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On April 26, according to the Wall Street Journal, in order to simplify the negotiations on reciprocal tariffs, US negotiating officials plan to use a new framework developed by the Office of the United States Trade Representative (USTR), which lists major categories of negotiations, such as tariffs and quotas, non-tariff trade barriers, digital trade, product origin principles, economic security and other commercial issues. In these categories, US officials will put forward specific requirements for individual countries, but people familiar with the matter emphasized that this document may also be adjusted at any time. People familiar with the matter said that the United States initial plan is to negotiate with 18 major trading partners in turn over the next two months. The initial plan is to alternately participate in the talks with six countries per week for three weeks (six countries in the first week, another six countries in the second week, and another six countries in the third week) until the deadline of July 8. If US President Trump does not extend the 90-day suspension period he set by then, those countries that cannot reach an agreement will begin to face reciprocal tariffs.On April 26, after the United States announced additional tariffs on goods from many countries, Peruvian business people expressed concerns that the US governments extreme measures would disrupt the global trade order and may even trigger a global economic recession. Alvaro Barrenechea Chavez, vice president of the Peruvian-Chinese Chamber of Commerce, said that the negative impact of the US tariff policy has begun to emerge and hoped that the US government would rethink. Recognizing the importance of countries working together to promote development, I think this is the best way to become a true "world citizen."Market news: Musks xAI company plans to raise about US$20 billion in a financing round.Conflict situation: 1. Ukrainian top commander: Russia tried to use air strikes as a cover to increase ground attacks, but was repelled by Ukraine. 2. Ukrainian Air Force: Russia launched more than 103 drones in the night attack on Ukraine. 3. Local officials said Ukraine launched an attack in the Belgorod region of Russia, killing two people. 4. The local governor said that Russia launched an attack on the Dnipropetrovsk region of Ukraine, killing one person and injuring eight people. Peace talks: 1. Trump: ① The situation between Russia and Ukraine is gradually becoming clear, and they are "very close" to reaching an agreement. ② Ukraine is unlikely to join NATO. ③ Ukraine has not yet signed the rare earth agreement and hopes that the agreement can be signed immediately. ④ It is foreseeable that the United States will conduct commercial cooperation with Ukraine and Russia after reaching an agreement. 2. Russian Foreign Minister: Russia is "ready to reach an agreement on Ukraine." 3. Russian Presidential Assistant Ushakov: Russia and the United States will continue to maintain active dialogue. 4. Russian Presidential Assistant: Putin discussed the possibility of resuming direct negotiations between Russia and Ukraine with the US envoy. 5. The differences between the United States, Europe and Ukraine are clear. The documents show that European countries and Ukraine have raised objections to some of the US proposals to end the Russia-Ukraine conflict. 6. Market news: As part of the peace agreement, the United States asked Russian President Putin to abandon the demilitarization requirement. Other situations: 1. President of Hungarys OTP Bank: We hope to return to all business areas in Russia after the (Russia-Ukraine) conflict ends. 2. Ukrainian President Zelensky: US ground forces are not necessary for Ukraine. 3. Trump said Crimea will remain in Russia, Zelensky: Never recognize it. Agreeing with Trumps view, Crimea cannot be recovered by force. 4. NATO Secretary-General Rutte met with Trump and senior US officials to discuss defense spending, NATO summit, and the Ukrainian conflict.Rising global trade risks, overall policy uncertainty and the sustainability of U.S. debt top the list of potential risks to the U.S. financial system, according to the Federal Reserves latest financial stability report released on Friday. This is the first time the Fed has conducted a semi-annual survey on financial risks since Trump returned to the White House. 73% of respondents said that global trade risks are their biggest concern, more than double the proportion reported in November. Half of the respondents believe that overall policy uncertainty is the most worrying issue, an increase from the same period last year. The survey also found that issues related to recent market turmoil have received more attention, with 27% of respondents worried about the functioning of the U.S. Treasury market, up from 17% last fall. Foreign withdrawals from U.S. assets and the value of the dollar have also risen on the list of concerns.

Oil Prices Continue to Rise Due to Soaring US Fuel Demand and Russia's Saber-Rattling

Charlie Brooks

Apr 14, 2022 09:31

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Brent oil futures closed up $4.14, or 4%, at $108.78 a barrel, adding to Tuesday's rise of 6.3 percent.


The New York-traded West Texas Intermediate, or WTI, crude oil benchmark in the United States concluded the day up $3.65, or 3.6 percent, at $104.25. It increased by 6.7 percent in the previous session.


Crude prices continued their rally on Tuesday as China relaxed some of its most strict Covid shutdown measures in two weeks, raising prospects for an increase in energy demand in the world's second largest oil user.


Oil was also aided in the previous session by the OPEC+ alliance's warning that its non-Russian members cannot — or would not — compensate for Russian output lost as a consequence of Western sanctions.


Wednesday's gain was fueled by increased gasoline use in the United States, as shown by weekly energy inventory data issued by the Energy Information Administration, or EIA.


Apart from the increase in gasoline and diesel prices for automobiles and trucks, Delta Airlines (NYSE:DAL) also cited customer acceptance of higher tickets as a way to offset expenses, implying that demand for jet fuel would increase as well.


New geopolitical concerns arising from the Russia-Ukraine dispute boosted the market's upside, with Moscow threatening that any assault on its territory would be met by attacks on locations where such decisions were taken, including Kyiv.


"Oil prices seem to be extremely comfortable above the $100 barrier, since US and Chinese demand appears to be improving," said Ed Moya, an analyst at online trading platform OANDA.


According to the EIA, gasoline stockpiles, America's most utilized petroleum commodity, are low. The week ending April 8 had a 3.65 million barrel reduction, compared to a 2.04 million barrel fall the prior week ending April 1. Last week, analysts surveyed by Investing.com expected a dip of only 388,000 barrels.


Stockpiles of distillates, which are converted into diesel for trucks, buses, trains, and ships, as well as jet fuel, decreased 2.9 million barrels last week, compared to a rise of 771,000 barrels the week before. Analysts had anticipated a weekly fall of 515,00 barrels.


The fall in gasoline products mitigated any gloomy emotion generated by the largest weekly rise in US oil stocks in more than a year as a result of massive withdrawals from the country's emergency reserves.


Last week, crude stocks increased by 9.4 million barrels, compared to 2.4 million the prior week. According to the EIA's historical data, it was the largest weekly increase in oil stocks since the week of March 5, 2021.


The construction occurred in the context of a weekly release of at least 3.0 million barrels from the US Strategic Petroleum Reserve, or SPR, approved by the Biden administration to address a supply shortage exacerbated by the West's sanctions against Russia. According to EIA statistics, the US imported no crude oil from Russia for the second consecutive week.


Analysts surveyed by US news organizations had forecast an average build of 2.4 million barrels for the week ending April 8.


"Oil inventories were the greatest surprise, climbing much over estimates" despite the SPR releases, ForexLive analyst Greg Michalowski said.


In November, President Joe Biden started tapping the SPR to supply US refiners with oil lent from the reserve that they would not have to pay for but would have to return within a certain time period. The president believed that by doing so, there would be fewer oil transactions on the open market, resulting in lower prices for crude and refined petroleum products such as gasoline and diesel.


Previously, the Biden administration authorized the release of 30 million barrels from the SPR in March and another 50 million barrels in November, in collaboration with other oil-consuming nations such as China, Japan, India, South Korea, and the United Kingdom.


However, the administration's largest SPR release will occur in May, when it will issue 180 million barrels from the reserve. Another 60 million barrels are expected from additional International Energy Agency member nations' reserves.


However, the government's measures have had little impact on energy prices so far, with a barrel of oil maintaining above $100 a barrel and a gallon of gasoline hovering around $4, not far from March's record highs around $4.30. This is because refiners have been producing more petroleum products than typical at this time of year, resulting in unusually high consumption.

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