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Market news: NATO Secretary General Rutte will meet with US President Trump in Washington next week.July 13, a senior German politician said on Sunday that the European Union and Washington may further negotiate to postpone raising import tariffs after U.S. President Trump threatened to raise tariffs on the European Union, escalating the trade war. "The negotiation poker game between the EU and the United States is entering a decisive stage," said Jurgen Hart, deputy leader of the conservative CDU/CSU party in the German Bundestag. "I bet that at least a partial agreement will be reached before August 1 and further postponed. After all, high tariffs have to be paid by American citizens and companies, which will lead to higher prices and inflation in the United States." Hart said Europe must dissuade Trump from "mistaking" the U.S. trade deficit for the EUs protectionist measures. He said the U.S. has a surplus in services due to the dominance of the IT industry, which largely offsets the trade deficit.July 13, European Commission President Ursula von der Leyen said on Sunday that a political agreement had been reached on advancing the EU-Indonesia free trade agreement. "There is still a lot of untapped potential in our trade relations, so this agreement comes at the right time and the new agreement will open up new markets," von der Leyen said at a press conference with the Indonesian president.July 13th, the UK plans to introduce new incentives to reduce the cost of people buying new electric cars. The British Labour government is trying to phase out the sale of heavily polluting cars. On Sunday, British Transport Secretary Heidi Alexander confirmed that she will announce new measures to promote electric vehicle sales this week. She said: "We will provide cheaper prices for those who want to switch to electric vehicles." As part of these efforts, her office announced on Sunday that it plans to invest 63 million pounds to build charging piles in homes and logistics warehouses across the UK, including providing charging pile funds for homes without driveways. Her department also outlined a 2.5 billion pound plan to support automakers in their transition to zero-emission vehicle manufacturing.Iraqs State Oil Marketing Organization SOMO: Iraq set the official selling price of Basra Medium crude oil for sales to North and South America in August at a discount of $1.15 per barrel to Argus sour crude oil.

U.S. oil sees a saw near US$76, OPEC+ fears no urgency to take action

Oct 26, 2021 10:57

In the European market on Monday (October 4), the US crude oil futures price was trading at a flat level near US$76. The Organization of Petroleum Exporting Countries and the Allied Powers (OPEC+) including Russia will hold a meeting on Monday to discuss the increase in production in November. The meeting may decide whether the recent price rebound can be sustained as the world recovers intermittently from the COVID-19 pandemic.

As of press time, U.S. crude oil futures prices are reported at US$75.91/barrel, up 0.05%, and have been rising for the past six weeks; Brent crude oil futures prices are at US$79.37/barrel, up 0.1%, up 1.5% last week, and the fourth consecutive week of rising .



Due to supply disruptions and recovery in global demand, oil prices rose, and Brent crude oil prices rose to a nearly three-year high above $80 a barrel last week. ANZ Banking Research Center stated in a report that risk appetite has been continuously enhanced by confidence in the strong recovery of the global economy, and investors are paying attention to the upcoming OPEC+ meeting.

The meeting is scheduled to be held by OPEC+ later today. As demand in certain regions of the world recovers faster than expected, some countries require OPEC to increase production to help reduce oil prices, and OPEC is under pressure.

OPEC+ agreed in July to increase production by 400,000 barrels per month until at least April 2022, and to phase out the existing reduction of 5.8 million barrels per day. However, four OPEC+ sources recently told well-known foreign media that oil-producing countries are considering increasing production beyond the agreement's expectations. Since OPEC+ last meeting decided to increase production in October, it will increase production in November at the earliest.

Market observers said that it is expected that OPEC+ may consider increasing its output in November, exceeding the original plan of 400,000 barrels per day. OPEC's model shows that oil demand will exceed supply in the next two months. The oil market has tightened significantly recently, and the surge in natural gas prices before the winter has also led to the need for more petroleum products for power generation, which may boost overall oil demand.

Analysts said that OPEC+'s decision to increase supply to the market may stabilize oil prices, but this is by no means an easy task. Such a proposal may trigger a lot of debate and disagreement.

Amrita Sen, co-founder and chief analyst of Energy Aspects, a consulting firm, said OPEC+ will stick to its plan to increase oil production by 400,000 barrels per day. I am not saying that the increase will not exceed 400,000 barrels, but for the time being, we think this is impossible. Saudi Arabia is very, very eager to reduce volatility, both up and down. This is the key. If prices suddenly spike, they will react quickly.

Amrita Sen said that the price of oil is still in the range of US$70 to US$80 per barrel. As long as we are within this range, the urgency of taking action outside of the current agreement is limited.

The rise in oil prices has also been driven by more substantial increases in natural gas prices. The price of natural gas has soared by 300%. At comparable prices, the current transaction price is around US$200 per barrel, prompting people to switch to fuel oil and other crude oil products to meet the needs of power generation and other industries.

The latest data from the Chicago Mercantile Exchange Group crude oil futures market showed that last Friday traders cut their open positions for the second day in a row, this time reducing about 0.1,800. At the same time, trading volume fell by nearly 321,000 contracts, reversing the previous increase.

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