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European Commission: The war with Iran has triggered an energy shock, reigniting inflation and shaking market sentiment.The yield on 30-year UK government bonds is on track for its biggest weekly drop since December 2023, falling about 23 basis points since the close of trading on May 15.On May 21, He Yadong, spokesperson for the Ministry of Commerce, announced at a regular press conference that Sino-Russian trade has exceeded US$200 billion for three consecutive years, reaching US$85.2 billion from January to April this year, a year-on-year increase of 19.7%, achieving a good start. He Yadong stated that the heads of state of China and Russia highly praised the achievements of Sino-Russian economic and trade cooperation in recent years. Both sides will continue to strengthen communication on economic and trade policies, create new engines of growth with new quality productivity, and promote the upgrading of trade in goods and services. China and Russia will firmly defend their right to independently develop bilateral economic and trade partnerships. Under the joint witness of the two heads of state, the Ministry of Commerce and relevant Russian departments signed cooperation documents on trade, support for multilateralism, and other matters.May 21st - UK government bond yields fell following weak preliminary May PMI data. The UK Composite PMI, which measures manufacturing and service sector activity, fell to 48.5 from 52.6 in April. A PMI reading below 50.0 indicates contraction in business activity. The weak data could further dampen the prospect of a near-term interest rate hike by the Bank of England. Tradeweb data showed that after the data release, the yield on 10-year UK government bonds fell 5 basis points to 4.944%, a new low in 11 days.Japanese Prime Minister Sanae Takaichi: Gasoline prices in Japan remained the lowest among the G7 countries this week.

WTI struggles at $87 as recession worries probe OPEC's forecast and supply deficit fears intensify

Daniel Rogers

Sep 14, 2022 11:42

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After reverting from the weekly high, WTI crude oil traders seek clear direction around $87.50 during Wednesday's Asian session. However, the present hesitation in the price of black gold may be attributable to the mixed concerns regarding the demand-supply matrix.

 

The Organization of the Petroleum Exporting Countries (OPEC) indicated in a monthly report that oil consumption will climb by 3,1 million barrels per day (bpd) in 2022 and by 2,7 million barrels per day (bpd) in 2023, which is unchanged from last month. Despite obstacles such as rising prices, the news also highlighted indications that major economies were performing better than projected.

 

The news that the United States intends to replenish its emergency oil reserves, as well as the German and European move to control Russian oil and gas prices, could also be favorable for energy prices. In addition, rumors that the Western oil deal with Iran is a long way off are bolstering fears of a supply bottleneck and should have helped energy bulls.

 

Tuesday's US inflation statistics revived concerns about the Federal Reserve's fast rate hike and exacerbated recession concerns. Also acting as downward drivers for WTI crude oil are expectations of economic slowdown due to China and Russia-related concerns.

 

In spite of this, the US Consumer Price Index (CPI) for August increased by 8.3% year-over-year, surpassing market expectations by 0.1%. However, the monthly data increased to 0.1%, exceeding the -0.1% projected and the 0.0% shown in previous assessments. The core CPI, or CPI excluding food and energy, likewise exceeded the 6.1% consensus and 5.9% prior to printing at 6.3% for the month in question.

 

It should be mentioned that the weekly prints of the American Petroleum Institute's (API) industry inventory report also contributed to the commodity's downfall. The API Weekly Crude Oil Stock climbed to 6,035 million during the week ending September 9, up from 3,645,000 the previous week.

 

In the future, the price of black gold may stay under pressure due to a stronger US dollar and economic troubles. Before today's official weekly inventory data from the U.S. Energy Information Administration, however, the supply crisis concerns could test the bears (EIA). Thursday's US Retail Sales for the month of August and Friday's preliminary reading of the September Michigan Consumer Sentiment Index will also warrant close attention.

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