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Kuwait raises May crude prices for Asia, pricing document shows
Kuwait raised its official selling price for Kuwait Export Crude in Asia to $17 per barrel over the average 'Oman/Dubai quotations' from $0.50 in April. After weekend talks failed to?clinch a deal? to end the Iran War, the U.S. Military announced it would blockade maritime traffic in Iranian ports and coastal regions. This could jeopardize a fragile?two-week truce. Documents showed that the producer increased the Kuwait Super Light Crude OSP for May to $17 per barrel over Oman/Dubai prices, up from $1.15 in April. Middle East producers have boosted official prices for Asia for May. Saudi Arabia set the price of its Arab Light crude for Asia at a record $19.50 per barrel over the Oman/Dubai benchmark, while Iraq raised the price of its Basrah Medium oil for Asia by $17. Middle East crude is now the most expensive in the world - after the U.S. and Israel war against Iran disrupted shipping along the Strait of Hormuz - a vital artery that supplies about a 'fifth of all the oil around the globe. This month OPEC+ has agreed to?raise?oil production quotas by 206,000 barrels a day for May. It is a modest increase that will largely be on paper, as the key members of OPEC+ are unable to increase production due to their involvement in the Iran War. Analysts expect the oil market to be in deficit this year due to a drop in global production. This is compared to pre-conflict predictions of a comfortable surplus. (Anjana Anil in Bengaluru, and Pablo Sinha at the Editing Department of Christopher Cushing and Clarence Fernandez.)
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Gold falls as Hormuz Blockade boosts dollar and dents Fed rate-cut bets
Gold fell to a new low of?nearly one week? on Monday as a stronger dollar and a surge in oil prices above $100 following the U.S. move to blockade Iranian port fuelled inflation fears, prompting traders back off their expectations of Federal Reserve rate reductions this year. As of 0735 GMT spot gold was down 0.4% to $4,730.75 an ounce. It had hit its lowest level since April 7 earlier that day, at $4643. U.S. Gold Futures for June Delivery fell 0.7% to $ 4,753.30. The dollar gained 0.3% after the?U.S. The Navy prepared to blockade the Strait of Hormuz, which could limit Iranian oil shipments following the collapse of?peace negotiations between the U.S. The Iranian Revolutionary Guards warned that any military vessel approaching the Strait would be considered a breach of ceasefire and treated harshly and firmly. Tim Waterer is the chief market analyst for KCM Trade. He said that "Ceasefire Optimism?has unraveled following the failure of the peace talks. The dollar and oil price have pushed up, and this has pushed gold backwards." Since the U.S. and Israel war against Iran began late in February, spot gold has dropped more than 11%. Gold's appeal is usually boosted by inflation and geopolitical risks, but high interest rates are a drag on this non-yielding precious metal. The greenback price of bullion is also more expensive for holders other currencies. Waterer stated that "as soon as oil prices?return above $100, the focus quickly shifts to possible central bank rate increases to curb inflation. This interest rate outlook is what is affecting gold's performance." The traders now see very little chance for a 'U.S. Rate cuts are unlikely this year as the higher energy prices could feed into inflation, limiting the scope for "monetary easing". Investors priced in two Fed rate reductions for 2026 before the start of war. (Reporting by Noel John in Bengaluru; Editing by Rashmi Aich, Subhranshu Sahu and Sonia Cheema) (Reporting and editing by Rashmi aich, Subhranshu Sahu, Sonia Cheema).
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London Aluminium hits four-year peak on Middle East Supply Woes
Prices for 'three-month' aluminium on the London Metal Exchange hit a four-year high of $3,569. Supply fears returned after a stalemate in the 'U.S. vs. Iran peace talks. The benchmark 'three-month' aluminium on the London Metal Exchange reached $3,555 per metric ton at 0729 GMT. This was up 1.61% from its previous high of $3 569. The Shanghai Futures Exchange's most traded aluminium contract closed the daytime trading up 0.55% to 24,760 yuan (about $3,623.38) per tonne. After the failed weekend peace talks, the U.S. Military announced that it would begin a blocking of all maritime traffic entering and leaving Iranian ports and coastal regions on Monday. This will put the fragile two-week truce in danger. In a recent note, ING analysts stated that the rising geopolitical risk in the Middle East has intensified concerns about shipments and production of aluminium. Elevated energy prices are adding to the upward pressure on aluminium and reinforcing costs support for smelters, they said. Last month, the conflict forced local aluminium producers to reduce their output. It also disrupted the supply of aluminium by closing down Strait of Hormuz. Before the Iran War, this region supplied roughly 9% global aluminium. Copper prices rose amidst falling stocks and improved demand from China's top consumers. Shanghai copper reached a new high, while London copper gained 0.35 percent. Yangshan Copper Premium On April 10, a measure of the country's appetite to import the metal, rose to $73 per ton, the highest level since June 2025. Nickel, zinc, and lead all fell 0.16%, while tin dropped 1.21%. Nickel grew 2.61% for other?SHFE Metals. Lead fell 0.63%. Tin dropped 0.87%. Zinc slipped 0.63%.
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Iron ore reverses a six-day decline on the back of surging oil and feedstock demand
Iron ore futures recovered?on Monday after a six-session decline to a?one-month low. The market was supported by surging oil prices and higher feedstock demands. The September contract for?iron ore on the?China's Dalian Commodity Exchange (DCE), rose by 1.26%, to 763.5 Yuan ($111.75), per metric ton. As of 0710 GMT, the benchmark May iron ore traded on Singapore Exchange was up 1.08% at $104.6 per ton. SteelHome data shows that iron ore inventories at major Chinese ports decreased by 0.16% in a week, according to the latest figures. According to Mysteel, continued portside destocking along with rising hot metal output keep prices stable. Mysteel data showed that iron ore imports at 47 Chinese ports fell by 536.100 tons due to disruptions in Australian supplies. Imports should improve this week, as supply disruptions have eased. On 'Monday, oil prices rose above $100 per barrel as the U.S. Navy prepared to block ships reaching Iran through the Strait of Hormuz. This could limit Iranian oil exports after Washington and Tehran failed in their efforts to end the conflict. As shipping costs increase, it is expected that rising oil prices will support iron ore. The Brazilian mining company Vale announced on Friday that it will start building a waste rock and tailings processing plant for the state of Minas Gerais in the southeast this year. The plant will be able to produce 2 million tons per year of iron ore and is expected to start operations in the next few months. It's part of the company's plan to reuse previously discarded materials. Coking coal and coke, which are both steelmaking ingredients, have gained a lot of ground. The Shanghai Futures Exchange saw a rise in most steel benchmarks. Rebar rose 0.19%. Hot-rolled coils firmed up 0.21%. Stainless steel increased 0.69%. Meanwhile, wire rod dropped 0.12%. ($1 = 6.8325 yuan) (Reporting by Ruth Chai; Editing by Subhranshu Sahu)
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BOJ's Ueda urges vigilance to counter the impact of Middle East War
Kazuo Ueda, the Bank of Japan governor, said that the economic and price development was roughly in line with the bank's predictions. He called for caution in assessing the impact of the escalating conflict. The Middle East tensions have caused a sharp rise in crude oil prices and instability on the global financial markets. Ueda, who was quoted by Ryozo Himino in a speech that he read out, said: "We must be vigilant for future developments." Markets were watching the speech closely for any hint that the BOJ would raise interest rates during its next policy meeting, which will be held on April 27-28. The markets are volatile due to fading hope of an early end to Iran's war. Ueda said that a gradual economic rebound was keeping inflation?on track to hit the BOJ’s 2% target, with companies offering substantial pay increases during this year's salary negotiations. He said that rising crude oil costs would harm Japan's economic growth. A protracted Middle East conflict could also affect factory production due to supply chain disruptions. He said that while higher oil prices would increase energy costs in the short term, they could also exert upward and downward pressures to underlying inflation. If the output gap widens, it could have a negative impact on underlying inflation. Ueda added that if the rising price of crude oil increases the public's expectations for medium- and long-term prices, this could increase underlying inflation. Ueda stated that "given the lingering uncertainties over the Middle East situation, we will examine how future developments impact the economy, price?and financial condition, as well the risks and likelihoods of our baseline predictions materialising," Ueda on the outlook for monetary policies. The BOJ's reference to Middle East unrest is a departure from its March guidance when it said that the BOJ would raise rates in accordance with the improvement in the economy and price levels.
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Budget for the spring election increases subsidies on energy and fuels
The government of Sweden announced a spring mini-budget that will slash fuel taxes, and increase electricity subsidies. This is to help ease the burden on households who are paying higher energy costs due to the war in Iran. The additional spending will be 7.7 billion crowns (825 million dollars) ahead of the September parliamentary elections. This is on top of an 80 billion crowns in new spending announced last September in the full year budget bill for 2026. "Sweden's on the right track." The Swedish economy remains strong despite war and uncertainty overseas. We continue to build safety barriers. Since the United States and Israel attacked Iran, oil prices have risen. In response, Tehran has launched missile attacks across the Gulf and closed the Strait of Hormuz. Sweden's economy is so far largely untouched by any major impacts, but a prolonged conflict could increase inflation, slow growth, and raise interest rates. The spring budget includes a temporary increase in electricity subsidies to households. This will cost 2.4 billion crowns, and the reduction of fuel taxes is 1.6 billion. Additional measures include funding for the?Swedish space programme, healthcare, and job creation. ELECTION BOOST Sweden's September budget included tax cuts, more money for healthcare, schools and defence to boost the sluggish economy and win back voters who were still feeling the pinch from high inflation. The political balance in Sweden is complicated ahead of the election. The left has a slight edge over the right but both sides may struggle to form a governing majority. Sweden Democrats, a populist anti-immigration party, could become part of the government if the right wins. Sweden's public finances are rock solid, unlike most of Europe. Eurostat predicts that debt will peak at 38% of GDP by 2028, compared to the current EU average of 88%. (1 dollar = 9.3309 Swedish crowns). (Reporting and editing by Terje Sollsvik, Anna Ringstrom & Simon Johnson)
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European chemical companies will report falling earnings in Q1 due to the Iran War.
European chemical companies will likely report lower first-quarter earnings, which will shed light on the?depth of the impact the Middle East war has had on an industry that is viewed as being one of the most vulnerable to it. The 'U.S.-Israeli conflict with Iran has caused disruptions in the 'fuel and feedstock market, which have pushed up prices for the energy-intensive chemical sector. VCI, the German chemicals association, said that the chemical industry is more affected than other industries by the dramatic rise in energy and raw materials costs because it relies primarily on oil and natural gas as feedstocks. The war-driven rise in energy prices exacerbated the already weak conditions that were seen at the beginning of 2026. This sector has been struggling for years due to?subdued demands, high energy costs and supply-chain disruptions, as well as a slowing economy. Companies have increased prices to protect margins. According to a note by the brokerage, the finance chief for Germany's BASF stated at a JPMorgan Chemicals Conference in March that the company expected to see cost inflation more than offset in the second quarter of the year. Brenntag's Chief Financial Officer said, meanwhile, that customers have accepted price increases. Martin Gornig, Research Director at the German Institute for Economic Research, says that while rising energy costs affect everyone, they have been particularly hard on Germany and other European nations. Mwb Research stated in a recent report that Asian competitors retain an edge due to their lower structural cost bases. This helps them buffer the effects of weaker demand. Anna Wolf, an industry expert at the Ifo Institute for Economic Research in Germany, said that "higher prices further weaken competitiveness of European producers against Chinese suppliers." VCI reported that feedback from companies has been?mixed'. Concerns over supply shortages are driving demand in certain segments while higher prices dampen?purchase activity for others. Analysts warn that gains could be fragile, and do not expect to see a meaningful recovery in earnings based solely on pricing. Wolf said that rising uncertainty and volatile prices could further weaken demand. The recent price increases were unexpectedly steep, given the generally low demand and sluggish confidence in business. The two-week ceasefire has not brought immediate relief to the energy markets. Although it has reduced the immediate pressure, costs remain high and volatility is elevated. VCI stated that "even if the energy crisis is temporarily resolved, it is unlikely to see a rapid return to normal prices." Sebastian Bray, Berenberg analyst, said that a reversal of chemical prices is possible in a scenario where there's lowered oil prices and improved feedstock availability. Anastasiia Kozolova in Gdansk and Amir Orusov, with editing by Milla Nissi-Prussak.
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As US-Iran talks fail, oil prices soar and the dollar rises. Stocks also fall.
The dollar rose, stocks and bonds fell and oil prices surged as the U.S. imposed a blockade against?Iranian ships after the weekend's?peace negotiations collapsed. The move, aimed at putting pressure on Tehran, leaves a fragile ceasefire hanging in the balance and no end is in sight to the choke on Middle East energy exports. The?U.S. Brent crude futures are up 7.3% to $102 per barrel, a gain of over 40% since the Strait of Hormuz was closed due to the war. S&P futures fell 0.7% during the Asia Day and European?futures dropped 1.4%. U.S. Treasuries, bonds and other assets in Asia fell, with Japan's 10-year benchmark yield reaching a 29-year record of 2.49%. However, the moves were modest, and most assets returned to where they stood before last week's truce. Saul Kavonic, an analyst at MST Marquee, said that the market has returned to its pre-ceasefire conditions. However, the U.S. is also blocking the remaining Iranian-linked flow of up to 2 million barrels through the Strait of Hormuz. The key question remains whether the U.S. will renew its strikes against Iran. This could raise the risk of attacks on energy infrastructure in the region, which would have an impact that would last beyond the war. The Wall Street Journal reported that Trump and his advisers are considering limited strikes against Iran. However, there have been no reports of any attacks on Asia Day. Trump acknowledged on Sunday the possible political consequences of the war by saying that oil and gasoline prices may continue to be high until the November midterm elections. DOLLAR HIGHER INFLATION LOOMS The euro dropped about 0.3% in the foreign exchange market to $1.1687, and currencies that are more risky such as the Australian Dollar fell a bit further. Benchmarks for equity from Hong Kong, Tokyo, Seoul, and Sydney have fallen by?around 1 percent. Russel Chesler is the head of VanEck's capital markets and investments in Sydney. He said that "the market does not believe Trump will strike more military assets, or take over Strait of Hormuz." He added that he was increasingly concerned about inflation as the oil shock continued. He said that even if the Strait of Hormuz is opened, the oil flow will be slow. We'll be stuck with high price for a while. Investors are bracing themselves for central banks such as the European Central Bank (ECB) and Bank of England to raise rates. This is a dramatic reversal of their pre-war predictions that they would cut interest rates or take a long pause. In Japan, traders are unsure about the outlook. They expect the rates to continue rising over the next few years but are hesitant on a possible hike in this month's market volatility. Hungarian forint soared to multi-year highs against the euro and dollar in 'emerging markets' after Hungary's nationalist veteran leader Viktor Orban was ousted by a centre-right upstart coalition. This will likely pave the path for EU funding to be directed to Hungary and Ukraine.
Gold falls as inflation concerns linger over failed US-Iran negotiations
Gold prices fell to a near-week-low on Monday due to a stronger 'dollar.
As of 0620 GMT spot gold was down 0.4% to $4,726.64 an ounce after reaching its lowest level since April 7 earlier that day, $4,643. U.S. gold futures for delivery in June fell by 0.8% to $4 748.70.
After the U.S. failed to reach an agreement with Iran to end the conflict, the dollar gained 0.3% and oil prices rose above $100 per barrel. The U.S. Navy was preparing a blockade of Strait of Hormuz to restrict Iranian oil shipments.
Iran's Revolutionary Guards responded with a stern warning that any military vessel approaching the Strait would be considered as a breach of ceasefire and "dealt" with harshly.
Tim Waterer is the chief market analyst at KCM Trade. He said that the optimism surrounding the ceasefire has been shattered by the failure of peace talks. The dollar and oil have risen as a result, putting gold back on the defensive.
Since the U.S. and Israeli war against Iran began in February, spot gold has dropped more than 11%. Gold's appeal is typically boosted by inflation and geopolitical risk, but high interest rates are a drag on the metal.
The greenback price of bullion is also more expensive when the dollar is stronger.
Waterer stated that "as soon as oil prices rise above $100, the focus quickly shifts to possible central bank rate increases to curb inflation. This interest rate outlook is what 'undermines gold's performance.
The traders now see little hope of a U.S. interest rate cut in this year as the higher energy prices are likely to contribute to broader inflation, and thus limit the scope for monetary easing.
Prior to the start of the Middle East war, two Fed rate reductions were expected this year.
(Reporting by Noel John in Bengaluru; Editing by Rashmi Aich and Subhranshu Sahu) (Reporting from Noel John, Bengaluru. Editing by Rashmi aich and Subhranshu Sahu.
(source: Reuters)