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April 30th - Sources at the European Central Bank (ECB) said that unless there is positive progress on energy prices and the end of the war with Iran, ECB policymakers are likely to raise interest rates at their next meeting in June. Sources indicated that the likelihood of avoiding a rate hike is very small if the conflict continues. However, they emphasized that no decision has been made yet, and the situation could change rapidly. ECB President Christine Lagarde earlier hinted that the ECB would consider raising rates in June. Previously, the ECB discussed and rejected a rate hike at its meeting on Thursday, keeping the deposit rate at 2%. Officials will receive updated forecasts at the next meeting, and economists and investors expect them to choose a 25 basis point rate hike. Lagarde stated that the next six weeks "will be the right time" to assess the economy "and thus make informed decisions based on verified and re-examined information."Apple (AAPL.O) accused Indian regulators of overstepping their authority in a filing and is seeking a suspension of the antitrust case.April 30th - Sources say the EUs revised semiconductor industry stimulus plan will allow EU executive bodies to directly invest in manufacturing and prioritize the development of new technologies. This proposal, dubbed "The Chip Act 2.0," is expected to be published at the end of May and aims to improve upon the previous version from 2022. Previously, several large-scale chip production projects in Europe were postponed or canceled, and the EUs auditing body stated that the EU is unlikely to achieve its goal of doubling its share of global chip production. Sources indicate that the draft proposes authorizing the European Commission to directly invest in large-scale cross-border projects, whereas previously its function was limited to funding research and approving aid from member states. They stated that projects supported by the European Commission will still be public-private partnerships. Allowing the European Commission to invest directly through grants would make it easier for companies to plan projects across multiple countries simultaneously and could be a simpler way to obtain state funding than applying for state subsidies. Sources also say the new bill will focus on increasing research and development in key chip manufacturing technologies, including mechanics, materials, and circuit boards.The German DAX 30 index closed up 330.65 points, or 1.38%, at 24,274.39 on Thursday, April 30; the UK FTSE 100 index closed up 154.65 points, or 1.51%, at 10,367.76 on Thursday, April 30; and the French CAC 40 index closed up 42.71 points, or 0.53%, at 8,114.84 on Thursday, April 30. The Stoxx 50 index closed up 57.88 points, or 1.00%, at 5874.36 on Thursday, April 30; the Spanish IBEX 35 index closed up 124.07 points, or 0.70%, at 17789.27 on Thursday, April 30; and the Italian FTSE MIB index closed up 422.47 points, or 0.88%, at 48218.50 on Thursday, April 30.According to Ukrainian sources, 18 people have been injured in the Dnipro region due to Russian attacks.

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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