Oil prices fell nearly 4 percent on Friday after the International Energy Agency said big consuming countries were more comfortably supplied than it previously thought.
US light crude tumbled US$1.18 to US$30.33 a barrel, extending Thursday's sharp losses and pulling prices back from recent 12-week highs above US$32. London August Brent crude fell US$0.87 to US$26.35 a barrel.
PHOTO: AFP
Prices fell as the Paris-based IEA, energy adviser to 26 industrialized nations, said its previous estimate of oil stock levels was 79 million barrels too low.
The agency's revised estimate put oil stocks in the industrialized world for the end of April at 2.439 billion barrels,
"Stocks are still below normal and can absorb some surplus in the third quarter, but I think we have entered a stage when more supply is coming on the market and will impact prices," said Geoff Pyne, oil market consultant to Sempra Energy Trading.
The IEA said the revision did not change its view that global markets were tight. Stocks are still 157 million barrels, or 6.5 percent, below last year.
"The market is obviously better supplied than we thought as little as two weeks ago, but stocks are still low and fundamentals are still tight, so we need to build more stocks," said Klaus Rehaag, editor of the IEA monthly oil market report.
"The increase in crude stocks may, however, signal some relief for an otherwise tighter heating oil situation later this year," he added
Oil stocks have been drawn down this year by a harsh northern winter and supply disruptions from a strike in Venezuela, ethnic strife in Nigeria and the war in Iraq.
Iraq on Thursday sold its first oil since the US-led invasion nearly three months ago, but looting and sabotage at oil facilities are expected to keep Iraq's exports well below prewar levels for several months.
The delays in Iraq's postwar export resumption enabled the OPEC producer cartel to postpone fresh supply cuts at Wednesday's meeting in Qatar.
OPEC, which controls about half the world's oil exports, decided to meet again in just seven weeks, on July 31, in case the return of Iraqi shipments undermines high prices.
OPEC sets a US$22 to US$28 target range for its basket of seven grades of crude oil. The basket was last valued at US$27.48.
The New Taiwan dollar is on the verge of overtaking the yuan as Asia’s best carry-trade target given its lower risk of interest-rate and currency volatility. A strategy of borrowing the New Taiwan dollar to invest in higher-yielding alternatives has generated the second-highest return over the past month among Asian currencies behind the yuan, based on the Sharpe ratio that measures risk-adjusted relative returns. The New Taiwan dollar may soon replace its Chinese peer as the region’s favored carry trade tool, analysts say, citing Beijing’s efforts to support the yuan that can create wild swings in borrowing costs. In contrast,
Nvidia Corp’s demand for advanced packaging from Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) remains strong though the kind of technology it needs is changing, Nvidia CEO Jensen Huang (黃仁勳) said yesterday, after he was asked whether the company was cutting orders. Nvidia’s most advanced artificial intelligence (AI) chip, Blackwell, consists of multiple chips glued together using a complex chip-on-wafer-on-substrate (CoWoS) advanced packaging technology offered by TSMC, Nvidia’s main contract chipmaker. “As we move into Blackwell, we will use largely CoWoS-L. Of course, we’re still manufacturing Hopper, and Hopper will use CowoS-S. We will also transition the CoWoS-S capacity to CoWos-L,” Huang said
VERTICAL INTEGRATION: The US fabless company’s acquisition of the data center manufacturer would not affect market competition, the Fair Trade Commission said The Fair Trade Commission has approved Advanced Micro Devices Inc’s (AMD) bid to fully acquire ZT International Group Inc for US$4.9 billion, saying it would not hamper market competition. As AMD is a fabless company that designs central processing units (CPUs) used in consumer electronics and servers, while ZT is a data center manufacturer, the vertical integration would not affect market competition, the commission said in a statement yesterday. ZT counts hyperscalers such as Microsoft Corp, Amazon.com Inc and Google among its major clients and plays a minor role in deciding the specifications of data centers, given the strong bargaining power of
INDUSTRY LEADER: INDUSTRY LEADER: Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), a major chip supplier to Nvidia Corp and Apple Inc, yesterday said it aims to grow revenue by about 25 percent this year, driven by robust demand for artificial intelligence (AI) chips. That means TSMC would continue to outpace the foundry industry’s 10 percent annual growth this year based on the chipmaker’s estimate. The chipmaker expects revenue from AI-related chips to double this year, extending a three-fold increase last year. The growth would quicken over the next five years at a compound annual growth rate of 45 percent, fueled by strong demand for the high-performance computing
RSS