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On August 27, local time, the Israel Defense Forces (IDF) issued a statement saying that Hezbollah launched two drones carrying explosive devices at IDF troops operating within the "safe zone" in southern Lebanon between the night of August 26 and the early morning of August 27. IDF soldiers stationed in the area quickly opened fire upon detecting the threat, shooting down one of the drones. No IDF personnel were injured in the attack. The IDF stated that it will not allow Hezbollah to take action against IDF soldiers within the safe zone. Troops are currently continuing operations in the area and will continue to take decisive action to counter Hezbollah attacks.Qatars Ministry of Foreign Affairs: Qatar and Iran reviewed efforts to ease regional tensions and created conditions for dialogue.On August 27, Shimao Group (00813.HK) announced on the Hong Kong Stock Exchange that it filed a winding-up petition against the company with the High Court of the Hong Kong Special Administrative Region on August 27, 2026. The petition concerns judgment debts arising from four judgments rendered by courts in Mainland China, totaling RMB 2,497,885,817. The High Court has set the first hearing date for the petition as November 11, 2026.On August 27, the Egyptian Foreign Ministry issued a statement saying that Egyptian Foreign Minister Bader Abdellatifi and Russian Foreign Minister Sergey Lavrov discussed recent developments in the Middle East, including a joint proposal from Iran and Oman to establish a temporary maritime passage through the Strait of Hormuz. The statement added that the call also touched upon Egyptian-Russian relations.August 27th - Currency traders are increasing their hedges against further dollar gains. Markets are preparing for continued dollar strength ahead of Federal Reserve Chairman Warshs key speech at the Jackson Hole symposium on Friday. The dollar has recovered half of its losses since Treasury Secretary Bessenters unexpected move last week to support the bond market, which worsened market sentiment. Data from the CME Group shows that so far this week, 57.2% of dollar options trades are poised to benefit from a stronger dollar against a basket of major currencies, up from 43.2% last week. Meanwhile, the bearish bias of the risk reversal indicator (a measure of options market positioning and sentiment) has weakened, with negative sentiment reduced by about half. ING strategist Pesole said, "This could be a decisive event for the FX market; the market may be reluctant to build too many short dollar positions." However, Spectra Markets analyst Brent Donnelly pointed out that the Jackson Hole symposium may ultimately have little impact on the market. He believes that given recent U.S. economic data, it would be difficult for Warsh to take a hawkish stance; and considering that the Treasury is already working to curb long-term yields, a shift to a dovish stance would also seem awkward.

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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