Chinese exports strengthen with the US attempts to tame soaring oil prices

China’s export growth accelerated unexpectedly in July, providing an encouraging boost to the economy in the fight to recover from the COVID-induced recession, but weak global demand could begin to put pressure on shipments in the coming months; while America’s largest oil and gas producers maintain supplies, defying calls from the Biden administration to raise production even as high fuel prices caused by Russia’s war in Ukraine make abundant profits.

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Chinese exports gain momentum but outlook confused as global growth slows

US oil producers defy calls to open up space to tame war-driven prices

Chinese exports gain momentum but outlook confused as global growth slows

Official customs data on Sunday showed exports rose by 18.0 percent in July from the previous year
the fastest pace this year, compared with a 17.9 percent increase in June
and above analysts’ expectations for a 15.0 percent gain.

Outbound shipments were one of the few bright spots for the Chinese economy in 2022,
as widespread lockdowns affected businesses and consumers dramatically,
and the once-robust real estate market struggled with back-to-back crises.

Analysts have been surprised by China’s export trend again on the upside,
as it continues to help China’s economy in a difficult year as domestic demand remains slow.

However, many analysts have predicted that exports will fade as the global economy
becomes more likely to head into a serious slowdown,
weighed down by higher prices and higher interest rates.

A global factory survey released last week showed weak demand in July,
with orders and production indicators falling to their weakest since the COVID-19 pandemic emerged in early 2020.

China’s official manufacturing survey indicated that activity shrank last month,
prompting alarm that the economy slowed from the spring lockdown
further and more difficult than expected.

But there were signs that transport and
supply chain disruptions caused by COVID restrictions were continuing to ease,
just in time for shippers preparing for peak shopping demand at the end of the year.

Production of foreign trade containers at eight major Chinese ports rose by 14.5 percent during July,
accelerating from an 8.4 percent increase in June, according to data from the Local Port Federation.

Container productivity in the coronavirus-hit port of Shanghai hit a record high last month.

artıcal name Chinese exports strengthen with the US attempts

Imports remain weak

After a shaky second quarter, most analysts expected China’s import momentum to increase modestly in the latter half of the year,
supported by construction-related equipment and goods as the government ramps up infrastructure spending.

But last month’s imports were again weaker than expected,
suggesting that domestic demand remains weak.

Imports rose by 2.3 percent from the previous year,
compared with June’s 1 percent gain and expectations for a 3.7 percent rise were lost.

Experts say that despite a slight rise in domestic demand as COVID control measures ease,
weak production performance has led to a decline in imports.

Crude oil imports in July fell by 9.5 percent from a year earlier,
as fuel demand recovered slower than expected due to the new virus outbreak.

The volume of imported integrated services, a significant Chinese import,
estimated at 19.6 percent in July compared to the previous year, had declined,
this may serve as an additional red flag for exports,
as much of the country’s imports are components of goods that are then re-exported.

China posted a record trade surplus of $101.26 billion last month,
well above the $90.0 billion surplus forecast by analysts.

The country’s chief economic planner said last week
that the economy was in a “critical window” for stabilization and recovery,
and the third quarter was “vital.”

Senior leaders recently indicated that they were ready to surpass the government’s growth target of about 5.5 percent for 2022,
which analysts said seemed increasingly elusive after the economy narrowed.

artıcal name Chinese exports strengthen with the US attempts

US oil producers defy calls to open up space to tame war-driven prices

Major shale oil and gas producers, including ConocoPhillips, Pioneer Natural Resources and Devon Energy,
have revealed a sharp increase in second-quarter profits this month as crude oil
and natural gas prices rise to fill industry coffers.

But executives say they are still under pressure from Wall Street,
to return the windfall gains to investors through dividends and
share buybacks rather than spending heavily to boost production.

Other shale executives echoed this sentiment in the latest sign that oil companies
and their shareholders remain unimpressed by politicians’ calls for more oil and gas supplies
after Russia’s invasion of Ukraine sent fuel prices soaring.

Energy prices pushed inflation across the United States and Europe to levels not seen in 40 years.

President Joe Biden and other Western politicians have attacked oil companies’ decision to transfer profits
to shareholders rather than investing in a new production that would help tame prices.

The approach now followed has slowed the country’s oil supply growth
compared to recent years when commodity prices rose.

The United States produces about 12.1 million barrels a day of crude oil,
according to the Energy Information Administration,
this is about 800 thousand barrels higher than last year,
but still below the level of highs preceding the coronavirus pandemic.

Growth in production this year has been driven mainly by private operators
who are not subject to the same type of shareholder pressure to limit investment.

artıcal name Chinese exports strengthen with the US attempts

Chinese exports strengthen with the US attempts to tame soaring oil prices

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