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Gold drops over 1% amid rate hike fears ahead of U.S. Inflation data
On Tuesday, gold fell more than 1% to a two-month low. This was due to a wider'market' sell-off. Investors were also pressured by expectations that the U.S. will raise interest rates this year. As of 1:45 pm, spot gold dropped 1.5% to $4264.70 an ounce. ET (1745 GMT) after having fallen more than 2% in the earlier session. Bullion dropped to its lowest price since March 23. U.S. Gold Futures for August Delivery Settled by 1.8% at $4,286.4 "Traders have become a bit nervous about the market... all markets are now in risk-off mode." Bob Haberkorn is a senior market strategist with RJO Futures. He said that the current risk-off has caused a decline in gold. S&P 500 & Nasdaq both fell to new lows of over a month on Tuesday. Haberkorn said that "gold and silver will remain under pressure" until the Fed provides clearer guidance. The focus this week has shifted from last week's positive?jobs numbers to the key inflation data, such as the U.S. Consumer Price Index for May on Wednesday, and the Producer Price Index on Thursday. These are expected to provide more insight into the U.S. monetary policies outlook. The gold price will likely fall even further if the U.S. May inflation data also surprises on the upside, as we expect. The gold price is likely to fall further if the U.S. inflation data for May also surprises on the upside, according to Commerzbank. According to the CME FedWatch tool, traders are estimating a 68% chance that the Fed will raise rates in December. After President Donald Trump's appeal, Iran and Israel announced that they would cease their attacks against each other. The higher crude oil prices can fuel inflation, and this will keep rates high for longer. Gold is often seen as a hedge against inflation, but higher rates can weigh down on the metal. India's sharp rise in gold import duties is "fueling a resurgence of smuggling" that could "exceed 100 tons this year", as "soaring grey-market margins allow smugglers and refiners to undercut each other." Silver spot fell by 4.3%, to $65.23, platinum dropped 2.1%, at $1.717.30, and palladium was down 1.3%, at $1.220.92. (Reporting and editing by Shilpa Majumdar, Jonathan Ananda, and Anushree mukherjee from Bengaluru)
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US EIA warns that oil inventories are headed for multi-decade lows
The U.S. Energy Information Administration reported on Tuesday that oil stockpiles in?the largest economies of the world are heading toward their lowest levels since 2003, as inventories are being drawn down at an unprecedented pace due to lost production from the Iran War. The EIA estimates that total oil inventories within the Organization for Economic Cooperation and Development members will fall to just over 2.3 billion barrels in December. This is based on the current assumption that the marine traffic through the Strait of Hormuz won't return to its pre-conflict level until early 2027. In its Short-Term Energy Outlook monthly report, the EIA said that the OECD's stockpile had 'not been at this low level since 2003 when the EIA started keeping records. The agency stated that the rapid inventory 'drawdown', which is required to compensate for the 11 million barrels per day of lost Middle Eastern production, creates the basis?for an increase in oil prices. Prices have been impacted by recent reports that the U.S., Iran and other countries were close to an agreement on reopening the Strait of Hormuz. This is a crucial waterway which handles 20% of all global oil shipments. As of this writing, an agreement had not yet been reached. The EIA reported that global oil inventories continue to drop to meet demand, while most oil production remains shut down in the region. The EIA expects the price of global benchmark Brent crude to average around $105 per barrel on the spot market in June and in July. This is well above the $91.60 per barrel that was traded in the Tuesday futures market. The agency stated that "because of the magnitude of the drawdown of global inventories we predict that oil prices will continue to be?elevated' until global oil flows are restored and oil inventories are replenished." The EIA stated that high oil prices, reduced fuel availability and government initiatives to conserve oil would cause the global oil demand this year to'reduce for the first time since the pandemic slump of 2020. The EIA now predicts that demand will fall by 1.1 million barrels per day this year, in contrast to its previous forecast of an increase of 200,000 barrels per day. Reporting by Shariq KHan and Scott DiSavino, New York; Editing and proofreading by Mark Porter and Paul Simao
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Data shows that Saudi jet fuel supplies to Europe are higher than before the closure of Hormuz.
Saudi Arabia will deliver more jet-fuel to Europe in this month than when the Strait of Hormuz was open. Data from shipping trackers Kpler and Vortexa shows the significance of Saudi Arabia's increased exports via Red Sea. Kpler data shows that EU and UK imports of jet fuel from Saudi Arabia’s Red Sea Port of Yanbu reached 118,000 barrels a day in the first week of June. This is their highest level since August 2025. Vortexa estimated that the flows were at 140,000 barrels per day. Kpler data indicates that the highest monthly volume this year was?77,000 Bpd in January. Saudi Aramco, the state-owned firm, declined to comment about the "increased jet exports to Europe". By 2025, Europe will receive about 300,000 bpd of jet fuel from the Middle East via the Strait of Hormuz. According to Kpler, Europe's total imported fuel averaged around 550,000 bpd. This includes imports from India and Nigeria, as well as the U.S. Saudi Arabia has increased exports through the Red Sea Port of Yanbu, as the strait is effectively closed due to the Iran War. If sustained, these exports would help 'Europe fill a gap in jet fuel imports and illustrate?how?the?closure of Strait of Hormuz affects global jet fuel flow. In May, Europe increased its jet fuel imports - which averaged around 200 bpd - from the U.S. International Energy Agency said previously that Europe could start to see some shortages of jet fuel in June. However, European airlines have played down fears of a shortage during the summer. (Reporting from Seher Dareen, London; additional reporting by Ahmad Ghaddar. Editing by Alex Lawler & Jason Neely).
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Jio BlackRock to launch ETF in August after $2 billion India fund base
Jio BlackRock Asset Management will launch its first exchange traded funds in India by August. The company hopes to emulate 'BlackRock’s' global success in passive investment in a market that is still developing. In the year following its launch, the joint venture between MukeshAmbani's Jio Financial Services (JFS) and the largest asset manager in world has managed to amass about 180 billion rupees in assets. This was achieved by establishing a solid base of cash, debt index and active equity funds. The plan is to begin with equity-focused ETFs. BlackRock manages approximately $5.1 trillion worth of ETF assets worldwide, which is more than a third of all assets managed by the company. This highlights the importance of this product line for its brand. Jio?BlackRock is currently India's 29th largest asset manager. "ETFs can be a good long-term investment." Retailers are now becoming more interested in ETFs, even though the Indian market is predominantly institutional. We can see by global trends that?ETFs are a popular choice of investment," said Sid Swaminathan. ETF INNOVATION CAN BOOST LIQUIDITY According to the Mutual Fund Industry Association, passive mutual fund assets in India amounted to 15.20 trillion rupees (or about 18.5%) of the industry’s average assets under administration, which totaled 81.94 trillion. Comparatively, equity index funds and ETFs make up about 45.3% (or more) of the long-term mutual and ETF assets held in the U.S. Swaminathan stated that tighter bid-offer margins and more innovative strategy could help improve liquidity and boost participation by retail in Indian ETFs. Within the next few months, the company plans to 'launch products' in GIFT City (Gujarat International Finance Tec-City), India’s low-tax financial centre that competes with centres like Singapore and Dubai. COMPLEX PRODUCTS?PROMPT PIVOT DISTRIBUTOR -LED MODEL Jio BlackRock's more complex products, such as special investment funds or GIFT City, are distributed by Jio BlackRock rather than digitally. This reflects the role that advisers continue to play in selling higher-ticket items. Swaminathan stated that the decision to "prioritise" those launches was partly driven by market conditions. India's Nifty 50 index has fallen 11.1% in 2026 due to foreign outflows and higher oil prices, as well as a slowing of earnings growth. MSCI's Asia-Pacific ex-Japan Index is up 18.2%.
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Markets rise as votes from overseas pour in and the race for Peru tightens up again
The race for Peru's presidency tightened up overnight, with candidates separated by less that 0.1%. Overseas votes are pushing the race to Keiko Fujimori. This is giving markets a boost on Tuesday. The main'stock -index' of Peru jumped more than 7% on Tuesday morning. U.S. listed shares like Buenaventura miner were up 8.2%, Intercorp Financial Services was up 12.9% and the iShares MSCI Peru Global Exposure ETF jumped by 6.7%. The local currency, the sol, was up by 2.45% against the dollar at 3.345. The increase is largely the reversal from a sharp drop on Friday, after leftist Roberto Sanchez, rattled investors and markets with his proposals to revamp Peru’s mining-heavy economic system, rose in the polls. He has advocated reforming the constitution and imposing wealth taxes. Fujimori has taken up the legacy of her authoritarian father, former Peruvian president Alberto Fujimori. He was jailed in connection with mass murders during his presidency. Fujimori was leading in exit polls and early counts, but Sanchez gained more ground as rural votes came in. Sanchez's lead grew to almost 50,000 votes Monday, but has now dropped to 20,000 as overseas votes continue to be counted. Sanchez is currently leading Fujimori with 49.94% to 50.06% with 95.95% votes counted. Alfredo Torres of Ipsos said that although the rural vote still tends to favor Sanchez, a significant part of the votes pending are from outside of the country. This is in favor of Fujimori. A total of?1.67% ballots are flagged for review. The majority of them are from the Lima metro region which is also Fujimori's stronghold. Torres, speaking to a local station, said that "doing the math" it is possible that the numbers now seen could be reversed. Both candidates have called for patience, and that all votes be counted. Peru's ONPE said that a complete count should be completed in July. (Reporting and editing by Alexander Villegas, Marco Aquino)
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Oil and dollar drop, while stocks lose steam
MSCI's global equity gauge retreated from its earlier gains as Wall Street investors waited anxiously for inflation data. The dollar also dropped along with oil prices in hopes of easing Middle East tensions following the ceasefire between Israel and Iran. U.S. Energy Sec. Chris Wright stated on Tuesday that the ship traffic in the Strait of Hormuz, a vital energy conduit, is increasing "very significantly." Israel's Tuesday attack on the historic port of Tyre, in southern Lebanon, killed at least eight people, but the progress towards a Middle East peace still seemed uncertain. Tehran had warned on Monday it would re-engage in hostilities should Israel continue to attack Hezbollah, its Lebanon-based ally. U.S. Treasury rates dipped as traders awaited the consumer inflation report for May, which is due on Wednesday. This will provide a better indication of whether or not price pressures continue to increase. S&P 500 technology's heavyweight sector was unable to hold gains earlier, which put pressure on both the benchmark index and the tech-heavy Nasdaq. Gene Goldman of Cetera pointed out that investors are anxious ahead of economic data, as they worry about elevated inflation fueling worries about the Federal Reserve. Investors are a little cautious as they worry about tomorrow's potential?high inflation numbers. Goldman stated that higher-than-expected inflation brings the Fed into the spotlight as a major risk. The CME Group's FedWatch tool shows that since the release of the stronger-than-expected May jobs report on Friday, traders are increasing bets the Fed will increase rates rather than cut them. According to the tool, the probability of a 25 basis point rate hike by December is now 43.4%, and the bets for a 50 basis point increase have increased from 12% the previous week. Wall Street opened at 11:01 am. The Dow Jones Industrial Average rose 145.62, or 0.29% to 50,931.63, while the S&P 500 dropped 16.64, or 0.22% to 7,389.09, and the Nasdaq composite fell 179.07, or 0.69% to 25,750.59. MSCI's global stock index rose 3.23 points or 0.29% to 1,104.19, after previously rising more than 1%. After paring gains, the pan-European STOXX 600 rose by 0.18%. BORROWING FEES In currency, the dollar index (which measures the greenback in relation to a basket of currencies that includes the?yen, and the Euro) fell by 0.22%, while the euro rose 0.23%, reaching $1.1561. The dollar gained 0.04% against the Japanese yen to 160.23. The yield on the benchmark 10-year U.S. notes dropped 0.2 basis point to 4.548% from 4.55% on Monday, while the 30-year bond yield increased 0.3 basis point to 5.0272%. The yield on the 2-year note, which moves typically in line with Federal Reserve interest rate expectations, dropped 1.7 basis points from Monday's 4.158% to 4.141%. Energy markets saw U.S. crude fall 3.94% to $86.70 a barrel while Brent dropped to $91.11 a barrel, a drop of 3.33% for the day. (Reporting from Sinead carew in New York; Amanda Cooper in London; Wayne Cole in Sydney. Editing by Thomas Derpinghaus & Gareth Jones.
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Sources say that China continues to issue fuel quotas in spite of export controls
Four?trade? sources said that China issued its second batch fuel quotas this year. The total is?18 millions metric tons. Despite existing export restrictions, the overall levels are largely unchanged year on year. China has cut back on outbound shipments since March to protect its domestic oil supply, in light of the protracted conflict in Middle East which is disrupting oil flow. Sources said that out of the total, 13 million tons quotas had been allocated for the export of gasoline, diesel, and jet fuel while 5 millions tons were reserved for marine fuel oil. Sources said that Sinopec, CNPC, and Sinochem received a total of 4,06 million?tons under the "processing" trade category. These quotas will be used primarily for exports to 'Hong Kong, and aviation fuel refueling at Chinese airports. Beijing allocated 19 million tons of the first batch quotas this year in December, while the second batch was 18 million tons last year. The?Commerce ministry of China was not available immediately outside office hours. Two of the four sources stated that the government had also given 8.94 million tons of quotas to six companies under the "general trade" category, but due to the current restrictions, only Sinopec and PetroChina are allowed to export. Estimated exports to ex-Hong Kong buyers, mainly in the Asia-Pacific area, for May and Juni were between 500,000-550,000 tonnes. Two separate sources familiar with the issue said that the government has vetted a list of countries receiving Chinese fuel in the past few months but is easing up on the scrutiny of June shipments. Reporting by Siyi Liu and Trixie Yap; Editing by Alison Williams
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Gold falls on fears of rate hikes ahead of U.S. Inflation data
Prices of gold fell on Tuesday as a result of the broader market sell-off, and rising expectations that interest rates will be raised in the United States this year. Investors are now focusing their attention on key inflation data to be released later this week. As of 11 am, spot gold was down 0.7% at $4,298.75 an ounce. ET (1500 GMT), following a fall of more than 1% in the previous session. U.S. gold futures for August delivery fell 0.9% to $4323.90. "Traders have become a bit nervous about the market. All markets across the board are now in risk-off mode. Bob Haberkorn is a senior market strategist with RJO Futures. He said that the current risk-off has led to a drop in gold. The Nasdaq Composite index, which is a tech-focused index, and the benchmark S&P 500 Index?were both down by 0.9% and 0.4% respectively. Haberkorn continued, "Gold and Silver remain under pressure until we get clearer direction from the Fed." The focus this week has shifted from last week's positive job numbers to the key inflation data, such as the U.S. Consumer Price Index for May on Wednesday and the Producer Price Index on Thursday. These are important indicators of the U.S. monetary policies outlook. If the U.S. Inflation data for May surprise to the upside again on Wednesday, then the gold price will likely fall even further. Commerzbank also said that this could increase the possibility of a recovery in the second half of the year if, as expected, the Fed does not raise interest rates. According to CME FedWatch, traders are pricing in a 70% chance of a Fed rate increase in December. The Middle East is showing signs of a possible peace agreement, which has pushed the oil price lower. This was after Iran and Israel announced that they had stopped their attacks against each other in response to an appeal by U.S. president Donald Trump. The higher crude oil prices can cause?inflation, and therefore keep interest rates high for longer. Gold is often viewed as an inflation hedge. However, higher interest rates can weigh down on this non-yielding material. Silver spot fell by 3.2%, to $65.98 an ounce. Platinum was down 1.1%, at $1.736.08, and palladium dropped 2.5%, at $1.234.93. (Reporting and editing by Shilpa Majumdar, Jonathan Ananda and Anushree mukherjee from Bengaluru)
Saudi Aramco: the oil colossus
Saudi Arabia may reveal a. landmark secondary share offering in oil giant Aramco. later Thursday, pending final approval from Crown Prince. Mohammed bin Salman, people with knowledge of the matter stated.
The landmark sale follows Aramco's record IPO nearly five. years earlier, as the kingdom pushes ahead plans to diversify its. economy away from oil.
Below are essential realities about Aramco:
HISTORY
Explorers from the Rockefeller family's Requirement Oil Company. struck oil in Saudi Arabia in 1938. The endeavor ended up being called. the Arabia American Oil Business and petroleum production hit. 500,000 barrels daily in 1949.
By 1980, the Saudi government had actually purchased out all the. initial investors and owned 100% of the business. 8 years. later on, the Saudi Arabian Oil Business (Saudi Aramco) was. formally developed.
Aramco has actually sustained decades of success in Saudi Arabia. The kingdom is the de facto leader of the Company of the. Petroleum Exporting Countries, or OPEC, helping engineer price. proceed world oil markets.
The crown prince, known as MbS, wants to diversify the Saudi. economy away from oil. Revealing plans for an Aramco IPO in. 2016, he said the kingdom should end its oil dependency to make sure. it was no longer at the mercy of commodity rate volatility.
OIL RESERVES AND OUTPUT
Aramco had 251.2 billion barrels of oil equivalent (boe) in. 2023, bigger than the combined reserves of ExxonMobil, Chevron,. Shell, BP and TotalEnergies. That consists of, since end-December. 2023, 191.35 billion barrels of crude and condensate and 33.8. billion boe of gas.
The oil giant produced simply over 9 million barrels per day. ( mbpd) in April, according to secondary sources utilized by OPEC,. below an average of 9.6 mbpd in 2023. Its typical upstream. raising expense was $3.19 per boe in 2023, with upstream capital. expense balancing $6.3 per boe.
Just over 2 thirds of Aramco's crude oil was exported last. year, as it delivered 6.6 mbpd, down from 7.1 mbpd in 2022. Asian. customers purchased 82% of Aramco's crude exports last year, up. from 79% in 2022.
DOWNSTREAM
To diversify its oil service - and safe offtake of its. crude - Aramco is broadening in refining and petrochemicals.
Last year, Aramco purchased Valvoline Inc's global products. company for $2.76 billion. It likewise began building and construction of. numerous petrochemical complexes: a $7 billion one in South Korea. with S-Oil, an $11.8 billion project in China, through HAPCO, a. joint venture with North Huajin and Xincheng, and an $11 billion. one through its joint venture with TotalEnergies in the kingdom.
It also bought a 10% stake in Chinese refiner Rongsheng. Petrochemical for $3.4 billion. In 2020, it bought a bulk. stake in Saudi Basic Industries Corp (SABIC), among the world's. greatest petrochemical companies.
Aramco produces, improves and exports oil from Saudi Arabia,. but also has refining operations across the globe. Aramco's U.S. oil refining subsidiary Motiva Enterprises owns the 640,000 bpd. Port Arthur refinery in Texas, the largest in the United States.
It is aiming to further expand its downstream company. in key high-growth geographies such as China, India and. Southeast Asia, as well as other markets, it stated in its yearly. report. Aramco had a net refining capability of 4.1 mbpd last. year.
GAS
Aramco aims to increase its gas production by 60% by 2030 from. 2021 levels.
In 2015, it brought online a growth to its Hawiyah Gas. Plant and started producing at its unconventional field in South. Ghawar. It likewise continues deal with its giant Jafurah field,. expected to begin producing gas next year.
It likewise made its first financial investment abroad in melted. gas, purchasing a minority stake in MidOcean Energy for $500. million, subject to approvals.
Aramco likewise discovered two new gas fields in the. kingdom's Empty Quarter.
The company had 207.5 trillion cubic feet of gas reserves at. completion of 2023. It produced 10.67 billion cubic feet of gas. in 2015.
SCALE
The state-owned firm is one of the world's largest oil. producers and leading exporter, pumping nearly 10% of the world's. supply. It is likewise amongst the world's most lucrative business,. generating $27.3 billion in net revenue in the first quarter,. somewhat more than oil majors ExxonMobil, Shell, Chevron and. TotalEnergies made integrated in the very same quarter.
Last year, Aramco made a yearly net profit of $121.3. billion, its second-highest on record after it carried $161.1. billion in 2022.
In late 2019, Aramco raised $25.6 billion from its initial. public offering, the world's biggest ever. It then offered more. shares through an over-allotment choice in January 2020 that. improved the IPO even more to an overall of $29.4 billion.
With more than 73,000 workers in 2023, Aramco has energy. industry operations, research study centers and workplaces scattered. around the world, in Asia, Europe and the Americas. It has. offices in Beijing, Houston, London, New Delhi, New York, Seoul,. Shanghai, Singapore, Tokyo, and in other places.
(source: Reuters)