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On August 23, Rezaei, Secretary of Irans Supreme National Security Council, stated on August 22 that Iran has told the world not to join the United States in waging an economic war against it. Any country that participates in imposing economic restrictions on Iran is considered an enemy. Rezaei stated that the economic war launched by the Trump administration is also a propaganda war. Although Iran has suffered from long-term US sanctions, it has learned how to circumvent them. He stated that the issue of a maritime blockade cannot be resolved overnight; Iran has been under a US maritime blockade for months, yet it has still successfully sold oil. Furthermore, he stated that any US action in the southern waters of the Strait of Hormuz will be a target for Iran, and Iran will crack down on any meetings between the US and any anti-Iranian forces in the region. Regarding the negotiations between Iran and Oman on the Strait of Hormuz, Rezaei pointed out that one of the important discussions is the coordination on the waterway and trade transit issues, and there are currently no problems in the negotiations. The meeting between the two foreign ministers is progressing smoothly, and the negotiations are ongoing. The Strait of Hormuz is crucial to Iran, and Iran will reach a final agreement with Oman.Iranian Foreign Minister Araqchi and Pakistani Army Chief of Staff Munir spoke by phone on Saturday to discuss regional situation and security issues.Iranian Foreign Minister Araqchi spoke with the Egyptian Foreign Minister to discuss the regional situation, the situation in the Persian Gulf and the Red Sea, and diplomatic efforts to ease regional tensions.According to Al Jazeera, Yemeni authorities say they have discovered a Houthi-laid mine in the Bab el-Mandeb Strait.August 23 – Federal Reserve Chairman Warsh will speak at the annual economic conference in Jackson Hole, Wyoming on August 27. Investors expect him to further clarify how the Fed should deal with stubborn inflation, but it remains uncertain whether he will offer a clear statement. The chairmans communication strategy has had a rough start. Following the July policy meeting, Warsh revealed little about his views on the economy and avoided providing forward guidance on interest rates. Investors interpreted his remarks as a lack of resolve to push inflation back to the target level, subsequently pushing long-term bond yields to their highest levels in two decades.

WTI struggles to prolong its two-day uptrend below $78, as negative sentiment undermines expectations for China-led oil demand

Daniel Rogers

Mar 02, 2023 15:46

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Following a two-day uptrend that reached the greatest levels in a fortnight, the price of WTI crude oil fluctuates between $77.80 and $90 early Thursday.

 

The recent struggles of the black gold may be related to the contradictory signals encircling China and the Oil equities. However, negative sentiment and the resurgence of the US Dollar appear to be the quote's greatest obstacles to the upside.

 

In addition, higher-than-anticipated US inventories weigh on the energy benchmark. The weekly data from the US Energy Information Administration (EIA) indicates a 1.165M increase in Oil inventories, compared to the expected 0.45M increase and the previous level of 7.648M.

 

The willingness of US President Joseph Biden to continue pumping the markets with the Strategic Petroleum Reserve (SPR) and the absence of offers for Russian Oil also exert downward pressure on the price of WTI crude oil.

 

The latest New York Times (NYT) headlines suggest a potential rift between the United States and China at the important event. According to the news, "China is urging the start of peace talks, and some Group of 20 nations may support that notion when they meet in India, but U.S. officials contend Russia would not negotiate in good faith."

 

It should be noted, however, that the recent uptick in China activity data and optimistic remarks from the dragon nation's policymakers keep black gold purchasers optimistic. China's Minister of Human Resources recently stated, "China's employment will continue to increase this year and remains stable overall." On Wednesday, China's Finance Minister Liu He expressed a willingness to increase the country's fiscal expenditure while noting that the foundation of China's economic recovery remains fragile.

 

However, hawkish remarks from policymakers of the US Federal Reserve (Fed), the Bank of England (BoE), and the European Central Bank (ECB) highlighted the need for additional rate hikes to combat inflation issues, which exerted downward pressure on the price of oil.

 

In response to these events, 10-year US Treasury bond yields surpassed 4% for the first time since early November 2022, while 2-year yields ascended to their highest levels since June 2007 by flashing 4.91%. The increase in US Treasury bond yields reflects the market's concerns, which in turn have impacted on bulls on Wall Street, S&P 500 Futures, and WTI bulls recently. Consequently, S&P 500 Futures were down 0.5 percent as of press time despite the varied closing of Wall Street benchmarks.

 

Moving on, G20 updates could be combined with comments from central bankers and secondary US data to amuse Oil traders.


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