Latest news with #IpekOzkardeskaya
The National
2 days ago
- Business
- The National
Opec+ agrees another accelerated oil output for July
Opec+ has agreed to maintain its monthly oil output of 411,000 barrels per day for July, as it boosts supply amid trade tension-induced economic uncertainty. Analysts say the move is a possible gesture to appease US President Donald Trump's desire for lower crude prices. The hike marks the third consecutive month that the group, led by Saudi Arabia and Russia, will raise production at the same level, Opec+ said in a statement following a virtual meeting on Saturday. The decision was "in view of a steady global economic outlook and current healthy market fundamentals, as reflected in the low oil inventories", the group said. Opec+ noted that gradual increases may be paused or reversed "subject to evolving market conditions", giving them the "flexibility will allow the group to continue to support oil market stability". The accelerated unwinding of Opec+'s own restriction programme is expected to boost the market's supply surplus into the second half of 2025 "when demand prospects are fragilised by trade tensions", Ipek Ozkardeskaya, a senior analyst at Swissquote Bank, told The National. Mr Trump, meanwhile, has repeatedly called for lower oil prices to boost the domestic US oil industry. "We don't yet know if Opec+'s latest moves are to please Mr Trump or to [align] certain members" with the group's quotas, Ms Ozkardeskaya said. "Yet the rising supply will likely continue to apply negative pressure on prices – unless there is a sudden shift in the tariff picture like ruling of the tariffs." Oil prices started 2025 strongly. The closing price of Brent, the benchmark for two thirds of the world's oil, peaked at more than $82 a barrel on January 15, while West Texas Intermediate, the gauge that tracks US crude, hit almost $79 per barrel also on that day. However, crude prices have since waffled and have been particularly jolted by Mr Trump's sweeping global tariffs that he announced on April 2, which have disrupted stock markets and reignited fears of a global recession, especially as US trade partners – most notably China – unleashed retaliatory levies. Since then, Brent and WTI have slipped more than 16 per cent and 15 per cent, respectively, and the uncertainty surrounding Mr Trump's flip-flopping over his tariff policies have put pressure on oil prices. In March, Opec+ said it would proceed with a 'gradual and flexible' unwinding of voluntary production cuts of 2.2 million bpd starting in April, adding 138,000 bpd per month until September 2026. The planned return of production cuts – originally made by eight Opec+ members, including Saudi Arabia, Russia, the UAE and Iraq, in November 2023 – had been pushed back several times amid concerns about growing supply in the market. In March, the alliance released a new schedule for seven member nations to make further oil output cuts to compensate for exceeding their quotas. The plan includes monthly cuts ranging from 189,000 bpd to 435,000 bpd, with the reductions scheduled to last until June 2026. Opec has been losing global market share in recent years. In 2024, their output was less than 27 million bpd, down from 30 million bpd a decade ago and after having peaked of 34 million bpd in 2016. "In addition to trying to enforce stronger discipline within the group, Opec sees [increasing output] as a good opportunity to place pressure on higher cost oil producers, including US shale, and win back some market share," analysts at Jadwa Investment said. "This policy has the added benefit of bolstering good relations with the US given President Trump's stated desire for lower oil prices to bring down inflation in the US and force a diplomatic solution to the Russia-Ukraine war." How Opec+ policy evolves during 2025 will largely depend on internal compliance issues and the broader developments in the oil market, with hikes seen to scale down should global crude inventories start to build up, they added. The UAE's Minister of Energy and Infrastructure, Suhail Al Mazrouei, this week said Opec+ should be 'mindful' about oil demand, and that the group is 'doing their best' to balance the market and ensure there is enough investment into the supply. Mr Al Mazrouei's comments are "constructive", said Giovanni Staunovo, a strategist at Swiss bank UBS. "Opec+ crude exports are stable versus April, suggesting higher compliance and domestic demand keeps exports in check," the told The National. At its ministerial meeting on Wednesday, Opec reiterated its "continued commitment ... to achieve and sustain a stable oil market".
The National
3 days ago
- Business
- The National
Oil prices head for second weekly drop ahead of Opec+ output decision on Saturday
Oil prices slipped on Friday and are heading for their second weekly decline as the Opec+ alliance prepares for its meeting this weekend, where it is expected to announce its third major output increase. Brent, the benchmark for two thirds of the world's crude, fell 0.31 per cent to $63.95 per barrel on Friday at 9.32am UAE time. West Texas Intermediate, the gauge that tracks US crude, also dropped 0.31 per cent to $60.75. The Brent benchmark posted a weekly loss of 1.28 per cent, while WTI dropped 1.3 per cent for the week. So far this year, the Brent benchmark has retreated by 12.7 per cent, while WTI has declined by 15.3 per cent. Concerns about a global economic slowdown due to US President Donald Trump's tariffs on trade partners, and retaliatory measures, have put pressure on oil prices. The oil alliance's meeting on Saturday to decide on July's production levels comes amid global trade tensions that have cooled demand prospects, analysts say. "The group is expected to bring an additional 411,000 barrels per day to the market starting in July, about 1 per cent of current production, citing rising demand as official justification," said Ipek Ozkardeskaya, a senior analyst at Swissquote Bank. Opec may be trying to 'appease Trump' or encourage some member states who were non-compliant in the past to abide by the quotas, she said. "Whatever the rationale, if trade tensions persist, the rising supply could send oil prices meaningfully lower." Looking ahead to the rest of the year, a drop of another $10 per barrel in the second half "can't be ruled out", Ms Ozkardeskaya added. The V8 (voluntary eight) Opec+ group still sees room for the market to absorb additional barrels, said Giovanni Staunovo, strategist at UBS Switzerland. "Higher temperatures require more oil to generate power to cool buildings, the Hajj pilgrims will further support travel demand, but also sanctions weighing on exports from Venezuela drive demand for barrels from the Middle East," he added. Despite the 411,000 bpd quota increase for May, Opec+ crude exports are stable compared with April, suggesting "higher compliance and domestic demand keep exports in check", he added. Earlier this week, the UAE's Minister of Energy and Infrastructure Suhail Al Mazrouei said that, despite a growing focus on renewable energy, Opec+ should be 'mindful' about oil demand. The oil group, led by Saudi Arabia and Russia, is 'doing its best' to balance the market and ensure there is enough investment into supply, he said. 'If this group was not there, there will be chaos … you will be seeing shocks and that is not good news for consumers,' the minister added.
The National
23-05-2025
- Business
- The National
Oil prices down amid expectations of Opec+ supply boost in July
Oil prices were lower on Friday, heading for their first weekly loss in a month, after reports that Opec+ is planning to boost supply again in July. Brent, the benchmark for two thirds of the world's oil, was down 0.65 per cent to $64.02 a barrel at 12.19am UAE time. West Texas Intermediate, the gauge that tracks US crude, shed 0.69 per cent to $60.78 per barrel. After surging on Tuesday, Brent and WTI are on pace to shed 2 per cent on a weekly basis. So far this year the benchmarks have retreated about 15 per cent. The Opec+ group of producers, led by Saudi Arabia and Russia, had announced output increases of 411,000 barrels per day for May and June. It is likely to announce a similar increase for July during its June 1 meeting, Bloomberg quoted delegates as saying on Friday. However, no final decision has been made yet, the delegates added. Meanwhile, demand prospects also remain uncertain amid trade tensions caused by the sweeping tariffs announced by the Trump administration, said Ipek Ozkardeskaya, a senior analyst at Swissquote Bank. "This move [by Opec+] may be an attempt to appease Donald Trump, who has long lobbied for lower energy prices, or possibly to penalise member states that have repeatedly breached their quotas," she said. "Either way, Opec+ appears less willing to cut supply to support prices ... geopolitical tensions alone are not enough to push prices sustainably higher – unless they escalate into something far worse, which we obviously don't hope for." How Opec+ policy evolves during this year will depend on internal compliance issues and the broader developments in the oil market, analysts at Saudi Arabia's Jadwa Investment said in its oil market update for May. The group is likely to scale back production increases later in the year as global inventories start to increase. "If Opec+ continues to accelerate production at the same rate as May-June, production in October 2025 would exceed the previous plan for October 2026. This could lead to substantial oversupply, taking into account expected gains in non-Opec+ oil production," the analysts said. For the producers in Opec specifically, a looser production strategy may be a good opportunity to place pressure on higher cost oil producers and win back some market share, with "the added benefit of bolstering good relations with the US given President Trump's stated desire for lower oil prices", the Jadwa analysts added. The oil market faces continued uncertainty, awaiting the outcomes of a potential US-Iran nuclear deal and developments on American tariff negotiations with trading partners around the world, with a particular focus on talks with China. The US and China, the world's two biggest economies and main protagonists in the tariff war, agreed to a 90-day trade truce after a much-anticipated meeting in Geneva this month. The two sides continued discussions on Thursday, an apparent signal of progress in efforts to reach a middle ground on tariffs.
Time of India
22-05-2025
- Business
- Time of India
Wall Street slips as US bond market worries intensify after House passes Trump tax bill
AI-generated image NEW YORK: US stocks slipped in early Thursday trading amid growing concerns over rising government debt and surging Treasury yields, following House approval of President Donald Trump 's sweeping tax cut legislation. The S&P 500 fell 0.3 per cent in early trade, putting it on track for its worst week in two months. The Dow Jones Industrial Average declined 101 points, or 0.2 per cent, to 41,829.75 around 9.35 am Eastern time, while the Nasdaq Composite dipped 0.2 per cent to 19,535.10. The pullback comes after a turbulent week driven by volatility in the bond market, the epicentre of investor anxiety. Yields on government debt spiked in response to fiscal concerns, with the 10-year US Treasury climbing as high as 4.63 per cent before edging back to 4.59 per cent. The 30-year bond yield also rose, reaching 5.12 per cent. Rising yields reflect investor unease over the US government's growing debt load and are seen as a headwind for equity valuations and borrowing costs. Swissquote Bank analyst Ipek Ozkardeskaya said the spike in yields is 'the market's way of signaling a lack of confidence in the US government and its policy direction.' The tax legislation approved by the House aims to extend around $4.5 trillion in tax cuts from Trump's 2017 plan while introducing additional reductions. Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Thị trường có dấu hiệu suy thoái không? IC Markets Đăng ký Undo However, it also scales back clean energy subsidies and includes cuts to certain social programmes. The bill is expected to undergo substantial revisions in the Senate before potentially reaching the president's desk. Investors are cautious about the long-term economic implications of the tax bill, particularly its projected impact on the national debt. Higher Treasury yields not only increase borrowing costs for the government but also ripple through the broader economy—raising expenses for households and businesses, and dampening appetite for riskier assets like equities. Sector-specific losses were also notable. Solar energy stocks took a hit following the proposed rollback of production tax credits. Sunrun plunged 40 per cent, Enphase Energy dropped 16.5 per cent, and First Solar fell 4 per cent. Health care shares declined after the Centers for Medicare & Medicaid Services announced an immediate expansion of Medicare Advantage audits. UnitedHealth Group fell 1.4 per cent, while Humana slid 3.6 per cent. Global markets mirrored the cautious sentiment. France's CAC 40 declined 1.1 per cent, Hong Kong's Hang Seng dropped 1.2 per cent, and South Korea's Kospi also shed 1.2 per cent in one of the day's sharper losses. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Yahoo
22-05-2025
- Business
- Yahoo
U.S. Treasury Yield Path May Depend on Budget Sustainability, Investor Behavior
The trajectory of U.S. Treasury yields will depend on a few things, said Swissquote Bank's Ipek Ozkardeskaya in a note. The fiscal choices made by the U.S., whether the budget is sustainable, and whether there is any long-term plan to rein in the debt.
