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On November 10th, the Ukrainian State Electricity Company announced that due to Russias continued attacks on Ukrainian energy facilities, most regions of Ukraine will experience 24-hour power rationing on November 10th. The company stated that the rationing will last from midnight to 11:59 PM, and industrial users power consumption will also be limited during the same period. The Ukrainian government also urged the public to conserve electricity during peak hours.On November 10th, Bezoss space company Blue Origin planned to launch its New Glenn rocket from Cape Canaveral, Florida, on Sunday, a key test in the startups path to challenging SpaceXs dominance. The approximately 97.5-meter-tall rocket will carry two spacecraft built by Rocket Lab to Mars. This mission marks New Glenns first mission for NASA. New Glenn successfully completed its maiden flight in January, reaching orbit, but its boosters failed to land. Similar to SpaceXs Falcon series, New Glenn is designed to be partially reusable, with boosters capable of multiple launches, thus reducing costs.On November 10th, New York Federal Reserve President Williams stated that financial pressures faced by low- and middle-income Americans could threaten the resilience of the U.S. economy, even as wealthier families benefit from the stock market boom. In an interview, Williams said the Feds December interest rate decision "will be a balancing act." He noted, "Inflation remains high and shows no signs of declining," but the U.S. economy "still exhibits a degree of resilience." Nevertheless, many Americans are still struggling with housing and living costs. There are signs that "low- and middle-income families are facing some constraints in terms of affordability," posing a risk to consumer confidence and spending. Williams also rejected calls to modify the Feds benchmark interest rate mechanism, stating that expectations of productivity gains driven by artificial intelligence are supporting the market, but he is concerned about potential over-investment and a stock market bubble.On November 10th, Russian Presidential Press Secretary Dmitry Peskov stated on the 9th that US President Donald Trumps recent announcement of plans to resume nuclear testing gave the impression that the US intended to begin nuclear testing in the near future. Russia needs clarification on this. Peskov said that Russian President Vladimir Putin has not ordered the immediate commencement of preparations for nuclear testing, and if any other country violates the nuclear testing ban, Russia will be forced to take reciprocal measures to maintain strategic balance.On November 10th, it was reported that on November 9th local time, U.S. Senate Majority Leader John Thune stated that a potential agreement to end the government shutdown was "progressing." However, Thune also noted that an agreement was not guaranteed, as senators needed time to read the proposal and it could take several hours before concrete action could be taken.

Oil Plunges 4%, Trade Turbulent on China, Global Economy Worries

Haiden Holmes

Jan 04, 2023 11:26

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Oil prices tumbled 4% in chaotic trading on Tuesday, as gloomy demand data from China, a dark economic outlook, and a stronger U.S. currency weighed on the market.


Brent futures for March delivery lost $3.81, or 4.4%, to $82.10 per barrel, marking the worst daily decline in over three months.


U.S. crude plummeted $3.33 to $76.93 per barrel, a loss of 4.1% and the worst decline in almost a month. Early in the session, both benchmarks increased $1 per barrel.


Robert Yawger, an analyst at Mizuho, commented, "The China COVID-19 scenario and the imminent likelihood of a recession are exerting pressure on the markets."


In the first tranche for 2023, the Chinese government boosted export quotas for refined petroleum products. Traders connected the move to the potential of weak domestic demand in the world's largest crude importer, which continues to fight viral epidemics.


China's manufacturing activity dropped in December as growing infections impeded production and weighed on demand, despite the fact that Beijing had virtually eliminated antivirus controls.


Sunday, IMF Managing Director Kristalina Georgieva said that the economies of the United States, Europe, and China are all sinking simultaneously, making 2023 a more challenging year for the global economy than 2022.


The dollar saw its largest one-day increase in over two weeks. As dollar-denominated commodities become more costly for holders of other currencies, a rising dollar can diminish demand for oil.


The market will closely examine the Federal Reserve's December meeting minutes on Wednesday. In December, the Fed boosted interest rates by 50 basis points (bps) following four straight increases of 75 bps.


A dealer quoted Genscape data indicating that oil stockpiles at the Cushing storage hub climbed by 176,000 barrels to 28.6 million barrels in the week ending December 30.


Last week, crude oil stockpiles grew by 2,2 million barrels, according to a survey conducted by Reuters on Tuesday.


The U.S. government released 2.7 million barrels of oil from the Strategic Petroleum Reserves last week, and oil major Chevron Corp (NYSE:CVXPascagoula,Mississippi, )'s refinery will receive the first cargo of Venezuelan crude in nearly four years, according to shipping documents seen by Reuters on Tuesday.


Recent official estimates forecast that the U.S. crude output will increase by an average of 620 thousand barrels per day in 2023. This is a third less than the over 1 million bpd expected by some at the beginning of the year.


Commerzbank (ETR:CBKG) stated that it expects the global economic outlook to have a "much larger impact" on oil price developments than decisions made by the Organization of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+) on oil output.


Brent may return to $100 per barrel as early as the second quarter of the year, according to the bank, as a result of economic development indicators in "key economic zones."

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