Oil settled back above US$69 a barrel and gasoline futures also rose on Friday on concerns about Iran's nuclear capabilities and on news that talks to end a general strike in Nigeria had failed.
The market has been fixated on US domestic supply concerns, but a lack of news from the US shifted traders' focus to international developments. The news about Iran and Nigeria sent light, sweet crude for August delivery up US$0.49 to settle at US$69.14 a barrel (159 liters) on the New York Mercantile Exchange, and gasoline for July was up US$0.0401 to settle at US$2.2868 a gallon (3.8 liters). August Brent crude rose US$0.96 to settle at US$71.18 a barrel on the ICE Futures exchange in London.
In other NYMEX trading, heating oil futures for July rose US$0.0133 to settle at US$2.038 a gallon while natural gas prices fell US$0.218 to US$7.13 per 1,000 cubic feet (28 cubic meters). A government report on Thursday showed natural gas supplies rose by 2.5 billion cubic meters in the week ended June 15, in line with expectations.
Traders began buying after Iran's interior minister, Mostafa Pourmohammadi, said his country had 100kg of enriched uranium. Investors' concern is that the West will at some point take action, military or economic, against Iran, which could disrupt oil supplies from the Persian Gulf.
"The market really started taking off from there," said Jack Hunter, an energy trader at FC Stone Group in Kansas City, Missouri.
In Nigeria, talks on Friday night between union leaders and the government failed to produce an agreement, sending Africa's largest oil-producing nation into a third day of a general strike. Strikers want the government to drop a 15 percent increase in gasoline prices, which the government subsidizes.
Later on Friday, labor leaders said the two sides continued to talk and could resolve the strike by tomorrow.
So far, the unions have failed in their threat to shut down Nigeria's oil industry.
"We don't see production being affected yet," said Michael Cohen, an industry economist at the US Energy Department's Energy Information Administration (EIA).
Nigerian oil supplies won't be affected unless the strike lasts at least a week, Cohen said, and even that is uncertain.
Still, geopolitical events that could affect supplies tend to make traders jittery, sending prices higher, analysts said.
Nigeria, which has proven oil reserves of 36.2 million barrels, according to the EIA, has been beset by political violence since December 2005 often targeting its oil infrastructure. The EIA estimates the violence has halted the production of about 587,000 barrels per day of the 2.28 million barrels of crude oil Nigeria produced each day last year. Nigeria is the third-biggest overseas supplier of oil to the US.
Analysts think traders long ago built a Nigerian violence premium into oil prices, and are taking a wait-and-see approach to the strike.
"There's historical precedent that these strikes don't last very long," said Jim Ritterbusch, president of Ritterbusch and Associates, an oil trading advisory firm in Galena, Illinois.
The EIA's report on Wednesday that showed crude inventories jumped by 6.9 million barrels in the week ended June 15 lent some support to prices. Analysts had expected crude stocks to drop by 150,000 barrels. Gasoline inventories rose by 1.8 million barrels, more than the 1 million-barrel increase expected.
In Italy’s storied gold-making hubs, jewelers are reworking their designs to trim gold content as they race to blunt the effect of record prices and appeal to shoppers watching their budgets. Gold prices hit a record high on Thursday, surging near US$5,600 an ounce, more than double a year ago as geopolitical concerns and jitters over trade pushed investors toward the safe-haven asset. The rally is putting undue pressure on small artisans as they face mounting demands from customers, including international brands, to produce cheaper items, from signature pieces to wedding rings, according to interviews with four independent jewelers in Italy’s main
Japanese Prime Minister Sanae Takaichi has talked up the benefits of a weaker yen in a campaign speech, adopting a tone at odds with her finance ministry, which has refused to rule out any options to counter excessive foreign exchange volatility. Takaichi later softened her stance, saying she did not have a preference for the yen’s direction. “People say the weak yen is bad right now, but for export industries, it’s a major opportunity,” Takaichi said on Saturday at a rally for Liberal Democratic Party candidate Daishiro Yamagiwa in Kanagawa Prefecture ahead of a snap election on Sunday. “Whether it’s selling food or
CONCERNS: Tech companies investing in AI businesses that purchase their products have raised questions among investors that they are artificially propping up demand Nvidia Corp chief executive officer Jensen Huang (黃仁勳) on Saturday said that the company would be participating in OpenAI’s latest funding round, describing it as potentially “the largest investment we’ve ever made.” “We will invest a great deal of money,” Huang told reporters while visiting Taipei. “I believe in OpenAI. The work that they do is incredible. They’re one of the most consequential companies of our time.” Huang did not say exactly how much Nvidia might contribute, but described the investment as “huge.” “Let Sam announce how much he’s going to raise — it’s for him to decide,” Huang said, referring to OpenAI
The global server market is expected to grow 12.8 percent annually this year, with artificial intelligence (AI) servers projected to account for 16.5 percent, driven by continued investment in AI infrastructure by major cloud service providers (CSPs), market researcher TrendForce Corp (集邦科技) said yesterday. Global AI server shipments this year are expected to increase 28 percent year-on-year to more than 2.7 million units, driven by sustained demand from CSPs and government sovereign cloud projects, TrendForce analyst Frank Kung (龔明德) told the Taipei Times. Demand for GPU-based AI servers, including Nvidia Corp’s GB and Vera Rubin rack systems, is expected to remain high,
RSS