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Saudi Arabia cuts prices on the back of US stockpile building
The oil prices fell in the early hours of Thursday's trading after an increase in gasoline and diesel stocks in the United States and Saudi Arabia lowering its July crude prices for Asian buyers. Brent crude futures dropped 21 cents or 0.3% to $64.65 per barrel at 0047 GMT. U.S. West Texas Intermediate Crude lost 29 cents or 0.5% to drop to $62.58. The price of oil closed about 1% lower Wednesday, after data revealed that U.S. gasoline stocks and distillate inventories grew more rapidly than expected. This was due to a weaker demand for the top economy in the world. Saudi Arabia, which is the largest oil exporter in the world, has cut its crude oil prices to Asian buyers by nearly 40% since July. Saudi Arabia's price cut, a key oil producer in OPEC+ – the oil producing group which includes members of the Organization of the Petroleum Exporting Countries (OPEC) and their allies like Russia – follows the OPEC+ decision over the weekend to boost production by 411,000 barrels a day for the month of July. Reports state that Saudi Arabia and Russia, the two leaders of OPEC+, are pursuing a strategy to punish producers who overproduce and regain market share. The European Union and Canada both reported that they had made progress in their trade negotiations as the new U.S. tariffs on metals caused more disruption to the global economy. In a recent note, Ole Hansen of Saxo Bank stated that "Uncertainty fueled by President Trump's changing stance on tariffs" has increased fears of an economic slowdown. (Reporting from Tokyo by Katya Glubkova; editing by Tom Hogue).
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Ukraine and the U.S. discuss ways to make a minerals fund operational within a year
Ukraine's Yulia Shvyrydenko said that the United States and Ukraine have discussed ways to make the minerals fund operational before the end of this year. The fund's initial meeting is scheduled for July. Svyrydenko signed the agreement in Washington, after months of hard negotiations, which made the terms more favorable for Kyiv. The agreement was heavily promoted by U.S. president Donald Trump. The Ukrainian parliament then ratified this agreement. Svyrydenko met with U.S. Treasury Sec. Scott Bessent on Wednesday and the Development Finance Corporation which will be the partner of the Minerals Fund. "We discussed very concrete steps to make this fund functional during this year," Svyrydenko told reporters. We will have our first board meeting in July to discuss the seed capital needed to operate this fund. We should also adopt the investment strategies for this fund over the next few decades. Negotiations leading to the signing of the Mineral Fund deal were preceded by a heated discussion between Trump and Ukrainian president Volodymyr Zelenskiy at the White House about how to end Ukraine's war with Russia, which has lasted for three years. Zelenskiy's ability to repair his relationship with Trump was dependent on the agreement. In April, the two men briefly met at the Vatican during the funeral for Pope Francis in order to get their relationship back on track. Reporting by Gram Slattery, Costas Pitas and SonaliPaul; Editing by Ron Popeski & SonaliPaul
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UN: Southwest Pacific to be hit by unprecedented marine heatwaves in 2024
The UN's weather agency said that in 2024, unprecedented heat waves in Southwest Pacific will affect more than 10% the surface of the ocean, damaging coral reefs, and placing the last tropical glacier in the region at risk of extinction. In an annual report, the World Meteorological Organization stated that the average 2024 temperature in the region (which includes Australia and New Zealand and southeast Asian island countries like Indonesia and the Philippines) was nearly half a degree Celsius higher than the mean temperatures between 1991 and 2020. Blair Trewin of WMO, who is one of the authors of the report, said that "much of the region experienced at least severe conditions of marine heat waves at some point in 2024," particularly near and south the equator. The report stated that extreme heat in 2014 affected 40 million square kilometers (15.4 million sq miles) of ocean and new temperatures were recorded in Australia and the Philippines. Ocean surface temperatures broke records as well, and the total heat content of the ocean was second highest on average behind 2022. In October and November, the Philippines was also hit by an unprecedented number of cyclones that experts attribute to climate change. The report also noted that sea levels are continuing to rise faster than the global average. This is an urgent issue in a region with more than half of its population living within 500 metres (547 yards), or less, from the coast. Satellite data also showed that the only tropical glacier in the region, located on the western side of New Guinea island, Indonesia, shrank up to 50% during the past year. Thea Turkington of the WMO, one of the authors of the report, said: "Unfortunately, the rate of glacier loss is so high that this glacier may disappear by 2026, or soon thereafter." (Reporting and editing by Stephen Coates; David Stanway)
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Peru restarts mining operations in the violence-hit North
Walter Astudillo, the Defense Minister, said that Peru has resumed formal mining operations for parts of northern Peru affected by violence. Dina Boluarte, the president of Colombia, suspended mining operations in her country last month after illegal miners kidnapped 13 gold workers and killed them. The incident occurred in the district of Pataz located to its north. Peru is the third largest copper producer in the world. Most of its red metal deposits are found in the southern part of the Andean country, while gold and other precious metals are mined to the north. Astudillo stated that the decision to resume operation was made after discussions with Pataz authorities and formal mining companies. He also noted the importance of the sector to the local economy. He said that the public was demanding mining activities at a post-cabinet meeting press conference. The minister said that the government has extended the state-of-emergency in Pataz by another 60 days. This will allow the armed forces take control of the region. Companies and small-scale or artisanal miners who have valid permits will be able to resume mining operations. The REINFO program allows temporary activities while formalization is completed. He added that activities will be allowed from 5 am to 10 pm local time. (Reporting and writing by Marco Aquino, editing by Sarah Morland, Alistair Bell and Sarah Morland)
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China's new tracking system increases scrutiny of rare earth magnets
Three sources confirmed that China has implemented a tracking system in its rare earth magnet industry, as export restrictions are beginning to isolate customers from around the globe. Two sources briefed on the issue and two others familiar with it said that the national tracking system went into effect this week and requires producers to provide extra information online, including trading volume and client names. China, the world's biggest rare earth magnet exporter and supplier, in April, placed export restrictions on several magnets and seven medium-to-heavy rare earth elements. Exporters were required to obtain licenses. The delays in getting approvals has disrupted supply chains, affecting automakers, semiconductor firms and others. Global automakers have already begun to shut down some production lines, as they run out of reserves. Beijing announced high-level plans in June to create an information tracking system for rare earths products. However, the subject was not mentioned again until this week, according to a source familiar with the issue. China's export restrictions on rare earths, magnets, and other products - in which it has a near monopoly - may become permanent. In the U.S., and elsewhere, there was hope that this would be eliminated as part of the trade truce reached in Geneva last week. Exports tend to gradually rebound in cases where China has placed export restrictions on metals. This is because exporters have applied for and received licences. Tim Zhang, the founder of Edge Research in Singapore, said: "Our current hypotheses is that China will continue to control its exports on rare earths as it's an ace card China can hold." Beijing's goal is to strengthen its control of the sector and crackdown on illegal mining, smuggling and tax evasion. A fourth source, who was also briefed about the issue, said that Beijing has a long-term plan to track all rare earth production chains, not just magnets.
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US stock market ends mixed as Treasury yields fall amid trade negotiations and jobs data
Wall Street was a little shaky and U.S. Treasury rates dropped on Wednesday, as investors watched the U.S. Trade Negotiations and looked forward to Friday's important employment report. The Nasdaq was modestly boosted by tech, while S&P 500 closed the session basically flat and the Dow ended slightly lower. The dollar dropped and gold rose. Ross Mayfield is an investment strategy analyst with Baird, based in Louisville, Kentucky. He said that the big rate move has provided some relief, if not directly for stocks, then at least to those who have been trying to explain why rates are moving higher. The equity markets are relieved that rates still seem to have a limit in this type of environment. The U.S. and European trade talks are moving forward, Europe's chief negotiator stated. He noted that the doubling in U.S. tariffs on metals, which took effect Wednesday, does not help negotiations. China's restrictions on vital mineral exports has upset global automakers who claim shortages could halt global supply chain. Trump, who is expected to meet with Chinese President Xi Jinping soon, called Xi "extremely difficult to deal with" in a post on social media. This suggests that a quick resolution of the trade dispute between the two world's largest economies may prove elusive. Investors remain confident or as confident as possible that the administration will not let things go too far. Mayfield said that the administration would not return to its April 8 low. Mayfield stated that "I do not necessarily believe that the TACO trade (Trump Always Chickens Out), is wrong. It's obviously a joke. But there are enough signs that suggest that if the Trump administration reverts to their worst tendencies in trade and tariffs then the market would react accordingly." ADP, a payroll processor, reported that the U.S. Private Sector added 37,000 new jobs in the last month. This is 69.2% less than what analysts expected to see on Friday from the Labor Department, which will release a more comprehensive report. Survey data also showed that the U.S. service sector contracted last month. Prices paid, an inflation indicator, reached their highest level since November 20,22. The Dow Jones Industrial Average dropped 91.90, or 0.22 %, to 42 427.74. The S&P 500 rose by 0.44, or just 0.01% to 5,970.81 while the Nasdaq Composite increased 61.53, or 3.32 %, to 19,460.49. After Berlin approved a tax relief package for corporations, European stocks rose and Germany’s benchmark index reached a new record high. This was despite survey data showing that euro zone business activity is stagnating and Germany’s services sector has posted its biggest contraction in over two years. The MSCI index of global stocks rose by 2.85 points or 0.32% to 888.75. The pan-European STOXX 600 Index rose by 0.47% while Europe's broad FTSEurofirst 300 Index rose by 9.84 points or 0.45% Emerging market stocks increased 14.71 points or 1.27% to 1,172.84. MSCI's broadest Asia-Pacific share index outside Japan closed up 1.3% at 618.16. Japan's Nikkei gained 300.64 or 0.80% to 37,747.45. Dollars fell across the board, as a series of downbeat economic reports suggested a softening in labor market conditions. The services sector also showed signs of contraction. The dollar index (which measures the greenback in relation to a basket of currencies, including the yen, the euro and others) fell by 0.29%, falling to 98.87. Meanwhile, the euro rose 0.36%, reaching $1.1411. The dollar fell 0.78% against the Japanese yen to 142.87. The yields on longer-dated U.S. Treasury bonds fell after the weaker-than-expected data. Investors looked for signs of progress with tariff negotiations, and were looking ahead to the payrolls reports. The yield on the benchmark 10-year U.S. notes dropped 10.1 basis points from 4.46% at late Tuesday to 4.359%. The 30-year bond rate fell by 10.2 basis points, from 4.983% to 4.8806% late on Tuesday. The yield on the 2-year bond, which is usually in line with expectations of interest rates for the Federal Reserve fell by 8.6 basis points, to 3.871% from 3.957% at late Tuesday. Crude oil prices fell as U.S. inventories were higher than expected, adding to the supply concerns amid tensions in trade and OPEC+ production increases. U.S. crude fell 0.88%, settling at $62.85 per barrel. Brent closed at $64.86 a barrel, down by 1.17% for the day. The gold price rose, supported by a soft dollar. Investors waited for employment and trade data. Spot gold increased by 0.62%, to $3372.86 per ounce. U.S. Gold Futures rose by 0.64% to an ounce of $3,371.50.
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The Nazca Lines in Peru are now at risk of mining after a protected area was slashed
The Peruvian government has reduced the area of protected land around the famed Nazca Lines. Critics and archaeologists are concerned that this could make the ancient geoglyphs more vulnerable to nearby informal mining operations. The Peruvian Culture Ministry reduced the protected area from 5,600 square kilometers to 3,200 last week. It attributed the decision to topographical studies and archeological investigations that better delineated areas of "real patrimonial values." Over 800 large desert etchings depicting animals, geometric figures, and plants were created over 1,500 years ago. UNESCO designated them a World Heritage Site in 1994. According to the Energy and Mines Ministry, 362 small scale gold miners are operating in the Nazca District as part of the program to regularize the status. The authorities have conducted previous operations to combat illegal mining. Pieter Van Dalen is the head of Peru's archaeological association. He said that the main threat to the Nazca Lines was informal mining in the surrounding area and within the protected zone. He described the reduction as "very regrettable" and questioned the claim that the original area had been too large to be controlled. Police and industry sources claim that with gold prices at record highs, the government's program to regulate small-scale mining (known as REINFO) is riddled with irregularities. Illegal miners are also accused of exploiting REINFO in collusion with criminal groups. Congress and the Administration are scrambling to come up with a new program that will close operating loopholes. The small-scale miners protested against an earlier deadline because they feared that there would be little time for them to normalize their operations. According to the government, illegal mining in Peru generates revenue of more than $3 billion per year, which is greater than that generated by drug trafficking. On Tuesday, Energy and Mines minister Jorge Montero confirmed that small-scale mining takes place in Nazca. He said that the government was "evaluating the impact of this (reduction) on the status of small scale and artisanal miners working in the area which used to be part of Nazca’s (protected zone) but is now not." Peru's gold exported in 2024 will be $15.5 billion, up from the $11 billion of the previous year. According to data from the industry and Peru's financial regulator, around 40% of Peruvian gold exports come from illegal sources. (Reporting and editing by Aurora Ellis; Marco Aquino)
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US stocks rise, Treasury yields fall as investors focus on tariff talks and jobs data
Investors watched the U.S. Trade Negotiations and awaited Friday's important employment report. The dollar fell and gold remained unchanged. Ross Mayfield is an investment strategy analyst with Baird, based in Louisville, Kentucky. He said that the big rate move has provided some relief, if not directly for stocks, then at least to those who have been trying to explain why rates are moving up. The equity markets are relieved that rates still seem to have a range of possible increases in this type of environment. U.S.-European The top European negotiator noted that trade talks were progressing. He also pointed out that the U.S. tariffs on metals have doubled since Wednesday. This is not helping negotiations. China's restrictions on vital mineral exports has caused concern among global automakers. They warn that shortages could disrupt global supply chains. Trump, who is expected to meet with Chinese President Xi Jinping soon, called Xi "extremely difficult to deal with" in a post on social media. This suggests that a quick resolution to trade disputes between the two world's largest economies may prove elusive. Investors remain confident, or as confident as possible that the administration will not let things go too far. Mayfield said that the administration would not return to its low point of April 8. I don't think that it is necessary to believe in the existence of God. (Trump always chickens out) trade is wrong. Obviously, it's just a joke. But there are enough signs that suggest if the Trump administration returns to their worst tendencies in terms of trade and tariffs then the market would react accordingly," Mayfield said. ADP, a payroll processor, reported that the U.S. Private Sector added 37,000 new jobs in the last month. This is 69.2% less than what analysts expected to see on Friday from the Labor Department, which will release a more comprehensive report. Survey data also showed that the U.S. service sector contracted last month. Prices paid, an inflation indicator, reached their highest level since November 20,22. The Dow Jones Industrial Average increased 18.57 points or 0.04% to 42,537.23. The S&P 500 gained 12.69 points or 0.21% to 5,982.97, and the Nasdaq Composite rose 84.52 or 0.44% to 19,483.48. After Berlin approved a tax relief package for corporations, European stocks rose and Germany’s benchmark index reached a new record high. This was despite survey data showing that euro zone business activity is stagnating and Germany’s services sector has posted its biggest contraction in over two years. The MSCI index of global stocks rose by 4.25 points or 0.48 percent to 890.15. The pan-European STOXX 600 Index rose by 0.47% while Europe's broad FTSEurofirst 300 Index rose by 9.84 points or 0.45%. Emerging market stocks increased 14.85 points or 1.28% to 1,172.98. MSCI's broadest Asia-Pacific share index outside Japan closed up 1.33% at 618.30. Japan's Nikkei gained 300.64 points or 0.80% to 37,747.45. Dollars fell across the board, as a series of downbeat economic reports suggested a softening in labor market conditions. The services sector also showed signs of contraction. The dollar index (which measures the greenback in relation to a basket of currencies, including the yen, euro and pound sterling) fell by 0.38%, falling to 98.79. At $1.1421, the euro rose 0.45%. The dollar fell 0.82% against the Japanese yen to 142.82. The yields on longer-dated U.S. Treasury bonds fell after the weaker-than-expected data. Investors waited for any signs of progress with tariff negotiations, and also looked forward to the payrolls report. The yield on the benchmark 10-year U.S. notes dropped 9.5 basis points from 4.46% to 4.365% late on Tuesday. The 30-year bond rate fell by 9.5 basis points, from 4.983% to 4.8877% late on Tuesday. The yield on the 2-year note, which is usually in line with expectations of interest rates for the Federal Reserve fell by 8.2 basis points, from 3.957% to 3.875%, late Tuesday. Crude oil prices fell as U.S. inventories were higher than expected, adding to the supply concerns amid tensions in trade and OPEC+ production increases. U.S. crude fell 0.88%, settling at $62.85, while Brent closed at $64.86 a barrel, down by 1.17% for the day. The gold price rose, supported by a soft dollar. Investors waited for employment and trade data. Spot gold increased 0.7% to $3.375.59 per ounce. U.S. Gold Futures increased 0.64% to an ounce of $3,371.50.
VEGOILS - Palm oil prices rise as Dalian Oils firm and India cut import duties on crude edible oil
The price of Malaysian palm oil futures increased on Tuesday as a result of the stronger Dalian edible oil market, and India's reduced basic import tax for crude edible oils.
By midday, the benchmark contract for palm oil delivery in August on the Bursa Derivatives exchange had gained 89 Ringgit or 2.29% to $3,967 Ringgit ($934.07) per metric ton.
The Chinese edible oil market is a major driver of palm oil futures, and the demand outlook has improved since India, the largest importer of crude edible oils, announced a decrease in import duties.
India reduced the basic import duty on crude edible oil to 10%, Friday. The country is trying to lower food prices and support the local refinery industry.
Lim added that a recent increase in crude oil price has increased palm's appeal for use as a feedstock for biofuel, which is contributing to the bullish sentiment.
Dalian's palm oil contract, which is the most active contract, gained 1.53%. Chicago Board of Trade soyoil prices rose 0.3%.
As palm oil competes to gain a share in the global vegetable oil market, it tracks price changes of competing edible oils.
According to AmSpec Agri Malaysia, an independent inspection company, exports of Malaysian products containing palm oil rose by 13.2% in May. Intertek Testing Services, a cargo surveyor, said that the increase was 17.9%.
Data from the Statistics Bureau showed that Indonesia exported 6,41 million metric tonnes of crude and refined Palm Oil in the period January to April, a decrease of 5.37% compared to the previous year.
Prices rose on supply concerns, as Iran is set to reject the U.S. proposal for a nuclear deal that would ease sanctions on the country's largest oil producer. The dollar was also weaker, which helped to support prices.
Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger.
Technical analyst Wang Tao stated that palm oil is neutral within a small range between 3,860 and 3,886 ringgits per metric ton. An escape from this narrow range could indicate a direction.
(source: Reuters)