Oil capped its worst annual showing since 2015 as fears of scarcity turned into panic about a glut.
Futures in New York on Monday eked out a small gain, but finished the year down 25 percent, completing a reversal few anticipated just three months ago, when prices jumped to a four-year high.
There is growing concern that the US-China trade dispute and tightening US Federal Reserve monetary policy would undercut growth. Five US manufacturing indexes dropped last month, the first such across-the-board decline in two years.
Highlighting the muscle of US crude drillers, stockpiles at a key storage hub in Oklahoma probably rose 1.2 million barrels last week, according to a Bloomberg survey of analysts released on Monday.
Despite encouraging talk on trade from US President Donald Trump, the coming months still look unsettled, said Phil Streible, senior market strategist at RJO Futures in Chicago.
“We’ll probably start off 2019 on the same foot, weighed down by record US production as well as the lingering trade war,” Streible said in an interview. “We won’t see a rebalancing of the market until past the first quarter, so I would expect us to get trading right around these lows.”
West Texas Intermediate for delivery next month rose US$0.08 to US$45.41 a barrel on the New York Mercantile Exchange.
Brent for March settlement gained US$0.59 to US$53.80 on the London-based ICE Futures Europe exchange. The global benchmark closed the year down 20 percent.
Crude’s moves have been amplified by gyrations in equity markets, which have propelled an oil-price volatility gauge to more than double over the past three months.
Oil jumped to a four-year high in early October on concern that renewed US sanctions on Iran’s oil exports would tighten supply, but Trump’s surprise decision to grant waivers to many buyers pushed prices into a bear market within weeks.
“Trump has reigned as the ultimate controller of oil prices this year, because everything from sanctions against Iran, the trade war with China and even tensions with Saudi Arabia, he’s been involved,” HI Investment & Futures Corp commodities analyst Sungchil Will Yun said. “While prices won’t fall further from here, the pace of increase will also be quite gradual next year.”
OPEC and its partners, including Russia, responded to the downturn earlier last month with a promise to cut 1.2 million barrels a day of output starting this month, but OPEC faces a formidable challenge from US drillers that are pumping at record levels.
More than 100 additional oil rigs were deployed across the US last year, with overall crude production topping 11 million barrels a day.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day