Day: September 18, 2022

China’s August gasoline exports nearly double from a year ago

China's August gasoline exports nearly double from a year ago© Reuters. FILE PHOTO: An employee fills a vehicle at a gas station in Nanjing, Jiangsu province March 25, 2009. REUTERS/Sean Yong

BEIJING (Reuters) – China’s August gasoline exports rose 97.4% from a year earlier, customs data showed on Sunday, as refiners took advantage of fresh export quotas amid faltering domestic demand.

Gasoline shipments were at 1.12 million tonnes last month, while volumes for the January to August period were 30.4% lower than the corresponding period last year, according to data from the General Administration of Customs.

Diesel exports were at 830,000 tonnes, up 51.8% from August 2021, on healthy export margins. Exports for the January to August period totaled 3.25 million tonnes, down 78.3% on the same period last year.

Exports of jet fuel in August declined 15.4% from the same period last year to 780,000 tonnes. However, year-to-date shipments were 4.4% higher than the year before at 5.54 million tonnes.

Analysts and traders had expected China’s exports of gasoline, diesel and jet fuel to rebound in August to near the highest for the year after Beijing issued more export quotas in June and July.

China topped up with a fourth batch of export quotas of 1.5 million tonnes for this year, taking the total so far this year to 24 million tonnes, still a third lower than 2021.

The customs data also showed that China’s liquefied (LNG) imports in August fell 28.1% from a year earlier to 4.72 million tonnes. Shipments during the first eight months of the year were also down 21.3% from the same time a year ago at 40.64 million tonnes amid high spot prices of the super-chilled fuel.

Pipeline gas imports last month rose 9% on-year to 4.13 million tonnes, the data also showed. Year-to-date import volumes were up 10.6% from a year earlier to 30.40 million tonnes.

Table below shows trade details, volumes in million tonnes.

Exports August y/y % change Jan-August y/y % change

Gasoline 1.12 97.4 7.56 -30.4

Diesel 0.83 51.8 3.25 -78.3

Jet fuel 0.78 -15.4 5.54 4.4

Imports August y/y % change Jan-August y/y % change

LNG 4.72 -28.1 40.64 -21.3

Piped gas 4.13 9.0 30.40 10.6

Super typhoon Nanmadol bears down on Japan’s Kyushu island

Super typhoon Nanmadol bears down on Japan's Kyushu island© Reuters.

TOKYO (Reuters) -Typhoon Nanmadol bore down on Japan’s southernmost main island of Kyushu on Sunday with the Japan Meteorological Agency (JMA) warning of gales and high waves “like never experienced before”.

The 14th typhoon of the season, classified as a super typhoon by the U.S. Navy’s Joint Typhoon Warning Center, could bring record rainfall, the JMA said, warning of the risk of rivers overflowing and landslides.

Southern Kyushu could receive 500 mm (20 inches) of rain and wind gusts of up to 250 km (155 miles) per hour on Sunday, while the central Tokai region could get 300 mm (12 inches) of rain, the agency forecast.

High winds caused damage including downing a bus stop in Miyazaki prefecture, southern Kyushu, according to footage carried by public broadcaster NHK.

Railway operators have cancelled trains and convenience store chain Seven-Eleven Japan temporarily shut around 950 stores. Toyota Motor (NYSE:) Corp said it will idle production at three factories on Monday.

The storm is forecast to curve east and pass over Japan’s main island of Honshu before moving out to sea by Wednesday. Heavy rain lashed the capital Tokyo, with operation of the Tozai subway line suspended due to flooding.

Haiti unrest worsens misery as residences face water shortage

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Haiti unrest worsens misery as residences face water shortage© Reuters. A man carries containers to fill with water amid water shortages due to daily protests against high gasoline prices and crime, and to stock up for Storm Fiona approaching in the Caribbean region, in Port-au-Prince, Haiti. September 17, 2022. REUTERS/Ralph

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PORT AU PRINCE (Reuters) – Thousands in Haiti faced water shortages after days of protest virtually halted distribution, eyewitnesses said on Saturday, as an approaching storm caused more worry in the reeling country.

Many residents of Haiti’s capital Port-au-Prince have been forced to shelter at home this week as gunfire broke out and burning tires blocked streets during protests of fuel price hikes and crime.

That slowed or halted companies that typically deliver water in the city where daily highs have been hitting 34 degrees centigrade (93 degrees Fahrenheit).

Many took advantage of an expected half day truce to rush to distribution centers to stockpile a few days supply of water and cooking gas, which has also run short in many places.

Fears about the approach of tropical storm Fiona also fueled the rush to get water. Forecasters said the storm’s heaviest rains were more likely to hit the Dominican Republic on the east of Hispaniola island.

Jean-Denis Sévère, a resident of Fort National, said many had to travel miles to fill buckets and bottles, then lug them back home.

“I live in Fort National, since there are blockades in the country, we came here to buy water. If it was not for these places, we would die from thirst,” he said.

The country’s latest unrest came as inflation surged to its highest in a decade and gang violence has left hundreds dead and thousands displaced, with much of Haiti’s territory beyond government reach.

Richardson Adrien, a Port-au-Prince resident, told Reuters the lack of potable water was just the latest headache. Residents in recent months have also struggled to find fuel, leaving some unable to work.

Finding clear water “is a problem. We look for it everywhere and we can’t find it. We put Clorox (NYSE:) in the water to be able to drink it, you can’t find water,” he said.

The Haitian government did not immediately respond to a request for comment.

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Biden pays respects to ‘honourable’ Queen Elizabeth before funeral

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Biden pays respects to 'honourable' Queen Elizabeth before funeral© Reuters. People pay respects to Britain’s Queen Elizabeth, following her death, as she lies in state, in London, Britain September 17, 2022. UK Parliament/Jessica Taylor/Handout via REUTERS

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By Michael Holden, Jeff Mason and Kate Holton

LONDON (Reuters) -U.S. President Joe Biden paid emotional tribute to Queen Elizabeth on the eve of her state funeral on Sunday, saying Britain and the world had been lucky to have such a dignified and dedicated servant on the throne for 70 years.

Biden, among scores of dignitaries and royals from Europe, Asia, Africa and the Americas who have arrived in London for Monday’s funeral, said the queen’s death at 96 years of age had left a giant hole on the global stage.

“To all the people of England, all the people in United Kingdom, our hearts go out to you,” Biden said after he signed a book of condolence and visited her lying-in-state in Westminster. “You were fortunate to have had her for 70 years, we all were. The world’s better for her.”

He said he had consoled the queen’s heir, King Charles, that the queen would be “with him every step of the way, every minute, every moment and that’s a reassuring notion”.

Hundreds of thousands of people have descended on London to bid farewell to Britain’s longest-reigning monarch, with people from all walks of life from around the country and overseas queuing for hours to file past her coffin.

Biden followed other world leaders in appearing on a balcony overlooking the coffin in the historic Westminster Hall, making a sign of the cross and placing his hand on his heart in reverence. French President Emmanuel Macron also appeared on the balcony.

The U.S. president later joined Charles and other leaders for an evening reception ahead of the state funeral https://www.reuters.com/world/uk/plans-queen-elizabeths-state-funeral-2022-09-15.

Biden was one of 14 U.S. presidents https://www.reuters.com/world/uk/queen-elizabeths-reign-featured-enchiladas-with-reagan-dancing-with-ford-2022-09-12 in office during the queen’s reign, of which Elizabeth met all except Lyndon Johnson, starting with Harry Truman in 1951 when still a princess.

He will join presidents, prime ministers, kings, queens and sultans representing nearly 200 countries and territories at the funeral.

Macron was seen walking near the River Thames earlier on Sunday, mingling with those gathered in the streets around parliament.

Liz Truss, who the queen appointed as Britain’s prime minister two days before her death, took the opportunity to meet with leaders from Australia, New Zealand, Ireland, Canada and Poland over the weekend.

Saudi Arabia’s Crown Prince Mohammed bin Salman, however, is no longer expected, according to a British government source. Inviting the man Western leaders believe ordered the murder in 2018 of Saudi journalist Jamal Khashoggi had been controversial. He has denied any role in the killing.

Britain has invited https://www.reuters.com/world/uk/world-leaders-come-london-queen-elizabeths-funeral-2022-09-12 heads of state or ambassadors from any country with which it has full diplomatic relations, but it is up to those nations who they send. The change was made by Saudi Arabia, the source added.

‘LOVE FOR A SON’

For all the high ceremony and careful diplomacy of the funeral, for the queen’s family it is also when they will bid farewell to a mother, grandmother and great-grandmother.

Prince Andrew https://www.reuters.com/world/uk/disgraced-prince-andrew-back-spotlight-still-out-cold-2022-09-15, the queen’s second son, paid tribute to “Mummy, Mother, Your Majesty” on Sunday, reflecting the roles he said Elizabeth fulfilled during her reign.

Andrew has fallen from grace, stripped of the “His Royal Highness” title and removed from royal duties after a scandal over his friendship with late U.S. financier Jeffrey Epstein, a convicted sex offender, and a related sex assault allegation.

Andrew, Duke of York, has not been charged with any criminal offence and has denied wrongdoing. He paid to settle a U.S. civil court case.

On Saturday, his two daughters joined the queen’s other six grandchildren, including Charles’ sons Princes William and Harry, at a vigil around her coffin.

Camilla https://www.reuters.com/world/uk/rottweiler-queen-consort-camillas-rise-shadow-diana-2022-09-08, wife of the new king and now Queen Consort, said the smile of the late queen was “unforgettable”, in her own tribute https://www.reuters.com/world/uk/i-will-always-remember-queen-elizabeths-smile-camilla-pays-tribute-2022-09-18 on Sunday.

CLAMOURING CROWDS

Transport for London said it expected one million people in central London for Monday’s funeral.

The period of mourning has already drawn hundreds of thousands of people to central London, many clamouring to view floral tributes and feel the atmosphere.

The government advised against travelling to join the queue to see the coffin before it closes later on Sunday.

Such has been the desire to pay tribute to the popular monarch, the only one most Britons have known since her accession in 1952, that tens of thousands have waited patiently for hours alongside the Thames to spend a few brief seconds at the side of her coffin.

Many have wept, said a prayer, bowed their head or dropped to their knees.

Dignitaries have also taken their place on the balcony to view her lying-in-state, with leaders from Canada, Brazil, Trinidad and Tobago and elsewhere having paid their respects.

Gary Thompson, 54, from London said: “When you’re here, it’s overwhelming.”

New Zealand Prime Minister Jacinda Ardern said the “sheer silence” was one of the things that made the lying-in-state so moving, adding she had shared her moment on Friday with people who had queued for 20 hours or longer.

“The queen was here for her people and now her people are there for her,” she told the BBC on Sunday.

Prince William joined his father Charles to speak to mourners waiting in line on Saturday. “She wouldn’t believe all this, she really wouldn’t,” he said.

MOMENT OF REFLECTION

Britain has hosted a series of carefully choreographed ceremonies in the 10 days that have followed Elizabeth’s death, reflecting the traditions and pageantry of a royal family whose lineage stretches back almost 1,000 years.

A minute of national silence was held at 8 p.m. (1900 GMT) on Sunday, marked by the striking of Big Ben, which towers over Westminster Hall.

London’s police force has described the funeral ceremony as the biggest security operation it has ever undertaken.

Members of the public were camping out to secure positions on the procession route and near Westminster Abbey, the site of coronations, weddings and burials of English and then British kings and queens since William I in 1066.

Britain has not held a state funeral on the scale planned for the queen since that for World War Two leader Winston Churchill in 1965.

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Strong earthquake hits southeastern Taiwan, 146 injured

Strong earthquake hits southeastern Taiwan, 146 injured© Reuters.

By Ben Blanchard and Yimou Lee

TAIPEI (Reuters) -A 6.8 magnitude earthquake hit the sparsely populated southeastern part of Taiwan on Sunday, the island’s weather bureau said, derailing train carriages, causing a convenience store to collapse and trapping hundreds on mountain roads.

The weather bureau said the epicentre was in Taitung county, and followed a 6.4 magnitude temblor on Saturday evening in the same area, which caused no casualties.

The U.S. Geological Survey measured Sunday’s quake at a magnitude 7.2 and at a depth of 10 km (six miles).

Taiwan’s fire department said one person had died and 146 were injured by the quake.

All four people were rescued from a building that collapsed in Yuli, while three people whose vehicles fell off a damaged bridge were rescued and taken to hospital.

The Taiwan Railways Administration said six carriages came off the rails at Dongli station in eastern Taiwan after part of the platform canopy collapsed, but the fire department said there were no injuries.

More than 600 people are trapped on the scenic Chike and Liushishi mountain areas by blocked roads, though there were no injuries and rescuers were working to reopen the roads, the department said.

The U.S. Pacific Tsunami Warning Center issued a warning for Taiwan after the tremor but later lifted the alert. Japan’s weather agency lifted a tsunami warning for part of Okinawa prefecture.

The quake could be felt across Taiwan, the weather bureau said. Buildings shook briefly in the capital Taipei, and aftershocks have continued to jolt the island.

Science parks in the southern cities of Tainan and Kaohsiung, home to major semiconductor factories, said there was no impact on operations.

Taiwan Semiconductor Manufacturing Co (TSMC), the world’s largest contract chipmaker, said there was “no known significant impact for now”.

Taiwan lies near the junction of two tectonic plates and is prone to earthquakes.

More than 100 people were killed in a quake in southern Taiwan in 2016, while a 7.3 magnitude quake killed more than 2,000 people in 1999.

In a first, EU moves to cut money for Hungary over damaging democracy

In a first, EU moves to cut money for Hungary over damaging democracy© Reuters. FILE PHOTO: Hungary’s Prime Minister Viktor Orban arrives for the European Union leaders summit, as EU’s leaders attempt to agree on Russian oil sanctions in response to Russia’s invasion of Ukraine, in Brussels, Belgium May 30, 2022. REUTERS/Johanna Gero

By Gabriela Baczynska and Gergely Szakacs

BRUSSELS/BUDAPEST (Reuters) – The European Union executive recommended on Sunday suspending some 7.5 billion euros in funding for Hungary over corruption, the first such case in the 27-nation bloc under a new sanction meant to better protect the rule of law.

The EU introduced the new financial sanction two years ago precisely in response to what it says amounts to the undermining of democracy in Poland and Hungary, where Prime Minister Viktor Orban subdued courts, media, NGOs and academia, as well as restricting the rights of migrants, gays and women during more than a decade in power.

“It’s about breaches of the rule of law compromising the use and management of EU funds,” said EU Budget Commissioner Johannes Hahn. “We cannot conclude that the EU budget is sufficiently protected.”

He highlighted systemic irregularities in Hungary’s public procurement laws, insufficient safeguards against conflicts of interest, weaknesses in effective prosecution and shortcomings in other anti-graft measures.

Hahn said the Commission was recommending the suspension of about a third of cohesion funds envisaged for Hungary from the bloc’s shared budget for 2021-27 worth a total of 1.1 trillion euros.

The 7.5 billion euros in question amounts to 5% of the country’s estimated 2022 GDP. EU countries now have up to three months to decide on the proposal.

Hahn said Hungary’s latest promise to address EU criticisms was a significant step in the right direction but must still be translated into new laws and practical actions before the bloc would be reassured.

Development Minister Tibor Navracsics, in charge of negotiations with the EU, said Hungary would meet all 17 of its commitments made to the European Commission to stave off the loss of any EU funding.

“Hungary did not make commitments to befuddle the Commission,” Navracsics told a news conference. “We have made commitments that we know can be implemented … therefore, we will not be facing a loss of funds.”

CORRUPTION

Orban’s government proposed creating a new anti-graft agency in recent weeks as Budapest came under pressure to secure money for the ailing economy and forint, the worst-performing currency in the EU’s east.

Orban, who calls himself a “freedom fighter” against the world view of the liberal West, denies that Hungary – an ex-communist country of some 10 million people – is any more corrupt than others in the EU.

Navracsics said Orban’s government would submit laws to parliament on Friday to establish a new independent anti-graft authority to monitor the public procurement of EU funds, with the body to be launched by the second half of November.

Hungary has also pledged to implement several other anti-corruption safeguards, including tighter rules on conflicts of interest, extending the scope of financial statements and broadening the power of judges to pursue suspected corruption.

Navracsics expressed hope that the Commission would be reassured by the implementation of the reforms and withdraw its proposed sanctions against Hungary by Nov. 19.

The Commission is already blocking some 6 billion euros in funds envisaged for Hungary in a separate COVID economic recovery stimulus over the same corruption concerns.

Reuters documented in 2018 how Orban channels EU development funds to his friends and family, a practice human rights organisations say has immensely enriched his inner circle and allowed the 59-year-old to entrench himself in power.

Hungary had irregularities in nearly 4% of EU funds spending in 2015-2019, according to the bloc’s anti-fraud body OLAF, by far the worst result among the 27 EU countries.

Orban has also rubbed many in the bloc up the wrong way by cultivating continued close ties with President Vladimir Putin and threatening to deny EU unity needed to impose and preserve sanctions on Russia for waging war against Ukraine.

https://www.reuters.com/investigates/special-report/hungary-orban-balaton

Pelosi condemns Azerbaijan’s attacks on Armenia

Pelosi condemns Azerbaijan's attacks on Armenia© Reuters. FILE PHOTO: U.S. House Speaker Nancy Pelosi addresses a news conference following her meeting at Germany’s lower house of parliament Bundestag in Berlin, Germany, September 16, 2022. REUTERS/Christian Mang/File Photo

TBILISI (Reuters) -U.S. House of Representatives Speaker Nancy Pelosi on Sunday condemned what she said were “illegal” border attacks by Azerbaijan on Armenia, using a visit to the Russian ally to pledge American support for its sovereignty.

Pelosi cast her trip to Armenia, a sliver of land the size of the U.S. state of Maryland that is wedged between Azerbaijan, Georgia, Turkey and Iran, as an attempt to strengthen support for what she cast as a beacon of democracy.

Speaking in the ancient city of Yerevan, Pelosi said her trip had significance following the “illegal and deadly attacks by Azerbaijan on Armenian territory” that triggered border clashes in which more than 200 people were killed.

“We strongly condemn those attacks,” Pelosi said beside Armenian parliamentary speaker Alen Simonyan, who last week expressed unhappiness with the response of a Russian-led military alliance to Yerevan’s request for help.

Pelosi, who angered China with a trip to Taiwan last month, said it was evident that the border fighting was triggered by Azeri assaults on Armenia and that the chronology of the conflict should be made clear.

The fighting “was initiated by the Azeris and there has to be recognition of that,” Pelosi said.

Pelosi’s remarks drew an unusually strong rebuke from Baku, which said she was endangering the peace in the Caucasus.

“The unsubstantiated and unfair accusations levelled by Pelosi against Azerbaijan are unacceptable,” the foreign ministry said in a statement.

“This is a serious blow to the efforts to normalize relations between Armenia and Azerbaijan,” the ministry said, casting Pelosi’s remarks as “Armenian propaganda”.

Such a definitive apportioning of blame for the conflict goes beyond what the U.S. State Department has so far said in public.

Secretary of State Antony Blinken has expressed concerns over the fighting and called for calm but did not assign blame.

Blinken urged Azerbaijan’s President Ilham Aliyev on a call on Sunday “to adhere to the ceasefire, disengage military forces, and work to resolve all outstanding issues between Armenia and Azerbaijan through peaceful negotiations,” State Department spokesperson Ned Price said.

Armenia said Azerbaijan shelled at least six Armenian settlements inside the border shortly after midnight on Sept. 13, attacking civilian and military infrastructure with drones and large calibre guns. Yerevan said it was unprovoked aggression.

Azerbaijan, backed by Turkey, rejects those claims. Baku says Armenian sabotage units tried to mine Azeri positions, prompting soldiers to respond. Armenia says that narrative is Azeri disinformation.

RUSSIA’S BACKYARD

Russia, which repeatedly condemned Pelosi’s visit to Taiwan, considers the Caucasus as its own sphere of influence and bristles at what it casts as U.S. meddling in the region.

Moscow though, is preoccupied by the war in Ukraine which has triggered the biggest confrontation with the West since the height of the Cold War.

Russia is Armenia’s major military ally, has a military base in northern Armenia and peacekeepers along the contact line in Nagorno-Karabakh, over which Armenia and Azerbaijan fought a war in 2020.

President Vladimir Putin said on Friday that Russia had enough resources to mediate in the conflict. The latest fighting ended after a Russian-brokered ceasefire.

But after appeals for help, the Collective Security Treaty Organization (CSTO), a Russian-led military alliance of former Soviet republics that includes Armenia but not Azerbaijan, decided on Tuesday to dispatch a monitoring mission.

Armenian Parliamentary Speaker Simonyan said he was dissatisfied with the response, likening the CSTO to a pistol that did not shoot bullets.

Speaking beside Pelosi, U.S. Representative Frank Pallone said the United States wanted to do whatever it could to be more supportive of Armenia’s security.

The United States, Pelosi said, was listening to Armenia about what its defence needs were and said Washington wanted to help and support Armenia in what she cast as a global struggle between democracy and autocracy.

“We should be using our influence, our leverage showing that Armenian democracy and sovereignty is a priority,” Pelosi said. “The velvet revolution was cheered globally.”

Armenian Prime Minister Nikol Pashinyan rose to power in 2018 after anti-government protests referred to as Armenia’s Velvet Revolution.

Pelosi said it was interesting that Armenia was disappointed by the response from Russia.

“It is interesting that they were disappointed they got fact finders and not protection from that relationship and we’ll see what happens next,” she said.

Energy & Precious Metals – Weekly Review and Outlook

By Barani Krishnan

Investing.com – Moves in oil were as riveting as those on the Ukraine front this week. Given that Vladimir Putin has turned global energy prices into a referendum on his war, perhaps it shouldn’t be surprising. Yet it was. After nearly seven months into the invasion of Ukraine, the fortunes of both oil bulls and the Russian president’s “special military operation” didn’t appear that special, after all.

​​Crude prices settled flat to slightly higher on Friday. But on a weekly basis, they fell for a third straight week, with U.S. crude’s West Texas Intermediate finishing again beneath the key $90 per barrel mark, while global benchmark Brent struggled vainly to recapture the $100 berth it lost on Aug. 31.

More interestingly was what was happening with the Russian president and his one-time stranglehold on energy prices.

There was a time when Putin’s mere hint of a squeeze in Russian energy exports would have made oil traders sit upright and sent crude prices flying.

Lately, however, some of Putin’s rhetoric seems to have lost its impact with the energy crowd. These included his threat to completely shut down all oil and gas flowing out of his country unless the G-7 halts its so-called “price cap” on Russian oil, and the EU dismantles sanctions built around the Nord Stream 2 pipeline.

Let’s be clear about something: the energy market, in general, is still super tight on supply. One major disruption is all it might take for prices to come screaming back.

Yet, oil prices haven’t really gotten too much higher from the seven-month lows they plumbed nearly two weeks ago. And that’s because of the overtime work the Federal Reserve has been doing in scaring the bejesus out of traders over inflation and interest rates. Oil bears have also had a helping hand from a lockdown-friendly China that seems Covid time-trapped in Marty McFly’s fictional DeLorean, when the rest of the world has moved on with the pandemic for more than a year now.

European gas prices are still sky-high, of course. And U.S. gas prices are aspiring for new 14-year highs each day in sympathy with what’s going on the other side of the Atlantic. This is in spite of a very-well informed constituency of the gas market patiently telling anyone who cares to listen that the US LNG output is capped at 13 billion cubic feet per day and there’s nothing more we can do about raising that right away — even if Europe goes to hell in a handbasket this winter, which, incidentally is what Putin wants (that it gets there in a frozen casket).

Anyway, much of the lofty projections for crude and gas prices in the fourth quarter of this year and the first quarter of 2023 are based on forecasts that the forthcoming winter will be brutal. No one knows for sure how that will turn out. If the opposite turns out to be true, I can only imagine how much money is going to be lost on the long side by those listening to the wonderful advice of Jeff Currie at Goldman Sachs.

But back to Putin. More interesting than the moves in oil was the public dressing-down the Russian leader got on Friday from one of his greatest allies — Indian Prime Minister Narendra Modi. And, unfortunately for Putin, that came after Russian forces lost important and embarrassing territory in Ukraine over the past week.

Crude prices closed sharply off their highs on Friday — WTI ended just a penny up — on news that Iraq’s Basra oil terminal had resumed pumping following a brief disruption over an oil spill. The resurgence on of a third straight bumper rate hike by the Fed this week also put paid to Friday’s early rally in crude. A jump in the to 736 was another negative.

While these events dominated Friday’s headlines on oil, inconspicuously weighing on the market, however, was the image of a Putin rendered somewhat smaller by his key ally Modi, after the Indian premier refused to share Russia’s passion for the war in Ukraine.

“I know that today’s era is not an era of war, and I have spoken to you on the phone about this,” the Indian leader told Putin as they chatted on the sidelines of the Shanghai Cooperation Organisation summit, which the Russian president has tried to use as a showcase of his alliance with China and India.

How Modi and China’s leader Xi Jinping respond to Putin and the war in Ukraine is important to crude prices, particularly from the perspective of the price cap on Russian oil that the Group of Seven countries want to impose from December to limit what Moscow can earn from its energy exports to fund the war against Ukraine.

For the record, India dismisses the G7 oil price cap, saying energy security needs – and economics – will guide crude purchases by its refiners. But within that reaction was India’s tacit admission that the lower the price of Russian crude, the more the demand from Indian refiners will be. And that basically underscores the aim of the oil price cap, which is to reduce Russian revenues from oil. Crude-importing nations, led by China and the United States, also get to see lower prices for a barrel in the futures market when discounted Russian oil lands on the physical market, pressuring competing barrels from Saudi Arabia and other producers. Russia can, of course, export more barrels at reduced prices to make up for lost revenue, but that’s not what Putin nor the Saudis want.

China’s Xi also refrained from embracing Putin exuberantly this week over the war in Ukraine. That forced the Russian leader to publicly acknowledge “the well-balanced position of our Chinese friends in connection with the Ukrainian crisis.”

In a further concession, Putin said on Friday Russia will uphold its energy commitments if the West lifts its restrictions against the Russian Nord Stream 2 gas pipeline that runs across the bloc. Just a couple of weeks ago, Putin virtually held oil and gas exports ransom in Russia’s dealings with the West.

“It’s a fact: Putin’s scare talk on energy is getting less scary these days,” said John Kilduff, partner at New York energy hedge fund Again Capital. “And Russia’s key allies, India and China, showed this week they are more like fair-weather friends than one that would stand with Putin in the eye of the storm.”

Oil: Market Settlements and Activity

New York-traded did a final trade of $85.40 per barrel after settling the official session just a cent higher at $85.11.

For the week, the U.S. crude benchmark was down almost 2%, adding to the near 7% loss over two prior weeks.

London-traded did a final trade of $91.57, after settling the official session up 51 cents, or 0.6%, at $91.35 per barrel.

For the week, the global benchmark for oil fell 1.6%, adding to the near 9% slump over the two previous weeks.

Oil: Price Outlook

Technically is caught between a rock and a hard place, said Sunil Kumar Dixit, chief technical strategist at SKCharting.com.

“The price action setup is absolutely weak,” said Dixit. “As long as WTI sustains below $88.50, bears will continue to push for $82.50 and $81.20. If this zone fails as support, look for the 78.6% Fibonacci level of $77.”

He noted that through the last two weeks, the U.S. crude benchmark had failed to make a sustained break above $88.43 (61.8% Fibonacci retracement of $62.43 – $130.50) despite testing $90.37 and $90.17.

“Previous week’s drop to $81.20 caused some bounce as prices approached the monthly middle Bollinger Band at $82.47, however, lack of buyers’ confidence kept prices subdued,” Dixit said in his analysis. “Weekly stochastics at 9/8 continue to crawl below the 20-mark for the 7th straight week, while weekly RSI languishes in oversold territories.”

On the flip side, a sustained break above $88.50 can resume recovery towards the 50 Week Exponential Average of $92.08 and challenge the $96.50 (50% Fibonacci level) and $97.10, which represents the 200-Day Simple Moving Average.

Gold: Market Settlements and Activity

It’s amazing how much 24 hours could do to gold in the just-ended week, versus what 24 previous months did.

On Thursday, when neither the forex nor bond markets did enough to move the needle on gold prices, bears found it fit to hammer the yellow metal to the mid-$1,600 lows seen before the pandemic rally of 2020 that eventually resulted in all-time highs of above $2,100 for bullion.

In an ideal world, market moves sync perfectly with the news, data and other valuation matrix of an asset. In the real world, of course, there’s a greater chance for things to be overly exuberant or gloomy.

Thursday’s selloff in gold was beyond gloom. As a wave of risk-off sentiment built across commodities, longs in the yellow metal ostensibly became its biggest victims. One by one, the stop losses in gold got taken out like ninepins, as the market teetered on unfounded panic.

For what it’s worth, the benchmark gold futures contract on New York’s Comex, , did a final trade of $1,684.50 after settling the official session up $6.20, or 0.4%, at $1,683.50. For the week, it fell 2.6% for its fourth week in the red out of five.

The , which is more closely followed than futures by some traders, settled up $10.90, or 0.7%, at $1,675.42. For the week, spot gold lost 2.4%, also settling down for a fourth week in five.

And with another 72 hours to go before the Fed’s , there’s room for things to get a little more uncomfortable for gold bulls before they get better.

Gold: Price Outlook

Dixit of SKCharting said gold’s drop below $1,681 over the past week has shaken the confidence of market bulls as the plunge corresponds to a 38.2% Fibonacci retracement of long-term rally in bullion that went from $1,046 to $2,073.

“With this phenomenal drop that pushed the metal below the 200-week Simple Moving Average of $1,676 and the 50-month Exponential Moving Average of $1,670, there is a growing possibility of gold dropping further down to the next leg lower. We’re talking about the 50% Fibonacci level of $1560 over the Fed’s rate hike spree that can add to the Dollar Index strength and .”

But, as per “old school”, gold is also likely to retrace upward towards the broken support-turned-resistance zone of $1,700-$1,710 before resuming the drop towards $1,560.

“Long story short, the metal has become extremely undervalued over the last six months as it accumulated a massive $420 loss,” Dixit noted.

While the weekly and monthly stochastics of 9/14 and 5/11 have reached oversold territories, daily stochastics have already made a positive overlap.

“Going into the week ahead, recovery may target $1,695 and $1,705 initially.

Top 5 Things to Watch in Markets in the Week Ahead

Top 5 Things to Watch in Markets in the Week Ahead© Reuters

By Noreen Burke

Investing.com — Investors’ attention will be squarely focused on the Federal Reserve in the week ahead with policymakers widely expected to deliver a third straight 75-basis-point rate hike on Wednesday. The Fed isn’t the only game in town – central bank policymakers in the U.K., Switzerland and Japan will also meet during the week as the global fight against inflation intensifies. Meanwhile, U.S. stocks look set for another volatile week amid fears that higher interest rates will see the economy run into trouble. Here’s what you need to know to start your week.

  1. Fed decision

Higher-than-expected U.S. numbers for August have cemented expectations for another jumbo rate increase from the Fed at the conclusion of its on Wednesday.

Markets have priced in a 75-basis-point rate increase, but some investors are bracing for a full percentage point hike – a move unthinkable just a short time ago.

Market watchers will be on high alert for how the U.S. central bank views the current pace of monetary tightening, the strength of the economy, and how likely inflation is to persist – as well as signs of how the balance sheet unwind is proceeding.

Some worry the process, in which the Fed cuts its balance sheet by $95 billion per month, could hurt market liquidity and weigh on the economy.

  1. Bank of England

The meets on Thursday after last week’s meeting was delayed by a week for Queen Elizabeth II’s funeral. Policymakers are expected to hike rates by another 50 basis points, which would bring the Bank Rate to 2.25%, although a 75-basis-point hike is still on the table.

It will be the BoE’s first meeting since the announcement of a government price cap on energy prices, which is expected to see inflation peak lower than it would have done, but the injection of money into consumers’ pockets is likely to keep it high for longer.

On Friday, new Chancellor of the Exchequer Kwasi Kwarteng will deliver a “fiscal event” – his first statement on how he plans to deliver new Prime Minister Liz Truss’ pledge to make the U.K. a low tax economy, which risks stoking inflation.

The seemingly opposing directions of monetary and fiscal policy underline the challenges facing the U.K. economy, which has the highest among the world’s major economies but is also at risk of tipping into a recession.

  1. Global central banks

The meets on Thursday with officials expected to deliver a 75-basis-point rate hike, matching the European Central Bank’s recent move even though in the Eurozone is far outstripping Switzerland.

Elsewhere in Europe, Norway’s central bank is expected to hike rates at its on Thursday as inflation continues to exceed forecasts.

The also meets on Thursday amid speculation that Japanese authorities are close to intervening in the foreign exchange market to support the weak , which hit a 24-year low against the dollar earlier this month.

The dollar has been supported by the view that the Fed will keep tightening policy aggressively, while the BoJ sticks to unprecedented easing.

  1. PMI data

The first look at European business activity in September comes on Friday with the release of PMI data from the eurozone and the U.K.

The has already spent two months below the 50 level that separates contraction from expansion – a sign the bloc may enter a recession earlier than previously thought as the energy shock and tighter monetary policy bite.

Last Thursday, the that the world’s economy has been slowing sharply, and even a “moderate hit to the global economy over the next year could tip it into recession” as central banks simultaneously hike interest rates to combat persistent inflation.

  1. U.S. equities

U.S. stocks ended in the red on Friday with the and the posting their largest weekly percentage declines since June as inflation concerns, looming interest rate hikes and ominous economic warning signs weighed.

U.S. stocks’ volatile run this year shows no signs of abating as stubbornly high inflation data makes it likely the Fed will continue to raise interest rates faster and further than previously expected, adding to chances of a recession.

“While the market is expecting a big bump in the Fed’s rates next week, there is tremendous uncertainty and concern about future rate increases,” David Carter, managing director at JPMorgan in New York told Reuters Friday. “The Fed is doing what it needs to do. And after some pain, markets and the economy will heal themselves.”

-Reuters contributed to this report

Ukraine allies see risk in Russia’s response to battlefield setbacks

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World 1 hour ago (Sep 18, 2022 06:53PM ET)

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Ukraine allies see risk in Russia's response to battlefield setbacks© Reuters. Police and experts work at a place of mass burial during an exhumation, as Russia’s attack on Ukraine continues, in the town of Izium, recently liberated by Ukrainian Armed Forces, in Kharkiv region, Ukraine September 17, 2022. REUTERS/Gleb Garanich

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By Pavel Polityuk and Phil Stewart

IZIUM, Ukraine (Reuters) – The top U.S. general warned on Sunday it was unclear how Russia would react to its battlefield setbacks in Ukraine, as Britain said Moscow’s forces had widened strikes on civilian infrastructure and were likely to expand their targets further.

Ukraine’s General Staff said Ukrainian forces repelled attacks by Russian troops in the areas of the Kharkiv region in the east and Kherson in south where Ukraine launched counter-offensives this month, as well as in parts of Donetsk in the southeast.

Ukrainian President Volodymyr Zelenskiy vowed there would be no let up in the fighting.

“Perhaps it seems to some of you that after a series of victories we now have a lull of sorts,” he said in his regular nightly address. “But there will be no lull. There is preparation for the next series … For Ukraine must be free. All of it.”

Ukrainians who returned to the northeastern area retaken in Kyiv’s lightning advance earlier this month were searching for their dead while Russian artillery and air strikes kept pounding targets across Ukraine’s east.

PUTIN, BIDEN WARNINGS

On Friday, Russian President Vladimir Putin brushed off Ukraine’s swift counteroffensive and said Moscow would respond more forcefully if its troops were put under further pressure.

Such repeated threats have raised concerns Putin could at some point turn to small nuclear weapons or chemical warfare.

U.S. President Joe Biden, asked what he would tell Putin if he was considering using such weapons, replied in an interview with CBS’s “60 Minutes”: “Don’t. Don’t. Don’t. It would change the face of war unlike anything since World War Two.”

Some military analysts have said Russian might also stage a nuclear incident at Zaporizhzhia, Europe’s largest nuclear power plant held by Russia but run by Ukrainian staff.

Moscow and Kyiv have accused each other for shelling around the plant that has damaged buildings and disrupted power lines needed to keep it cooled and safe.

U.S. Army General Mark Milley, chairman of the Joint Chiefs of Staff, called for vigilance after visiting a base in Poland aiding Ukraine’s war effort. His remarks were a reminder of the risks of escalation as the United States and its NATO allies aid Ukraine from a distance.

“The war is not going too well for Russia right now So it’s incumbent upon all of us to maintain high states of readiness, alert,” he said after his trip to the base, which reporters traveling with him were asked not to identify.

Five civilians were killed in Russian attacks in the eastern Donetsk region over the past day and in Nikopol, further west, several dozen residential buildings, gas pipelines and power lines were hit, regional governors said on Sunday.

In a intelligence update, Britain’s defence ministry said Russian strikes at civilian infrastructure, including a power grid and a dam, had intensified.

“As it faces setbacks on the front lines, Russia has likely extended the locations it is prepared to strike in an attempt to directly undermine the morale of the Ukrainian people and government,” it said.

MASS GRAVES

On Saturday, Zelenskiy said authorities had found a mass grave containing the bodies of 17 soldiers in Izium, some of which he said bore signs of torture.

Izium residents have been searching for dead relatives at a forest grave site where workers began exhuming bodies last week. Ukrainian officials said last week they had found 440 bodies in woods near Izium. They said most of the dead were civilians and the causes of death had not been established.

The Kremlin has not commented on the discovery of the graves, but in the past Moscow has repeatedly denied deliberately attacking civilians or committing atrocities.

Making his way between graves and trees where exhumations were underway, Volodymyr Kolesnyk was trying to match numbers on wooden crosses with names on a neatly handwritten list to locate relatives who he said were killed in an air strike early in the war. Kolesnyk said he got the list from a local funeral company that dug the graves.

“They buried the bodies in bags, without coffins, without anything. I was not allowed here at first. They (Russians) said it was mined and asked to wait,” he told Reuters.

In Kozacha Lopan, a village some 45 km (30 miles) north of Kharkiv and only about 5 km (3 miles) from the Russian border, a Reuters reporter was taken to a squalid cellar with rooms fitted with iron bars, which officials said had served as a makeshift prison during the occupation. District mayor Vyacheslav Zadorenko said the rooms had been used as a “torture cellar” to detain civilians. Reuters was unable to verify those accounts.

Elsewhere in the region, residents of towns recaptured after six months of Russian occupation were returning with a mixture of joy and trepidation.

“I’ve still kept this feeling, that any moment a shell could explode or an airplane could fly over,” said Nataliia Yelistratova, who travelled with her husband and daughter 80 km (50 miles) on a train from Kharkiv to her hometown of Balakliia to find her apartment block intact, but scarred by shelling.

“I’m still scared to be here,” she said after discovering a piece of shrapnel in a wall.

(This story refiles to add dropped word in “no let up” in paragraph three)

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