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Financial Times - April 24
These are the most popular stories from the Financial Times. These stories have not been verified and we cannot vouch their accuracy. Headlines UK announces final approval for flagship carbon-capture project Davos founder accused by World Economic Forum of manipulating research Bailey: BoE must "take seriously" the risk of Trump tariffs to growth London Metal Exchange to introduce premium for green metals View the full article The UK government and Italian energy giant Eni will announce the final approval for a 38 mile pipeline that will collect carbon dioxide from industrial facilities around Liverpool and Manchester, and bury it off-shore. The World Economic Forum's founder Klaus Schwab is accused of manipulating the research conducted by his organisation to curry favor with governments. Andrew Bailey, Governor of the Bank of England (BoE), said that the BoE must "take seriously" any risks posed to the growth of the economy by Donald Trump's policies on tariffs. He also indicated that the central banks was likely to reduce interest rates during its next meeting due to the uncertainty surrounding global trade. London Metal Exchange has drawn up plans to introduce a "green premium" for metals mined sustainably. This is in response to industry pressures aimed at distinguishing these from "dirty", more environmentally damaging supplies.
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Dalian iron ore at three-week high due to seasonal demand and US-China trade talks hopes
Dalian iron ore Futures reached their highest level in almost three weeks on March 13, boosted by the hopes that U.S. China trade talks will be successful and seasonal demand for this steelmaking ingredient. The price of the most traded September iron ore contract at China's Dalian Commodity Exchange grew by 2.11%, finishing at 727.5 Yuan ($99.73). In the early part of the session, prices reached 731 yuan - their highest level since April 3. As of 0708 GMT, the benchmark May iron ore traded on Singapore Exchange was 1.61 % higher at $100.2 per ton. In a recent note, Galaxy Futures said that the steel production in China continues to grow and that downstream demand has increased for building materials. "Increased purchases by mills and reduced imports have depleted inventories of iron ore," said ANZ. Mysteel, a consultancy, reported that the stocks of five major carbon products held by Chinese mills had fallen 5% week-on-week on April 17. It attributed this decline to the resilient domestic demand for steel. ANZ added that while China's property indicators have improved, the prospects for a significant recovery are still bleak. Hopes of a reduction in tensions over trade between the United States, and China also boosted sentiment. U.S. Treasury secretary Scott Bessent stated on Tuesday that the trade tensions between China and the United States will be eased, but he called future negotiations a "slog", which hasn't yet begun. U.S. president Donald Trump expressed his optimism that he could make significant progress with China in order to lower their tariffs. India imposed on Monday a temporary 12% tariff on certain steel imports. This is known locally as a "safeguard duty" and was aimed at curbing a rush of cheap shipments coming from China. Coking coal and coke, which are used to make steel, also increased in price, by 2.56% and 3.14 %, respectively. The benchmark steel prices on the Shanghai Futures Exchange rose. Rebar rose by 1.46%. Hot-rolled coil was up 1.41%. Stainless steel and wire rod both increased by 0.39%. $1 = 7.2948 Chinese Yuan (Reporting and editing by Eileen Soreng; Michele Pek)
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Sources say Sinopec has resumed its Russian oil purchases after a short break amid sanctions risk
Sinopec, Asia’s largest refiner, has resumed its purchases of Russian crude oil following a short pause in last month to assess the risks posed by sanctions imposed on Russian entities by the United States, according to trade sources on Wednesday. Sources said that Unipec, a trading division of China's state run Sinopec, had purchased Russian Far East ESPO blend oil for May loading, after being absent from the March and April loading ESPO cargoes. Unipec's decision to resume purchases was not immediately apparent. Sinopec didn't immediately respond to an inquiry for comment. Sources claim that the number of cargoes purchased by Unipec is significantly lower than it was before the January announcement. On January 10, the former Biden administration imposed harsh sanctions against Russian oil producers Gazprom and Surgutneftegaz, as well as insurers and over 100 vessels in order to reduce Moscow's revenue. Last month, it was reported that sanctions had caused a drop in Russian oil exports from China and India while Chinese state oil companies Sinopec Zhenhua Oil and Zhenhua Oil stopped purchasing Russian oil. Traders said that ESPO blend oil cargoes loaded in May were trading at a premium of around $2 per barrel over the ICE Brent benchmark, on a shipped basis to China. Reporting by Siyi Liu and Florence Tan in Singapore, Editing by Andrew Heavens and Kirby Donovan
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Markets take stock of Trump’s U-turns and the relief rally is stuttering
Investors struggled to sort through the noise of the Trump administration, its erratic stance on tariffs, and the Federal Reserve leadership. This week, U.S. president Donald Trump attacked Fed chair Jerome Powell. He then retracted his calls for the resignation of the chair, leaving investors in the dark about the final state of tariffs against China, despite the many headlines. A source said on Wednesday that, in the event of talks with Beijing, the Trump administration may consider lowering tariffs for imported Chinese products. This follows a Wall Street Journal article which stated that Trump's White House was considering reducing tariffs on Chinese imports. Treasury Secretary Scott Bessent said later that such a step would not be taken unilaterally. He was echoing remarks made by White House spokesperson KarolineLeavitt. I don't believe you'll ever be able to get used the flip-flopping and haphazard behavior we've seen. Tony Sycamore is a market analyst for IG. He said that it was extreme. "I think Trump is like that - he wants the best levers and he doesn't fear trying anything. He's not afraid to walk it back either if it fails." MSCI's broadest Asia-Pacific index outside Japan fell by 0.17%. This was in contrast to the Wall Street trend, which saw stocks rise on Wednesday amid hopes of a de-escalation in Sino-U.S. tensions. The Nasdaq 500 and S&P500 futures each rose by about 0.2%. The EuroStoxx 50 futures rose 0.16%. Japan's Nikkei gained 0.86%. NHK reported that the Trump administration informed Japan's trade delegation it couldn't give Japan a special treatment in regards to its tariff measures. This was in response Tokyo's demand for a revision during this month's ministerial talks. Salman Ahmed is the global head of strategic asset allocation and macro at Fidelity. He said: "Short-term volatilities are quite extreme. This high volatility will continue. You have elevated volatility moving forward because the fundamental rules of the game, the economic world, are changing." Ahmed said this on the sidelines the IMAS Investment Conference 2025 and Masterclass in Singapore. Investor confidence in U.S. asset prices remained fragile, and the dollar dropped on Thursday after a week of gains on Trump's U turn on firing Powell. The dollar dropped 0.15% against the yen to 143.24. The euro rose 0.15%, to $1.1331. Meanwhile, the Swiss franc increased by 0.2%. The 30-year yield was little changed, at 4.3675 percent. Trump's change of heart on Powell appeared to lessen the threat to the U.S. fiscal and monetary credibility. The benchmark 10-year rate was down by about 2 basis points, to 4.3675%. Beth Hammack, President of the Federal Reserve Bank of Cleveland, said that on Wednesday there is still a lot of uncertainty about the future. She urged the central bank to be cautious in its monetary policy and to monitor the economy's performance. The markets are expecting a rate cut of about 80 basis points by December. Oil prices have stabilized in other markets after a drop in the previous session. Sources said that OPEC+ will consider accelerating their oil production increases in June. Brent crude futures rose 0.2% to $66.26 per barrel while U.S. Crude also increased 0.18% to 62.38 per barrel. Gold continued its march towards a new record high. The yellow metal rose 1.2% to $3,329.03 per ounce.
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Oil prices steady after 2% decline on possible OPEC+ production increase
Oil prices rose early on Thursday, after falling by nearly 2% the previous day. Investors weighed a possible OPEC+ production increase against contradictory tariff signals from White House as well as ongoing U.S. Iran nuclear talks. Brent crude futures gained 6 cents or 0.09% to $66.18 per barrel at 0038 GMT. U.S. West Texas Intermediate Crude rose 7 cents or 0.11% to $62.34 per barrel. The previous trading session saw prices fall 2% after it was reported that three sources familiar with OPEC+ discussions said several OPEC+ member countries will suggest to the group that they increase oil production for a second consecutive month in June. The members had a dispute over the production quotas. Prices rose on signs that U.S.-China trade talks could be nearing completion. The Wall Street Journal reported the White House was willing to reduce its tariffs against China by as much as 50% to start negotiations. Scott Bessent, U.S. Treasury secretary said that the current tariffs of 145% for Chinese products and 125% for U.S. goods were not sustainable. He did not give a specific number but he stated that they would need to be reduced before any trade talks could take place between both sides. White House Press Secretary Karoline leavitt told Fox News in an interview on Wednesday that the tariffs on Chinese goods would not be reduced unilaterally. Rystad analysts believe that a prolonged U.S. China trade war would cut China's growth in oil demand by half, to 90,000. barrels per day. The Financial Times reported that Trump was also considering tariff exemptions for imports of car parts from China. The U.S. will meet with Iran for a third round this weekend to discuss a possible agreement that would impose restrictions on Tehran's nuclear enrichment program. This could put downward pressure on the oil price. The market is looking for signs that a U.S. and Iran rapprochement may lead to a easing of sanctions against Iran oil, which would boost supply. The U.S. imposed new sanctions on Iran's oil sector on Tuesday, a move that was criticized by the Iranian foreign ministry as demonstrating a lack of "goodwill and seriousness" in regards to dialogue with Tehran. (Reporting Colleen Waye; Editing Sonali Paul).
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Albanese, an Australian company, pledges to establish a strategic reserve for critical minerals
The Australian centre-left Labor Government pledged on Thursday an initial investment A$1.2 billion (roughly $763 million) in order to establish a strategic reserve for critical minerals. It is looking to create a different supply chain within a Chinese dominated market. The Prime Minister Anthony Albanese said that the reserve, which is expected to be established in nine days, would use the mineral deposits of the country and increase its economic resilience. Albanese stated in a press release that "we need to do more" with the natural resources needed by the world, which Australia can provide. After President Donald Trump imposed tariffs against Chinese goods, China placed restrictions on exports of minerals that are vital for everything from smartphones to EV batteries and infrared weapons. This has squeezed supply to the West. China is the top producer in the world of 30 out of 50 critical minerals, according to the U.S. Geological Survey. Australia also has some of its largest deposits of critical minerals. Albanese stated that the government will buy minerals critical to commercial projects, or create an option for a set price and hold security over assets. The government will establish stockpiles for some minerals produced in accordance with offtake agreements. Albanese stated that "it will allow us to deal with market and trade disruptions in a stronger position, as Australia will have access to a significant amount of resources for global demand." Minerals from the strategic reserve will be available to key domestic and international partners. Albanese stated that a task force would be formed to finalise and consult on the scope and design for the strategic reserve. This reserve is expected to become operational in the second quarter of 2026.
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Petrobras Board approves agreement with Unigel for fertilizer plants
Petrobras, the state-run Brazilian oil company, said that its board of directors had authorized it to sign a settlement agreement with Unigel Chemical Company to settle a legal dispute over two fertilizer factories in northeastern Brazil. Petrobras stated in a filing of securities that the agreement would restore Petrobras ownership over two fertilizer factories located in Sergipe state and Bahia state. Petrobras announced that the plants would resume operations after a process of bidding to contract for services to operate and to maintain them. The deal, however, still needs to be approved internally within Unigel, and it must also meet certain conditions before taking effect. Unigel didn't immediately respond to an outside of normal business hours request for comment. Petrobras leased two nitrogen fertilizer factories to Unigel under a 10-year contract in 2019. Unigel has shut down both plants since 2023 citing high gas prices as the reason for their closure. Both companies are involved in arbitration related to their lease agreement, which includes disagreements about the shutdown of the operations, Unigel’s investments and gas supply terms. Announcement comes after Report on Friday According to sources, the Petrobras board approved plans to select partners to restart operations at fertilizer plants. (Reporting andre Romani, additional reporting by Roberto Samora).
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The rosy outlook of chipmaker TI soothes tariff concerns for the moment
Texas Instruments announced a second-quarter revenue forecast that was above Wall Street expectations on Wednesday. The company attributed this to a robust demand for analog chips, despite the fact that the threat of U.S. Tariffs has created uncertainty in the semiconductor industry. TI shares rose more than 5% after-hours following the announcement. This was the first major U.S. semiconductor company to provide an outlook this earnings season. The stock price had dropped over 17% this year due to macroeconomic worries and trade tensions. LSEG data shows that TI estimates revenue for the quarter ending June between $4.17 and $4.53 Billion, compared to analysts' average estimate $4.10 Billion. The earnings per share is projected to be between $1.21-$1.47, which is also higher than the average estimate. Kinngai Chang, senior analyst with Summit Insights Group, says that the positive forecast is driven by "cyclical demand recovery" and possible tariff pull-ins. Haviv Ilan, the CEO of Haviv Group, sounded a cautionary note. On a call after earnings, Haviv Ilan said, "We'll have to wait and see" what happens in the second half 2025, as well as into 2026. He cited ongoing uncertainty regarding tariff policy. According to an April notice by the Chinese main semiconductor association, while President Trump has exempted for now semiconductors from further levies and tariffs, Beijing has imposed high tariffs on U.S. made chips. Analysts asked Ilan if customers were stockpiling the chips in anticipation of expected taxes. I would guess that in a time of uncertainty, you might want to stock up on a bit more inventory. He said. Tore Svanberg, Stifel's analyst, noted that it may be too soon to determine the impact of the increased tariffs and escalating Sino U.S. Trade tensions on the chip company and the industry as a whole due to the ongoing tariff negotiations. CHINA WORRIES TI, a company with significant manufacturing capacity in America, derives about a quarter of its revenue annually from China. This makes it vulnerable to ongoing tit for tat tariffs between Beijing & Washington. Ilan stated that the company could use its manufacturing facility in China to meet any needs. Since years, the legacy chipmakers have worked to adopt a “China-for China” policy. They set up fabs to meet domestic demand in the face of escalating tensions. TI is facing stiff competition in China, where state subsidies have boosted the production of mature-node chips. Ilan stated that "the competition in China has intensified." (Reporting by Arsheeya Bajwa in Bengaluru; Editing by Tasim Zahid)
China action secret to crude oil after new sanctions on Russia: Russell
This time it's various is a wellworn cliché that seems to be getting another try with the most recent U.S. sanctions versus Russia's. petroleum exports.
Oil costs jumped in the wake of the brand-new steps targeted at. avoiding Russia from shipping crude using a so-called dark. fleet of tankers.
It does appear weird a market which has been arguing. because Russia's 2022 intrusion of Ukraine that sanctions are. mostly inadequate, need to unexpectedly change to believing the new. actions are the genuine offer.
What's more likely is that the jump in costs because. President Joe Biden's outbound administration revealed the. sanctions versus more than 160 tankers is short-term, enduring. just as long as it takes to change supply chains.
International benchmark Brent crude futures ended at $82.03. a barrel on Wednesday, the highest close because August last year,. having acquired 6.6% since Jan. 9, the day before the U.S. steps were announced.
The rise has come amidst media reports that refiners in India. and China, the 2 greatest buyers of Russian crude, are. rushing to source option providers for deliveries from. next month onwards.
The International Energy Company stated in a report on. Wednesday the new sanctions cover entities that managed more. than a 3rd of Russian and Iranian crude exports in 2024.
It's likely there might be a short-term squeeze on oil prices. as Indian refiners in particular seek cargoes from other. providers, most likely those in the Middle East and Africa,. whose crude is comparable in quality to Russia's Urals grade.
However the oil market has shown itself to be rather adept at. getting used to any sanctions steps, and this will likely be the. case once again.
It's possible Russia's dark fleet will re-emerge in other. kinds, with brand-new owners or higher use of ship-to-ship transfers.
It's also possible Moscow will reluctantly decide to use. more of its crude at the $60-a-barrel cost cap enforced by. Western countries, rather than offer even more limited volumes.
CHINA IMPORTS
There is another likely short-term circumstance, and China could. simply pare back its unrefined imports and dip into stocks.
China, the world's most significant petroleum importer, has a. reputable pattern of trimming imports when its refiners. take the view that costs have actually risen expensive or too rapidly.
Given the lag of up to two to three months in between when. freights are set up and when they are delivered, this indicates. China's crude imports might moderate from March onwards.
China is already anticipated to see only moderate growth in oil. need this year, with the Organization of the Petroleum. Exporting Countries anticipating a boost of simply 310,000. barrels each day in 2025.
It's definitely the case that China has sufficient oil in storage. to satisfy some its need.
By turning to inventories China can put down pressure on. costs while waiting to see if the new sanctions on Russian. crude are a short-term concern or are undoubtedly a game-changer.
There are likewise other aspects at work which cloud the outlook. for oil costs in the very first half of the year.
U.S. President-elect Donald Trump wishes to tighten sanctions. on Iran, which would be bullish for oil costs.
He also wants to end the conflict in between Russia and. Ukraine, which would be bearish based on the presumption that. Moscow would want sanctions relief as part of any offer.
Trump likewise wants U.S. manufacturers to lift output, something. that may well take place if oil rates do stay raised on concern. over the loss of Russian barrels.
In general, the present rally in unrefined prices runs the risk of. being more short-term than much of the current commentary. recommends.
That said, there are still a myriad of factors to be. careful over the direction of costs, with much hinging on what. the Trump administration actually does once it takes the reins. on Jan. 20.
The views revealed here are those of the author, a writer. .
(source: Reuters)