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Oil prices are being held down by a subdued supply and a large amount of oil despite geopolitical risk
A poll conducted on Friday showed that analysts are keeping their oil price predictions largely the same as OPEC+'s rising output targets and a lacklustre market demand have offset geopolitical risk to supply. According to a survey conducted by 36 economists and analyst in October, Brent crude is expected to average $67.99 a barrel in 2025. This is about 38 cents higher than the estimate from last month. West Texas Intermediate will average $64.83 per barrel in 2025. This is slightly higher than September's estimate. Brent and WTI have been averaging $69.27 and $65.92 respectively so far this year. Tobias Keller, UniCredit's analyst, said that the oil prices of 2025 will be shaped by a delicate equilibrium between supply growth, modest consumption, and geopolitical uncertainties. The market is well supplied, thanks to the rising production from OPEC+ producers and non-OPEC ones. However, the demand growth, although positive, has slowed, especially in OECD countries. Analysts predict that oil will be in surplus by 2026. Estimates range from 0.19 million barrels per daily (bpd) to 3.0 million. Oil prices fell to their lowest level in five months on October 20 due to fears of an oil glut and economic concerns related to U.S. China trade relations. Since April, OPEC+ has increased its output targets by over 2.7 million bpd. This is around 2.5% global supply. It's also just under half of the 5.85 millions bpd cut the group previously agreed on. After a 137,000-bpd increase for November, the group has indicated that it is inclined to make another modest increase in its oil production for December. Suvro Sarkar, DBS analyst, said that while the OPEC+ response to market conditions continues to be flexible, the current action appears to be driven more by a desire for market share than a desire to support oil prices. The U.S. imposed sanctions on two of Russia's biggest oil companies this month, and markets are monitoring the fragile ceasefire that has been reached in Gaza. Keller said that the ceasefire in Gaza has reduced regional risk premiums while new sanctions against Russian oil and attacks on infrastructure have brought up fresh concerns about supply. Analysts predict that global oil demand will grow between 0.65 and 2 million bpd in this year. This growth is largely due to the growth of China.
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Gold drops as investors reduce rate-cut bets. Set for third monthly gain
Gold fell to $4,000 per ounce as the dollar remained near its three-month highs due to uncertainty about another rate cut by the U.S. in December. However, it is still on track to make a third consecutive monthly gain. Gold spot was down 0.5% to $4,004.37 an ounce at 0936 GMT. It had gained almost 4% this month. U.S. Gold Futures for December Delivery were unchanged at $4,016.30 an ounce. Dollar-priced gold is more expensive to other currency holders because the dollar index has been near its highest level in three months. Ricardo Evangelista, an analyst at ActivTrades, said that "gold is under pressure because the dollar has strengthened on the backs of these hawkish comments (by Fed chair Powell)." He said that markets had taken another rate reduction in December as a given. The Fed cut rates on Wednesday by 25 basis points, for the second consecutive time in this year. This brings the overnight benchmark rate down to a range of 3.75% - 4.00%. CME Group's FedWatch showed that after Chairman Jerome Powell made hawkish comments, the markets now place a 67% chance of a 25 bp reduction, compared to 91.1% a week earlier. The demand for safe-havens has also declined due to the optimism surrounding trade after trade talks between China and the U.S. this week. Donald Trump, the U.S. president, said on Thursday that he agreed to reduce tariffs against China in exchange for Beijing crackingdown on illegal fentanyl trafficking. He also stated that he would resume U.S. purchases of soybeans and keep rare earths exports flowing. Evangelista said that the macro-environment remains favorable for gold over the medium and long term. This is due to the ongoing geopolitical turmoil in Ukraine, the Middle East and between the U.S. Silver fell by 0.2% at $48.82 an ounce. Platinum dropped 1.5% at $1,586.64 and palladium declined 0.4% to $1,438.72. (Reporting by Ishaan Arora in Bengaluru; Editing by Jan Harvey)
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Vedanta, an Indian miner, has seen its quarterly adjusted profit increase on the back of higher metal prices
Vedanta, an Indian conglomerate that converts metals into oil, reported a higher adjusted quarterly profit on Friday. This was largely due to higher metal prices. The company's profit before taxes and exceptional items increased 21.7% compared to a year ago, reaching 70.14 billion rupiahs ($798m) for the quarter ending September 30. The operating profit margin increased to 22%, up from 20%. This was due to stable expenses. Due to the uncertainty surrounding U.S. Trade policies, the benchmark three-month aluminium prices and copper rose by 8.2% and 5.6% respectively on an annual basis during the quarter. Mining companies tend to benefit from higher commodity prices by increasing their margins and selling prices. The total revenue of the miner increased by 5.5%, to 392,18 billion rupees. Vedanta’s aluminium business in India is the largest and accounts for nearly 40% of its revenue. Copper is followed by zinc as the company's second largest business. Copper revenue grew by 3.6% and aluminium revenues rose by 14%. India Zinc, Lead, and Silver segment revenue grew by 3.5%. Total expenditures rose by 0.8%, to 334.49 Billion Rupees. The company reported net extraordinary expenses of 20,67 billion rupees. This included a write-off amount of 14,07 billion rupees as well as a settlement of 6,60 billion rupees. Vedanta’s subsidiary Hindustan Zinc reported a higher profit for the quarter on strong silver prices and zinc.
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Trump's nuclear reactor plans raise safety concerns
The Trump administration announced a huge nuclear deal earlier this week that provides an incentive of multi-billion dollars for the U.S. Government to issue permits for new Westinghouse Reactors. Critics say the structure is unprecedented and poses safety and environmental risks. The U.S. Government will help to secure approvals and permits for the $80 billion worth Westinghouse nuclear reactors. The plan gives the U.S. Government a way to get a share of 20% future profits, and even a possible 20% stake in the firm if it's value exceeds $30 billion by the year 2029. The deal represents one of the most ambitious plans for U.S. nuclear energy in recent decades. It highlights President Donald Trump's desire to maximize energy production to meet the booming demand in artificial intelligence data centres. Safety advocates and regulatory experts say that financial incentives could cloud regulatory scrutiny to prevent nuclear accidents. Greg Jaczko is a former Chairman of the Nuclear Regulatory Commission. He said that Three Mile Island and Chernobyl are three of the most serious nuclear accidents in history. All of these problems are linked to a lack of regulatory independence. The White House has said that concerns about safety are unfounded. The regulatory regime is unchanged and not compromised. The White House stated in an email that there was no agreement about regulatory changes. Cameco, the owner of Westinghouse, declined to comment. Brookfield and Westinghouse have not responded to requests for comment. TD Cowen's analysts said in a recent research note that they expect Westinghouse will have 10 large-scale nuclear reactors under construction - enough to power several millions of homes - by 2030. It takes an average of ten years to build a nuclear power plant, mostly due to the complex construction and high costs. Patrick White, an expert in nuclear technology and regulatory issues at the Clean Air Task Force said that effective regulation does not have to be a long or slow process. White stated that it was in both the companies' and the public's best interests to ensure nuclear regulation is timely and predictable. Todd Allen, an expert in nuclear engineering at the University of Michigan said that the Westinghouse design is well-established, but questioned the speed of the projects. Allen stated, "With this aggressive timeline and the demand for reactors all over the world, I'm wondering if there is enough manpower to handle these projects." DURATION DELAYS IN PREVIOUS U.S. WORK PROJECT Westinghouse was forced into bankruptcy in 2017 by its last nuclear project in the United States, the construction of two nuclear reactors in the Vogtle Power Plant in Georgia. The cost of the two reactors was about $35 billion and seven years behind schedule, which is more than twice as much as the initial estimate of $14 billion. Patty Durand has spent many years studying this project. She fears that a fast-tracked permitting process will overlook climate change risks. She said that severe droughts in Europe and America have forced operators to reduce nuclear power to avoid overheating reactors. Westinghouse had a number of issues with its modular design for the AP1000 reactors. For example, some parts were not sized correctly when they arrived at their site. The AP1000 was also used to build the new reactors. They were built using prefabricated parts, and assembled on-site. Edwin Lyman is a physicist with the Union of Concerned Scientists. He fears that the Trump administration may exert too much control over the Nuclear Regulatory Commission in order to have the new reactors approved. (Reporting by Tim McLaughlin and Timothy Gardner; Editing by Nia Williams) (Reporting by Tim McLaughlin, Timothy Gardner and Nia Williams).
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Newmont CEO: Ghana's fiscal stability is key to the $900 million gold mining project opening
Newmont CEO Tom Palmer said that fiscal stability and fair tax systems and royalties are essential if countries wish to attract mining investments. The company had just opened its $900m Ahafo North Mine in Ghana. Newmont only operates in Ghana in Africa, which is one of the most stable mining jurisdictions on the continent. It offers stability agreements to firms that lock in royalties over a period of five to fifteen years. However, the government intends to tighten oversight of mining companies. Palmer, in an interview on Thursday, following the inauguration the Ahafo North Mine, Newmont's second mine in Ghana, after selling the Akyem to China's ZIJIN last year, said that Newmont's investments are based on "very stable fiscal régimes" and on "robust and fair tax and royalties systems." "It's important to have a fair and transparent regime... He said that if the capital is not moved elsewhere, it will. This week, it was reported that Ghana, Africa’s largest gold producer, had ordered audits on mining companies, including Newmont of the United States, AngloGold Ashanti and Gold Fields, as well as China’s Zijin. Ghana is also preparing for major legal reforms as West African countries push to gain greater control over their natural resources in the face of a global commodities boom. Palmer said that the investment climate is still favorable. He said that Ghana was a crucial place. "We are in Australia, Canada and the United States. We're also in Peru, Argentina, Mexico and Suriname. All of these locations were carefully chosen, and we chose to stay there long-term because we know we can maintain and build lasting relationships." Newmont operates two mines in Ghana, Ahafo South & Ahafo North. Palmer called them "cornerstones of the global portfolio" for Newmont. "We've lived here for 30 years." "I expect Newmont to be here for at least another thirty years." Jane Naana Opoku Agyemang, Vice President of Ghana, said that the Ahafo North Mine marks a new phase in inclusive growth for Ghana’s economy. This partnership must be more than just a business deal. She said that the partnership must be able to deliver value for the people of Ghana and in particular those living in the host communities. Ghana's regulatory climate is more stable than in other parts of Africa, where governments led by military forces, such as those in Burkina Faso and Mali that are rich with gold, iron ore, uranium and bauxite and Mali and Niger, tighten fiscal regimes for state revenue. On October 20, spot gold prices reached a new record of $4,380 per troy ounce. This boosted the revenue for miners. The Ahafo North Mine, located 30 km (19miles) from Newmont’s Ahafo South mine, is expected produce 50,000 ounces gold this year. Production will increase to 275,000-325,000 over the course of its 13-year lifespan. Palmer stated that the mine would employ around 1,000 permanent workers. Newmont will produce around 800,000 gold ounces in Ghana by 2024.
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China's Industry Association recommends a capacity cap for lead, zinc and copper
China's non-ferrous metals association, which is backed by the government, has recommended setting a cap on capacity for certain metals such as copper, zinc, and lead to limit the addition of additional capacity, because low processing fees are hurting smelters’ profitability. China's rapid growth in the supply of goods has led to an excess supply in several industries, from steel, solar and coal. Beijing's promise to end price wars between producers in early-July has triggered an anti-involution campaign across all sectors that are plagued with overcapacity. A state-run news outlet reported last month that China was looking at ways to improve regulation regarding the expansion of copper melting capacity. The state-run China Nonferrous Metals News reported that Duan Shaofu was an official of the association who said at a quarter-long briefing: "There's an intense competition in the smelting, refining and other nonferrous metals, but aluminium is the exception." China's cap on capacity for aluminium was 45 million metric tonnes from 2017. This has contributed to the astronomical profits made by producers of this light metal since then. Duan said that the intense competition in the form of 'involution' has weakened companies' bargaining power when it comes to raw material procurement. This has lowered profits and threatened a sustainable development for industry. Copper, zinc, and lead smelters rely heavily on processing fees or treatment and refinement charges. The fierce competition to obtain scarce feedstocks, coupled with rapid expansion of smelting capacities, has put pressure on these fees. Copper concentrate processing charges, for example, are at record lows. China's leading copper smelters have decided to refrain from providing guidance on such fees in the fourth quarter of 2025. This is the third time they have made this decision.
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Sources: Russian-backed Indian refinery sanctions boosts crude run to 90%
Two sources with knowledge of the situation said that after European Union sanctions earlier in the year, Nayara Energy, a Russian-backed Indian refiner, has increased crude processing to 90-93% capacity at its Vadinar Refinery. Sources have said that oil processing at Nayara’s 400,000 barrels-per-day western India plant fell to 70 to 80 percent after the EU sanctions it in July. This impacted its exports, and caused suppliers like Iraq and Saudi Arabia, to stop crude sales to the firm. Nayara was operating at 104% capacity before the sanctions. Nayara, a majority-owned company by Russian entities, is dominated by Rosneft. Rosneft holds 49.13% of the shares and was sanctioned by the United States last week. Nayara and Rosneft didn't immediately respond to comments. Sources said that Nayara crude sales have recently rebounded as the company increased domestic fuel sales. This includes supplies to Hindustan Petroleum Corp., a state-owned refiner. Ship tracking data indicates that the private refiner operates its plant only using Russian oil. Sources said that Rosneft arranged for Russian oil to be sold by traders to Nayara. Sources said that Nayara will likely continue to buy Russian crude oil through non-sanctioned companies, but declined to provide further details on how Nayara pays for its crude oil purchase. It was reported that Nayara settled its Russian oil supply against exports. Reliance Industries - the largest Indian refiner and client of Russia - has stopped buying Russian oil since Washington's sanctions against Rosneft, a Russian energy company, were imposed last week. According to a report on Friday, India's largest refiner, Indian Oil Corp., purchased five cargoes from non-sanctioned sources of Russian oil, due for delivery in December. Nayara has more than 6,600 retail outlets. (Reporting and editing by Joe Bavier; Nidhh Verma)
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Orban, the Hungarian Prime Minister, says he'll seek an exemption from US oil sanctions
Viktor Orban, the Hungarian prime minister, said that he hopes President Donald Trump will convince him to exempt Hungary from U.S. sanctions against Russian oil due to its high dependency on pipeline networks. Orban said that he would discuss U.S. Sanctions on Russian Oil Companies Rosneft, and Lukoil at a scheduled meeting with Trump for the 7th of November and hopes to conclude a wide economic agreement with America. "Hungary has a landlocked status... We depend on the transport routes that allow energy to reach Hungary. Orban stated that the majority of these are pipelines. He said: "We must make the Americans aware of this peculiar situation... if they are to grant exemptions to the American sanctions against Russia." Orban stated that Germany, despite its access to the sea and its refineries, had requested an exemption. Germany's Economy Minister said Tuesday that he received assurances from Washington stating that Rosneft Germany would be exempted from sanctions as the assets were no longer under Russian authority. Rosneft Germany owns the majority stake in Schwedt Oil Refinery. The U.S. announced new sanctions that could put Hungary at risk of relying on Russian crude oil imports. This was just days after an fire forced the Hungarian oil company MOL to reduce its capacity due to a fire in their main refinery along the Danube. The government of Hungary published a draft law to amend the existing legislation on imports and stockpiling crude oil, crude products and other crude materials. This will allow it to designate "standby" filling stations that can provide fuel in an emergency to users who are critical to supply. Orban will meet Trump for the first time next week, since his longtime ally has returned to the White House. (Reporting and editing by Sharon Singleton, Timothy Heritage and Anita Komuves)
Gold falls as Fed rate caution increases dollar, but is set to rise for 3rd month.
Gold prices fell Friday as the dollar strengthened on fears of further Federal Reserve rate reductions, but bullion is still on course for its third consecutive monthly gain.
As of 0459 GMT, spot gold was down 0.4%, at $4,005.54 an ounce. Bullion is up 3.9% this month.
U.S. Gold Futures for December Delivery remained at $4,018.10 an ounce.
Tim Waterer, Chief Market Analyst at KCM Trade, said that the Fed Chairman's hawkish stance this week did not do gold any favors.
The prospect of a December rate cut is now much less certain than previously believed, which has helped boost the dollar and made things more difficult for gold in terms of yield.
Dollar index nears its highest level for three months, making gold more expensive to other currency holders.
The U.S. Central Bank cut interest rates on Wednesday by a quarter percentage point, for the second consecutive time in this year. This brings the benchmark overnight rate down to a range of target of 3.75%-4.00%.
After comments from Chairman Powell, traders have reduced their bets on the Fed cutting rates at its next policy gathering in December.
According to CME Group's FedWatch, the markets now price in a probability of 74.8% for a 25 basis-point reduction from the Fed by December compared to a chance of 91.1% a week earlier.
Donald Trump, the U.S. president, said that he and Chinese President Xi Jinping had agreed to reduce tariffs against China in exchange for Beijing crackingdown on illicit fentanyl trafficking. He also stated that the U.S. would resume its soybean purchases as well as continue exports of rare earths.
Gold was discounted in India this week for the first seven-week period, and a drop in prices boosted activity in other Asian hubs.
Silver spot was unchanged at $48.89 an ounce. Platinum was stable at $1,610.75, and palladium rose 1.5% to $1466.42. (Reporting and editing by Subhranshu sahu, Mrigank dhaniwala in Bengaluru)
(source: Reuters)