by 19% between 2026 and 2015, compared to an estimated 15% increase before the war.
Stocks have become more attractive due to the increased earnings forecast. According to LSEG Datastream, the price-to earnings ratio for S&P '500 was?20.4, down from a high of over 23 at the end of October.
Chris Fasciano is the chief market strategist of Commonwealth Financial Network. He said that estimates are continuing to rise despite the increase in oil prices. "More appealing valuations and higher earning estimates make me feel okay about the background."
In the weeks to come, companies will report their first quarter results.
Tuz stated that people are expecting a huge increase in earnings from all companies this year. It's too early to tell if the number is accurate or not.
(source: Reuters)