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Business News/ Market / Mark-to-market/  Oil jumps on resurgent Chinese demand
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Oil jumps on resurgent Chinese demand

A rebound in China's crude imports last month from a one-year low defused some of the pessimism among investors fanned by a US government report showing bearish increases in fuel inventories and domestic oil production

Crude edged higher as near-record Chinese orders for foreign crude signalled stronger demand in the world’s second largest economy.Premium
Crude edged higher as near-record Chinese orders for foreign crude signalled stronger demand in the world’s second largest economy.

Crude edged higher as near-record Chinese orders for foreign crude signalled stronger demand in the world’s second largest economy.

Futures climbed 1.2% in New York. A rebound in China’s crude imports last month from a one-year low defused some of the pessimism among investors fanned by a US government report earlier this week showing bearish increases in fuel inventories and domestic oil production.

This year’s watershed moment for the global oil markets was last month’s agreement by the Organization of Petroleum Exporting Countries (Opec), Russia and allied producers to extend production curbs through all of next year. Euphoria among bullish traders was short-lived though in the face of the American shale juggernaut. Bloomberg

World fumbles for new trade consensus

Trade ministers will meet in Argentina with one of the traditional defenders of free markets, the US, questioning the benefits of the international rules it helped to forge.

Even though trade volumes are set to grow faster than the world economy this year for the first time since 2014, members of the World Trade Organization (WTO) will gather in Buenos Aires concerned about the outlook.

While he hasn’t followed through on many of his threats to rip up trade accords or take on China, Trump is questioning WTO’s ability to police global commerce. He’s also threatening to walk away from the North American Free Trade Agreement (Nafta) after withdrawing from a 12-nation Asia-Pacific trade pact early this year.

With the US doubting WTO’s very purpose, it will be difficult for trade ministers to make headway in their meetings on anything but narrow issues such as illegal fishing and agricultural subsidies. Bloomberg

China producer prices ease to four-month low

China’s producer price inflation slowed to a four-month low in November as factory activity softened due to the government’s ongoing efforts to curb pollution, cooling demand from factories for raw materials.

Producer prices rose 5.8% from a year earlier—the lowest since July, the National Bureau of Statistics said on Saturday. The rise was slightly less than market expectations and compared with the previous month’s 6.9% increase.

Analysts polled by Reuters had predicted the Producer Price Index (PPI) in November would rise an annual 5.9%, easing back also because of a high base a year earlier.

On a month-on-month basis, the Producer Price Index rose 0.5% in November.

As northern China officially entered the heating season in mid-November, the government has stepped up efforts to address winter smog, ordering many steel mills, smelters and factories to curtail or halt production to rein in pollution.

Analysts expect producer price pressures to recede as the war on smog curtails production, cooling demand from factories for raw materials.

Raw materials prices rose 7.5% in November year-on-year, compared with 9% in October, data from the statistics bureau showed. Reuters

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Published: 10 Dec 2017, 11:48 PM IST
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