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Investors assess U.S. China trade deal as Fed lowers rates and gold gains
Gold prices increased by nearly 2% Thursday. This was due to a Federal Reserve rate cut and lingering uncertainties over the outcome of the trade agreement between China & the U.S. As of 11:26 am, spot gold was up by 1.7% to $3,995.59 an ounce. ET (1525 GMT), after rising nearly 2% in the earlier session. U.S. Gold Futures GCcv1 delivered in December rose by 0.2% to $4,009.20 an ounce. U.S. president Donald Trump announced on Thursday that he would lower tariffs against China from 57% to 47% in exchange for Beijing returning U.S. purchases of soybeans and rare earths and cracking down the illicit fentanyl traffic. The markets have backed off any optimism about the end of the trade wars as details of the U.S. China deal were revealed. Fears that the truce could be temporary led to a fall in equity markets. The U.S. Federal Reserve cut interest rates in line with expectations on Wednesday. However, it indicated that this may be the last reduction of the year, as the government shutdown is threatening the availability key economic data. In a low interest rate environment, safe-haven assets like gold become more appealing as they are non-yielding. Gold tends to do well during times of geopolitical or economic uncertainty. Wells Fargo Investment Institute has raised its gold target for 2026 to $4,500-$4,700/oz from $3,900-4,100/oz previously, citing uncertainty in geopolitical policy and trade. Analysts said that they expect the question marks to continue to drive private and public demand, and higher prices. Other than that, silver spot rose 2.6%, to $48,80 an ounce. Platinum gained 0.7%, to $1596.75, and palladium increased 2.8%, to $1439.52. (Reporting from Noel John in Bengaluru and Pablo Sinha; editing by Shalesh Kuber).
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India's NTPC reports a quarterly profit increase on lower expenses
NTPC, India's largest power producer, reported a higher adjusted profit for its second quarter on Thursday. This was due to lower expenses as a result of a decrease in fuel prices. The company's profit for the three-month period ended September 30 increased 19.4% compared to a year ago, reaching 56.24 billion rupies ($639.9m). Fuel cost is the total amount of expenses incurred by NTPC in acquiring and consuming the fuels needed for electricity production. This accounts for nearly 60%. Fuel costs fell nearly 5%, resulting in a 1.6% drop in the total expenditures of the state-owned company. India's power generation recovered in the second half of the year after a subdued first quarter ending in June. According to Elara Capital analysts, a low base and an increase in economic activity helped spur demand. Due to grid restrictions however, NTPC’s thermal power segment’s plant load factor (which is a percentage energy used by the power plants corresponding to their installed capacity) fell to 66.01%, from 72.28% during the period of July-September. Since Sept. 2024 the company has added 7450 Megawatts (MW), bringing its total installed power to 83893MW. India is planning to increase its coal-power capacity by 46 percent by 2035. It also plans to expand its renewable power capacity. NTPC's revenue from operations rose marginally by 0.2%, to 447.86 trillion rupees. ($1 = 87.8950 Indian rupees) (Reporting by Anuran Sadhu in Bengaluru; Editing by Harikrishnan Nair and Krishna Chandra Eluri)
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Saudi Arabia's budget deficit reaches $23 billion by Q3
Saudi Arabia's third-quarter budget deficit increased by 160%, as revenues dropped and spending rose. The finance ministry announced this on Thursday. Oil revenues dropped 0.1%, to 150.8 billion riyals. The unwinding of OPEC production cuts weighed on prices. Meanwhile, the Kingdom's Vision 2030 plan for diversification was implemented. In the first quarter of this year, revenues for the world's largest oil exporter fell by 13% compared to last year. 119.1 billion dollars came from industries other than oil. The public spending increased by 6% on an annual basis to 358.4 billion Riyals. The IMF's latest World Economic Outlook raised its forecast of Saudi Arabia’s GDP growth to 4% in 2025 from the 3% projected in April. The IMF revised the growth in 2026 to 4% due to an earlier than expected unwinding in Saudi Arabia's oil production cuts. The OPEC+ group increased crude oil production in October after the Organization of Petroleum Exporting Countries (OPEC), Russia, and other allies decided to accelerate the unwinding of some cuts earlier than originally planned. Saudi Arabia's deficit budget shrank by 41.1% to 34.534 billion Riyals in the second quarter. According to the Ministry, the public debt of the kingdom stood at 1,47 trillion riyals by the end the third quarter.
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Ghana orders the first major audits of mining companies in 10 years
Ghana, Africa’s top gold producer has launched the most aggressive audit of its mining industry in 10 years, targeting top miner to recover revenue lost and tighten up oversight, as a letter from government shows. West African governments are increasing their scrutiny on mining companies to ensure compliance with regulations, and protect revenue from the soaring prices of commodities. On October 20, the spot gold price reached a new record of $4,380 per troy ounce. The audit will include major gold producers including Newmont, AngloGold Ashanti Gold Fields, Perseus Asante Gold, China's Zijin, and China's AngloGold Ashanti. According to a government letter sent by the Minerals Commission to the Ghana Chamber of Mines on October 13, the audit will be conducted by independent consultants and forensic accountants. The Minerals Commission is the industry regulator and will be deploying teams to conduct a nationwide physical and financial audit between November 1, 2018 and June 20, 2026. These teams will examine production volumes, mineral flow, tax and royalties payments, and environmental compliance. By October 31, miners must submit all permits, stockpiles, shipping manifests, 10 years worth of production records, 3 years financial records and 10 years worth of production logs. The letter stated that company-specific reports must be submitted within 30 days after each site visit. The Minerals Commission refused to comment. The Mines Ministry did not respond immediately to a comment request. TRUE REVENUE RESOURSE POTENTIAL The world's second largest cocoa producer will generate 17.7 billion Ghanaian Cedis ($1.68billion) by 2024. This is due to a 25.1% increase in gold production, which helped stabilize the economy following its worst crisis for a generation. Ghana, which exports bauxite and diamonds, as well as manganese and diamonds, expects its gold production to increase to 5.1 millions ounces from 4.8. The letter from the commission details a phased auditory starting with Gold Fields Damang mine in November and Perseus, Canada-based Xtra-Gold Kibi unit by late June 2026. An executive from one of the companies, who asked not to be identified, said that individual companies received letters detailing the schedule. AngloGold Ashanti did not respond immediately to comments from Asante Gold. Gold Fields, Newmont. Perseus. Xtra-Gold. Zijin. Chamber of Mines did not respond immediately either. Ghana audited the mining sector last in 2015, with external investigators' help, but some companies disputed the findings. A source familiar with this process said. Said Boakye is an economist at the Accra based Institute for Fiscal Studies and a research fellow. He said that special audits should not be performed periodically but every year. It's the only method to develop a sound tax policy, and unlock the true revenue potential of the sector. The government has implemented sweeping reforms in order to increase returns. The country's mines ministry said that the country would shorten the licence terms and implement direct revenue sharing with host communities. This is the most ambitious overhaul of mining laws in almost 20 years.
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Letter shows truckmakers asking EU to relax emissions targets
A letter obtained by revealed that European truck manufacturers, including Traton Scania, Volvo, and Daimler Truck, have asked the European Union to relax its CO2 emission rules for this sector. Industry is being pressed to reduce its emissions that are warming the planet. Electric trucks are still a small part of the market because they cost more than diesel versions and buyers worry about charging infrastructure. In a letter dated October 13, the companies demanded changes to the EU credit system, which rewards manufacturers who achieve emissions below the EU targets as well as a linear trajectory from target year to target year. They want to be credited for just beating headline targets. Christian Levin of Scania and Traton said that the letter was a "cry for help". "We don't argue that the targets are incorrect... but it will be very, difficult," said Levin. He is also chair of the European Automobile Manufacturers' Association's (ACEA's) board for commercial vehicles. Daimler Truck's spokesperson said that the industry has invested heavily in electrification, but faces "draconian penalties" for not meeting targets. This is despite factors beyond their control such as battery manufacturing and charging infrastructure. Levin said that the best solution would be to eliminate the stupid fines imposed on the industry and instead force everyone to work together through incentives or penalties. According to EU law, truckmakers are required to reduce emissions of new trucks by 15 percent by 2025. This will rise to 90 percent by 2040 compared to the levels in 2019. The majority of truckmakers are on course to reach the 2025 target - mostly by improving their diesel lineup, rather than selling electric trucks. Environmentalists warn that lowering the targets will slow Europe's move to electrification, and could open the door for Chinese producers. Transport & Environment, a campaign group, said that the proposed changes would reduce EU sales of zero emission trucks by 27% by 2030. The European Commission didn't immediately respond to our request for comment. In a letter addressed to EU leaders, Ursula von der Leyen, the President of the European Commission, promised to "concrete" measures that would help heavy-duty vehicle producers reach their goals. Brussels has already considered lowering its CO2 emission target for cars by 2035, in response to pressure from the industry and EU member states.
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Investors assess U.S. China trade deal as Fed lowers rates and gold gains
Gold prices increased by nearly 2% Thursday. This was due to a Federal Reserve rate cut and lingering uncertainties over the outcome a trade agreement between China and the U.S. As of 9:43 a.m., spot gold was up by 1% to $3,970.36 an ounce. ET (1343 GMT) after a nearly 2% rise earlier in the day. U.S. Gold Futures GCcv1 were unchanged at $3.992.40 an ounce for December delivery. U.S. president Donald Trump announced on Thursday that he would lower tariffs against China from 57% to 47% if Beijing resumed U.S. purchases of soybeans and rare earths and cracked down on the illicit fentanyl traffic. The markets have backed off any optimism about the end of the trade wars as details of the U.S. China deal were revealed. Fears that the truce could be temporary led to a fall in equity markets. The U.S. Federal Reserve cut interest rates in line with expectations on Wednesday. However, it indicated that this may be the last reduction of the year, as the government shutdown is threatening the availability key economic data. In a low interest rate environment, safe-haven assets like gold become more appealing as they are non-yielding. Gold tends to do well during times of geopolitical or economic uncertainty. Wells Fargo Investment Institute has raised its gold target for 2026 to $4,500-$4,700/oz from $3,900-4,100/oz previously, citing uncertainty in geopolitical policy and trade. Analysts said that they expect the question marks to continue to drive private and public demand, and higher prices. Other than that, silver spot rose by 1.7%, to $48.34 an ounce. Platinum gained 0.9%, to $1.598.55; and palladium increased 1%, to $1.415.52. (Reporting from Noel John in Bengaluru and Pablo Sinha; editing by Shailesh Kuber)
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Nigeria imposes a 15% import duty to support local refiners
According to a memo from the president seen on Thursday, Nigeria has approved an import duty of 15% on petrol and diesel. The government is trying to protect its multi-billion dollar investments in domestic refinery by limiting an influx cheaper fuel. The government stated that the measure was part of broader reforms to boost non-oil revenue in advance of tax changes planned for 2026. The measure follows the removal of fuel subsides and foreign exchange controls last year. The memo said that "this reform will accelerate Nigeria’s path to fuel self-sufficiency. It will protect consumers and investors, and stabilize downstream petroleum markets." Bola Tinubu, President of the Republic of Nigeria, signed off on new import duties on October 21, 2018. Nigeria, Africa's largest oil producer, has been trying to reduce its dependence on imported fuel for a long time. The Dangote refinery, which produces 650,000 barrels of oil per day, was inaugurated last year. This gave the ambition a big boost. The memo said that the refinery, Africa's biggest, was built for $20 billion and faced competition from imported goods priced below the cost recovery. The current pump price is around 928 Naira ($0.6322) a litre. The officials estimate that the duty may increase prices by 99 naira. Fuel shortages have been experienced in Nigeria due to supply issues. $1 = 1,467,8100 Naira (Reporting and editing by Chijioke Ohuocha, Joe Bavier; Additional reporting by Camillus in Abuja)
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Copper backs off Fed caution amid concerns about Chinese demand
The Federal Reserve's cautious comments on U.S. rate cuts and concerns about Chinese demand led to a decline in copper prices on Thursday, compared with the record highs of the previous day. The price of three-month copper at the London Metal Exchange fell 1.8% in open-outcry official trading to $10,978 a metric ton, after reaching a record high on Wednesday, $11,200, due to supply concerns. Robert Montefusco, a broker at Sucden Financial, said: "Copper prices are down today due to the lackluster physical demand and the Fed's dovish sentiment on a rate cut in December. Fed Chair Jerome Powell shocked the markets on Wednesday, casting doubt on the prospects for an interest rate reduction at the next central bank meeting in December. He said that such a move "was not a foregone decision". This helped push the dollar index up to its highest level in three weeks, making commodities priced using the U.S. dollars more expensive for buyers who use other currencies. The Shanghai Futures Exchange's most traded copper contract fell 0.1% to 87.960 yuan (12,348.73 dollars) per ton. The physical demand for metals in China, the top consumer of metals, has been weakening as prices rise. Spot copper prices are higher than SHFE prices. Flipping to a 55-yuan discount per ton of coal on Thursday, from a premium 90-yuan on 15 October. A poll found that major miners have reported lower output of copper in the first nine month of the year. This has led analysts to raise their price predictions for next year. Dan Smith, managing Director at Commodity Market Analytics said that the market is bullish but some miners may be holding it back because they want to sell ahead to lock in high prices. I'd imagine that copper producers are doing a lot of hedging, which prevents prices from rising. These are good numbers for many copper producers." Other metals include LME aluminium, which fell 1.4% to $2.845.50 per ton in official activity, nickel, which dropped 1% to $16,215; zinc, which slipped 1.9% to $3,000; lead, a 0.1% drop to $2.024; and tin, a 0.6% decline to $35,960. Click here for top metals stories ($1 = 7.1230 Chinese yuan). (Reporting and additional reporting by Lucas Liew, Editing by Shareysh Kuber, Shreysh Biswas, and Shareysh Kuber)
Nayara, a sanctions-hit company, scrambles with New Delhi to maintain operations
Since late August, Nayara Energy refinery in western India has been moving fuel by rail to inland depots with two or three 50-tanker trains per day. This is more than twice the amount of diesel and petrol it used to transport previously. The European Union imposed crippling sanctions on the Russian-owned refinery on July 18 that shut it out of many markets. It forced the refinery to find new customers and divert more fuel into the domestic market.
Sources from the Indian government and the company claim that the ongoing crisis at Nayara has forced the Indian government to provide enough support for it to continue operating, while avoiding actions that could provoke an Western backlash. New Delhi has taken several measures to assist a refinery that is owned by a friendly country. These include providing tanker train services and approving coastal vessels for the transport of its products.
Nayara is owned by the Russian state oil giant Rosneft, which puts it in the middle of a long-standing relationship between New Delhi and Moscow. This puts India at odds against its Western allies. The refiner's biggest shareholder, the Russian state oil company Rosneft relies solely on Russia to import oil, after Iraqi crude and Saudi Arabian oil supplies were cut-off following the EU measure. This makes it vulnerable if flow disruptions are caused by tighter sanctions or increased U.S. pressurization.
"The government is trying cover two possible scenarios: trying to support Nayara, while remaining aware of the fact there will be a persistent global pressure to tighten the sanctions," said Amitendu Palait, a Senior Research Fellow at the National University of Singapore Institute of South Asian Studies.
He said that "Long-term Support might not be sustainable until the global dynamics change, such as a resolution between Russia & the U.S.A.
Nayara has not responded to an email asking for comment on this story. India's Oil Ministry and Rosneft have not responded to requests for comments.
Nayara, a Mumbai-based company, is a major player in India's rapidly growing fuel sector. It accounts for 8% the refined product output and operates more than 6,500 gasoline stations. It has been forced to reduce crude runs at its 400,000-barrel-per-day Vadinar refinery to 70-80% of capacity - it was previously running at 104% - as it struggles to find export buyers for its fuel and banks to facilitate payments, sources with knowledge of the refinery operations say.
STOP-GAPS AND WORKAROUNDS Nayara's refinery, which is not connected to the pipeline network, increased its use of railcars for fuel transportation after sanctions made it difficult to charter coastal vessels or export products, forcing it redirect production domestically. Its access to more railcars was facilitated by New Delhi, which has also temporarily allowed Nayara to use four coastal vessels, sources said, including the E.U.-sanctioned Leruo and two shadow fleet ships, the Guinea-Bissau-flagged Garuda and Djibouti-flagged Chongchon.
Sources said that Nayara was seeking approval from the government to use two additional coastal ships. Nayara also seeks government assistance to find equipment and materials it struggles to get due to sanctions, for a scheduled maintenance shutdown in February. Sources said that Nayara is also considering pushing back the shutdown until April while it searches for alternative raw materials.
A senior official of a company, speaking on condition of anonymity due to the sensitive nature of the issue, said that the company was constantly under threat. The official cited the concern that the vessels they are currently using may be subject to future Western sanctions.
We never expected to be so directly hit. "Every day is like fighting fires."
Nayara, a combination of Hindi and English meaning "New Era", was originally called Essar Oil. It was purchased by Rosneft in 2017, along with a group that included the Russian fund UCP and Trafigura. Trafigura later sold its share.
Nayara purchased oil from many countries until 2022. In that year, India began buying discounted Russian oil, after the West sanctioned Moscow for its invasion in Ukraine. It became the largest buyer of Russian crude by sea. Recent purchases by India have led to a diplomatic rift between Washington and New Delhi. President Donald Trump doubled tariffs on Indian imports up to 50%.
MAINTENANCE AND PAYMENTS ARE THE IMMEDIATELY BIGGEST CHALLENGES
Sources at the company have stated that the most immediate challenge for Nayara is to resolve the maintenance issue and be able make international payments. Sources have reported that Nayara’s principal banker, the government-owned State Bank of India (SBI), stopped processing forex and trade transactions for the refiner due to concerns over EU sanctions in August. SBI did respond immediately to a comment request.
Nayara officials met with officials from the finance ministry and banks to try to resolve this banking issue. However, they have not yet found a solution. This limits Nayara’s ability to import and export fuel in foreign currencies.
The Indian finance ministry has not responded to a comment request.
According to shipping and traders data, Nayara exported 30% of its production before the sanctions. This was mainly through trading with Western, Middle Eastern, and Asian firms to ship products to Asia and Northwest Europe. Data shows that since then, Nayara has shipped cargoes to the Middle East, Turkey and Brazil. At least 16 of these cargoes were diesel, gasoline, and jet fuel, and they were all transported on EU-approved tankers. Industry sources claim that some of these recent exports were done through traders, with payment offset against crude supplies.
According to Kpler, Nayara exports 2.23 million barrels in September. This compares with an average of 3.3 millions barrels per month from January through June.
A trader from north Asia said, "We're interested in buying their products." They told me that their bank account was blocked and they couldn't accept payments.
(source: Reuters)