Oil rose 1% on concerns about the Middle East
Oil prices rose as traders remained worried that Israel’s military campaign in the Gaza Strip could escalate into a regional conflict.
Closing the session on October 19, Brent crude oil for December delivery increased by 1% or 0.88 USD to 92.38 USD/barrel, WTI oil for delivery in November (expiring on October 20) increased by 1.05 USD or 1,000 USD/barrel. 2% to 89.37 USD/barrel. During the session, both types of oil dropped more than 1 USD/barrel.
Israeli Defense Minister Yoav Gallant told troops gathered at the Gaza border that they would soon see land inside Palestine, suggesting a ground war aimed at destroying Hamas could be imminent.
Egyptian aid trucks have approached the only border crossing into Gaza not controlled by Israel but have not yet passed through despite US President Joe Biden’s request to allow aid.
Oil prices were supported late in the session after Federal Reserve Chairman Jerome Powell said the US central bank would “proceed cautiously” with future interest rate hikes, which could slow the economy and reduces fuel demand.
Gains were limited after the United States issued a six-month license allowing trading in the energy sector of OPEC member Venezuela, where the government reached a deal with the political opposition there to secure elections. 2024 election is fair.
Easing US oil sanctions on Venezuela is unlikely to require any policy changes by the OPEC+ producer group for now as production recovery is likely to be gradual.
Saudi Arabia said it will continue voluntary production cuts until the end of the year. Japan, the world’s fourth largest crude oil buyer, called on Saudi Arabia and other oil-producing countries to increase supplies to stabilize the global market.
According to the US Energy Information Administration, the country’s crude oil and fuel inventories fell last week due to increased demand for diesel and heating oil. Distillate fuel stocks fell 3.2 million barrels last week to 113.8 million barrels.
Gold increased for the third consecutive session
Gold prices rose for the third consecutive session as escalating tensions in the Middle East sparked safe-haven demand, while comments from the Federal Reserve Chairman raised hopes that the US central bank could Temporarily suspend interest rate increases.
Spot gold increased 1.3% to 1,973.41 USD/ounce. US gold futures in December closed up 0.6% to 1,980.5 USD/ounce.
Investors now see a 70% chance of no rate hike in December compared with nearly a 50% chance before Powell’s comments.
Dong increased due to optimism about China
Copper prices rose on strong Chinese economic data coupled with hopes for more stimulus, but worries about weak global growth limited gains.
Copper delivered after 3 months on the London Metal Exchange (LME) increased 0.3% to 7,944 USD/ton, the price has decreased 10% since the beginning of August.
Data on October 18 showed that China’s economy grew at a faster pace than expected in the third quarter, while consumer and industrial activities in September also unexpectedly increased.
Copper and other base metals are expected to remain under pressure around current levels through the end of this year amid worries that US interest rates will have to remain high to reduce inflation.
Supporting prices was a fall in the USD index as US 10-year bond yields fell from 5% in response to comments from Federal Reserve Chairman Jerome Powell.
Iron ore increased
Iron ore prices rose on positive investor sentiment due to China’s economic recovery and low inventories although weaker-than-expected steel output limited gains.
Iron ore futures for January 2024 on the Dalian Commodity Exchange, China closed up 0.4% to 866.5 CNY/ton, up for 7 consecutive sessions.
In Singapore, iron ore delivered in November increased 1% to 116.85 USD/ton.
The iron ore market also saw a boost from dwindling inventories, with iron ore stocks falling to 105.2 million tons as of October 13, the lowest level since 2016, according to company data. Steelhome consulting company.
China’s crude steel output fell 5% in September from the previous month, contrary to expectations of an increase after steelmakers increased activity levels amid the peak construction season.
Additionally, new home prices fell for the third consecutive month in September, dashing hopes of a shift in demand during the traditional peak month for home buying.
The steel market in Shanghai was mixed, bar steel increased by 0.3%, hot rolled steel coil increased by 0.1%, steel wire coil decreased by 1.1%, stainless steel increased by 0.3%.
Japanese rubber fell as investors took profits
Japanese rubber ended eight sessions of gains as investors took profits, although strong Chinese economic data and supply concerns limited the decline.
The March 2024 rubber futures contract on the Osaka exchange closed down 2.3 JPY or 0.9% to 266.2 JPY/kg.
In Shanghai, rubber for delivery in January 2024 decreased by 40 CNY or 0.2% to 14,690 CNY/ton.
Sugar decreases, coffee increases
Raw sugar futures for March 2024 closed down 0.19 US cents or 0.7% to 27.29 US cents/lb, while white sugar futures for December fell 4 USD or 0.5% to 737.8 USD/ton.
Robusta coffee futures in January 2024 increased 67 USD or 2.9% to 2,402 USD/ton, while Arabica coffee futures in December increased 5.9 US cents or 3.7% to 1.6395 USD/lb .
In Vietnam, trading is still gloomy this week, prices are still high because the supply from the new crop is not ready until next month.
Farmers in the Central Highlands are selling green coffee at 63,000 – 63,800 VND (2.56 – 2.6 USD)/kg, higher than 62,000 – 63,000 VND/kg a week ago.
Traders offered to sell type 2 robusta coffee with 5% black and broken beans at an additional 200 – 400 USD/ton compared to the January 2024 futures contract in London, unchanged from a week ago.
Farmers are starting to harvest some ripe coffee but supplies are still limited.
In Indonesia, Sumatran robusta coffee is offered for sale at an additional 580 USD/ton compared to the January 2024 futures contract, an increase of 100 USD compared to a week ago.
Indian rice prices continue to decrease, Vietnamese rice prices increase
Parboiled rice export prices in India decreased for the third consecutive week due to weak demand, mainly due to the extension of export tax until March 2024.
India’s 5% parboiled rice price decreased to 510 – 520 USD/ton from 515 – 525 USD/ton a week ago.
India has announced an extension of the 20% export tax until March 2024, which was originally set to expire on October 15.
Last week, India said it would maintain floor prices for basmati rice until the next announcement due to continued export restrictions.
But the country said it will allow white rice exports to a number of countries including Nepal, Cameroon, Malaysia, Philippines, Seychelles, Ivory Coast and the Republic of Guinea.
Thailand’s 5% broken rice price also decreased to 575 – 580 USD/ton compared to 580 – 600 USD/ton a week ago.
Vietnam’s 5% broken rice price increased to 625 – 630 USD/ton compared to 615 – 625 USD/ton a week ago.
A trader in Ho Chi Minh City said prices increased slightly because supplies were stable as the summer-autumn harvest ended, adding that high global demand and tensions in the Middle East were additional factors. .
Preliminary data show that 271,600 tons of rice were exported at Ho Chi Minh City port from October 1 to 22, most of which were sent to the Philippines, Indonesia and Cuba.
Prices of some key items on the morning of October 20
