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US refiners expect first-quarter profits to increase as war increases fuel margins
Fuel margins have reached multi-year highs due to supply disruptions caused by the Middle East war. After the U.S. and Israeli attacks against Iran, which began on February 28, the refiners' diesel and jet fuel margins were much higher than they had been at the beginning of the year. The Strait of Hormuz is a narrow shipping channel that transports about a quarter of world oil and a significant share of fuel exports. Analysts believe that the bulk of the profits will be realized later in the year. The shares of major U.S. refining companies such as Valero Energy and Phillips 66 have risen more than 20% this year. Matthew Blair, a Tudor, Pickering, Holt & Co analyst, said that the biggest margin increase was in distillates. As barrels that normally move out of the Middle East via the Strait were choked, diesel cracks increased. Analysts said that the already low inventories prior to the global supply shock contributed to the positive outcome. Diesel markets, unlike gasoline, had less spare capacity that could cushion the shock. This left refiners located outside of the Middle East in a better position to capture "incremental" demand. The crack spread for ultra-low sulfur futures, which is a measure of refinery profit margins, increased by 105% on March 20, reaching a new record high of $86.25 per barrel. Analysts said that jet fuel margins have also increased since the beginning of the conflict. This is especially true for refineries located on the coast and those focused on exports. Middle East jet fuel exports are a major concern for aviation markets in Asia and Europe. Gas Prices Jump The supply disruption also boosted gasoline margins, but to a lesser degree, since profits had been capped earlier in quarter, when refineries were working hard and supplies plentiful. On March 27, the U.S. crack spread for gasoline futures reached its highest level in over two years. U.S. gasoline prices at the pump topped $4 per gallon for the first month in over three years at the end March, marking the largest monthly increase in decades. According to LSEG estimates, Phillips 66 will report its first refiner earnings this Wednesday. Analysts expect the company to post a loss per share of $0.27, compared to a $0.90 loss per share a few years ago. Houston-based refiner Phillips 66 warned its first-quarter results were affected by the sharp rise in commodity costs, which resulted in nearly $900,000,000 in mark-to market hedging losses. Hedging is used by companies to protect themselves against fluctuations in oil prices. Analysts claim that these losses are mostly accounting-related, and they could reverse them later. However, they still affected first-quarter results. Allen Good, Morningstar analyst, says that despite the short-term impact, Phillips 66 is still well-positioned for the long-term - due to its high yield of distillate, which is among the best in the industry. According to LSEG, analysts expect Valero to report a profit per share of $3.15, up from $0.89 a year earlier. Strong Gulf Coast cracks boosted the results of the?San Antonio Texas-based refiner, but its upside was limited due to the closure of its refinery and a fire in Port Arthur, Texas. LSEG estimates that Marathon Petroleum, which is the largest U.S. refiner in terms of volume, will report a profit per share of $0.86. This compares to a loss per share of $0.24 a year earlier. Analysts note that Marathon is well positioned to 'harvest the benefits of the current environment due to its exposure to U.S. midcontinental and West Coast markets. Investors are looking for guidance in the months ahead as fuel margins start to show up more clearly in earnings. Analysts believe that U.S. refining companies will benefit from the favorable margins for the next couple of quarters. Jason Gabelman is an analyst with TD Cowen. He noted that the market would likely be more focused on earnings for the rest of the year.
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MORNING BID AMERICAS - Oil and Chips
What's important in the U.S. market and globally today by Mike Dolan, Editor at Large, Finance and Markets Tech stocks continue to rise despite the weekend's stalemate over Iran, rising oil prices and a close call with a Washington press dinner that was attended by Donald Trump and his officials. This week, the dissonance between AI and geopolitics is likely to continue. ?Companies that represent 44% of S&P 500 market capitalization will'report earnings' in the next few days. There is no sign yet of a pause in the AI arms races around the globe. Below, I'll go into more detail. Listen to the Morning Bid podcast for the most recent episode, in which I discuss the busy week that lies ahead. Subscribe to the Morning Bid daily podcast and hear me discuss the most important news in finance and markets seven days a weeks. Oil and chips Microsoft, Meta Apple, Alphabet, and Amazon all report earnings next week. Meanwhile, chipmakers' stock prices have rocketed on demand for AI components. Intel's dazzling?advance towards record highs has been the highlight of this month. It's unclear how the markets will react to hyperscalers, big tech companies and Tesla who last week increased their 2026 capital expenditure plan by more than $25 billion. For now, tech stocks continue to soar, as chipmakers led Asian indices to new record highs. This comes after Wall Street also hit record highs on Friday, although S&P futures were flat on Monday before the bell. After the opening, European shares were muted. Brent crude has reached a three-week record of $108 a barrel. Traffic in the Strait of Hormuz remains sluggish, and there haven't been any 'new peace talks scheduled yet, though Pakistani efforts continue to broker discussions. Goldman Sachs has also raised its forecast for fourth-quarter Brent to $90/bbl. The Fed, G7 central bankers, and the Bank of Japan will all be meeting this week. The Bank of Japan is the first to announce its rate decision, which will take place on Tuesday. As they continue to evaluate how energy prices impact inflation expectations, no interest rate changes are expected this week. The Fed meeting is likely to be Jerome Powell's last as chairman. The Department of Justice's decision to drop its criminal investigation into Powell on Friday has cleared the way for Kevin Warsh, the nominee for Fed chair, to be confirmed by the Senate. Powell's guidance may be less effective than in the past eight years. The week will also bring new inflation data from around the globe, with the U.S. Personal Consumption Expenditures (PCE), the Fed's preferred measure, due Thursday, along with flash data from the Eurozone. Chart of the Day U.S. oil exports have increased in the last few weeks, which has helped to calm the energy supply crisis that is originating from the Middle East. According to Energy Information Administration figures, total U.S. crude oil exports reached a record high of 12,9 million barrels per a day in this month. Refined products made up over 60% of the total. According to Kpler, U.S. seaborne oil exports will reach a new record of 9.6 million barrels per day in April. Flows to Asia are expected to nearly double from pre-war levels, to 2.5 million barrels per day. Ron Bousso, ROI Energy's columnist, explains that the surge in oil exports has cushioned Asian economies which are among those most vulnerable to Gulf supply loss. Watch today's events * U.S. 2-year & 5-year Note Auctions (1 p.m. EDT) Bank of Japan starts monetary policy meeting * UK King Charles III starts four-day U.S. State Visit 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 the views of News. News is committed to the Trust Principles and is dedicated to a free, independent, and impartial news service.
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Chinese EV Battery Maker CATL Launches $5 Billion Hong Kong Share Sale
Contemporary?Amperex Tech Co (CATL), the world's biggest EV battery manufacturer, launched a $5 billion share sale on Monday in Hong Kong. The company is looking to capitalize on its shares which are nearing record highs. According to a termsheet seen by, CATL will be?offering HK$628.20 - HK$651.80 for new H shares, a discount ranging from 3.5% - 7.0% on Monday's closing price HK$675.50. The fundraising is part of CATL's efforts to lock in capital as its share price continues to rise. It also faces an EV market in China that is fiercely competitive and where it has been difficult for the company, despite rapid growth, to maintain profitability. EXPANSION DRIVE CATL shares listed in Hong Kong have risen 157% since their HK$263 price at the time of listing in May 2025. According to LSEG data, its Shenzhen listed shares have risen about 18.4% in the past year, valuing it at around $293.9 billion. Sinopec's Hong Kong unit, which was able to cash in on the rally, sold 8.5 millions CATL Hong Kong share for $770 million last week. CATL announced a fourth-quarter 2025 profit that exceeded market expectations in March. CATL raised $4.6 billion through its Hong Kong listing. It is the largest in the world by 2025. The majority of the proceeds will be used to fund a battery factory in Hungary. The term sheet from Monday stated that the proceeds of the sale would be used to expand global capacity, develop zero-carbon businesses, conduct research and development, as well as for general working capital. CATL, a supplier of automakers such as Tesla, BMW and Volkswagen, Xiaomi, Nio and Xiaomi, has not responded to an email request for comment. Reporting by Yantoultra NGi. (Editing by David Goodman, Mark Potter and Mark Potter.)
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India's UltraTech Cement exceeds profit expectations for the fourth quarter on the back of improved demand
UltraTech Cement reported on Monday a higher-than-expected profit for the fourth quarter, thanks to improved demand and favourable weather conditions. LSEG data shows that the consolidated net profit grew 20.2% on an annual basis to 29.83 billion rupees (about $316.61 million). This was above analysts' expectations of 28.1 billion, which were based on LSEG's compilation. Cement companies typically strive to meet their fiscal year-end goals and achieve higher volumes in the fourth quarter, when construction activity is boosted by weather conditions. According to HDFC Securities analysts, India's cement demand increased by 6%-7% in the first quarter of this year, mainly due to strong growth between January and February. Ultratech's revenue from operations increased by about 12% on an annual basis to 257.99 billion rupies, supported by a growth of 9% in sales volume. The firm's share of the market also increased due to better 'capacity usage and expansion' than its competitors. The company reported in a filing that "capacity utilization surged to 89% due to robust demand across the housing, infrastructure and commercial construction segments." The firm's operating profit margin dropped from 22% to 20% due to the weak cement prices in India's southern and eastern regions. Analysts expected that cement manufacturers would face higher operating costs in the third quarter of this year, due to increased fuel costs and packing bag prices. UltraTech saw a 15.4% increase in raw material costs. Fuel and freight expenses also increased by about 9% each. Total expenses were?218.94 bn rupees, 9.2% more than the previous year. The company plans to expand its footprint in different regions by adding 15.9 million tonnes of cement capacity in fiscal year 2027 and another 29.8 millions tonnes in fiscal 2020.
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Triton Uranium is aiming for a US listing in 2026 as the demand for nuclear fuels increases
Triton Uranium's president Scott Evans said that the company is looking at a U.S. listing in 2026 through a merger with a special-purpose acquisition company. The company wants to "tap into" rising demand for nuclear fuels and boost domestic supply. The Canadian-based company began development work on its Atlas Project at Uranium City in Saskatchewan, where it controls approximately 46,742 acres. Triton raised almost $16 million from private sources, which it plans to use for exploration in advance of a possible public listing. Evans stated that the company would be open to selling a stake to either the U.S. government or?Canadian Government in future, given growing efforts by policy makers to secure supply chains of critical minerals. As electricity demand increases, interest in nuclear power is increasing. This is partly due to data centers that support artificial intelligence and cloud-based infrastructure. Amazon-backed reactor developer X-Energy raised $1.02 billion recently in an initial public offering in the United States, highlighting renewed investor interest. The uranium market is still constrained due to years of underinvestment. According to a report in January, U.S. mining production has increased again. However, it is estimated that this year's output will only be about 1 million pounds. This is far below the annual U.S. consumption of more than?50 millions pounds. Triton prepares to begin a 10,000 meter drilling programme in four priority targets. This includes the Dubyna Mine Area. Denison Mines Corp. and NexGen Energy were approved by the Canadian Nuclear Safety Commission earlier this year to begin construction on their respective 'Wheeler River' and 'Rook I Projects, respectively, located in northern Saskatchewan. This was the first new Canadian uranium mining approval since 2004. (Reporting and editing by Sumana Niandy in Bengaluru)
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Meta Energy partners with space-startup Overview Energy to provide solar power for data centres
Meta Platforms and Overview Energy have signed an agreement to provide power for Facebook's data centres from the startup's solar energy infrastructure based in space. Overview?Energyis?developing an energy system that can beam solar power to ground-based facilities for continuous power production. The companies expect the first orbital demonstration to take place in 2028 and commercial power deliveries in 2030. According to the companies, this agreement gives?Meta access to capacity of up to 1 gigawatt from Overview's system. The financial terms of the agreement were not disclosed. Nat Sahlstrom is vice president of Meta's energy and sustainability. He said that space solar technology was a "transformative step" because it leveraged existing infrastructure to deliver new, uninterrupted power?from space. Meta, like its Big Tech counterparts, has secured long-term deals for energy supply as the surge in artificial intelligence use and the data centre boom put pressure on the U.S. existing power grid. As they are pushed by environmental and consumer groups, tech companies are turning to alternative power sources. Meta is building several gigawatt data centers in the U.S. including one in rural Louisiana. U.S. president Donald Trump said that this project would cost $50 billion and span an area comparable to a large part of Manhattan. The social media giant also has partnered with Vistra, Oklo, and TerraPower to position itself as one of the largest corporate buyers of nuclear energy in the world.
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Powell is preparing for a possible farewell, so the Fed will likely hold rates at current levels.
Federal Reserve policymakers are expected to meet in Washington, D.C. this week for a meeting that may be Jerome Powell’s last as the head of the U.S. Central Bank. Energy prices remain high and the Iran War is at a standstill. This will likely prolong uncertainty regarding the outlook for economic and monetary policies. After a major obstacle was removed from the way, it now seems more likely that Powell's eight-year tenure at the Fed will end on May 15. Kevin Warsh's confirmation by the Senate as his successor was lifted on Friday. Powell is likely to oversee a vote on Wednesday by the Federal Open Market Committee, the policy-making body of the central bank, in order to keep the overnight benchmark interest rate at the same level it has held since December. Powell's presser after the meeting could resolve key issues, such as whether policymakers are willing to consider a rate hike later this year, if inflation increases. Powell's future on the Fed Board of Governors, even if Warsh gets confirmed in time for the next policy meeting scheduled in June, could also be discussed. The U.S. Department of Justice dropped on Friday a controversial criminal investigation of Powell regarding renovations of the Fed headquarters in Washington. This could satisfy the demands of an important Republican senator, who had threatened to delay Warsh’s confirmation due to it. Powell had also made the end of the investigation a condition for leaving the Fed board. Powell, who has traditionally resigned his board seat when the leadership term of the U.S. Central Bank Chiefs expired, said last month that he would consider staying and "make this decision based on what is best for the organization and the people we are serving." This was a wider test related to President Donald Trump's attempts to encroach upon the Fed's autonomy. Powell could be a Fed Governor until January 2028. This would be the last year of Trump’s presidency, and the long epilogue of the man Trump has nicknamed “too late” for not delivering the rate cuts that he wanted. The current Fed head will be questioned on?his plan as well as the economic substance of a debate that is still clouded over by the U.S. - Iran war. Powell's conference will follow the FOMC's statement at 2 pm EDT (1800 GMT). Central bankers warned that the impact of the war on economic growth and inflation would depend on the speed at which it was resolved and the oil price returning to its pre-war level, around $70 per barrel. Eight weeks after the war began, the bombing is paused, but economic warfare continues. The U.S. blocks Iranian ships from leaving Strait of Hormuz and?Iran prevents other vessels from crossing the vital waterway. Brent crude futures - the benchmark for global oil - have increased by about 50% since the beginning of the war. Last month, the surge in energy and gasoline prices helped push up the U.S. Consumer Price Index by its largest increase in almost four years. The U.S. Central Bankers are expected to keep interest rates the same, but they will need to decide whether it is time to consider raising borrowing costs in case inflation continues to rise. Bond markets are positioned to keep the Fed's rate at its current level until at least 2027. The possibility of rate reductions has diminished. The longer energy prices are high and the Strait is constrained, then the more likely it is that higher inflation will be embedded in a variety of goods, services and supply chain effects. Real activity and employment may also begin to slow. Waller stated that the Fed could be faced with a "very complex" situation, where it must deal with both high inflation and a weakening labour market. Waller stated that this dilemma could mean keeping?rates the same, but an increasing number his colleagues had already noted the possibility of rate hikes in their discussions during the March 17-18 meetings. This sparked a debate about whether the Fed's statement for this week would include language indicating that the Fed's rate change next could be either way, which would represent a significant shift. It was anticipated that the central bank would resume rate cuts this year. However, it has been on pause since December. Inflation is about a percentage above its 2% goal. Alberto Musalem, St. Louis Fed president, said that monetary policy is "in a good spot" and it would be appropriate to maintain policy at the current level for a while. Musalem, like other central bankers, said that an extended period of high crude oil prices would likely raise "core inflation" and not just the headline price of gasoline. "At that point, de-anchoring of inflation expectations will become relevant," he said. At the moment, inflation expectations are anchored in the medium- to long-term, but that will change, and it may be time to increase rates. Few U.S. policymakers would argue against the current rate hold at this time. Even their most vocal advocate of cheaper money, Fed governor Stephen Miran, said recently that he was considering slowing down his recommended pace of rate cuts due to the "less favorable" inflation outlook. Powell's interpretation of the discussion and whether or not the Fed's statement on policy changes to include possible increases in borrowing costs is the open question. Bank of America economists said in a recent note that the Fed would "stay firmly on hold" at its meeting in April. The Iran War has not abated the inflation risks. Labor data are improving. The question is whether or not the language of the statement that provides forward guidance will show that policy risks are both-sided. It's close, but we think it won’t. Powell will likely sound hawkish." (Reporting and editing by Dan Burns, Paul Simao and Howard Schneider)
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Iran suspends the export of steel sheets and slabs until May end
State media reported on Monday that Iran had 'banned exports of steel sheets and slabs until 30 May, without providing any further details. This is because the'steel industry in Iran was targeted by strikes against Israel and the United States during the conflict. The newspaper Etemad reported that damage to key facilities had knocked out 10 million tonnes, or 25 to 30 percent, of Iran's total annual steel production. During the war, major producers such as Mobarakeh Steel Company and Khuzestan Steel Company were affected. Etemad reports that the resulting disruption in production has caused shockwaves throughout industries such as?construction?, automotive?, and infrastructure?. According to Iranian news agency Tabnak, a member of the Iran Chamber of Commerce board of representatives stated that the market for steel sheets is expected to stabilize within two months due to imports which will offset shortages as well as curb speculative demands. Early April, the deputy director at Khuzestan Steel Company stated that it would take between 6-12 month to restore its operations after its facilities were damaged. Etemad said that steel is Iran's largest non-oil export. The loss of production and export capacity would have a negative impact on the country's trade balance, foreign currency earnings, as well as the risk of losing a market share of global?steel. The damage is expected to have wider economic implications, including job losses and inflation pressure. (Reporting and editing by Bernadette B. Baum, Dubai Newsroom)
The rupee is almost flat as a result of RBI's presence.
The Indian rupee finished modestly stronger on Monday as the dollar sales made by state-run banks helped to ease the pressure of higher oil prices after the U.S.-Iran negotiations stalled.
The rupee closed at 94.19 compared to its previous closing of 94.2475.
Traders said that state-run banks, likely acting on behalf of Reserve Bank of India (RBI), offered dollars to limit the fall of the currency early in the session.
A trader from a Mumbai bank stated that this was what triggered a broader interest in selling dollars, giving the rupee breathing space. As shipments of oil through the Strait of Hormuz were limited, causing global supplies to be tight, oil prices rose?almost 3 percent on Monday.
Increased oil prices could slow India's growth, increase inflation and widen its fiscal and current accounts deficits. Goldman Sachs analysts increased their oil price forecast for the weekend from $84 to $94 a barrel, three months later. Goldman Sachs analysts have also reduced India's 2026 growth forecast to 5.9%, down from 6.2%.
In a recent note, they said: "We remain cautious as the Middle East disruption will likely keep crude oil prices high and physical supply conditions tight, increasing industrial input costs. If administered, pump price adjustments are higher, this would weigh on household real income."
A modestly weaker Dollar?also supported the rupee during the second half of Monday's session. The dollar index fell 0.3% to 98.3, while Asian currencies, including the Korean won, were on the rise.
This week, the focus will be on a number of policy decisions made by central banks in the U.S.A., Europe and Japan. Investors will be analyzing central bank comments to see how the Iran War impacts their economies. (Reporting and editing by Rashmi aich, Harikrishnan Nair, and Jaspreet kalra)
(source: Reuters)