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July 26 – According to a report by The New York Times, US President Trump has shelved plans for a significant escalation of military action against Iran. Trump is concerned that an escalation could dangerously deplete the Pentagons already dwindling stockpile of Patriot missile interceptors and other air defense munitions in the Middle East. The report states that government officials indicated that the strain on interceptor stockpiles is one of many factors making a resumption of large-scale military action extremely risky. Furthermore, Trump and his senior advisors are also uneasy about the potential for a escalation of the Middle East conflict, the possible alienation of key Gulf allies vulnerable to Iranian attacks, a global economic shock, and a worsening energy and refugee crisis.On July 26th, Huang Renxun discussed the US-China AI competition in an interview with foreign media on July 25th. He stated that outstanding talent will always find excellent solutions, and China is destined to produce excellent AI technology; therefore, China should continue to learn from and cooperate with them.July 26 – The latest epidemic report released by the Ministry of Health of the Democratic Republic of Congo on July 25 shows that the cumulative number of confirmed cases of Ebola in the country has risen to 3,075, with 1,354 deaths. Data shows that as of July 24, a total of 755 patients were receiving isolation or hospitalization treatment, and the cumulative number of recovered cases was 556. The outbreak has spread to five provinces: Ituri, North Kivu, South Kivu, Haut-Uele, and Chowpo.On July 26, Australian Prime Minister Barnes stated that he would raise the issue of tariffs with US President Trump. This comes after Washington imposed new tariffs on trading partners, including Australia. The Labor government, led by Barnes, has called the tariffs unreasonable and expressed its desire for their removal. When asked if he would discuss the issue with Trump, Barnes replied, "Of course." "We will raise this issue at all levels of the Australia-US relationship, and in fact, we have already done so."July 26 – According to Politico, as the US-Iran conflict continues, Arab countries suffering retaliatory attacks from Tehran are attempting to unite and find a path to peace. However, long-standing contradictions are hindering this process. In recent weeks, senior officials from the UAE and Saudi Arabia have publicly posed for photos together, demonstrating a thaw in relations; Jordan and six members of the Gulf Cooperation Council (GCC) have also held talks at the US State Department and Capitol Hill; and the GCC has issued several joint statements condemning Irans attacks. However, several Arab diplomats, current and former US officials, and people familiar with the regional situation say that while these countries all want to ensure the Strait of Hormuz remains open, their differing priorities in how to achieve this goal are hindering substantial progress. These differences include a series of conflicting interests, such as which countries possess alternative shipping lanes, which countries have the deepest infrastructure ties with Iran, and which countrys economy will suffer the greatest losses in the current crisis. An Iraqi official stated, "They are working together to visit the U.S. Congress and the State Department to coordinate their messaging. But they are not on the same page." The Gulf Cooperation Council (GCC), comprised of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE, already had numerous internal divisions before the current conflict, and the war with Iran is further amplifying these contradictions. "They have many issues to resolve, and this war has exacerbated the existing divisions in the Gulf region," said David Schenker, former U.S. State Department director for Middle East affairs.

After $100, The Dollar Weakens And The CPI Game Drives Oil Prices Down

Haiden Holmes

Nov 08, 2022 14:15

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The dollar's depreciation in expectation of a Federal Reserve rate reversal pushed oil to within pennies of $100 per barrel on Monday, supporting market bulls who have been predicting triple-digit prices for the previous week.


Crude oil lost its midmorning gains and fell further to end the day in the negative, displaying the chaotic trading that is typical before the weekly U.S. oil inventory report. The Weekly Petroleum Status Reports provided by the Energy Information Administration or EIA on the previous two Wednesdays were extremely supportive to market longs.


The weekend reaffirmation of China's commitment to a tight COVID control policy negated any bullish fervor caused by news of rising oil imports in the world's largest importer.


Prior to the Commerce Department's release of the Consumer Price Index (CPI) on Thursday, oil bulls are betting that the dollar will continue to slide. As inflation has been moving at four-decade highs over the last year, some anticipate that the upcoming CPI data for October might disclose a large reduction in price pressures as a result of the Fed's decision to increase interest rates by 375 basis points from 25 basis points in March.


Economists anticipate that the annual reading for the CPI in October will be 8.0%, down from 8.2% in September, and the monthly rate will be 0.6%, up from 0.4% before. Nevertheless, if both the annual and monthly readings decline considerably, the Fed is expected to approve a rate increase of just 50 basis points in December, as opposed to the four straight rate increases of 75 basis points between June and November. This notion has led to the dollar's decline.


A weak dollar is advantageous for oil and other commodities priced in dollars because it reduces transaction and acquisition costs for euro and non-dollar currency customers. On Monday, the Dollar Index, which measures the U.S. dollar to the euro, yen, pound, Canadian dollar, Swedish krona, and Swiss franc, hovered just below the crucial 110 level, compared to Thursday's three-week high of 113.035.


Ed Moya, an analyst at the online trading platform OANDA, said, "You must feel we need two positive [inflation] readings for the Fed to ratchet down its [rate] expectations and provide the markets with the Christmas cheer they so desperately want." Until then, choppy and confused trading conditions might be expected.


The price per barrel of West Texas Intermediate, the benchmark for U.S. crude oil traded in New York, declined by 82 cents, or 0.9%, to $91.79. The session high for the WTI was $93.74 a barrel.


Brent, the London-traded global oil benchmark, lost 65 cents, or 0.7%, to $97.92 after hitting a session high of $98.55.


In addition to the possibility of a Fed rate change, the demand for oil prices to exceed $100 is supported by forecasts of a tighter supply when the European Union's ban on Russia's seaborne crude exports goes into effect on December 5 — despite the fact that global refineries are increasing production.


John Kilduff, a partner at the New York-based energy hedge fund Again Capital, said, "What you virtually never hear is how the oil industry self-repairs despite its fundamental flaws in order to supply almost every client with critical petroleum." "And to those who feel the Fed should halt rate hikes, consider the following: if the price of oil exceeds $100, how in the world could inflation significantly reduce, considering that almost everything we purchase needs energy? You do not need a Harvard degree in economics to ask this question."

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