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On January 11, the weather in northern and western Japan near the Sea of Japan has been extremely cold recently, with heavy snowfall in large areas over the past few days. In particular, the snow depth in Suoyu, Aomori Prefecture reached 3.7 meters on the 10th. Due to the snowfall, some sections of Japans highways were closed, and some Shinkansen trains were suspended or delayed.British Chancellor of the Exchequer Reeves: The fiscal rules set in the October budget are "non-negotiable". Global financial markets have undoubtedly changed.On January 11, Mitsubishi Motors President Takao Kato was interviewed on January 10. Regarding whether to join the management merger consultation between Honda and Nissan, he said "this is one of the options." Speaking of the envisioned benefits, Kato Takao said "We can actively get help in the North American business (where Mitsubishi Motors has no production base)." Kato Takao also pointed out that in terms of in-vehicle software development, "there will also be scenarios where the technical strength of the two companies will be utilized, which will be very beneficial." Honda and Nissan announced the full launch of management merger consultations in December last year. Mitsubishi Motors previously stated that it will decide whether to join the consultations around the end of January.On January 11, CICC commented on the US non-farm data. The team believes that the highlight of this time is the recovery of the service industry. The service industry has added 231,000 jobs, which has become the main driving force. Judging from the market reaction, the unexpected non-farm data has pushed the US Treasury bond interest rate and the US dollar to a new high, which is also in line with its judgment since the fourth quarter of last year: it believes that the US dollar is still strong and that interest rate cuts should be "done in reverse". When the interest rate cut is realized, it will be the low point of the US Treasury bond interest rate, rather than continuing to look at the recession and the starting point of the downward interest rate.German Geoscience Research Center GFZ: A 5.5-magnitude earthquake occurred in Ethiopia.

WTI sellers assault $87.00 as US President Biden contests OPEC+ ruling

Daniel Rogers

Oct 12, 2022 14:29

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WTI remains below the $87.00 support level as US President Biden expresses his displeasure with the decision by the Organization of the Petroleum Exporting Countries and its allies, including Russia, known collectively as OPEC+. Nevertheless, the bears remain cautious at the weekly low throughout the Asian session on Wednesday.

 

Reuters reported that US Vice President Joe Biden stated on Tuesday that "there will be consequences" for US-Saudi ties following OPEC+'s announcement last week that it will reduce oil production against US concerns. The news further reported that Biden's remark occurred a day after the influential Democratic senator Bob Menendez, chairman of the Senate Foreign Relations Committee, stated that the United States must immediately halt any cooperation with Saudi Arabia, including military sales. Notable is the fact that OPEC+ startled markets by declaring a two million-barrel-per-day output cut last week.

 

In addition to the OPEC+-agreed-upon supply cutbacks, the risk-aversion wave and the strengthening US Dollar Index (DXY) further weigh on commodities prices.

 

In spite of this, the DXY re-establishes a two-week high above 113.50 as higher US Treasury yields and hawkish Fed bets keep dollar investors optimistic ahead of today's Federal Open Market Committee (FOMC) Meeting Minutes.

 

The International Monetary Fund's (IMF) most recent economic forecasts may also impose downward pressure on the price of black gold. Tuesday, the IMF dropped its global economic growth forecast for 2023 from 2.9% in July to 2.7%, citing pressures from rising energy and food prices and interest rate hikes as the primary reasons for the change. Notable is that the Washington-based institute maintained its 3.2% growth prediction for 2022, compared to 6.0% for 2021.

 

In conclusion, the risk-averse sentiment and optimism for an easing of the supply constraint weigh on the price of black gold prior to the private weekly inventory data from the American Petroleum Institute (API), which was previously -1.77M.


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