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Asian markets are declining.. Oil is falling due to the failure of the OPEC negotiations

Asian markets are declining.. Oil is falling due to the failure of the OPEC negotiations

Asian markets are declining.. Oil is falling due to the failure of the OPEC negotiations

Asian markets are declining.. Oil is falling due to the failure of the OPEC negotiations: Oil continued to decline today,
Thursday, after OPEC, failed to reach an agreement on production in August, creating uncertainty in the market. 

Evest follows the developments in the commodity trading market and relays them to you in the following lines.

Oil continues to decline for the second day in a row

After negotiations of the major oil-producing countries collapsed this week,
oil prices declined for the third day in a row on Thursday because of supply uncertainty,
which could cause the current production agreement to be overturned.

Brent crude futures declined $0.23, or 0.3%, to $73.20 per barrel; U.S. West Texas Intermediate crude futures fell $0.33, or 0.5%, to $71.87 per barrel.

After the OPEC + negotiations collapse, Brent crude prices have declined by about 5% since the close on Monday OPEC+ refers to the alliance of oil-producing countries with allies such as the Organization of the Petroleum Exporting Countries (OPEC) and Russia.

The UAE requested an increase in its production under the agreement, but Saudi Arabia refused to accept it.

Reuters

According to Reuters, Oanda’s senior market analyst said: “The oil market is looking to evolve after the shortage of oil supply in August.

The OPEC+ agreement is expected to collapse before the agreement expires in April 2022,
Member States will require more concessions for greater market share.“

It’s been more than a year since OPEC + applied production restrictions because demand has been affected by the pandemic.

The organization maintained a policy of reducing production by about 6 million barrels per day,
and it was originally expected to increase the supply,
but the three-day meeting failed to bridge the differences between Saudi Arabia and the UAE.

Three sources in OPEC + said Russia was trying to broker a deal to increase production.

However, the sharp decline in U.S. crude oil inventories has led to some support for oil prices.

Two market sources cited data from the American Petroleum Institute (API) on Wednesday that U.S. crude oil inventories declined by 8 million barrels last week.

Reuters estimated a decrease of 4 million barrels.

official inventory data is postponed

Since Monday is the national day of the United States, official inventory data is postponed one day to Thursday.

The decline in U.S. oil production is expected to reverse gear this year.

The U.S. Energy Information Administration (EIA) said Wednesday that it expects U.S. oil production to be 11.1 million barrels per day in 2021,
down 210 thousand barrels per day from 2020, while previous projections were down 230 thousand barrels per day.

However, concerns about the spread of the epidemic have put pressure on oil prices.

According to Nihon Keizai Shimbun, the Japanese government is preparing to declare a state of emergency in Tokyo this month in response to a rise in cases of the novel coronavirus variant, and the state of emergency will last until August 22 after the Tokyo Olympics. 

For its part, the number of new infections reported in one day in South Korea has reached the highest level in history.

Declines in Japanese and Chinese exchanges

The Tokyo Stock Exchange declined again on Thursday, as on the day before due to a renewed health crisis in Japan and a possible new emergency in Tokyo until August 22, including during the Olympics.

The main Nikkei index fell by 0.88% to 28118.03 points, having already shed nearly 1% the day before.

The Japanese government is scheduled to officially ratify later on Thursday the return of the state of emergency in Tokyo from Monday until August 22,
which will thus cover the period of the Olympic Games (July 23 to August 8).

Tokyo recorded 920 new infections of Covid-19 on Wednesday, a record for nearly two months.

It is very likely that restrictions on the public will be tightened during the Olympic Games in the aftermath.

Japanese media reported on Thursday the possibility of holding a closed session at most of the Olympic stadiums in Tokyo.

In Hong Kong, the Hang Seng index fell by 2.5%, against the backdrop of Beijing’s increasing emphasis on Chinese digital giant companies.

The composite indicators for Shanghai and Shenzhen fell more moderately.

Mass rally on Wall Street

Standard & Poor’s index reached a new record on Wednesday.

The stock market index rose 0.34% to record an all-time high of 4,358.13.

This is largely due to investors returning to their usual technology stocks.

In the meantime, the Dow Jones Industrial Index rose 104.42 points (0.30%) to 34681.79,
and the Nasdaq Composite Index rose 1.42 to 14665.06. 

Investors have returned to their reliable big-tech stocks.

Tech giants Amazon and Apple saw a rise of more than 15% last month, nearly 5 times the S&P 500 index by 3.1%.

Also, contrary to expectations, the 10-year Treasury yield fell by 1.296% on July 7, the lowest level since February.

 

European exchanges began to fall sharply, following Asia’s weakness and with U.S. futures in the red zone.

After the volatile session on the night, Milan recorded the worst performance at a 1.2% loss.

So were Paris (-1.12%), Frankfurt (-0.9%) and Amsterdam (-0.74%). 

Central banks are always at the focus of attention.

The European Central Bank is expected to publish today a review of its strategic lines,
and the President, Christine Lagarde,
will hold a major conference to understand what Frankfurt’s next steps will be.

 

Asian markets are declining.. Oil is falling due to the failure of the OPEC negotiations

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