US inflation accelerates to 3.5pc pace in March

  • : Crude oil, Metals, Oil products
  • 24/04/10

The US consumer price index (CPI) accelerated to a 3.5pc annual pace in March, a sign the Federal Reserve is likely to hold its target lending rate at a 23-year high for longer in order to slow inflation to its long-range goal.

The CPI rose from a 3.2pc rate in February and was the highest since it reached 3.7pc in September, the Bureau of Labor Statistics reported today. So called core CPI, which strips out food and energy, rose at a 3.8pc rate, unchanged from the prior month. Food rose at a 2.2pc rate and energy rose at a 2.1pc pace. Shelter rose at a 5.7pc annual rate.

The CPI report reduced the probability that the US Federal Reserve will begin cutting its target rate at its June meeting to less than 20pc, futures markets showed on Wednesday, down from a greater than 57pc probability on Tuesday. The Fed last week signaled it was in no hurry to begin cutting borrowing costs amid stronger than expected economic data, even as it also suggested most members did expect cuts to begin later this year.

On a monthly basis, CPI rose by 0.4pc for a second month and core CPI rose by 0.4pc for a third month. Food rose by 0.1pc on the month and energy rose by 1.1pc, with gasoline up 1.7pc. The shelter index and gasoline index accounted for 50pc of the monthly gain in the headline CPI index, the bureau said.


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24/06/20

Australia’s MinRes to close Yilgarn iron ore hub

Australia’s MinRes to close Yilgarn iron ore hub

Sydney, 20 June (Argus) — West Australian (WA) iron ore mining firm Mineral Resources (MinRes) will stop shipping from its lower grade Yilgarn operations by 31 December and transfer staff to its Onslow project in the Pilbara. The 8mn t/yr Yilgarn in the Mid West region of WA is not financially viable beyond the end of 2024, according to MinRes. The mine operated at a delivered cost of A$139/wet metric tonne (wmt) ($93/wmt) and received revenue of A$164/wmt during July-December 2023 . The Argus ICX 62pc Fe iron ore price averaged $117.45/dry metric tonne (dmt) cfr Qingdao January-June this year compared with $121.47/dmt for July-December 2023. It was last assessed at $107.10/dmt on 19 June. As prices have fallen for MinRes, costs are also rising, particularly at the ageing Yilgarn operations, which it bought six years ago after its previous owners US firm Cleveland Cliffs closed it in 2018. The WA government helped MinRes to restart the Koolyanobbing mine as the foundation of the Yilgarn operations in early 2019 . The Argus ICX price was $72.80/dmt cfr Qingdao on 31 December 2018 and rose to a peak of over $200/dmt in mid-2021 before easing to its current levels. MinRes will move staff and equipment from Yilgarn to its new 35mn t/yr Onslow, which shipped its first ore to Chinese producer Baowu Steel in May . By Jo Clarke Iron ore prices ($/dmt) Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Alberto year's first named Gulf of Mexico storm


24/06/19
24/06/19

Alberto year's first named Gulf of Mexico storm

Houston, 19 June (Argus) — A storm system in Mexico's Bay of Campeche became the first named tropical storm of this year's Atlantic hurricane season, bringing heavy rains and winds to the south Texas and northeast Mexico coasts. Tropical Storm Alberto is expected to come ashore in Mexico's Tamaulipas and Veracruz states late Wednesday or early Thursday, with maximum sustained winds of 40mph, according to the US National Hurricane Center. Heavy rain may be seen as far north as Corpus Christi, Texas, but the heaviest rains are expected inland in Mexico. Rain and heavy seas associated with the Gulf of Mexico storm system were expected to disrupt ship-to-ship lightering operations off the coast of Corpus Christi, Galveston and Beaumont-Port Arthur, Texas. The storm system does not appear to have curtailed US offshore Gulf of Mexico oil and gas production. This year's Atlantic hurricane season is expected to be more active than normal , according to the US National Oceanic and Atmospheric Administration, with 4-7 major hurricanes possible. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Nigeria tightens sulphur cap on oil product imports


24/06/19
24/06/19

Nigeria tightens sulphur cap on oil product imports

London, 19 June (Argus) — Nigeria has reduced the sulphur cap on refined oil product imports to 50ppm, according to market participants. The new cap — which took effect at the start of June, according to sources — marks a sharp reduction from a previous 200ppm limit set on 1 March . Sources suggest there was no widespread information campaign to make market participants aware of the specification change. The lower sulphur limit comes as Nigeria braces for the imminent ramp-up of 10ppm ultra-low sulphur diesel production at the country's 650,000 b/d Dangote refinery, followed by 10ppm gasoline production in mid-July. A lower sulphur content ceiling for imports will likely favour the sale of diesel, jet fuel and gasoline from the Dangote refinery to the local Nigerian market, which until March was able to import high-sulphur products upwards of 2,000ppm. Some 10ppm diesel has already been delivered to Nigeria since the start of June, as traders have struggled to source any available 50ppm diesel to import into the country under the new cap, one trader said. Despite the regulatory change, one local Nigerian marketer told Argus that a 30,000t cargo of 150ppm gasoline is discharging in the country on 19 June, raising questions around enforcement of the new cap. By George Maher-Bonnett Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Buyers, ex-EU mills discussing HRC quota management


24/06/19
24/06/19

Buyers, ex-EU mills discussing HRC quota management

London, 19 June (Argus) — Buyers and exporters to the EU are trying to reduce the risk of purchasing "other countries" hot-rolled coil (HRC) under the 15pc single country quota cap. They are discussing adding duty-sharing clauses to contracts, and commitments from sellers to not exceed their quotas. Mills from the same countries, in the meantime, are deciding whether it would benefit them to allocate the quarterly quota between themselves, in a similar way to South Korean producers, or adopt India's approach, where each seller has tried to maximise its market share. Participants are preparing for a turbulent lead-up to and start of July, and trying to estimate how much duty will be payable on imports mainly from Japan and Vietnam, but also Egypt and Taiwan. Sources expect that October arrivals could also be above quota allocations. In order for purchasing to resume, amid all the uncertainty, buyers are demanding that sellers provide some guarantees that they would not sell excessively in the EU. But feedback from mills has so far been mixed — Vietnamese sellers have said they cannot be held responsible if exports to the EU are higher than the roughly 142,000 t/quarter allowed duty-free, and they were not willing to share duties with buyers, according to participants. Some buyers said they have enquired with Egypt about committing their full quota to them with a firm bid. But controlling Egypt's quota may be more complicated, as often the mill sells on a fob basis to traders, which may in turn sell to Europe or not, market participants said. Some sources said the producer is allocating volumes per buyer depending on the relationship and historical tonnages purchased. Co-operation between Taiwanese mills could be more straightforward, as export certificates are issued by the Taiwanese steel association, according to a seller, in which case volumes can be tracked and monitored more easily. One source said mills will look to sell higher grades and specialties in lieu of commodity HRC to compensate for the reduction in volume to the EU, but maximise the revenue generated. In Japan, mills have been discussing sharing the allocation between themselves, but each seller is reportedly pushing for a larger portion of the quota, even those that have sold very low historical amounts to the EU previously, placing the most active mill under further pressure. There have been suggestions that Japan could try to ramp up its exports of other products to compensate for the loss in HRC — it is often already the lowest-priced supplier of cold-rolled coil (CRC). Buyers and traders are continuing to urge the EU to allow for a grace period in the meantime, so that the material due to be cleared on 1 July is subject to the old regulations. But it appears that the European Commission, which has not yet officially confirmed that the safeguards have been passed as proposed, is not going to take those requests into account. Sources in Brussels suggest that no grace period has been included in the regulation. By Lora Stoyanova Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Iran's crude output at 3.6mn b/d, says oil minister


24/06/19
24/06/19

Iran's crude output at 3.6mn b/d, says oil minister

Dubai, 19 June (Argus) — Iran's crude output has risen to around 3.6mn b/d, according to the country's oil minister Javad Owji. This puts production at the highest level since sanctions were reimposed on Tehran's oil sector in 2018 following Washington's exit from the Iran nuclear deal. "Our oil production, which was 2.1mn b/d at the beginning of our time in office [in September 2021], has reached 3.6mn b/d," Owji said today during a presentation to the Iranian parliament. "During these three years… with round-the-clock work and effort, production of crude oil in the country rose by more than 1.4mn b/d," he said. "A major part of that increase came through signing investment contracts with [domestic] contractors." When the administration of Iran's late president Ebrahim Raisi assumed office, Iran's crude exports were at their lowest level in a decade, Owji added. Owji's current production figure is 200,000 b/d above where he put Iranian crude output in November last year . At that time, he predicted a rise to 3.6mn b/d by March 2024, continuing an upward trend since the back end of 2022. In July last year, Owji put output at just shy of 3.1mn b/d. His latest assessment is around 300,000 b/d above Argus' estimate for both April and May . The last time Argus estimated Iranian crude output as high as 3.6mn b/d was back in July 2018. The rebound in production has been driven by Iran's ability to boost its exports. Iranian exports began picking up in the months after US president Joe Biden assumed office in January 2021, reaching around 700,000-750,000 b/d compared with 500,000 b/d before the US election. It was not until the second half of 2022 that exports took another leap, to 1mn b/d and beyond. Iran's crude exports have averaged just shy of 1.6mn b/d since the start of this year, according to data from Vortexa, up from 1.42mn b/d in 2023 and 990,000 b/d in 2022. The reasons for the revival in exports have been the subject of much debate, with some attributing it to more relaxed enforcement of sanctions by the US and others saying it has more to do with Iran scaling up its methods of circumvention. The debate even became a point of contention among Iranian presidential candidates this week as they gear up for the country's election on 28 June. Conservative candidates and even regime hardliners largely attribute the boost in exports to methods of circumvention. "Constructive and extensive relations with the world are required for [improving] the economy. This happened during the tenure of martyr Raisi. Now the US foreign secretary must explain to the [US] Senate why Iran can sell 2mn b/d of oil now," former nuclear negotiator Saeed Jalili said on 15 June. Raisi administration officials have repeatedly pointed to their techniques to get around sanctions and "energy diplomacy" as reasons for Iran's success in raising exports. But the reformist camp refutes those claims, with former foreign minister Javad Zarif rejecting the conservative narrative on state television on 18 June. "They [hardliners] said 'we taught them how to sell oil.' Not at all," Zarif said. "When Biden took office, his policy was to loosen the screw. Wait until Trump returns to office, and then we can see what [the hardliners] say." By Bachar Halabi and Nader Itayim Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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