Latest news with #oilprices
Yahoo
15 hours ago
- Business
- Yahoo
Oil prices gain on demand expectations amid improving economy
By Colleen Howe BEIJING (Reuters) -Oil prices rose on Wednesday on expectations of steady demand in the U.S. and China, the world's two largest oil users, amid an improving economic outlook. Brent crude futures rose 29 cents, or 0.42%, to $69 a barrel by 0105 GMT. U.S. West Texas Intermediate crude futures were up 40 cents, or 0.6%, at $66.92. That reversed two days of declines as the market downplayed the potential for supply disruptions after U.S. President Donald Trump threatened tariffs on purchases of Russian oil. Prices have seesawed in a fairly tight range as signs of steady demand from an increase in travel during the Northern Hemisphere summer has competed with concerns U.S. tariffs on its trading partners will slow economic growth and fuel consumption. However, major oil producers are pointing to improvement in economic growth for the second half of the year and Chinese data showed growth there remained consistent. "Strong seasonal demand is currently providing upward momentum to oil prices, as summer travel and industrial activity peak," LSEG analysts said in a note. "Increased gasoline consumption - especially in the U.S. during the Fourth of July holiday period - has signaled robust fuel demand, helping offset bearish pressures from rising inventories and tariff concerns." China data showed growth slowed in the second quarter, but not by as much as previously feared, in part because of frontloading to beat U.S. tariffs. That eased some concerns about the economy of the world's largest crude importer. The data also showed that China's crude oil throughput in June jumped 8.5% from a year earlier, indicating stronger fuel demand. That was the highest since September 2023, as state-owned refineries increased operations and saw a recovery in profit, consultants said. Additionally, the Organization of Petroleum Exporting Countries (OPEC) forecast in a monthly report on Tuesday that the global economy would do better in the second half of the year, boosting the oil demand outlook. India, China and Brazil are outperforming expectations while the U.S. and EU are recovering from last year, the report said. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Forbes
a day ago
- Business
- Forbes
Trump's Russia Math, Simplified
MOSCOW, RUSSIA - JULY 3 (RUSSIA OUT) Russian President Vladimir Putin speaks during the New Ideas ... More For New Times Forum at the Russia National Center, July 3, 2025, in Moscow, Russia. Putin visited a forum, hosted by Kremlin-backed Agency for Strategic Initiatives, prior to his announced telephone call with U.S. President Donald Trump. (Photo) Before the math, there is one word – Energy. The Russian economy is about oil prices. Russia exported about 2.8 billion barrels of oil in 2024, and it earned $192 billion doing that. The core idea here is elegantly simple: weaponize America's energy production capacity to collapse Russia's economy and force a quick end to the war. Let's break down the math behind Trump's thinking and see whether it actually adds up. Separately, see the potential for growth in Google Stock To $350? The Basic Economics Russia's vulnerability is real. Russia's energy exports, which include oil and gas, generated approximately $240 billion in 2024. When compared to Russia's GDP of $2.2 trillion for the same year, these exports accounted for over 10% of their total economic output. And oil is responsible for 80% of the country's total energy exports. So one way for Trump to hit Russia where it hurts is to flood the global energy market with subsidized U.S. oil. Let's say Trump offers a $20 per barrel subsidy on U.S. oil. That's a 30% subsidy on the current WTI crude price of $67 - making U.S. oil irresistibly cheap at just $47 a barrel. Now, the U.S. has the production capability. At peak capacity, American frackers can pump out 14 million barrels daily. The problem is they typically shut down when prices drop too low to be profitable. This subsidy would keep them pumping regardless of market conditions. The Financial Logic Here's where it gets interesting from a fiscal perspective. The hypothetical $20 per barrel subsidy on a production capacity of 14 million barrels a day works out to subsidy cost of $280 million a day for the U.S. And if the U.S. is willing to keep this subsidy going for 6 months, the total bill will come to just over $50 billion. Looks steep? Not really, when you consider the broader economic picture. The U.S. carries $36.6 trillion in debt at an average 3.3% interest rate. Every 1% drop in rates saves $366 billion annually in interest payments. If cheap energy helps drive down inflation and gives the Fed room to cut rates significantly, the subsidy could theoretically pay for itself multiple times over. Plus, lower energy costs would ripple through the entire economy - from data centers to shipping - creating deflationary pressure that could offset any tariff-driven price increases. The Strategic Risks The plan isn't without major vulnerabilities. Putin might escalate rather than capitulate when cornered economically. Russia has historically responded to existential threats with increased aggression, not surrender. China represents the biggest wild card. As a major buyer of Russian energy, they could potentially prop up Russia's economy even when cheaper U.S. alternatives are available. However, if prices drop dramatically enough, China might prioritize its own economic interests over supporting Russia. The Reality Check This strategy essentially treats subsidies as a lesser evil compared to the costs of prolonged conflict and economic instability. It's a high-stakes bet that economic pressure can achieve what military aid hasn't - a quick resolution to the war. The math works on paper, but geopolitics rarely follows economic theory. Russia's ability to endure economic hardship is historically impressive, and the assumption that cheap energy will automatically lead to Fed rate cuts involves several economic variables that don't always behave predictably. Still, when weighed against the alternatives - continued military spending, prolonged instability, and ongoing economic uncertainty - a $50 billion energy subsidy starts looking like a calculated risk rather than reckless spending. Whether it would actually work depends on variables no spreadsheet can fully capture. Markets, including cryptocurrencies, are trending higher. Related – Will The Rally In XRP Price Continue? This positive sentiment is largely driven by hopes that the Federal Reserve will resume cutting interest rates sooner than expected. However, investing always carries inherent risks. Now, we apply a risk assessment framework while building the 30-stock Trefis High Quality (HQ) Portfolio, which has a strong record of comfortably outperforming the S&P 500 over the past four years. Why is that? As a collective group, HQ Portfolio stocks have delivered superior returns with reduced risk compared to the benchmark index; less of a roller-coaster experience, as shown in HQ Portfolio performance metrics.
Yahoo
a day ago
- Business
- Yahoo
Oil prices down as Trump's deadline for Russia eases supply fears
Oil prices fell during early European trading after US president Donald Trump set a 50-day deadline for Russia to end its war in Ukraine, potentially averting further sanctions. The announcement alleviated immediate concerns surrounding global supply disruptions. Brent crude (BZ=F) lost 0.7% to trade at $68.72 a barrel, while West Texas Intermediate retreated 0.9% to $66.41. Initially, oil prices had surged on speculation about upcoming sanctions. However, the market reversed course as the deadline imposed by Trump raised hopes that punitive measures could be avoided. Investors began to question whether the US would actually go ahead with imposing high tariffs on nations continuing to trade with Russia. Read more: FTSE 100 LIVE: London heads near all-time highs as EU readies for US tariffs 'China, India, and Turkey are the largest buyers of Russian crude oil. They will have to weigh the benefits of buying cheap Russian oil against the costs of exporting to the US,' ING analysts wrote in a note. On Monday, Trump announced additional military aid for Ukraine, and over the weekend, he reiterated plans to impose a 30% tariff on most imports from the EU and Mexico, effective on 1 August. This move is part of broader threats aimed at other countries. Such tariff risks pose a potential slowdown to global economic growth, which could weaken fuel demand and, in turn, push oil prices lower. Meanwhile, Goldman Sachs (GS) raised its oil price forecast for the second half of 2025. The investment bank cited factors such as potential supply disruptions, declining oil inventories in OECD countries, and production constraints in Russia. Gold prices were steady on Tuesday morning as investors weighed mixed signals from the US regarding the state of trade negotiations. Gold (GC=F) futures were 0.3% higher at $3,368.80 an ounce, while spot gold was muted at $3.363.49 per troy ounce after touching a three-week high of 3,385.90 in the last session. Trump expressed openness to further discussions with major economies, including the EU. However, his comments seemed to contradict his insistence that letters to governments outlining tariff rates essentially represent "the deals" for trade partners. Read more: Bank of England could cut interest rates faster if jobs market slows, Bailey says 'If trade talks deteriorate before August, we could easily see bullion retest or even breach its former highs,' said Fawad Razaqzada, a market analyst at City Index. 'For now, the market seems firmly in wait-and-see mode, keeping the gold forecast leaning cautiously bullish.' The precious metal has surged more than 25% this year, with gold reaching a record high above $3,500 an ounce in April. 'Gold remains the asset of choice when tariff tensions flare up. Its move towards $3,350 shows this again,' Tim Waterer, chief market analyst at KCM Trade, said. The pound was trading cautiously, edging up 0.1% to $1.3443, hovering just above a three-week low of $1.3430 against the dollar (GBPUSD=X). Market participants were hesitant to make significant moves ahead of the US inflation data set to be released later in the day. Investors are keenly awaiting the US consumer price index (CPI) data, as it will provide insights into the impact of the tariffs imposed by Trump on inflation. US Federal Reserve officials have signalled a preference for holding interest rates steady until there is more clarity on how much Trump's tariff policies are influencing price levels. The upcoming CPI release could offer crucial information on this front. The US dollar index ( which tracks the greenback's value against six major currencies, was down by around 0.2% to 97.94 at the time of writing on Tuesday morning. Stocks: Create your watchlist and portfolio Estimates for the CPI data suggest that US headline inflation rose to 2.7% year-on-year in June, up from 2.4% in May. Meanwhile, core CPI, which excludes volatile food and energy prices, is expected to have increased by 3%, up from 2.8% in the previous reading. On a month-to-month basis, both the headline and core CPI are forecast to have risen by 0.3%. Sterling's gains were also capped as investors awaited the release of key UK economic data. The UK CPI for June is set for release on Wednesday, followed by labor market data for the three months ending in May, which will be unveiled on Thursday. In other currency moves, the pound was flat against the euro, trading at €1.1505 at the time of writing. In equities, the FTSE 100 (^FTSE) hit 9,000 points for the first time ever. For more details follow our live coverage while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
2 days ago
- Business
- Yahoo
Oil edges down as market contemplates potential sanctions, tariffs
By Anjana Anil (Reuters) -Oil prices edged down on Tuesday as the market digested U.S. President Donald Trump's 50-day deadline for Russia to end the Ukraine war and avoid sanctions on buyers of its oil, while worries continued to linger over Trump's trade tariffs. Brent crude futures fell 5 cents to $69.16 a barrel by 0000 GMT, while U.S. West Texas Intermediate crude futures fell to $66.89, down 9 cents. Both contracts settled more than $1 lower in the previous session. Trump announced new weapons for Ukraine on Monday, and threatened sanctions on buyers of Russian exports unless Moscow agrees to a peace deal in 50 days. Oil prices had climbed at the news of potential sanctions, but later gave up these gains as the 50-day deadline raised hopes that sanctions could be avoided, and traders dwelled on whether the U.S. would actually impose steep tariffs on countries continuing to trade with Russia. "The pause eased concerns that direct sanctions on Russia could disrupt crude oil flows. Sentiment was also weighed down by rising trade tensions," ANZ senior commodity strategist Daniel Hynes wrote in a note to clients. Trump said on Saturday he would impose a 30% tariff on most imports from the European Union and Mexico from August 1, adding to similar warnings for other countries and leaving them less than three weeks to hammer out framework deals that could lower the threatened tariff rates. Tariffs risk slowing down economic growth, which could sap global fuel demand and drag oil prices lower. Elsewhere, oil demand is set to stay "very strong" through the third quarter, keeping the market snugly balanced in the near term, the Organization of Petroleum Exporting Countries' secretary general said, according to a Russian media report. Goldman Sachs on Monday raised its oil price outlook for the second half of 2025, pointing to potential supply disruptions, shrinking oil inventories in Organisation for Economic Co-operation and Development countries, and production constraints in Russia. Sign in to access your portfolio
Yahoo
2 days ago
- Business
- Yahoo
Oil edges down as market contemplates potential sanctions, tariffs
By Anjana Anil (Reuters) -Oil prices edged down on Tuesday as the market digested U.S. President Donald Trump's 50-day deadline for Russia to end the Ukraine war and avoid sanctions on buyers of its oil, while worries continued to linger over Trump's trade tariffs. Brent crude futures fell 5 cents to $69.16 a barrel by 0000 GMT, while U.S. West Texas Intermediate crude futures fell to $66.89, down 9 cents. Both contracts settled more than $1 lower in the previous session. Trump announced new weapons for Ukraine on Monday, and threatened sanctions on buyers of Russian exports unless Moscow agrees to a peace deal in 50 days. Oil prices had climbed at the news of potential sanctions, but later gave up these gains as the 50-day deadline raised hopes that sanctions could be avoided, and traders dwelled on whether the U.S. would actually impose steep tariffs on countries continuing to trade with Russia. "The pause eased concerns that direct sanctions on Russia could disrupt crude oil flows. Sentiment was also weighed down by rising trade tensions," ANZ senior commodity strategist Daniel Hynes wrote in a note to clients. Trump said on Saturday he would impose a 30% tariff on most imports from the European Union and Mexico from August 1, adding to similar warnings for other countries and leaving them less than three weeks to hammer out framework deals that could lower the threatened tariff rates. Tariffs risk slowing down economic growth, which could sap global fuel demand and drag oil prices lower. Elsewhere, oil demand is set to stay "very strong" through the third quarter, keeping the market snugly balanced in the near term, the Organization of Petroleum Exporting Countries' secretary general said, according to a Russian media report. Goldman Sachs on Monday raised its oil price outlook for the second half of 2025, pointing to potential supply disruptions, shrinking oil inventories in Organisation for Economic Co-operation and Development countries, and production constraints in Russia.
