Oil rises 1% on reports Israel preparing strike on Iranian nuclear facilities
Oil prices jumped more than 1 per cent on Wednesday after reports Israel is preparing a strike on Iranian nuclear facilities, raising fears that a conflict could upset supply availability in the key Middle East producing region.
Brent futures for July rose 86 cents, or 1.32 per cent, to $66.24 a barrel by 0003 GMT. U.S. West Texas Intermediate crude futures for July climbed 90 cents or 1.45 per cent to $62.93.
New intelligence obtained by the United States suggests that Israel is preparing to strike Iranian nuclear facilities, CNN reported on Tuesday, citing multiple U.S. officials familiar with the matter.
It was not clear whether Israeli leaders have made a final decision, CNN added, citing the officials.
U.S. crude futures rose by more than $2 a barrel on the news while Brent futures rose more than $1.
Iran is the third-largest producer among the members of the Organization of the Petroleum Exporting Countries and an Israeli attack could upset flows from the country. There are also concerns Iran could retaliate by blocking oil tanker flows through the Strait of Hormuz chokepoint in the Gulf, through which Saudi Arabia, Kuwait, Iraq and the United Arab Emirates export crude oil and fuel.
Still, there were some signs of improving crude supply.
U.S. crude oil stocks rose last week while gasoline and distillate inventories fell, market sources said, citing American Petroleum Institute figures on Tuesday.
Crude stocks in the U.S., the world's biggest oil consumer, rose by 2.5 million barrels in the week ended May 16, the sources said on condition of anonymity.
Investors are also looking ahead to government U.S. oil stock data from the Energy Information Administration later on Wednesday.
Also, Kazakhstan's oil production has risen by 2 per cent in May, an industry source said on Tuesday, an increase that defies pressure from OPEC+ on the country to reduce its output.
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Straits Times
31 minutes ago
- Straits Times
Singapore factory activity stays in contraction for second month on global trade uncertainty
The purchasing managers' index edged up 0.1 point from April to post a slower contraction reading at 49.7 points. PHOTO: ST FILE Singapore factory activity stays in contraction for second month on global trade uncertainty SINGAPORE – Manufacturing activity in Singapore shrank again in May, although at a slower pace than the month before, as US President Donald Trump's tariffs continued to threaten the global economic outlook, despite a de-escalation in the US-China trade war. The purchasing managers' index (PMI), a barometer of the manufacturing sector's health, edged up 0.1 point from April to post a slower contraction reading at 49.7 points. Readings above 50 indicate growth, while those below point to contraction. This is the second contraction reading for the overall manufacturing sector, after having recorded 19 months of expansion, said the Singapore Institute of Purchasing and Materials Management (SIPMM), which issued the report on June 2. Before falling into contraction in April, the last time the manufacturing PMI reading was below 50 was in August 2023 when it stood at 49.9 points, SIPMM data showed. Mr Stephen Poh, SIPMM's executive director, said the slower contraction reading in May could be a result of thawing US-China trade tensions, with the world's two largest economies slashing their tariffs substantially. 'However, global uncertainty remains despite the temporary suspension of tariffs,' he said. Under an agreement reached on May 12, the US slashed tariffs on China from 145 per cent to 30 per cent, while Beijing's retaliatory levies on US goods were lowered to 10 per cent from 125 per cent. The tariff reprieve is meant to last 90 days, during which time negotiators hope to secure a longer-term agreement. However, on May 30, President Trump accused China of violating terms of the truce on tariffs, a claim China has responded to with its own accusations of US wrongdoing. Said Mr Poh: 'Amid the geopolitical fragmentation, supply chain disruptions are becoming more frequent and less predictable.' Still, the latest PMI reading reflects slower contractions in key sub-indexes such as new orders, factory output and employment and faster expansions of input purchases and imports. Input prices, finished goods and order backlog also contracted at a slower pace, while the future business index shrank at a faster pace compared with April. The PMI for the electronics sector – which accounts for about 40 per cent of Singapore's manufacturing output – edged up 0.1 point in May from the previous month to post a slower contraction at 49.9 points. Before the 1.1-point drop in April, the sector had expanded for 17 straight months. This latest reading for the sector was helped by faster expansion in new orders, input purchases and imports. Also, the new exports index reverted to an expansion and factory output shrank at a slower pace. However, employment in electronics contracted in May at a faster pace, and indexes of finished goods, supplier deliveries, factory output and order backlog recorded slower expansion readings. DBS Bank senior economist Chua Han Teng said US tariff uncertainties and global trade frictions, despite the temporary suspension of US reciprocal tariffs, are negative for Singapore's external demand prospects, and will likely weigh on new export orders and factory production, particularly in the second half of 2025. 'Singapore's export-oriented factories remain vulnerable to the US tariff roller coaster,' he said. The Republic's latest PMI reading comes on the back of shrinking factory activity in May across much of Asia. Soft domestic demand in China and the impact of US tariffs took a heavy toll on manufacturing companies, private surveys showed on June 2. Trade-reliant Japan and South Korea continued to see manufacturing activity contract in May as President Trump's car tariffs clouded the outlook for exports. Adding to the gloom, an official survey on May 31 showed China's manufacturing activity shrank in May for a second month in a sign of weakness in the world's second-largest economy. Ms Xiaoqing Pi , Greater China economist at Merrill Lynch, said: 'While the US-China trade truce boosted sentiment, the recovery in growth momentum is far from solid, with domestic demand remaining weak.' Vietnam, Indonesia and Taiwan also saw factory activity shrink in May, private surveys showed. Join ST's Telegram channel and get the latest breaking news delivered to you.
Business Times
31 minutes ago
- Business Times
Singapore PMI marks slower contraction in May as trade tensions thaw but uncertainty remains
[SINGAPORE] Singapore's overall factory activity improved in May, but remained in contraction. This was as global powers' trade tensions de-escalated, but the outlook remains uncertain. The city-state's Purchasing Managers' Index (PMI) posted a reading of 49.7 last month, up 0.1 point from April, data from the Singapore Institute of Purchasing and Materials Management (SIPMM) showed on Monday (Jun 2). This marked two months of contraction, after a 19-month expansion streak. A reading above 50 indicates expansion. Stephen Poh, executive director at SIPMM, noted that the slower contraction could be due to 'thawing trade tensions when the world's two largest economies slashed their substantial tariffs'. On May 12, the US and China agreed to temporarily roll back the bulk of sky-high tariffs imposed on each other since 'Liberation Day'. Similar to Singapore's milder contraction, official Chinese data recorded an improvement, while University of Michigan data showed that US consumer sentiment rebounded in May, highlighted UOB associate economist Jester Koh. The improvements likely reflect some degree of optimism from the temporary US-China truce, he said. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Singapore's electronics sector PMI, which was on a 17-month streak of expansion till March, also recorded a second month of contraction. It edged up 0.1 point, to 49.9 in May. The uptick, coming after five consecutive months of deterioration, is likely due to lingering front-loading momentum, said Koh, given the potential of higher tariffs after the US' 90-day pause on reciprocal tariffs and looming sectoral tariffs. Still, Poh warned that global uncertainty remains despite the temporary tariff suspension, with more frequent and less predictable supply chain disruptions amid geopolitical fragmentation. US President Donald Trump last week accused China of violating their agreement, while a spokesperson for China's ministry of commerce accused Washington of severely undermining the truce earlier on Monday. These mutual accusations 'reflect the significant challenges in the path to achieving a lasting de-escalation of trade tensions', said DBS senior economist Chua Han Teng. Ongoing uncertainty continues to threaten global trade and growth prospects, in turn contributing to weak business sentiment, including in Singapore's manufacturing PMI data, he said. Chua flagged that the latest local data signals a 'weaker outlook', with minimal improvement following April's sharp declines. Some sub-indices reflected the weakness, he said. Headline and electronics manufacturing production sub-indices contracted for the second straight month, Meanwhile, though they did not contract in May, headline and electronics new export orders sub-indices moderated from late-2024 peaks. Koh noted that, 'more worryingly' than the overall PMI, the employment and future business sub-indices remain in contraction, possibly indicating concerns over demand prospects in the medium term, as trade negotiations are likely to take some time, with risks of re-escalation should talks go south. Region mostly in contraction Factory activity across Asia was largely similar to Singapore. Figures from China's national statistics bureau showed that manufacturing PMI – 49.5 in May – shrank for a second straight month, but contracted at a softer pace. The Caixin PMI, derived from smaller private manufacturers, is yet to be released. South Korea's S&P Global Manufacturing PMI picked up slightly from April, but remained in contraction at 47.7 in May. Its new orders saw the strongest fall since June 2020. Similarly, Taiwan's PMI, published by S&P Global, rose but stayed below the neutral level, at 48.6. Slightly closer to home, Vietnam and Indonesia's PMI rose – indicating a slower contraction rate – but remained below the neutral 50 mark for the second successive month. Vietnam's PMI was 49.8, while Indonesia's was 47.4. As for the Philippines, the latest PMI data indicated a setback to growth momentum built in April, with May recording broad stagnation in its manufacturing sector.
Business Times
35 minutes ago
- Business Times
Stablecoin issuer Circle targets US$7.2 billion valuation in upsized US IPO
[BENGALURU] Crypto firm Circle Internet said on Monday (Jun 2) it was targeting a valuation of up to US$7.2 billion on a fully diluted basis in its upsized initial public offering in the US, underscoring growing momentum in the stablecoin market. The upsized IPO indicates strong investor appetite for crypto firms under US President Donald Trump, who has not only promised friendlier regulations for the sector, but also has several crypto projects associated with him. New York-based stablecoin issuer Circle and some existing investors are now looking to raise up to US$896 million from 32 million shares priced between US$27 and US$28 apiece, up from their earlier offer of 24 million shares between US$24 and US$26. Circle's US dollar-denominated USDC, the second-largest stablecoin in the world, is expected to benefit from the impending stablecoin Bill, which is expected to catalyse institutional adoption. Stablecoins are designed to maintain a constant value, usually a 1:1 US dollar peg, and are commonly used by crypto traders to move funds between tokens. Circle's reserve income, its primary revenue source, from interest on the Treasuries backing its USDC coin, rose 55.1 per cent to US$557.9 million in the quarter ended Mar 31. But distribution and transaction costs for the period jumped 68.2 per cent, outpacing revenue growth for Circle, which distributes USDC primarily via its partnership with Coinbase and other third-party distributors. JPMorgan, Citigroup and Goldman Sachs are the lead underwriters for the offering. Circle will list on the New York Stock Exchange under the symbol 'CRCL'. Circle is poised to go public in New York later this week. REUTERS
