Oil soars as European stock futures rise while Asian stocks decline
Oil prices rose on Wednesday,
rebounding after heavy losses in the previous session on signs of strong fuel
demand in the United States, and Chinese and Hong Kong stocks decline,
while European stock futures rose.
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Oil prices escalate as US fuel inventories fall
Chinese and Hong Kong stocks plunged by automakers
Oil prices escalate as US fuel inventories fal
Oil prices rebounded slightly on Wednesday as data pointed
to strong fuel demand in the United States,
providing relief after a 5 percent fall a day earlier due to concern over the suffering of demand
caused by China’s growing COVID-19 restrictions and a central bank hike in interest rates.
US West Texas Intermediate (WTI) crude futures jumped by 85 cents,
or 0.9%, to $92.49 per barrel at 0456 GMT after falling by $5.37 in the previous session,
prompted by concern over a recession.
Brent crude futures for October, due to end on Wednesday,
rose by 70 cents, or 0.7 percent, to $100.01 per barrel,
trimming Tuesday’s loss of $5.78.
The most active futures contract for November rose by 93 cents,
or 1 percent, to $98.77 per barrel.
Price volatility since the start of the conflict in Ukraine
six months ago has negatively affected
hedge funds and speculators and declined trading,
which in turn has led to the market falling further, as seen on Tuesday.
In support of market sentiment on Wednesday
data from the American Petroleum Institute (API)
showed gasoline inventories fell by about 3.4 million barrels,
while distillate inventories, including diesel and aviation fuel,
fell by about 1.7 million barrels for the week ending August 26.
American Petroleum Institute data showed
crude inventories rose by about 593 thousand barrels,
against analysts’ estimates of a decline of about 1.5 million barrels.
The weakness of the United States dollar has also boosted the market,
thus becoming cheaper for buyers with other currencies.
Price gains have been curbed by concern that some of China’s largest cities
– from Shenzhen to Dalian, are imposing lockdowns
and business closures to curb COVID-19 at a time
when the world’s second-largest economy is already experiencing weak growth.
The main factor supporting prices at present is the talk of members
of the Organization of the Petroleum Exporting Countries (OPEC) and its allies (OPEC +),
that they may reduce production to stabilize the market,
and OPEC + is scheduled to meet on September 5.
artical name Oil soars as European stock futures rise
Chinese and Hong Kong stocks plunged by automakers
Chinese and Hong Kong stocks slid Wednesday,
declining by major automakers after Warren Buffett’s Berkshire Hathaway
(NYSE: BRKa) cut its stake in BYD,
while broader Asian markets were mixed amid uncertainty over US monetary policy.
Hong Kong’s Hang Seng fell by 0.2 percent,
with BYD Co HK:1211 falling nearly 10 percent
after a statement showed Berkshire Hathaway
had narrowed its stake in the company.
China’s Shanghai Shenzhen CSI 300 index declined by 0.6 percent,
while the Shanghai Composite index lost 1.2 percent.
Sentiment toward China also fell through data showing the country’s
manufacturing sector shrank for the second consecutive month in August,
but the pace of its contraction was slightly lower than expected.
The broader Asian markets were mixed on Wednesday as concern
grew over higher US interest rates,
following stronger-than-expected US overnight employment data.
In Asia, Japan’s Nikkei 225 index fell by 0.5 percent,
while Taiwanese stocks rose by 0.8 percent, rebounding from a four-week low.
artical name Oil soars as European stock futures rise
European stock futures rise
European stock markets are expected to rise at the opening on Wednesday,
as investors absorb the latest Chinese manufacturing activity data
ahead of the eurozone’s major inflation release.
At 02:00 GMT, Germany’s DAX futures rose by 0.7 percent,
France’s CAC 40 futures rose by 0.4 percent and
the UK’s FTSE 100 futures index rose by 0.3 percent.
The official manufacturing PMI was at 49.4 for August,
while this was below 50 indicating a contraction in the sector,
it is still an improvement from 49.0 in July.
This is likely to make the start of the day positive in Europe,
although the focus is likely to be on issuing the latest consumer price index in the eurozone.
The European inflation, which hit a record high of 9 percent in August,
is expected to show further pressure on the European Central Bank
to raise interest rates strongly next month.
Gas prices
in Europe fell below record highs,
but this could be a temporary measure as Russia halted
the flow of gas along the Nord Stream pipeline to Germany,
for the second time in several months.
The EU is on track to meet targets for filling up gas inventory,
but analysts warn that the biggest factor for energy security
this winter is whether countries can cut consumption enough to ensure
that the fuel stored continues through cooler months.
After scrambling for fuel during the summer following Russia’s invasion of Ukraine,
Europe’s largest gas supplier, Europe’s gas inventory is now 79.94 percent full,
according to gas infrastructure data in Europe,
leading countries to exceed their target of having 80 percent full storage by November.
In addition, gold futures fell to $1735.90 per ounce,
while the euro traded against the US dollar 0.2 percent higher at 1.0034.
artical name Oil soars as European stock futures rise