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India eyes Venezuela blocks operatorship; regains Russia's Sakhalin-1 stake
India's Oil and Natural Gas 'Corp (ONGC) hopes to sign agreements soon with Venezuela 'to operate two oil 'blocks under the South 'American nation's 'new petroleum 'law', its finance chief'said 'on Wednesday. ONGC Videsh (ONGC Videsh is the overseas investment arm of the state-run ONGC) holds a stake of 40% in the San Cristobal oil field, and along with other Indian firms, a stake 18% in the Carabobo-1 Project. "Now, we are able to work freely on Venezuelan projects." We had restricted our operations in Venezuela because of sanctions-related risks," said finance director Anupam agarwal on a?analyst's call following the company's earnings for the June quarter. He said Venezuela offered additional incentives under its 'petroleum laws' and that ONGC was experienced in 'operating fields of similar geology? in India. He said, "We are taking over operatorship of some projects from PDVSA, we believe we will soon see positive developments." RUSSIAN SKHALIN-1 ASSET Agarwal stated that ONGC regained their 20% stake in Russia's Sakhalin-1 project for oil and gas after a four-year gap. He said that the restored stake increased the group's revenue contribution to the project from 5 billion to 6 billion rupees. After the West imposed broad?sanctions against Moscow in response to its invasion of Ukraine, Sakhalin-1 was transferred by Russia to a new domestic operator. ONGC has agreed to pay?payments to the Sakhalin-1 Abandonment Fund?in roubles, using dividends that have been frozen in Russia. This will allow it to keep its 20% stake, as was reported last year.
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India eyes Venezuela blocks operatorship; regains Russia's Sakhalin-1 stake
India's Oil and Natural Gas 'Corp (ONGC) hopes to sign agreements soon with Venezuela 'to operate two oil 'blocks under the South 'American nation's 'new petroleum 'law', its finance chief'said 'on Wednesday. ONGC Videsh (ONGC Videsh is the overseas investment arm of the state-run ONGC) holds a stake of 40% in the San Cristobal oil field, and along with other Indian firms, an 18% share in the Carabobo-1 Project. "Now, we are able to work freely on Venezuelan projects." We had restricted our operations in Venezuela because of sanctions-related risks," said finance director Anupam agarwal on a?analyst's call following the company's earnings for the June quarter. He said Venezuela offered additional incentives under its 'petroleum laws' and that ONGC was experienced in?operating similar geology - fields?in India. He said, "We are taking over operatorship of some projects from PDVSA." We believe that we will soon see positive developments. The new agreements have been signed. RUSSIAN SKHALIN-1 ASSET Agarwal stated that ONGC regained their 20% stake in Russia's Sakhalin-1 project for oil and gas after a four-year gap. He said that the restored stake increased the group's revenue contribution to the project from 5 billion-6 billion rupees per quarter, up to a total of?10 billion Indian?rupees (about 105.13 millions dollars). After the West imposed broad?sanctions against Moscow in response to its invasion of Ukraine, Sakhalin-1 was transferred by Russia to a new domestic operator. ONGC has agreed to pay?payments to the Sakhalin-1 Abandonment Fund?in roubles, using dividends that have been frozen in Russia. This will allow it to keep its 20% stake, as was reported last year.
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Reliance's luxury unit brings Kim Kardashian SKIMS to India
Reliance Brands is the luxury retail arm of Reliance Retail. They have partnered with Kim Kardashian's SKIMS in order to bring this shapewear brand into India. This comes as global companies race to enter India's growing fashion and beauty market. The company, which is a subsidiary of Mukesh-Ambani's Reliance Industries, said that it would launch the SKIMS name across both physical and digital channels?starting in Delhi and Mumbai. Indian beauty retailers are racing to introduce international brands into the country as Gen Z and younger consumers gravitate towards global trends in beauty and brands backed by celebrities, thanks to social media. This year, Indian beauty and fashion retailer Nykaa teamed up both with Selena Gomez’s Rare Beauty as well as Shiseido Group’s NARS Cosmetics. SKIMS is a new partnership that will add to Reliance Retail’s growing portfolio of foreign brands, including Rihanna’s Fenty Beauty, Fenty Skin and designer brands like Stella McCartney and Valentino. The entry of SKIMS comes at a time when India's shapewear industry is booming, with a mix?of?homegrown direct to consumer brands, such as Underneat, competing for customers. SKIMS, founded in 2019, has recently opened'stores in London and Dubai after raising $225m in funding which valued the company at 5 billion dollars.
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Phillips 66 surpasses its quarterly expectations as the Iran War boosts US refining profits
Phillips 66'reported a nearly 4-fold increase in'second-quarter profits on Wednesday, crushing Wall Street expectations, as the Middle East conflic? squeezed global fuel suppli?es and sent U.S. refinery margins soaring. The Iran War has been a boon to U.S. refiners, as buyers from around the world have scrambled for alternative fuels amid fears of disruptions in Middle Eastern exports. Fuel exports from the United States have reached record levels, especially for diesel and other refined fuels. Phillips' refining segment reported a record jump in earnings adjusted to $3.09 Billion from $392 MILLION a year ago. The?realized profit margin? in the second quarter?more than?doubled from a year ago to $24.08 a barrel. The company's quarterly net profit was $3.85 billion. This is its highest quarterly profit since the 2022 Russian invasion of Ukraine, which disrupted global supply chain and increased refinery earnings. In premarket trading, shares of the company increased 1.4% to $208,67. Phillips 66’s renewable fuel segment reported a quarterly adjusted profit of $544 million compared to a loss of $133 millions a year ago. After years of margin pressures, U.S. refiners have begun to see better returns on renewable fuels. This is due to a recent rise in the blending of biofuels mandates as well as a rise in diesel prices related to the Middle East conflict. According to data compiled and published by LSEG, Houston-based Phillips 66 posted an adjusted profit of $9.41 for the three months ended June 30 compared to analysts' average estimates of $7.44.
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Hungary and Albania both cut power in the face of Europe's heat
Emergency services in Albania battled a wildfire?in the southern region Mallakaster while?Hungarians?cut back on power consumption due to a heatwave?and drought?that continued to affect large parts of Europe's south and east. This summer, Europe, the continent that is warming up fastest in the world, was ravaged with record-breaking temperatures and devastating wildfires. France and Spain were particularly hard hit. It is now Italy that has been focusing on the heatwave. Temperatures in some places reached around 40 degrees Celsius. It was the heat that prompted the Vatican's decision to move Pope?Leo's weekly general audience, which had been held in St Peter's Square during the July holiday, indoors. Rome visitors welcomed the decision, as they were seeking relief from the hot conditions. A tourist from Mexico named?Diego Amaya said, "I suppose that it is better to have it inside because of the heat." RECORD LOW ON DANUBE Hungarian households and companies reduced their power consumption in the past week following a government appeal to reduce the pressure on the grid due to the severe drought. Budapest, the capital of Hungary, is bracing itself for the heatwave's peak on Wednesday and Thursday. Temperatures of 40 C to42 C (104 F - 108 F) are expected. The Danube's record-low levels have forced Hungary to shut down its only nuclear plant that uses river water for cooling. This has created an energy crisis which has stretched the power supply capacity to the limit. Wildfires in Albania's Mallakaster forced 15 families to evacuate, along with their animals and pets. Ground and aerial crews battled the flames, trying to prevent them from reaching homes near a nearby village. In the rocky, mountainous terrain, south of Gjirokaster, an Albanian city, efforts continued to be made to contain another wildfire. This fire was likely started by lightning. A wildfire in Greece has destroyed thousands of acres of farmland northwest of Athens. The fire was likely caused by electricity conductors vibrating and then fanned with gale force winds. On Wednesday, the fire appeared to be largely contained. However, hundreds of firefighters were still in the area to keep it from re-igniting. Six helicopters also doused scattered smoke spots. The agriculture is suffering from the hot and dry summer. According to an analysis released on Wednesday, Britain's cereal harvest is likely to be the worst since 1984 when comparable records were first kept. This is because the crops have withered after one of the most arid and hot spring-summer seasons on record.
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Gold reaches a one-month high as US-Iran hopes for peace ease inflation concerns
On Wednesday, gold rose by more than 2% to a new one-month-high as investors looked forward to key U.S. employment data and hoped that a U.S. Iran peace deal would ease inflation fears. By 1113 GMT, spot gold had risen 2.3% to $4168.34 an ounce, its highest since July 7. U.S. Gold Futures increased 1.8% to $4227.40. Donald Trump, the U.S. president, said that his administration had "very positive discussions" with Iran on Tuesday during an all-day negotiation. This has fueled expectations for a quick end to this five-month conflict. There are more signs that a Gulf ceasefire agreement is in the works, and this means Treasury yields will be moving lower on account of inflation concerns, making non-yielding investments like gold even more attractive," Jamie Dutta said, a market expert at trading platform Nemo.money. The U.S. Dollar remained under pressure. This made metals priced in greenbacks more appealing to holders of other currencies. Yields on the benchmark 10-year U.S. Treasury notes fell to an all-time low. In a high-interest rate environment, gold tends to lose appeal despite its role as an inflation hedge. It yields no return. According to the CME FedWatch Tool, traders now price in a 57% chance of a rate hike for September, down from 67% one day earlier. Jeff Schmid, President of the Federal Reserve Bank of Kansas City, said that monetary policy needs to be tightened to bring "too-high" inflation to 2%. Concerns about the Fed’s credibility are likely to ease over the next few months as the central bank increases interest rates. This would lead to gold prices dropping and settling under $4,000 per ounce by the end of this?year," said Hamad Hussain a climate and commodities economist with Capital Economics. The ADP Employment Report is due at 1215 GMT, and the non-farm payroll report for July will be released on Friday. Spot silver rose 3.3% to $61.50 an ounce, its highest level since July 7. Palladium was up 1.5% at $1,373.35, following a two-month high. Platinum rose 1% to $1752.20. (Reporting and editing by Rashmi aich and Joyjeet Das in Bengaluru)
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MORNING BID AMERICAS - Outer SpaceX
What is important in the U.S. and international markets today by Mike Dolan Editor-at-Large of Finance and Markets After all the 'doubts and hand-wringing the S&P 500 & Dow Jones have returned to record highs. They surged on Tuesday amid the falling oil prices & bumper earnings season. SpaceX's shares dropped despite exceeding?revenue estimates in its first quarterly earnings report. Below, I'll delve deeper into that. Check out my midweek column where I discuss the possibility of an AI "jobsmageddon", and more. Listen to the Morning Bid podcast where we talk about yesterday's outstanding earnings reports. Subscribe to the Morning Bid daily podcast and hear our journalists discuss all of the latest news in finance and markets seven days a weeks. Outer SpaceX The market's reaction to SpaceX’s first earnings release was not positive, despite the company’s strong top-line numbers. Discussions centered on the company's rising AI capex, and its cash burn. There was also concern over whether the sale of early investors and insider shares would put pressure on the stock when the post-IPO locking periods expired. AMD's stock also fell overnight following its own forecast beating update. Palantir's shares soared by nearly 30% earlier in the day after it announced its impressive quarter results. Dow-stalwart Caterpillar, meanwhile, also saw its share price rise. The reporting season was a remarkable success, with the indexes gaining overnight. The strong Wall Street performance yesterday may have been due in part to Brent crude which fell another 5% on Wednesday to below $80 a barrel. Prices rose above this level again on Wednesday, after Yemen's Iran aligned Houthi rebels claimed to have attacked a Saudi tanker in Red Sea. Washington officials also said that the mediation between the U.S., Iran and other countries on the reopening of the Strait of Hormuz may?bear fruits this week. Tehran denies direct talks are taking place with the U.S., but it has said that talks with Oman about transit through the Strait of Hormuz were ongoing. Qatari officials have said that go-betweens made progress in the efforts to end the war. The strait has also been busier in recent weeks. The oil price decline has also cooled the yields on Treasury bonds, even though Kansas City Fed Chief Jeffrey Schmid stated Tuesday that tightening policy would be needed to bring inflation back to the 2% target. In the wake of this week's major labor market reports, we have learned that hiring has increased but job openings decreased in June. Today's schedule includes the private sector payrolls for June. The bond market must also consider the latest quarterly details of refunding, which are due to be released later today. This will allow them to determine how the higher borrowing totals?are spread along the yield curve. Recently, the U.S. financial situation took a new blow. On Tuesday, there were reports that the U.S. had already paid up to $100 billion in rebates for tariffs imposed by the Supreme Court earlier this year. Treasury Secretary Scott Bessent stated that he will do "whatever is necessary" to help Japan defend the yen on the currency markets. He also urged the Fed to increase the size of the repo facility used in the joint intervention last week. The yen seems to be stabilising at higher levels for the time being. Chart of the Day Chipmaker AMD's shares fell 7% before Thursday's bell, despite beating quarterly revenue estimates overnight. High valuations means that?the bar is high to impress Wall Street. The stock is up 140% this year, as the AI frenzy 'catapulted chip shares higher around the world. AMD's $850 billion market capitalization means its price-to-forward-earnings valuation is now an eye-watering 43 times - far higher than the 25 times for the U.S. chip sector overall and more than twice Nvidia's multiple. Watch today's events * U.S. ADP July payrolls (8.15 am EDT), ISM Non-Manufacturing PMI for July (10.30 am EDT). * U.S. Corporate Earnings: Eli Lilly (Sandisk), Western Digital, Disney and Uber Mary Daly, President of the San Francisco Fed and Fed Governor Lisa Cook both speak Want to receive Morning Bid every morning in your email? Subscribe to the newsletter by clicking here. Follow us on LinkedIn, X and ROI. The opinions expressed here are the author's. These opinions do not represent those of News. News is bound by the Trust Principles to maintain integrity, independence and freedom from bias. (By Mike Dolan).
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Glencore says that exposure is not material, and takes a provision against Radiant World
Gary Nagle, the CEO of Glencore, said that the company had?taken an provision relating to Radiant World. However, he added that Glencore's exposure towards the iron ore trading firm was not significant. We have some existing contracts that still need to be completed. Nagle said on a conference call that they are assessing how to deal with them in a legal manner. However, we have stopped doing any new business. Bloomberg reported that last week, fellow trading houses Vitol and Cargill had stopped doing business Radiant World because they were concerned about the validity of invoices sent to their banks. Radiant World stated that the claims made were unsubstantiated and inaccurate. Nagle refused to reveal the amount of the provision, or when and why Glencore ceased doing new business with Radiant World. The CEO said: "We want everything to be done legally, due to the increased scrutiny surrounding this counterpart." Nagle said that Radiant World, Sapphire Minmetals and another 'company' reported to have been scrutinized over invoices should be considered as being part of the same group. Nagle, when asked to comment on Glencore's exposure to Sapphire, said that the two firms "share similar shareholdings and have similar management." Radiant World declined to comment. Sapphire didn't immediately respond to a comment request. Reporting by Tom Daly, Clara Denina. Solomon Cefai contributed additional reporting from Singapore. Editing by Louise Heavens, Mark Potter and Mark Potter
Copper stocks above $14,000/t as US stock tightens
The?price of copper remained above the psychological $14,000 per metric ton mark on Wednesday. This was due to the fact that inventories at the London Metal Exchange fell as more metals were brought into the U.S. Ahead of possible tariffs on refined Copper.
The benchmark three-month copper price on the LME remained unchanged at $14,066 per metric ton as of 1004 GMT. On Tuesday, the contract reached $14,117, which was its highest level since last May 14.
The daily LME stock data revealed that more metal had been removed from LME-registered storage facilities in Asia. Total stocks are now at 231,825 tonnes, their lowest level since mid-February. Available stocks have also dropped to 94,125 metric tons, their lowest level since mid-January.
The premium of the LME Cash Copper contract over the 3-month contract signals tighter conditions in the near-term for supply.
COMEX copper was traded at a premium to the LME benchmark, as the market anticipated a possible U.S. tariff decision. This encouraged inflows into COMEX inventory. COMEX inventories grew by 45,000 tons just in July.
Codelco, a Chilean company, halted an expansion project at its flagship El Teniente Mine a year after the deadly?collapse. They said that recent studies showed a greater seismic risk.
RBC Capital Markets analysts said: "We remain positive on the copper markets given the tightening of the market, both physically and in the longer term, as well as the disappointments with supply and the uncertainty surrounding tariffs."
The improved risk sentiment that followed the U.S. president Donald Trump's Tuesday statement that his administration had "very positive discussions" with Iran, fueled expectations of an ending to their?"five-month conflict.
Zinc, among other LME metals rose by 0.7%, to $3 699 per ton, after reaching $3 709, which was a four-year record. LME's?available zinc stock is at 73.825" tons, which is the lowest since December. Short-term LME Zinc?contracts are trading at a higher premium than contracts with longer maturities.
LME aluminium rose 0.2%, to $3,228.50. Lead fell 0.2%, to $1,892.50. Tin gained 0.6%, to $56,255. Nickel lost 0.9%, to $17 045. (Reporting and editing by Emelia Sithole Matarise; Polina Devtt)
(source: Reuters)