Crude posted its biggest weekly gain since July last year as the appointment of a hardliner for US national security adviser fueled speculation sanctions on Iran will be reimposed.
Futures in New York climbed 5.7 percent this week.
US President Donald Trump is taking a hawkish foreign-policy turn by picking John Bolton for the job, drawing the market’s attention to one of OPEC’s largest producers.
“We’re seeing the Bolton premium being priced in,” said John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund. “There’s geopolitical jitters. This switch in national security advisers is going to make the market uneasy about what lies ahead in terms of dealing with Iran.”
Crude this week surpassed US$65 a barrel for the first time since early last month as geopolitical tension adds to signs that OPEC and its partners are succeeding in draining a global glut.
Crude stockpiles in the US finally ticked below the closely watched five-year average mark for the first time since 2014.
Yet, record-high US crude production, coupled with concerns over a potential trade war with China that could thwart economic growth, is keeping the rally at bay.
West Texas Intermediate crude for May delivery on Friday rose US$1.58 to settle at US$65.88 a barrel on the New York Mercantile Exchange, up 5.7 percent for the week.
Brent for May settlement advanced US$1.54 to US$70.45 a barrel on the London-based ICE Futures Europe exchange, the highest level since late January. Brent futures are up 6.4 percent this week, the biggest weekly gain since July last year.
Any resumption of unilateral US sanctions against Iran could lead to a drop in the country’s oil exports by 250,000 to 500,000 barrels a day by the end of this year, oil and gas researcher FGE said last week in a note.
“I think we are at the top of the range,” Thomas Finlon, director of Energy Analytics Group LLC in Wellington, Florida, said in a telephone interview. “It’s reasonable to assume that US$70 represents a short-term ceiling for Brent.”
Oil market news:
‧ Gasoline futures on Friday rose 0.5 percent to US$2.0194 a gallon.
‧ Royal Dutch Shell PLC is selling its stake in Iraq’s West Qurna 1 field, abandoning the last of its oil assets in the country as it focuses on natural gas.
‧ Bank of America Merrill Lynch sees oil demand growth at 1.5 million barrels a day this year and 1.3 million a day next year, analysts wrote in a report.
‧ Lukoil PJSC is cautious about oil prices over the next decade, but promised to be generous to shareholders.
Demand for artificial intelligence (AI) chips should spur growth for the semiconductor industry over the next few years, the CEO of a major supplier to Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) said, dismissing concerns that investors had misjudged the pace and extent of spending on AI. While the global chip market has grown about 8 percent annually over the past 20 years, AI semiconductors should grow at a much higher rate going forward, Scientech Corp (辛耘) chief executive officer Hsu Ming-chi (許明琪) told Bloomberg Television. “This booming of the AI industry has just begun,” Hsu said. “For the most prominent
Former Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) chairman Mark Liu (劉德音) yesterday warned against the tendency to label stakeholders as either “pro-China” or “pro-US,” calling such rigid thinking a “trap” that could impede policy discussions. Liu, an adviser to the Cabinet’s Economic Development Committee, made the comments in his keynote speech at the committee’s first advisers’ meeting. Speaking in front of Premier Cho Jung-tai (卓榮泰), National Development Council (NDC) Minister Paul Liu (劉鏡清) and other officials, Liu urged the public to be wary of falling into the “trap” of categorizing people involved in discussions into either the “pro-China” or “pro-US” camp. Liu,
Minister of Economic Affairs J.W. Kuo (郭智輝) yesterday said Taiwan’s government plans to set up a business service company in Kyushu, Japan, to help Taiwanese companies operating there. “The company will follow the one-stop service model similar to the science parks we have in Taiwan,” Kuo said. “As each prefecture is providing different conditions, we will establish a new company providing services and helping Taiwanese companies swiftly settle in Japan.” Kuo did not specify the exact location of the planned company but said it would not be in Kumamoto, the Kyushu prefecture in which Taiwan Semiconductor Manufacturing Company (TSMC, 台積電) has a
China has threatened severe economic retaliation against Japan if Tokyo further restricts sales and servicing of chipmaking equipment to Chinese firms, complicating US-led efforts to cut the world’s second-largest economy off from advanced technology. Senior Chinese officials have repeatedly outlined that position in recent meetings with their Japanese counterparts, people familiar with the matter said. Toyota Motor Corp privately told officials in Tokyo that one specific fear in Japan is that Beijing could react to new semiconductor controls by cutting the country’s access to critical minerals essential for automotive production, the people said, declining to be named discussing private affairs. Toyota is among
RSS