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On February 3rd, Apurva Sheth, Head of Market Views and Research at Samco Securities in India, stated that the market should not have miraculous expectations for a US-India trade agreement. In a report, she pointed out that the US reduction of tariffs on Indian goods to 18% is likely to significantly boost previously subdued market sentiment, as this will allow Indian products to become more competitive in the US domestic market. However, she added that exports to the US account for only a small portion of Indias $4 trillion GDP, and the related boost is expected to be short-lived. Although the Indian benchmark Sensex index rose sharply at the open following this news, Sheth believes that the stock market needs "new long positions to be established" to maintain this upward momentum.Moodys: Indias full shift to non-Russian oil could also lead to supply shortages in other regions, pushing up oil prices and ultimately causing higher inflation.Moodys: U.S. tariff cuts on most Indian goods will revive Indian exports to the U.S.February 3 - It was learned on February 2 local time that the U.S. House Rules Committee passed a government spending bill that evening with 8 votes in favor and 4 against, paving the way for ending the partial government shutdown and proceeding to a full House vote. The bill, which had previously passed the Senate, includes five annual appropriations bills and a two-week temporary funding arrangement for the Department of Homeland Security (DHS) to allow Congress to continue negotiating on immigration enforcement-related disagreements.February 3rd, Futures Market News: Zhengzhou rapeseed meal futures opened flat and then fluctuated downwards. Canadian canola futures closed lower, with the benchmark contract down 0.46%, mainly dragged down by declines in international crude oil futures and Chicago soybean oil. Rapeseed meal spot prices followed suit, with Guangxi oil mills beginning to crush Australian canola. The market anticipates a gradual easing of the tight rapeseed meal supply situation, coupled with the end of pre-Chinese New Year stockpiling, suggesting downward pressure on rapeseed meal prices.

Oil costs increase as supply restrictions trump economic worries

Charlie Brooks

Jul 05, 2022 11:12


Oil prices climbed on Monday as supply worries spurred by a decrease in OPEC production, unrest in Libya, and sanctions against Russia trumped fears of a worldwide recession that would diminish demand.


In June, Euro zone inflation hit an all-time high, boosting the case for rapid rate rises by the European Central Bank, while consumer sentiment in the United States reached an all-time low.


Brent oil rose $2.26, or 2%, to $113.89 a barrel as of 12:47 p.m. ET (1648 GMT), after shedding more than $1 in early trading. The price of U.S. West Texas Intermediate (WTI) crude rose $2.20, or 2%, to $110.63 despite the lack of trading activity over the Fourth of July holiday.


According to a Reuters survey, the Organization of the Petroleum Exporting Countries (OPEC) failed to meet its June goal of increasing production.


Thursday, authorities in OPEC member Libya declared force majeure at the Es Sidr and Ras Lanuf ports and the El Feel oilfield, claiming a reduction of 865,000 barrels per day in oil output (bpd).


Meanwhile, more than two weeks of unrest have caused Ecuador to lose almost 2 million barrels of production, according to Petroecuador, the country's state-owned oil company.


This week, a strike in Norway may restrict supply from the biggest oil producer in Western Europe and reduce overall petroleum production by 8 percent.


"This background of rising supply interruptions clashes with a probable shortage of spare production capacity among Middle Eastern oil producers," said Stephen Brennock of oil trader PVM, referring to the producers' limited ability to pump more oil.


And prices will climb if new oil production does not reach the market shortly.


On Monday, British Prime Minister Boris Johnson asked OPEC+ to raise oil output to tackle the growing cost of living.


As a consequence of Russia's invasion of Ukraine, supply concerns have sent Brent oil prices close to 2008's record high of $147 a barrel.


As a consequence of restrictions on Russian oil and limited gas supplies, surging energy prices have driven inflation in certain countries to multi-decade highs and stoked fears of a recession.


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