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Short-covering of oil prices has pushed up the price, but concerns about tariffs persist
Investors took advantage of Tuesday's loss to cover their short positions. However, concerns remain about economic headwinds resulting from tariffs and U.S. policy. Brent crude futures increased 36 cents or 0.5% to $66.62 per barrel at 0421 GMT. U.S. West Texas Intermediate Crude contract for May expires Tuesday and was $63.73 per barrel, an increase of 65 cents or 1%. The WTI June contract, which is the most actively traded, was up 43 cents or 0.7% at $62.84 per barrel. The benchmarks fell more than 2% each on Monday as the signs of progress made in the nuclear agreement talks between Iran and the U.S. helped to ease supply concerns. Hiroyuki Kikukawa is the chief strategist at Nissan Securities Investment. "However concerns about a possible recession driven by the Tariff War persist," he stated, predicting WTI would likely trade between $55 and $65 for the moment given the ongoing uncertainty regarding tariffs. Donald Trump, the U.S. president, repeated on Monday his criticisms of Federal Reserve chair Jerome Powell. He also said that the U.S. economic growth could be slowed if interest rates are not immediately lowered. His comments about Powell fueled concerns about the Fed's ability to set monetary policy independently and the outlook for U.S. investments. On Monday, the dollar index and major U.S. stock indices fell to their lowest levels in three years. Kikukawa stated that "the growing uncertainty around U.S.monetary policy will negatively impact financial markets as well as the wider economy. This could also lead to a decrease in crude oil demand." A poll conducted on April 17 revealed that investors believed the tariff policy would trigger a significant economic slowdown this year and the following, with a median probability of recession within the next 12 month approaching 50%. The U.S. has the largest oil consumption in the world. The U.S.-Iran nuclear talks could have a positive impact on the oil price and ease supply concerns, as Iran is a major oil producer. Vivek Dhar is an analyst with Commonwealth Bank of Australia. In a recent note, he said that the U.S. could be willing to ease sanctions on Iran. According to documents obtained, the Russian economy ministry's forecast for the average Brent crude price in 2025 has been cut by 17% compared to its calculations in September. A preliminary poll conducted on Monday showed that U.S. crude and gasoline stocks were likely to have declined last week. However, distillate inventories are expected to be higher, according to the American Petroleum Institute's and Energy Information Administration's weekly reports. Reporting by Yuka Obaashi in Tokyo and Emily Chow, Singapore; editing by Himani Sarkar
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MORNING BID EUROPE - Trying to contain the US market contagiousness
Wayne Cole gives us a look at what the future holds for European and global markets. It is said that the U.S. can sneeze and the whole world will catch a cold. Is contagion inevitable if it's a self-inflicted injury? The Nikkei, which is flat today despite the S&P500's 2.4% loss on Monday, may be an indication of this. It would normally be down by 1,000 points. This is despite the stronger yen. The money that is leaving U.S. assets must go somewhere and it's not only to European defence stocks. According to LSEG Lipper, investors purchased a net of $11 billion worth of European equity funds, and $3.6 billion worth in Asian equity fund in the week ending April 16. Meanwhile, U.S. equity fund saw a $10.6 billion outflow. Since then, Trump has raised the stakes and attacked Fed Chair Powell because he is not cutting rates as quickly as Trump would prefer. Although it's unclear if Trump has the authority to fire Powell, the mere appearance that he is threatening independence of the central banks is a blow to investor confidence. The dollar dropped to a new decade low against the Swissy, at 0.8842. This brings the losses since "tariff-day" to over 8%. The dollar is now testing the 140.00-yen barrier and the euro has surged above $1.15. Unhedged foreign investors in the U.S. have suffered a particularly difficult April. The yields on 10-year Treasuries increased to 4.41%. This is a continuation of the recent increase in term risk. If Trump were to consider Powell's ouster and the appointment of a loyalist then, for example, replacing Treasuries by zero coupon perpetual bonds would not be so outlandish. Trump will also be counterproductive, as the Fed may now be less willing than before to reduce rates out of fear that they'll appear to have bowed to political pressure. Fed fund futures have fallen and are 90% against a May rate cut. Today, there are at least 5 Fed speakers scheduled. It will be interesting to watch how they deal with this difficult political issue. Dodge, maybe. Tesla also released its results today, so investors can see just how bad the news has already been for their shares. The following are the key developments that may influence Tuesday's markets: ECB members Knot, de Guindos and BoE's Breeden speak Jefferson, Kugler Barkin Kashkari, and Harker are among the Fed members who spoke. US Richmond Fed survey on EU consumer confidence
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London copper reaches a two-week high as the dollar falls
The copper price in London reached a two-week-high on Tuesday. This was due to a sharp drop in the dollar, as Donald Trump's harsh criticism of the Federal Reserve Chairman shook the confidence of investors in the U.S. As of 0350 GMT, the benchmark three-month price for copper on London Metal Exchange (LME), was up by 1.2% to $9,302.5 a metric tonne. It briefly reached $9,319.5 per ton, its highest level since April 4. After a weekend break for Easter, the LME returned on Monday. The Shanghai Futures Exchange's (SHFE) most-traded contract for copper rose by 0.6%, to $10,525 per metric ton. The U.S. dollar sagged near the decade low reached the day before against the Swiss Franc and hovered close to a 3-1/2 year trough when compared with the euro. The dollar's weakness makes the price of commodities in U.S. dollars cheaper for buyers who use other currencies. Trump stepped up his criticisms of Fed chief Jerome Powell in a Truth Social posting on Monday, calling him "a major loser" while demanding that he reduce interest rates "NOW", or risk an economy slowdown. Kyle Rodda is a senior financial analyst at Capital.com. He said that the crisis of confidence among U.S. investors was intensifying as Trump's policies could potentially disrupt global economic order. Other metals include LME aluminium, which rose by 0.89%, to $2.386.5 per ton. Lead was up 0.75%, to $1.936.5; tin, up 1.4%, to $31,080; zinc, up 0.8%, to $2.598; and nickel, up 0.5%, to $15,695 per ton. SHFE aluminium fell 0.4%, to 19,695 Yuan per ton. Zinc was down 0.4%, to 22,130 Yuan. Lead was down 0.3%, to 16,890 Yuan. Nickel was up by 0.3%, at 125850 yuan. Tin was down 0.78%, to 257300 yuan. ($1 = 7.3078 Yuan) (Reporting and editing by Janane Venkatraman, Mrigank Dhaniwala).
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China's CMOC shares jump after announcing the acquisition of Lumina Gold
The shares of China's CMOC Group jumped Tuesday after the miner announced that it would purchase Canada-listed Lumina Gold in a cash-only deal for C$581,000,000 ($420.7million). The acquisition allows CMOC to gain access the flagship asset, Cangrejos, of Lumina Gold, which is located in Ecuador's El Oro Province, and has total mineral reserves of approximately 659 millions tons. This project is the largest primary gold deposit of the South American country. CMOC shares listed in Shanghai jumped over 4% while those listed in Hong Kong rose more than 8%. Shares of Lumina Gold soared 29%. The purchase comes at a moment when gold prices are on a rise, reaching multiple historic highs in this year. This is fueled by demand for safe haven amid uncertainty over the U.S. Tariff impact and lingering political conflicts. CMOC reported a 64% increase in its net profit in 2024, aided by a surge in the production of copper and cobalt. The company has also assets such as molybdenum. tungsten. niobium. and phosphate fertiliser. Reporting by Amy Lv, Lewis Jackson and Varun H. K.
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Atlantic Zonda Drillship Starts its Maiden Job with Petrobras
The seventh generation Atlantic Zonda drillship, managed by Ventura Offshore Midco, has started operations for Petrobras under a three-year drilling contract.The Atlantic Zonda is managed by Ventura Offshore through marketing and operating agreements with the rig owner, Eldorado Drilling, and the company will earn its management fees and reimbursable revenues from these agreements.Following the delivery of the Atlantic Zonda from Samsung shipyards, contract preparations were carried out in Singapore, where the rig was upgraded with the most advanced technological drilling package available.The three-year contract marks the start of its inaugural assignment, with an option for additional three years for the Brazilian state-run firm Petrobras.The Atlantic Zonda is a full dual activity rig equipped with Managed Pressure Drilling (MPD) capability.“We extend our heartfelt congratulations to the entire Ventura Offshore team for achieving this important milestone. Their dedication and hard work have been instrumental in bringing this project to fruition. Additionally, we would like to express our sincere gratitude to Eldorado Drilling for their invaluable partnership and support throughout this endeavor. We look forward to delivering safe and efficient operations to Petrobras with the Atlantic Zonda,” said Guilherme Coelho, CEO of Ventura Offshore."We are excited to commence the contract made possible through our strong relationship with Ventura and the hard work, dedication and commitment of the entire Zonda project team,” added Svend Anton Maier, CEO of Eldorado Drilling.
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China's demand for iron ore is likely to increase in the near future
Iron ore futures prices rose on Tuesday due to a near-term increase in demand from China, the world's largest consumer. However, lingering concerns about tariffs limited the price rise. As of 0253 GMT, the most traded September iron ore contract at China's Dalian Commodity Exchange rose by 0.49% to $71.35 per metric ton. The benchmark May ore price on the Singapore Exchange fell 0.76% to $98.6 per ton. ANZ analysts wrote in a report that "strong iron ore purchases by steel mills, and lower imports, saw inventories drop sharply." ANZ reports that despite the government's efforts to reduce capacity, steel production grew by 4.6% in March to 93 tonnes. Steelhome data shows that the total iron ore stocks across China ports fell by 2.39% in a week to 134.6 millions tons on April 18. According to a report by Mysteel, the volume of iron ore exports from Australia and Brazil increased 0.1% compared with the previous week. Galaxy Futures said that tariffs are still weighing down on steel exports and affecting demand for iron ore during the second quarter. China accused Washington's abuse of tariffs, and warned other countries not to strike a wider economic deal with America at its expense. India implemented a temporary 12% tariff on certain steel imports (locally known as safeguard duty) to stop a rush of cheap shipments, mainly from China. Coking coal and coke, which are used to make steel, also lost ground. They fell by 1.89% each and 1.51% respectively. The benchmarks for steel on the Shanghai Futures Exchange have declined. The price of rebar fell 0.13%. Hot-rolled coils dropped around 0.2%. Wire rod fell 0.06%. Stainless steel declined 0.55%. $1 = 7.3125 Chinese Yuan (Reporting and editing by Eileen Soreng; Michele Pek)
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India imposes temporary tariffs on certain steel imports to stop cheap imports from China
India, the second largest producer of crude iron and steel in the world, imposed on Monday a temporary 12% tariff on certain steel imports. This is known locally as a "safeguard duty" to stop a rush of cheap shipments, primarily from China. In recent years, a flood of Chinese steel has forced some Indian mills into reducing operations and considering job cuts. India is among a number countries that have considered action to stop imports in order to protect their local industry. In an official order, the Ministry of Finance stated that this duty will be in effect for 200 days starting Monday "unless it is revoked, replaced or amended sooner". New Delhi has made its first major shift in trade policy since U.S. president Donald Trump imposed tariffs on a number of countries, starting a bitter trade conflict with China. The investigation into the latest action began in December, but tensions about cheap steel imports to India were already present before that. H. D. Kumaraswamy, India's steel minister, said in a press release that the measure was designed to protect domestic steel producers from the negative impact of a surge in imported steel and ensure fair competition on the market. This move will be a relief for domestic producers and small-scale businesses, which have been under immense pressure due to the rise in imports, Kumaraswamy stated. New Delhi's tariffs mainly target China, the second largest steel exporter to India in 2024/25 behind South Korea. The decision was expected and we are now waiting to see if this measure will support the industry, margins, and limit cheap imports in the country. The executive said that "Chinese imports have an impact on the world, whether they are directly or indirectly." According to government data, India became a net importer for the second consecutive year of 2024/25. Shipments reached a record high of 9 million metric tonnes, a figure not seen in nine years. New Delhi's top steelmakers' group, which includes JSW Steel and Tata Steel as members along with the Steel Authority of India, ArcelorMittal Nippon Steel India and Steel Authority of India has expressed concerns about imports and demanded curbs. Reporting by Neha Misra and Surbhi Arora; Editing by Alison Williams and Toby Chopra. Mayank Bhardwaj, Jan Harvey and Alison Williams.
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London copper reaches a two-week high, as the dollar falls
The copper price in London reached a two-week-high on Tuesday. This was due to a sharp drop in the dollar, as Donald Trump's harsh criticism of the Federal Reserve Chairman shook the confidence of investors in the U.S. As of 0212 GMT, the benchmark three-month price for copper on London Metal Exchange (LME), was up 0.8% to $9,265.5 per kilogram. It briefly reached $9,319.5 per ton, its highest level since April 4. After a weekend break for Easter, the LME returned on Monday. The Shanghai Futures Exchange's (SHFE) most-traded contract for copper rose by 0.4%, to 76760 yuan per metric tonne ($10,503.56). The U.S. dollar sank close to a decade-low against the Swiss Franc and hovered around a 3-1/2 year low versus the Euro. The dollar's weakness makes the price of commodities in U.S. dollars cheaper for buyers who use other currencies. Trump stepped up his criticisms of Fed chief Jerome Powell in a Truth Social posting on Monday, calling him "a major loser" while demanding that he reduce interest rates "NOW", or risk an economy slowdown. Kyle Rodda is a senior financial analyst at Capital.com. He said that the crisis of confidence among U.S. investors was intensifying as Trump's policies could potentially disrupt global economic order. Other metals include LME aluminium, which rose 0.9% to $ 2,387.5 per ton. Lead was up 0.96% at $1,940.5. Tin was up 2.5% at $31,270. Zinc was up 0.99% at $2,602.5. Nickel was down 0.08% to $15,610. SHFE aluminium fell by 0.08% at 19,760 yuan per ton. Zinc was down by 0.18% at 22,170, lead was up 0.15% at 16,965 and nickel was down by 0.02%, falling to 125,400, and tin was down 0.67 percent to 257 590 yuan.
Uphill roadway for Europe's climate plan after EU election
A more rightwardleaning European Parliament will make it more difficult to pass enthusiastic EU environment policies, but most of Europe's current worldleading green policies are likely to sit tight, legislators, authorities and experts stated. Provisional results in the European Parliament election on Sunday night revealed centrist parties holding a majority, however gains for rightwing and farright celebrations sceptical of the EU's. Green Deal bundle of environmental policies, and heavy losses. for Green celebrations.
I don't believe that we'll be rolling back on (environment). policies. However I do think that it will be more complex to get. brand-new policies off the ground, Bas Eickhout, head of the European. Parliament's Greens lawmaker group, informed .
EU climate steps over the next five years will depend upon. the inbound European Commission, which is responsible for. proposing EU laws. But the newly-elected European Parliament. will get a say on every new green policy.
Sunday's election result signals tougher maths to authorize. new EU environment procedures.
All brand-new policies will be more difficult to pass. But backsliding is. extremely not likely, Krzysztof Bolesta, Poland's secretary of state. for environment, told .
It is possible that new ambition will be delayed, primarily. for populistic factors, concurred Julian Popov, who until April. was EU member Bulgaria's environment minister.
That might have effects for an approaching 2040 EU. climate target, needed to guide the EU towards its 2050 net zero. emissions target. The EU Commission has actually suggested the 2040 objective. need to be an ambitious 90% emissions cut, but it requires approval. from both EU nations and the Parliament.
The upcoming European Commission and Parliament will also. face hard choices on whether to present brand-new policies to. push markets towards that 2040 target. That consists of farming, a sector whose emissions have barely. fallen considering that 2005. But after months of demonstrations across Europe by. mad farmers, there is little political hunger to target the. sector with new guidelines, especially if the cost of abiding by. them would drive up food prices for residents already dealing. with the biggest dive in living costs in a generation.
NO BIG U-TURN
While new climate measures might face a tougher ride, a. full-scale turnaround of the lots of EU environment policies passed. in the last 5 years would be lawfully challenging. Those policies - that include renewable energy targets and a. reinforced carbon prices routine on power and market - are. repaired into EU law and already being rolled-out across the bloc's. 27 member states. Many are currently working. EU emissions are down by almost a. third from 1990 levels, and Europe is setting up wind and solar. energy capability at record speed.
Still, the election campaign saw mounting calls from the. right to ditch some Green Offer policies - with a prime target. the EU's 2035 ban on brand-new petrol and diesel vehicles. That policy has. a 2026 evaluation stipulation, on which the Parliament will get a say.
It was an ideological recklessness, which absolutely must be. corrected, Italian Prime Minister Georgia Meloni told online. magazine Open recently. 3 EU diplomats singled out the 2035 cars and truck policy as one that. European Commission President Ursula von der Leyen will face. significant pressure to compromise, consisting of from some lawmakers in. her centre-right European Individuals's Party who desire it ditched. Von der Leyen needs support from a bulk of lawmakers in the. new European Parliament to win a 2nd term.
However broad environment policy rollbacks are not likely, authorities and. analysts said. That's partly because the EU's existing climate. steps add up to deliver its 2030 climate target - to cut net. greenhouse gas emissions 55% from 1990 levels - which nationwide. governments and legislators both approved into EU law.
There might well be changes in private pieces of. legislation, but what will be necessary to enjoy is how this. builds up, stated Mats Engström, senior fellow at the European. Council on Foreign Relations think-tank.
DON'T CALL IT A 'GREEN' DEAL. Contrary to the last EU election in 2019, when millions of young. environment protesters took to Europe's streets, this year's. campaign saw climate modification took over by concerns consisting of. immigration, economic concerns and having a hard time European industries. Fulfilling the EU's 2030 environment target will need financial investments of. 1 trillion euros annually, a jump of around 356 billion each year. compared with 2010-2020, according to the European Financial investment. Bank.
Buying regional industries was a project promise throughout. the political spectrum, as competition hones with the U.S. and China to produce green tech like low-carbon steel and. electrical cars and trucks. Some analysts said this focus would see the EU pass more funds. and policies to support climate-friendly jobs - but with the. focus on helping industry, instead of being green and. clean.
If it's about scaling up manufacturing of green. technologies here in Europe, then that may be performed in the name. of 'commercial competitiveness' and not for the climate, said. Linda Kalcher, Executive Director at think-tank Strategic. Viewpoints.
It may be that we see the rhetoric shifting, but the. action on the ground being the very same, Kalcher stated.
(source: Reuters)