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Libya plans to restart Ras Lanuf Oil Refinery within one year, NOC reports
Masoud Suleman, chairman of the National Oil Corporation in London, told reporters that Libya plans to restart its 220,000 barrels-per-day Ras Lanuf refinery within six to twelve months to supply the domestic market. Since 2013, the refinery, Libya’s largest, was idle due to an arbitration dispute between Trasta and NOC, its Emirati partner. NOC announced on Monday that it had signed an agreement to end the partnership with Trasta, and transfer full control of the Ras Lanuf refinery and complex to Libyans. Suleman said that the budget for the restart was already allocated. He added that NOC had the necessary manpower and equipment to maintain the system, which, he estimates, will cost around $60 million. Since the NATO-backed 2011 uprising which toppled Muammar Gadhafi, Libya's oil industry, its main source of revenue, has been repeatedly disrupted by local and wider political unrest. The Zawiya refinery, which produces 120,000 bpd, was forced to close last week due to clashes in the area. Suleman stated that?output?from Ras Lanuf will primarily serve the domestic market, and be sold by Brega Oil Company?a NOC subsidiary. NOC anticipates an initial run rate of about 200,000 barrels per day, and will gradually ramp up to full capacity. The refinery will run on Libyan Amna crude grade. Reporting by Ahmad Ghaddar, Shadia Nasralla. Ahmed Elumami contributed additional reporting from Tripoli. Editing by Philippa Faletcher and Mark Potter
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The dollar and bond yields are rising as US inflation is on the rise. Global equity markets are modestly up with this.
MSCI's global equities index advanced with the dollar Wednesday. U.S. treasury yields also saw a slight increase as investors evaluated hotter than expected inflation data, all while waiting for a meeting between U.S. president Donald Trump and China's Xi Jinping. U.S. producer price increases were higher than expected by the Bureau of Labor Statistics at the Labor Department in April, marking their largest increase since early 2022. The latest economic impact of the U.S. and Israeli war on Iran was evident in Tuesday's U.S. consumer price data, which showed that energy costs accounted for the largest increase in the last three years. Jim Baird is the chief investment officer of Plante Moran Financial Advisors. He said that this data was a further source to increase the concern about inflation. You're seeing the reactions in stocks and bonds as a result of an increase in yields. This is one of two key narratives, and probably the biggest concern for investors in near-term. There are two opposing forces at play, namely the inflation concerns and their implications for Fed policy. The upside for stocks was a strong earnings season, even though it was more concentrated in tech stocks and AI-related stocks. Elon Musk and Nvidia's Jensen Huang were among the entourage of President Trump who received a warm welcome on Wednesday in Beijing as he prepared to ask China’s Xi Jinping for "openness" towards U.S. businesses at the beginning of their two-day meeting. Trump stated on Tuesday that he didn't think he needed China's assistance to end the Middle East conflict. "What we will hear is that the meeting was productive. In reality, the progress will be more limited. My expectations would be realistic. Baird, of Plante Moran, said: "You have to be." Wall Street was buzzing at 11 a.m. The Dow Jones Industrial Average fell by 258.37, or 0.5%, to 49.502.19; the S&P 500 gained 10.15, or 0.1%, to 7.411.11; and the Nasdaq Composite gained 163.96, or 0.6%, to 26249.15. The MSCI index of global stocks rose by 2.91 points or 0.26 percent to 1,106.23. The pan-European STOXX 600 Index rose by 0.64%. On Wednesday, the longer-dated bond yields hit their highest level since July after producer prices rose faster than economists expected in April. Then, they eased as traders assessed the likely impact of Fed policy. The yield on the benchmark U.S. 10 year notes increased 1.7 basis point to 4.489% from 4.471% on Tuesday. Meanwhile, the 30-year bond rate rose 2.1 basis to 5.0484%. The yield on the 2-year bond, which is usually in line with expectations of interest rates for the Federal Reserve rose by 1.3 basis points, to 4.009%. The dollar grew on Wednesday after the latest U.S. inflation report, and investors were focused on the upcoming talks between Trump Xi and China's Xi. The dollar index (which?measures greenback against a currency basket including the yen, the euro and others) rose by 0.19%, to 98.51. Meanwhile, the euro fell by 0.25%, at $1.1708. The dollar gained 0.16% against the Japanese yen to reach 157.86. It had briefly surged on Tuesday due to "rate-check" speculations, which are often seen as a prelude to an intervention. The British pound fell 0.16%, to $1.3515, as the Prime Minister Keir starmer's hold on power began to wane. After a rally on Tuesday, oil prices have been mixed. International Energy Agency has said that global oil supply this year will be insufficient to meet demand, due to the Middle East war which is destroying oil production. Both sides have failed to reach an agreement on ending hostilities, while Israel has intensified its attacks in Gaza over the past five weeks. Some ships were able to cross the Strait of Hormuz. U.S. crude climbed 0.87% to $103,07 per barrel. Brent dropped to $107,67 per barrel on the same day. Spot gold dropped 0.72%, to $4,679.79 per ounce. U.S. Gold Futures increased 0.04% at $4,679.60 per ounce. Reporting by Sinead carew and Elizabeth Howcroft. Clarence Fernandez and Mark Potter edited by Keith Weir.
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Italy's Ludoil purchases Sicilian oil refinery as war threatens Europe fuel supply
G.O.I., a Cypriot private equity fund, has agreed to purchase the Sicilian oil refiner ISAB. The Italian group Energy said Wednesday that the Iran War has revealed Europe's dependence on the Gulf to supply jet fuel and refined products. Ludoil is the jet fuel supplier to Rome's Fiumicino airport. The Morattis family of Italy and the Brachetti Perettis family in Azerbaijan sold their oil refineries recently to Vitol, a commodity trader. Ludoil had already begun discussions with G.O.I. When the United States and Israel struck Iran on February 28, they used ISAB to generate energy. Ludoil was founded in 1954 by Donato Ammaturo's grandfather. The new entity, which is Italy's largest privately-held multi-energy firm, will have consolidated revenues of more than 10 billion euros (11,7 billion dollars). The acquisition will enable ISAB to evolve from a refinery to an energy company. This will enhance competitiveness, supply security and the development new value chains in energy. Ludoil stated that it would integrate ISAB into its portfolio, which included coastal storage terminals and a fuel retailer network. It also hoped to develop a biofuels business for the refiner. The deal is divided into two phases. In the first, Ludoil will acquire a 51 percent stake in ISAB. This acquisition is subject to a number of conditions, including the approval from the Italian government, under the so-called golden powers regime. Ludoil has not revealed how much money it will pay for the stake. It also did not respond immediately to requests for more information. ISAB, which accounts for over 20% of Italy's refinery capacity, is considered by the government to be a strategic asset. G.O.I. Energy? Bought from Russia's Lukoil by 2023. Ludoil has not said whether the existing agreement between Trafigura and Ludoil for 'the supply of raw material and 'the purchase of finished goods will remain in place. According to a person with knowledge of the deal, Trafigura will keep its contract for supply and offtake with ISAB's Priolo refining facility.
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TSX falls as gold, technology stocks drag
Canada's main stock index dropped on Wednesday, as gold and technology stocks?came under pressure?while investors viewed developments?around the Middle East conflict and U.S. president Donald Trump's China visit. At 11:03 a.m., the S&P/TSX composite index of the Toronto Stock Exchange fell 0.5% to 34 128.67. ET. It closed Tuesday at its highest level in three weeks. This index is the worst performing on TSX in this?year. It has fallen by nearly 20%. Brian Madden said that the Canadian technology sector was more of a victim than a benefit of artificial intelligence due to a high concentration of software firms. It was down a lot during the first quarter, and it hasn't recovered as well as the U.S. technology sector." A positive earnings season, largely driven energy companies and miner, has helped to keep the Canadian equity markets just below their record high of March 2. Oil?prices remained largely unchanged, but above $100 a barrel as investors watched a fragile Middle East truce and awaited a summit between Trump and China’s Xi Jinping. The energy stocks are steady. Gold?miners fell 1.4%, as the price of precious metals dropped. This was after U.S. producer price data that were hotter than expected reinforced expectations of a tighter monetary policies. Equinox Gold's shares dropped 3.6% following the announcement that it would be acquiring Orla Mining as part of an all-stock transaction to create a North American producer of gold worth $18.5 billion. Orla shares ?dipped 0.7%. Boyd Group shares, which operate autobody and autoglass repair facilities in North America, fell 12% as the company failed to meet analysts' expectations regarding first-quarter sales. (Reporting and editing by Joyjeet Das in Bengaluru, Sruthi Shakar in Bengaluru)
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Europe falling short on replacing Middle East jet fuel imports, IEA says
The 'International Energy Agency' said on Wednesday that Europe's jet fuel supply from the Middle East has plummeted since April and the region is not able to replace those shipments. The IEA reported in a report that Middle East jet fuel supplies to Europe fell from 330,000 bpd per day in March to only 60,000 bpd per day in April. This was due to the Iran War and the effective closure of Strait?of Hormuz. According to the IEA, importing'regions such as Europe' should replace a minimum of 80% and preferably 90% of lost Middle -East import volumes in order to avoid summer shortages. The IEA reported that European jet fuel imports in April were only 70% of the March levels. The European Union increased its imports of jet-fuel from the United States and Nigeria but not enough to compensate for the Middle East's losses. These flows were 221,000?bpd according to?Kpler's data in April. The report stated that "With European inventories reducing at a rapid pace, and Middle East flow still largely 'offline, supply chains are now stretching to cover a much greater gap...In the absence of a near-term solution to the 'Hormuz issue, rebalancing is going to take time." Reporting by Seher DAREEN in London and editing by Alex Lawler & Kirsten Donovan
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The Latvian government has lost its majority in the parliament due to its handling of Ukraine drone incidents
Evika Silina, the Latvian Prime Minister, was left without a majority in the 'parliament' on Wednesday after the 'left-wing Progressives Party' announced that it would withdraw its support. This decision comes after the Progressives' defence minister Andris Spruds was fired at the weekend for his handling of incidents with stray Ukrainian drones that flew into Latvia from Russia. Andris Suvajevs, the parliamentary leader of the Progressive Party, told the media that the current Prime Minister "doesn't have nine votes" from the Progressives after meeting Silina. He added: "Therefore, we?call President Edgars Rinkevics?to?begin the political consultations about the?formation a new government as soon as possible." Suvajevs said that Silina could either resign, or she can wait until the parliament votes her out. The Prime Minister wrote on X she was speaking with her centre-right New Unity Party and the other coalition parties, the Greens & Farmers Union regarding their next steps. The national broadcaster LSM reported that Rinkevics will meet with all the parliamentary factions this Friday. BNS reported that the opposition party United List announced on Wednesday it would vote no confidence against Silina in parliament, and was'ready to lead the next government. (Reporting from Andrius Sytas, Vilnius; Janis Laizans, Riga; editing by Hugh Lawson).
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Rate cut bets are impacted by inflation worries as gold prices continue to fall
The gold price fell a second time on Wednesday, as inflation fears fueled by war weighed down on the expectations of interest rate reductions. Markets were also looking forward to Trump-Xi's upcoming meeting. At 09:05 am EDT (1305 GMT), spot gold fell 0.6%, to $4686.99 an ounce. U.S. Gold Futures rose 0.2% to $4694.70. U.S. Producer Prices increased more than expected during April. They posted their largest gain since early 2022. This is the latest sign that inflation has accelerated amid the Iran War. Peter Grant, senior metals analyst at Zaner Metals and vice president, said that inflation remains "sticky" and therefore, expectations of higher rates for longer were reinforced. This has led to gold's price being pushed up in the last two days. Gold is often seen as a hedge against inflation. However, higher interest rates can put pressure on the metal. Data released on Wednesday revealed that U.S. consumer inflation rose further in April. The annual rate posted its biggest gain in three year. Last month, the U.S. Central Bank left its benchmark interest rate at 3.50%-3.75%. CME Group's FedWatch reports that traders have priced in a rate cut by the U.S. this year. Donald Trump is on his first trip to China as a U.S. President in almost a decade, eager to make deals, maintain the fragile trade truce between?the second-largest economic power and boost public approval ratings that have been hurt by his war with Iran. India raised its import tariffs for gold and silver from 6% to 15% as part of an effort to reduce overseas purchases of metals. This will also help to ease the pressure on India's foreign exchange reserves. India is the second largest consumer of precious metals in the world. Grant stated that the news of higher import duties has caused some?demand worries and could be a long-term headwind. After hitting a session high of two months earlier, spot silver dropped 0.2% to $86.70 an ounce. Platinum fell 0.3%, to $2,120.20 after reaching its highest price since March 17. Palladium fell 0.4% to $1,484.10. Ashitha Shivprasad, reporting from Bengaluru and Alexander Smith, editing)
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India's increased tariffs on gold and silver are unlikely to affect demand
India, which is the second largest gold consumer in the world, raised its tariffs for gold and silver from 6% to 15%, as the Iran war strains New Delhi’s balance of payment. India imports nearly all its gold and has repeatedly tried to reduce consumption. India's weddings and festivals are a major part of its culture, so gold is a necessity rather than merely luxuries. Why is India targeting imports of gold and silver? India's current-account deficit is being impacted by imports of precious metals that New Delhi considers non-essential. The rupee has been impacted by the rising prices of gold and silver, which have increased the bill and led to a widening of external outflows. India spent $84 billion in gold and silver imports during the fiscal year ending March. This is up from $35.5 billion 10 years ago. India is the largest consumer of silver in the world. It's used for jewellery, coins, bars, and industrial applications from solar energy to electronic devices. In the last year, silver ETFs have seen record-high inflows, indicating that investment is driving demand more than jewellery or silverware. Do higher tariffs curb demand? Indian consumers are very price sensitive, and sudden price increases often cause them to delay their purchases. The annual demand for gold has been relatively stable at 666-803 tons on average, even though local prices have risen by 443% in the last decade. The demand remained resilient even when India increased gold import tariffs from 2% to 10% between 2012 and 2013 Buyers are unlikely to stop buying gold because of a tariff increase. Indian households purchase gold to protect themselves against inflation, currency weakness and long-term value. In rural areas, farmers use it for financial protection during times of crisis. Banks and finance companies offer credit in minutes to millions of Indians. Which Gold Demand Segment Will Be Hit Hardest? India's gold consumption is dominated by jewellery demand, which accounts for 75%. The rest comes from investment, in the form of coins, bars, and gold ETFs. The demand for jewellery has already weakened due to high prices. Further increases are likely in the near future and will push buyers toward lower-carat pieces. Investors buy gold to anticipate price increases, while Indians view it as a safe haven and an inflation hedge. The higher tariffs increase?local prices and make gold a more attractive asset. In addition, rising prices can attract new investors who are worried about missing out on future gains. In the March quarter, investment demand for gold exceeded jewellery consumption for first time. Investors turned to the metal due to weak equity returns. Inflows to local gold ETFs are expected to continue rising. Will the TARIFF RISE Spur Gold Smuggling? The latest duty increase has increased the margins of so-called grey markets to 18% from around 9%. New Delhi reduced tariffs in 2024, and the unofficial gold imports dropped sharply. The gold imports dropped from 156.1 tons to 69.2 tonnes in 2024, then further to 20.4 tons in 2020. The margin for smuggling one kilogram of gold is now at a record high 3 million rupees. This creates a greater incentive for gray market operators.
What has been the impact of the Iran War on Middle East countries?
LONDON, MAY 13 - Since the massive Israeli-U.S. airstrikes against Iran began on February 28, the war has ravaged infrastructure and economies in the Middle East and thrown into disarray long-held assumptions about regional security.
In March, Israel launched an invasion of Lebanon and a bombing campaign to pursue Hezbollah militants who had fired across the border as a show of solidarity with Iran.
Here's how certain countries have been affected:
The attacks killed Ayatollah Ayatollah Khamenei, the Supreme Leader of Iran and many other top officials and military generals. However, the ruling system remains as firmly entrenched as before. Khamenei’s son has replaced him and?the Revolutionary Guards are more powerful than ever.
Thousands of Iranians died in six weeks of U.S. and Israeli airstrikes. This included scores of children who were in a school that was hit on the first day of the war.
Although 'the war' began only a few weeks after authorities had killed thousands of protesters to quell a popular uprising there have been very few signs of domestic organised opposition since.
The Iranian closure of the Strait of Hormuz proved effective in deterring further attacks. Iran may still possess over 400 kg (900 lbs) of highly-enriched uranium, which the United States demands it give up.
The U.S. and Israeli strikes on Iranian ports and the blockade have caused massive damages, putting Iran's economy at risk and causing further unrest.
Iran's attacks against Gulf states and Israel’s continuing assault on Lebanon's Hezbollah could also make Tehran more isolated within the region.
ISRAEL
Israel's military has been successful in targeting Iranian military commanders, military installations, and most of the incoming Iranian missiles. However, some have made it through.
The original war goals are still far from being achieved. The?Islamic Republic is still standing. Its long-range missile and drone arsenals remain a threat to Israel, and its nuclear program can still be salvaged.
Israel's strategy in Lebanon has been to inflict heavy losses on Hezbollah, and to create a buffer zone within Lebanese territories. It believes this is vital for the protection of its borders. However, it could lead to an occupation that lasts indefinitely with no prospects of peace.
Israel's decision, coming after the international condemnation of the Gaza conflict that devastated the global economy, to launch a military campaign that hit the global economic system may damage ties with important allies in the West.
LEBANON
Lebanon, with thousands of deaths, has suffered greater damage and losses than any other country. Israel's attack initially forced a quarter the population to leave their homes. Although some people have returned, large swathes in the south are still depopulated and under Israeli control.
Israel continues airstrikes in Lebanon despite an April ceasefire. Israeli invaders have destroyed entire villages in the southern part of Lebanon.
The United States and Israel have increased pressure on the government in order to disarm Iran-backed Hezbollah. This could worsen sectarian tensions in a nation still scarred by the civil war of 1975-1990. The group is deeply rooted among Lebanon's Shi'ite Muslim community, but some other members of the?community resent its role in bringing Lebanon back to war.
UNITED ARAB EMIRATES
The UAE has been hit harder than any of its neighbours by Iran's strikes on Gulf States in response to U.S. and Israeli attacks, including civilian infrastructures and energy facilities.
In response, the UAE has redoubled its efforts to strengthen its ties with Israel and the United States. It normalised their relations with Israel in the Abraham Accords 2020. It has called for a hard line to be taken in any future peace talks with Iran.
The UAE, unlike many of its Gulf counterparts, has a pipeline which allows it to divert oil exports to avoid the blocked Strait of Hormuz. This makes it better able to endure prolonged disruption. The war could damage its position as a regional economic hub that provides security and ease to the region.
SAUDI ARABIA
Saudi Arabia is the largest, wealthiest and most powerful of all the Gulf monarchies. It has a pipeline which allows it to export much of its crude oil from the Red Sea. This allows it to take advantage of high prices and compensate for the loss of shipments that are blocked in the Strait of Hormuz.
The long-term damage caused by the war could undermine Crown Prince Mohammed Bin Salman's Vision 2030 plans, which are the most ambitious economic plans, but have been increasingly scaled back.
The war in the long term has raised serious questions about Riyadh’s foreign and security policies, especially its decades-long reliance on the United States as its main military ally, and its 2023 detente agreement with Iran.
Qatar, despite having built bridges to Tehran, has no export route around the Strait of Hormuz and had to stop production of liquefied gas which is its main source for wealth. Qatar was hit by one of the worst Iranian attacks in response to Israel's attack on Iranian energy targets. The North Field gas facility, which will require years of repair, was severely damaged.
As with other Gulf States, the country hosting the largest U.S. Air Base in the Middle East faces a dilemma over regional security policies once the dust settles. This is especially true if Iran tries to extend its control over Strait of Hormuz.
Houthi, the Iran-aligned group in Yemen that controls the capital and the most populous parts of the country, has remained out of the conflict despite concerns that they could intensify Iran's closing of the Strait of Hormuz if they fired on ships at the mouth of Red Sea -- the other maritime chokepoint of the region.
It is not clear why the Houthis are being so restrained, and their stance may change. It is closer to Iran than Lebanon’s Hezbollah and appears focused on a Yemeni civil war ceasefire with groups supported by Saudi Arabia, its former arch enemy.
The 'economic impact' will be dire, as the Strait of Hormuz closure will cut off most of the oil exports, which represent almost all of the government's income.
Iraq, the only country in this region to be so closely aligned both with the United States as well as Iran since its Shi'ite government was established after the U.S. led invasion in 2003 has been on a difficult path.
Baghdad is increasingly being pressured by Washington to crack down on the powerful Iran-backed militias that have become more assertive.
KUWAIT
Kuwait, another rich energy producer without a route out of Gulf except the Strait of Hormuz has seen its export revenue drop to almost zero. Although it has never been as assertive as Saudi Arabia or the UAE, Kuwait has just as much to gain from a prolonged disruption as any other country. (Compiled by Angus McDowall, edited by Peter Graff.
(source: Reuters)