Crude oil rose to a five-week high after the International Energy Agency raised its forecast for oil use in 2001. It was the first increase from the agency this year, as sluggish economies have curbed growth in oil demand worldwide.
Average daily oil use will rise by 510,000 barrels from last year, 50,000 more than expected in July, according to the IEA, an adviser to 26 industrialized countries. Because of revisions to estimates covering past years, demand this year will total 76.4 million barrels a day, up 380,000 from last month.
"The IEA revisions were strongly supportive," said Andrew Lebow, senior vice president and broker with Man Financial Inc in New York. "This was a substantial change in the demand forecast." Crude oil for September delivery rose 41 cents, or 1.5 percent, to US$28.42 a barrel on the New York Mercantile Exchange, the highest closing price since July 6. Prices rose 1.6 percent this week and down 11 percent from this time last year.
In London, Brent crude oil for September settlement rose US$0.30, or 1.2 percent, to US$25.98 a barrel on the International Petroleum Exchange, a 1.1 percent gain for the week.
The forecast for growth, which the IEA had halved last month, indicates that slowing economies may not have restrained oil demand as much as expected. The agency said daily US consumption in May was more than 400,000 barrels higher than previously predicted.
Estimated oil demand growth this year is still far below the increase of 2 million barrels a day the IEA predicted in November.
"The IEA overdid last month's cut," said Julian Lee, senior energy analyst at the Centre for Global Energy Studies in London, founded by former Saudi oil minister Sheikh Zaki Yamani. "The rest of the year is going to be characterized by a fairly normal upward trend in seasonal crude oil demand."
Crude oil also rose on violence in the Middle East, which renewed concern of disruption to supplies from the region that pumps about one-third of the world's oil.
Fifty US and British military aircraft attacked three targets in Iraq's southern "no-fly" zone, damaging three targets, Pentagon officials said.
Iraq normally accounts for about 3 percent of world oil supply and was the fourth-biggest source of US imports in April.
Escalating violence between Israelis and Palestinians also helped to push prices higher, analysts said. Israeli F-16 fighter jets yesterday destroyed a Palestinian police station in the West Bank, and Israel shut the Palestine Authority's main office in east Jerusalem, after a suicide bombing killed 15 people and injured 130 others in the city.
While no Arab nations are threatening to cut oil sales, traders are concerned that escalating violence could lead to such a step in support of the Palestinians.
In October 1973, Arab states imposed an embargo on oil shipments to the US in response to the Arab-Israeli War, causing shortages and a doubling of prices. The Arab producers were hurt by the embargo, as consuming nations conserved and found new sources of oil.
Additionally, US military forces are now stationed in Saudi Arabia and Kuwait, defending them from Iraq, which makes it less likely that they would initiate an embargo.
"The Saudis and Kuwaitis are apprehensive about using the `oil weapon,' knowing the serious ramifications to the producers that it will spark," said Mordechai Abir, director of energy and geo-political research at Hoenig & Co in New York.
Gasoline futures rose after a report that a unit making gasoline-blending components at the Shell Deer Park Refining Co facility in Deer Park, Texas, was shut. The unit, known as a platformer, has a capacity of 340,000 barrels a day, and was shut down during an attempt to resume production, which had been halted by a fire last Friday. The company couldn't say when the unit would come back into service.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last