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July 8th - According to CNN, citing three sources familiar with the decision-making process, prior to the February 28th attacks on Iranian targets, senior U.S. military commanders ignored warnings in key databases that intelligence regarding potential Iranian targets was severely outdated and approved multiple strikes, including an attack on an Iranian girls school that killed nearly 200 children and adults. The sources stated that the system contained warnings indicating that the intelligence was based on data from years ago and needed to be reviewed, and that adding targets to the strike list required approval from senior officers. Two of the sources indicated that senior commanders ignored the warnings for "efficiency reasons," as identifying targets was urgently needed in the early stages of a war, but this directly led to the mistaken bombing of the school. This attack is one of the deadliest civilian casualties in recent U.S. military operations.July 8th - According to Iranian state television today (July 8th), the US attack on Sirik in southern Iran has resulted in multiple injuries. Iranian President Pezechzian, who had just arrived in the Iraqi Shiite holy city of Najaf a few hours earlier, has left Iraq and returned home ahead of schedule. Pezechzian was scheduled to attend the funeral service for the late Iranian Supreme Leader Ali Khamenei in Iraq today.Bahrains Foreign Ministry condemned Irans attacks on Saudi and Qatari oil tankers, calling the incidents a "serious violation of international law" and a threat to maritime security and global energy supplies.1. All three major U.S. stock indexes closed lower. The Dow Jones Industrial Average fell 0.25% to 52,925.15 points, the S&P 500 fell 0.45% to 7,503.85 points, and the Nasdaq Composite fell 1.16% to 25,818.69 points. Caterpillar fell more than 3%, Honeywell International fell more than 2%, leading the decline in chip stocks, with the Philadelphia Semiconductor Index falling 4.65% and Intel falling more than 9%. The Wind U.S. Tech Big Seven Index fell 0.01%, Tesla fell more than 4%, Facebook rose more than 2%, and SpaceX fell nearly 7%. 2. The three major European stock indexes closed mixed. The German DAX fell 1.37% to 25,465.25 points; the French CAC40 fell 0.51% to 8,436.24 points; and the UK FTSE 100 rose 0.13% to 10,665.88 points. 3. The WTI crude oil futures contract rose 5.32% to $72.2 per barrel; the Brent crude oil futures contract rose 5.49% to $75.94 per barrel. 4. International precious metals futures generally closed lower. COMEX gold futures fell 1.22% to $4116.60 per ounce, and COMEX silver futures fell 3.09% to $60.41 per ounce. 5. Most London base metals fell. LME aluminum rose 0.75% to $3139.0 per tonne, LME lead rose 0.40% to $1887.5 per tonne, LME tin fell 0.12% to $53000.0 per tonne, LME copper fell 0.51% to $13334.5 per tonne, LME zinc fell 0.56% to $3571.0 per tonne, and LME nickel fell 0.90% to $16275.0 per tonne.According to Iranian state television, Iranian President Peshizian has left Iraq and returned to Iran after the United States launched airstrikes on southern Iran.

WTI crude oil drifts above $80.00 amidst a US Dollar rebound and supply shortage concerns

Alina Haynes

Apr 10, 2023 14:16

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In the early hours of Monday, purchasers of WTI crude oil struggled to maintain the price above $80.70 as risk aversion and hawkish Fed forecasts bolstered the US Dollar. However, threats to Oil supplies, primarily emanating from China and OPEC+, appear to keep purchasers of black gold optimistic.

 

US Dollar Index (DXY) reverses a four-day downtrend near 102.25 despite the inability of US Treasury bond yields to recover due to recession concerns. However, US 10-year and 2-year Treasury bond yields remain under pressure near 3.37 percent and 3.95 percent, respectively. In doing so, the benchmark bond coupons extend the previous day's losses and illustrate the market's flight to protection in response to concerns of an economic decline.

 

In spite of this, the recent disappointing US data reignite concerns of a recession in the world's largest economy and challenge the optimists in the energy sector. However, the positive US Nonfarm Payrolls (NFP) data enabled Fed hawks to return to the table and renew demands for a 0.25 percentage point rate hike in May. The same constrains the value of the US dollar and stimulates demand for WTI crude oil.

 

On the other hand, geopolitical concerns surrounding China, particularly after the dragon nation's military exercises near Taiwan, combine with last week's unexpected OPEC+ production cut to keep Oil purchasers optimistic.

 

China's willingness to defend the global economy through robust monetary and fiscal easing at home also enables Oil purchasers to maintain optimism in the face of optimism among the world's largest Oil consumers.

 

The Easter Monday holiday in spot markets may limit Oil price movements, but the investors appear to be out of steam, so US inflation and Fed Minutes will be closely monitored for signs of a pullback.