— Brent crude oil fell 0.3% to $93.09 a barrel.
— European benchmark gas fell 2.2% to 169.85 euros per megawatt hour.
— Gold futures are up 0.2% at $1,723.60 a troy ounce.
— Three-month copper rose 0.4% to $7,732 per metric ton.
— Wheat futures fell 1% to $8.93 a bushel.
U.S. gasoline prices are climbing again and could get worse
U.S. gasoline prices are rising after about a 100-day decline, threatening to inflict further pain on consumers who have been battling widespread inflation for more than a year.
Maintenance at fuel manufacturing plants, increased demand for gasoline and tight fuel supplies contributed to a 14-day streak of rising gasoline prices. A gallon of regular fuel averaged about $3,831 on Wednesday, according to OPIS, an energy data company that’s part of Dow Jones & Co., publisher of The Wall Street Journal.
Wednesday’s decision by the Organization of the Petroleum Exporting Countries and its Russian-led allies to cut oil production by 2 million barrels a day will push prices even higher, analysts said. The White House, calling the decision short-sighted, said it would explore measures to protect American consumers.
Shell braces for profit on natural gas price volatility and rising costs
Shell PLC said it expects its third quarter earnings to be hit by “significantly lower” gas trading profits due to market volatility as well as higher fuel delivery costs in a context of a global scramble for energy supplies.
The London-based company said on Thursday that price and cost swings due to liquefied natural gas shortages would likely squeeze profits from its huge gas business, usually its largest source of cash. But Shell said its overall marketing profits from trading oil and other products were higher in the third quarter compared to the previous quarter. The comments came in a preview of Shell’s full third-quarter earnings, due later this month.
Norway to increase tax on oil and gas sector next year
The Norwegian government announced on Thursday that it would reduce a tax incentive for the oil and gas sector introduced during the Covid-19 pandemic, which is expected to increase tax revenue by 2 billion Norwegian kroner ($189.8 million). in 2023.
The temporary tax rules were intended to encourage continued investment in the sector during the pandemic as oil prices fell sharply, but have since rebounded considerably, so the rules now need to be adjusted, the finance ministry said. of the country in a release in conjunction with the 2023 national budget.
Saudi Arabia leaves Asian oil prices unchanged
Saudi Arabia left prices for its benchmark light crude sold to Asian customers unchanged for November, but lowered prices for European buyers, the national oil company said Thursday.
Saudi Arabian Oil Co., the state-owned oil giant, left the price of its Arab Light crude sold in Asia at a premium of $5.85 a barrel to the average of benchmarks from Oman and Dubai.
Prices for European buyers were lowered by $1.80 a barrel at a premium of $0.90 a barrel to the benchmark ICE Brent index.
Thungela Resources warns of potential impact of transport strike
Thunela Resources Ltd. said on Thursday that a strike at Transnet SOC Ltd. started today is likely to affect rail and port services, and will disrupt rail operations to the Richards Bay Coal Terminal.
The London-listed South Africa-based coal export company – a spin-off of Anglo American PLC – said previous rail constraints had resulted in relatively high inventory levels and operations could run rail-free for an additional seven days without affecting manufacturing.
If the strike continues for two weeks, the group would be forced to cut production, leading to a potential reduction of 300,000 tonnes of salable production for export, the company said.
Europe’s metals industry could see permanent scars from the energy crisis
10:30 GMT – The energy crisis in Europe has dented production and demand for metals on the continent and the effects could be more permanent than first thought, analysts at Morgan Stanley Research say. While destocking and slowing demand – two temporary drivers – exaggerate the decline, a more permanent “shock” could emerge from higher energy prices for longer, analysts at the bank said. They estimate that currently 10% of steel capacity and 28% of aluminum capacity are idle. The permanent shock would be felt in a lack of competitiveness of industry in Europe, with migration to regions where energy prices are lower, they add. “Protectionist policies could only partially cushion the impact.” ([email protected])
Emissions are considered the most important ESG issue
10:15 GMT – Emissions of carbon dioxide and other greenhouse gases are the biggest issue impacting company value across all industries, Citi analysts say in a research note. Analysts mapped 3,000 stocks against the sustainability issues considered most financially relevant according to the standards of the Sustainability Accounting Standards Board. Overall, emissions is the ESG issue that stands out as the most important for investors to consider, says Citi. However, there remain nuances between sectors, he notes, adding that social issues are generally considered more important in the retail space compared to environmental issues. ([email protected])
Rise in palm oil prices; Could trade sideways ahead of key data
1010 GMT – Palm oil prices rose as market sentiment improved. The price of edible oil may continue to trade around MYR 3,400 to MYR 3,700 per metric ton ahead of the release of supply and demand data from the Malaysian Palm Oil Board this week. next, said Abdul Hameed, sales manager in Pakistan. Manzoor trade. Falling palm oil stocks in Indonesia and expectations of higher demand in November should also continue to support the price of the commodity, it adds. The benchmark contract for December delivery closed MYR59 higher at MYR3,701 per tonne. ([email protected])
ArcelorMittal looks unlikely to avoid a weaker 2H
0904 GMT – ArcelorMittal’s idling of European blast furnaces in an attempt to temper falling demand has come at a faster pace than expected, and the Luxembourg steelmaker is unlikely to avoid profit cuts in the second semester, according to UBS analysts in a research note, reducing their rating on the stock to neutral from the buy. Lower volumes expected in Q3, Q4 and H1 2023, combined with European hot-rolled coil prices falling by around 45% since March, will hurt business performance, especially in Q4 quarter, according to them. Analysts say the Q3 consensus is now too bullish and that due to deteriorating demand expectations and likely increased capital spending in 2023, ArcelorMittal may be constrained in its ability to initiate new growth. new short-term buybacks. The bank lowers its target price on the share to 23 EUR against 27 EUR. ([email protected] )
Rise in metals during macro recovery
0722 GMT – Metals prices rise as traders once again turn to risky assets amid tepid signs of a macroeconomic recovery. Three-month copper is up 1.8% at $7,840 per metric ton while aluminum is up 1.3% at $2,386.50 per ton. Gold is also up 0.6% at $1,730.70 per troy ounce. “The macro environment is on the bullish side of the ledger for the first time in four weeks,” said Dave Whitcomb, head of research at Peak Trading Research, in a note. Stocks and oil rallied while industrial metals also rose, another green light for risky commodities, he said. That said, all eyes remain on Friday’s nonfarm payrolls data and how that is influencing sentiment. ([email protected])
Oil soars after OPEC+ supply quota cut
07:48 GMT – Oil prices rise, adding to Wednesday’s gains after OPEC+ approved its biggest cut to production targets since 2020. Brent crude adds 0.3% to $93.64 a barrel and is up 10% this week. OPEC+ said it would cut production targets by two million barrels a day, citing weakening global economies and tighter central bank policy. As OPEC+ is already producing below its targets, the actual reduction would likely be closer to 1 million barrels per day. Yet the oil market is already tight and is expected to tighten further when an EU embargo on Russian oil comes into effect later this year. “This is a significant number given unprecedented tension,” SPI Asset Management said in a note. ([email protected])
Increased Cocoa Production in Ghana Could Ease Market Tensions
05:30 GMT – A rebound in cocoa production in Ghana is expected to ease global market tensions in 2023 and lower prices, according to Fitch Solutions. Ghanaian production of the key chocolate ingredient is likely to increase by 18% year-on-year to reach 825,000 metric tons in the 2022-23 marketing year, recovering from a 33% plunge l ‘last year. Fitch expects cocoa prices to fall to $2,380/tonne in 2023, from the current estimate of $2,440/tonne for 2022, but notes that demand growth will likely outpace demand growth. short-term production. “We consider the risks to our price outlook to be on the upside, despite the strength of the dollar and an uncertain outlook for growth in the global economy and consumer demand,” Fitch said. ([email protected]; @Nicholasbariyo)
Write to Yusuf Khan at [email protected]