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Russell: The debate over the volume of crude oil in Hormuz hides a real shortage of refined fuels
The crude oil market is currently debating the wrong issue about how much oil actually moves through the Strait of Hormuz. Instead, it should focus on the restricted flows of'refined products' around Asia. Energy Secretary Chris Wright of the U.S. has claimed repeatedly that vessel tracking analysts such as Kpler cannot see how much crude oil is flowing through the disputed Strait. Wright claimed that 15 million barrels of oil per day (bpd), or about 500,000 barrels a day, left the Strait of?Hormuz in a single day last week. If true, this would bring the volumes to?what they were before U.S. & Israel attacked Iran on 28th February. Wright also stated that transits averaged around 9 million bpd during a 7-day period. However, he did not specify exact dates or provide details like vessel names and intended destinations. The Strait of Hormuz is estimated to be leaving around 5,000,000 bpd, including dark transits from smaller vessels onto larger tankers. The dispute over crude oil volume is false. If Wright's claim is true, then Asia will see a rise in oil imports as the crude that he says is coming from the Middle East reaches ports. The market will soon be able to determine whether Wright's numbers are accurate or if they're overstated. As a result of sharply reduced volumes and high refining margins, the markets for Asia's refined products remain under stress. Kpler estimates that Asia's imports for light and middle distillates in August will be 5.59 million barrels per day, which is the same as the 5.60 millions barrels per day seen?in July. These volumes, however, are down 21% compared to the average of 7.08 million bpd in the three-month period ending February. Asia will have to absorb a loss of 1,49 million bpd in key fuels like diesel, jet-fuel and gasoline. UNEVEN FALLOUT Impact is not evenly distributed across the continent that consumes the most energy, with the less-wealthy countries bearing a greater share of the product volume loss. The imports of Indonesian light and middle distillates were estimated to be 432,000 bpd during August. This is the lowest level in 13 months, and down from the average of 533,000 in the three-month period prior to the Iran conflict. In August, the Philippines will see an arrival of 257,000 bpd for light and middle distillates. This is down from the average of 362,000 in the last three months. Kpler estimates that August imports of middle and light distillates were 863,000 bpd. This is only slightly less than the 880,000bpd of the three months before the Iran War. Securing fuel comes at a cost. Product prices are near record levels, and refinery margins remain high. A Singapore refinery made a profit of $71.29 per barrel of gasoil (the building block of diesel) on August 21. This was down from the high of $85.63 a month earlier on March 30, but still 226% more than the $21.90 a day prior to the start of the conflict on February 27. Middle distillates have been under the most pressure due to the limited supply of Middle East crudes. Many of these are medium-gravity. Asia's refineries have been adapted to convert this oil type into products like jet fuel and diesel. Even gasoline, which is the primary light distillate, commands a premium with a large profit margin Ending at $20.74 per barrel on August 21 up?159% since $8.00 on Feb 27. The market's message is that, while crude oil may reach Asia in sufficient quantities, it is not necessarily of the right grade and countries with surplus refining capacity do not increase exports to meet the demand. 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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Oil prices fall ahead of US announcements on new Iran sanctions
Prices of oil fell by more than $1 per barrel on Monday, as investors took a profit ahead of an announcement that Washington is expected to make about additional sanctions against Iran. This could further disrupt Middle East supplies. Brent crude futures dropped $1.22 or 1.29% to $93.17 at 0035 GMT. U.S. West Texas Intermediate was $85.86 per barrel, down by $1.20 or 1.38%. The two contracts both posted their second weekly gains, up over 5% last week as the peace talks between Iran and the U.S. hit a deadlock, limiting oil shipments across the Strait of Hormuz, where a fifth of the world's supply once transited. Scott Bessent of the U.S. Treasury Department, who will hold a press briefing at 2 pm EDT (1800 GMT) on Monday afternoon, has warned that "the harshest sanctions in human history" could be imposed on Iran. President Donald Trump also?threatens to impose sanctions against Iran's trading partner. Vivek Dhar is a commodities analyst with Commonwealth Bank of Australia. He wrote in a recent note that it was unclear whether the U.S. strategy to economically isolate Iran would be effective. If the U.S. sanctions work as intended, Iran’s ability to retaliate with increased violence will become a greater?risk to energy markets. Iran has condemned U.S. sanctions plans, even though President Masoud Peshkian is calling for a diplomatic resolution. Tony Sycamore, IG Markets analyst, said that "the?more pragmatist members of the Iranian Leadership would prefer de-escalation but?the Hardliners would 'probably prefer to fight until the bitter end." I think we'll know by the end this week which side has the upper-hand in the?Iranian government." According to trade sources, Iranian crude offers to Chinese buyers are down and prices have increased as the U.S. sanctions have cut off?Tehran shipments. Iran has reportedly allowed a number Iraqi oil tankers through the Strait after repeated requests by Baghdad. This was reported by Iran's official news agency IRNA on Saturday. (Reporting and editing by Clarence Fernandez, Lincoln Feast and Florence Tan.)
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US declares "economic D-Day" as Iran threatens to stop all oil exports
As it prepared to launch economic sanctions against Iran's trading partners on Monday, the U.S. warned Iran of "the greatest financial assault ever marshalled". Iran, in turn, vowed "to shut down all oil exports" from the Gulf if the economic "war" continues. U.S. Treasury secretary Scott Bessent is scheduled to hold a news conference on Monday at 2 pm EDT (1800 GMT), promising even harsher measures against a country which has been subjected to economic sanctions almost continuously since the Islamic Revolution in 1979. Bessent, in a Sunday Financial Times opinion piece, wrote: "At dawn starts an economic D-Day - the greatest financial offensive against an enemy ever mounted." They haven't engaged in meaningful discussions to end this six-month conflict, nor have they conducted any military attacks against each other. Since the U.S. began its strikes against Iran on February 28, it has killed thousands of people, mostly in Iran and Lebanon. The U.S. and Israel have also caused economic damage and degraded much of Iran's conventional weapons capability. Iran still has enough drones and missiles to threaten its Gulf neighbors and oil tankers on the Strait of Hormuz. This would bring shipping to a standstill in this key waterway and put pressure on world fuel prices. Iran's exact nuclear program status, which Israel and the US aspire to eliminate, is unknown. Bessent did not specify specific measures but said that the U.S. will target "fearful countries" who engage in "appeasement", by engaging Iran's financial system and economy. He wrote in the Financial Times that "they would do well to think about the consequences of maintaining it." Iran has been preparing for the sanctions since days. It issued a series strongly worded declarations suggesting that it planned a significant military response. Mohsenrezaei suggested economic retaliation on Sunday, the secretary of Iran's Supreme National Security Council. Rezaei said in a post on social media that if the economic war continued, no oil would be exported through the Strait of Hormuz or from anywhere else in the Persian Gulf. "Iran will consider any country that supports or participates in America's war on the Iranian people an act of war." Bessent had previously urged China, noting that China imports half its oil from the Gulf Region. A spokesperson from the Chinese embassy in Washington stated that "sanctions and pressuring do not solve the problem" while calling for diplomacy. Iran's economy had already been under international sanctions prior to the U.S.-Israeli attacks that destroyed some of its infrastructure. Iranian officials have warned, despite 'Tehran's outward defiance, that more economic sanctions could worsen hardships, reignite discontent and undermine the Islamic Republic’s legitimacy. Iran began the war with high levels of inflation, a weakening dollar, energy shortages and sanctions. Now, it must deal with the damage to its infrastructure, disruption of trade, loss in production, and the cost for rebuilding. Qatar, Pakistan, and Turkey are all trying to foster diplomacy in the absence of face-to-face official talks between the U.S., Iran and Switzerland. These last took place in June, Switzerland. Iran confirmed that Pakistan's Army Chief, Asim Muniz, would visit Tehran on January 9th as part of efforts to restore security and peace in the region. However, it gave little information. Pakistan has been mediating in the conflict, and a source within the Pakistani government said that Munir will touch on recent developments such as the U.S. threat to impose new sanctions. During the war, U.S. and Israeli strikes on Iran as well as Israeli attacks on Lebanon have caused thousands of deaths and millions of refugees. The U.S. has reported 18 deaths and over 750 injuries. Reporting by Yasmine GHANI in Cairo and Kanishka SINGH in Washington, Writing by Daniel Trotta, Editing by Chris Reese
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Shein, a fast fashion company, is valued at $27 billion dollars in Hong Kong's IPO
Shein, an online fast-fashion retailer, has seen its valuation drop by 70% since it peaked at a private market value of $100 billion four years ago. It now aims to raise HK$13.86 'billion ($1.77 bn) through its Hong Kong IPO that was launched on 'Monday. The filings show that Shein is selling 280,000,000 shares at HK$47.60 to HK$49.50 each, valuing the company at nearly $27 billion if the price range is at its highest. Shein's valuation has fallen dramatically from previous private fundraising rounds, which valued Shein at 98.2 Billion dollars in 2022. The company's valuation was $64 billion between April 2024 and 2023. The company will announce its final price on August 31, and begin trading on September 1. Shein, known for its $5 dresses and $10 denim jeans sold in 160 countries around the world, had initially sought an IPO value of $30 billion to 40 billion when investor meetings prior to the IPO began. Shein was questioned about slowing growth, rising cost and changing market conditions. Investors were not sure Shein would be able to return to growth rates that valued the company at almost $100 billion four year ago. The prospectus revealed that cornerstone investors, including existing shareholders Boyu and Tiger Global, as well as General Atlantic, had subscribed for approximately $383 million in Shein shares. Tencent, Greenwoods Taikang Life, UBS Asset Management, and Taikang Life will also purchase shares. Shein stated that it would spend 80% of its IPO proceeds to upgrade its technology and increase its global presence. According to the prospectus, it has agreed to pay up $3.5 billion to certain investors that purchased special shares during earlier private funding rounds. The Hong Kong IPO shares will have a tenth of the voting rights as the shares owned by the founders. The prospectus stated that Sky Yangtian Xu and Maggie Gu will have 90% of Shein’s voting rights. GROWTH SLOCKS DOWN QUICKLY Shein's business is suffering from a slowdown in revenue growth, and its core earnings are weakening. Meanwhile, shrinking margins and increased trade costs have raised concerns about the expansion of Shein, as well as tighter regulations and increasing competition. Shein stated in its prospectus that its first-half revenue growth in 2026?is likely to be roughly in line with 1.1% growth in the first quarter. Its operating margin is expected to be slightly lower than the first-quarter. This is attributed to increased European import duties, price pressure and a weaker Middle East demand due to the Iran War. After an accounting change, it swung from a quarterly profit of $99 million to a loss of $328 millions on convertible redeemable preferred stock. Shein's IPO in Hong Kong is the biggest new share sale to date in 2026. It surpasses Momenta Global, which raised $751 million in July. It is the third largest IPO in Asia behind?CXMT, China Resources New Energy and $9.8 billion, respectively, in Chinese onshore IPOs. LSEG data shows that Hong Kong IPOs raised $41 billion in the first half of this year. This is a record and double what was raised a year ago.
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Ampol reports near five-fold increase in profits as Iran War boosts refining margin
Ampol, Australia's largest fuel retailer, posted a nearly five-fold increase in?interim profits to a record high on Monday. This was largely due to the sharp rise in refinery margins as a result of supply disruptions in Middle East. Ampol operates one of Australia's?refineries. Profit margins have more than tripled since the beginning of the U.S. War with Iran. The company reported a nine-fold increase in its earnings from the fuel and infrastructure (F&I), while its earnings from convenience retail rose by 12%. The underlying net profit after taxes reached a record A$857.2?million ($614.44?million) for the six-month period ended June 30. This compares to A$180.2 million a year ago and easily beats?the Visible Alpha consensus estimate of A$840?million. Ampol announced an interim dividend of 185 Australian Cents per share. This is more than quadrupling last year's interim?dividend of 40 Australian cents.
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Fire threatens Reno, Nevada and tens of thousands are ordered to evacuate
Tens of thousands have been evacuated from Reno this weekend, and others were ordered to leave on Sunday, as a wildfire raged near the outskirts of Nevada's third most populous city. Local officials reported late Sunday that the Hawk Fire was threatening northern Reno and had forced 42,000 residents to leave their homes or evacuate. Another 45,000 were in "be ready to evacuate" mode. Local TV footage showed flames encroaching on roads. Eyewitness footage?verified as true by eyewitnesses shows smoke billowing over residential neighborhoods. Websites that track fires showed evacuation zones extending from the Sierra Nevada Hills to the University of Nevada, located in Reno's northwest. Officials said that the fire had burned approximately?13,000 acres (5.261 hectares) to date, at a Sunday press conference. They said the fire was caused by humans and is still under investigation. Three civilians as well as three first responders were injured, according to?Shane Akerson. He is a commander in charge of?fire-and-rescue operations. Richard Edwards of the Truckee Meadows Fire Protection district said that officials first heard reports of an alleged fire on Hawk Meadow Trail around 11:15 am PDT (1815 GMT), Saturday. He said that firefighters worked in "extremely red flag" conditions on Saturday. Conditions that are red flags include high temperatures, low humidity and strong winds. These conditions increase the risk of wildfires. Edwards stated on Sunday that he expects the same conditions to return this afternoon. Nevada - Governor Joe Lombardo declared an emergency state late Saturday night in Washoe County. This includes Reno and some parts of Lake Tahoe. In a recent statement,?Lombardo stated that the situation was "active and rapidly evolving". He urged residents to be vigilant and to follow local officials' directions. Officials said that Lombardo had authorized the deployment of 60?National Guard members to support operations in conjunction with?the Washoe County Sheriff's Office. Commercial flights continued to operate normally on Sunday at the?Reno-Tahoe International Airport, which was outside of the evacuation zone.
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Government says 30 people killed in landslide at Guinea landfill
The government announced on Sunday that 30 people were killed in a landslide near a landfill?in Guinea's capitol after heavy rains caused a mound of?waste to collapse, engulfing nearby tents and shelters. The incident happened less than one week after the government announced its plans to relocate waste and close the landfill site. This was due to the danger it posed. According to a government statement, the landslide occurred?at 2 a.m. (0200 GMT), in the Gbessia community of Conakry. According to the government statement, 30 people were killed and six others seriously injured. Another 16 people suffered only minor injuries. Rescue workers were using excavators, among other tools, to clear the area of the landslide. Witnesses said that the slide was large enough to bury a building and several more homes. Cire Diallo told reporters that all five of her children had been killed. "I've lost all my kids." "All I can do now is trust God," said the woman. Guinea has the largest bauxite deposits in the world and is home to?the richest untapped iron ore at Simandou. A massive mining project began there in November. Guinea has a poor infrastructure and widespread poverty. According to a World Bank Report published in April, 3.7 million out of the 15.1 million residents 'live on less than $4.20 a day. Djenab toure, Guinea's Minister of Territorial Administration, announced Thursday that the government would close the landfill due to its unsafe condition and relocate the waste outside Conakry. The?government said that Prime Minister Amadou?Oury Bah had visited the landfill on Sunday to assess?damage, supervise the response and ensure the people remained calm and showed solidarity. Reporting by Guinea Newsroom, Writing by Robbie Corey Boulet; Editing and Mark Porter.
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Kazakhs vote in elections that will tighten President's powers
Kazakhs began voting 'Sunday in a snap election for a new parliament that appeared to be strengthening the power of President Kassym Jomart Tokayev over this 'Central asia country. The election was triggered after the adoption of a revised constitution in early this year. This new constitution consolidated parliament into a single chamber, reducing it from two. Kazakhstan's Supreme Court said last month that Tokayev who took office in 2019 was allowed to run for another seven-year term under the new constitution. Opinion polls show a majority of people support 'Adilet', a pro Tokayev party that was founded only a few months ago. The previous ruling party Amanat has been dissolved. The election is also being contested by a number of opposition parties who are all viewed as generally loyal to Tokayev. Tokayev, who voted in Astana's capital, told journalists that it was too early to decide whether he would run for another term. Tokayev is the successor of Kazakhstan's first President, Nursultan Nazabayev. He split with his predecessor after the 2022 unrest, which he has characterized as a coup by Nazarbayev's allies. Reporting by Felix Light, Mariya Gordeyeva and Elaine Hardcastle
Gold reaches a 3-month high before US inflation data and Fed chair speech
On 'Monday,' gold prices reached their highest level in more than three month as a subdued Dollar lent support. Meanwhile, attention shifted towards key U.S. Inflation data and Kevin Warsh's speech this week.
As of 0155 GMT spot gold was up 0.5%, at $4,627.42 an ounce. It had earlier reached its highest level since May 15 during the session. Prices rose by more than 5% in the last week.
U.S. Gold Futures edged up 0.1% to $4,683.80.
The dollar was teetering near a multi-month low in a market unsteady by the?U.S. Treasury's promise of buying back more long-term bonds. The weaker U.S. Dollar makes greenback priced bullion more accessible to holders of other currencies.
Tim Waterer is the chief market analyst for KCM Trade. He said that gold is starting the week in a positive mood. It has re-entered the bid mode and is taking cues from the weaker dollar. The higher yields could be a sign of underlying economic tensions and policy uncertainties.
For new clues about the U.S. rate outlook, watch the July Personal Consumption Expenditures price index data as well as Fed Chair Warsh’s speech this week at the 'Jackson Hole Symposium.
"Traders are watching for any shift in tone regarding the policy direction and how that fits with recent bond market developments. Waterer said that a cautious or balanced tone, which leaves room for flexibility, would allow gold to "extend" its gains.
The U.S., on the geopolitical side,?threatened Iran by launching "the greatest financial offense ever marshaled" in preparation for economic sanctions that target Iran's trading partners. Oil prices dropped by more than $1 per barrel as investors took profits before the announcement.
Silver spot fell by 0.3%, to $68.76 an ounce. Platinum fell 0.5% to $1868.03, while palladium dropped 0.3% to $1345.87.
(source: Reuters)