Abans Group Commodity World Round Up

25 Oct- 29 Oct

1 . ECB's Lagarde sees higher inflation; pushes back on rate-hike bets

Oct 28, 2021

On Thursday, European Central Bank President Christine Lagarde admitted that inflation will remain high for some time, but she rejected market expectations that pricing pressures could prompt an interest rate hike as soon as next year. With central banks around the world signalling tighter policy in reaction to increasing prices, Lagarde said the ECB had done a lot of "soul-searching" about its approach but concluded that inflation was still transient and that a policy response was premature.

Source: Reuters

2 . Saudi Arabia may raise light crude prices to Asia in Dec

Oct 29, 2021

Saudi Arabia, the world's top oil supplier, may hike prices of light crude grades to Asia in December, owing to a rise in distillate margins and spot premiums for Middle Eastern oil this month, according to trade sources. The large range of numbers in the study, they said, indicates uncertainty about how much Saudi Aramco will mark prices based on its pricing formula, as the producer has lowered prices more than expected in recent months to encourage buyers.

Source: Reuters

3 . China’s Economic Planning Body Says Coal Prices Could Fall More

Oct 28, 2021

China's chief economic planner stated on Friday on its official Wechat account that coal prices have room to fall further, citing a recent assessment on production costs. In Zhengzhou, futures prices have plummeted. According to China's National Development and Reform Commission, preliminary results reveal that coal production costs are substantially lower than current spot prices. After examining costs in all production regions and major coal companies across the country, the NDRC came to this conclusion.

Source: Bloomberg

4 . Libya’s Es Sider Oil Output Plunges 72% As Pipeline Leakage Leads To Closure

Oct 29, 2021

Libya's Es Sider crude production has dropped 72% and will continue to drop for the next ten days owing to a pipeline breach that forced its shutdown, as the OPEC producer struggles to maintain its ageing energy infrastructure due to a lack of government funds. Waha Oil Co is now producing 77,000 barrels per day of Es-Sider crude, down from a capacity of 285,000 barrels per day, according to a statement released by the state-owned National Oil Corp. on Oct. 27. Libya produces light sweet Sharara and Es Sider export crudes with a high production of intermediate distillates and gasoline, making them attractive with refineries in Europe and China. Libya has Africa's largest proven oil reserves.

Source: hellenicshippingnews

5 .U.S. natural gas falls near 7% on drop in European prices, big storage build

Oct 29, 2021

On increased output, weaker demand predictions, a large storage build, and a decrease in global gas prices after Russia stated it would export more fuel to Europe for the winter heating season, U.S. natural gas futures plummeted about 7% on Thursday, erasing the previous session's gains. During the week ending Oct. 22, the US Energy Information Administration (EIA) reported that US utilities added 87 billion cubic feet (bcf) of gas to storage. The build was larger than typical for the seventh week in a row. This was in line with the 86 billion cubic feet predicted by analysts in a Reuters poll, and compares to a 32 billion cubic foot increase in the same week last year and a 62 billion cubic foot growth for the prior five years (2016-2020).

Source: hellenicshippingnews.com

6 .U.S. demand for oil surges, depleting tanks in Oklahoma

Oct 27, 2021

Crude oil tanks at the Cushing, Oklahoma storage and delivery centre for US crude futures are more depleted than they have been in the last three years, and pricing of longer-dated oil contracts indicate that prices will remain lower for months. As the economy recovers from the worst of the pandemic, demand for crude has increased among refiners producing gasoline and diesel in the United States. Other countries have turned to the United States for oil barrels due to increased demand throughout the world, which has boosted pulls out of Cushing.

Source: Reuters

7 . Japan's factory output hit by supply snags as outlook darkens

Oct 29, 2021

Japan's manufacturing output fell for the third month in a row in September, owing to a prolonged global supply deficit in the auto sector, heightening the danger of an economic contraction in the third quarter and casting doubt on the recovery. The prognosis for the world's third-largest economy has been clouded by output interruptions across Asia and declining growth in China, which has relied largely on exports to sustain growth as the COVID-19 outbreak damaged domestic demand. Factory output fell 5.4 percent in September compared to the previous month, according to official data released on Friday, owing to lower output of cars and general-purpose machinery. After decreasing 3.6 percent in August and 1.5 percent in July, output shrank for the third month in a row.

Source: Reuters

8 . Australia's central bank loses yield control as bonds melt down

Oct 28, 2021

The Reserve Bank of Australia lost control of the main yield goal for its stimulus policy on Friday, as bonds took their worst beating in decades and markets screamed for rate hikes as soon as April. The Reserve Bank of Australia (RBA) declined to maintain its 0.1 percent objective for the important April 2024 bond, even though its yield was all the way up at 0.58 percent, making an already bad week for debt even worse. Investors were betting that the RBA would end yield curve control (YCC) and its prediction of no rate hikes until 2024 at its policy meeting on November 2.

Source: Reuters