Oil Has Worst Month Since March After Covid Surge Hurts Recovery - Bloomberg

Oil Has Worst Month Since March After Covid Surge Hurts Recovery - Bloomberg

Oil posted its largest monthly drop since March as renewed lockdown measures to contain the coronavirus threatened to upend a shaky demand recovery.

Futures fell 1.1% in New York on Friday to end the week below $36 a barrel taking their cue from a broader market selloff and the worst week for U.S. stocks since March. At the same time, the U.S. posted a record surge in daily coronavirus infections, while new restrictions in Europe could drive the region toward another recession.

“The risk appetite in the market is definitely lower,” said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management. “The return-in-demand story is taking a lot longer to play out than oil bulls had hoped.”

A return to tougher lockdown measures will likely deter a substantive rebound in airline demand, with more restrictions in Europe prompting further cuts in airline capacity for the remainder of the year. Still, there’s some support from booming freight markets and improvements in China and India. All the while, traders are looking ahead to next week’s U.S. election and an OPEC+ meeting at the end of November.

Oil falls on demand concerns, posts second monthly decline | Reuters

Oil falls on demand concerns, posts second monthly decline | Reuters

Oil prices fell on Friday and posted a second consecutive monthly drop as rising COVID-19 cases in Europe and the United States heightened concerns over the outlook for fuel consumption.

Brent crude LCOc1 dropped 19 cents to settle at $37.46 a barrel, after touching a five-month low of $36.64 in the previous session. The front-month Brent contract expired on Friday and the January contract LCOc2 settled down 32 cents.

U.S. West Texas Intermediate (WTI) crude fell 38 cents to settle at $35.79 a barrel, after dipping to its lowest since June on Thursday at $34.92.

WTI fell 11% for the month, while Brent dropped 10%.

Leaders in France and Germany have ordered their countries back into lockdown, as a massive second wave of coronavirus infections threatened to overwhelm Europe before the winter.

Biden, Iran, and Oil Prices: How the Puzzle Pieces Might Fit Together - Bloomberg

Biden, Iran, and Oil Prices: How the Puzzle Pieces Might Fit Together - Bloomberg

Oil prices have sunk back to their lowest levels since the novel coronavirus lockdown in the spring (when, bizarrely, the price of West Texas Intermediate crude briefly touched negative $37.63 a barrel). The pandemic is still weighing on the oil market, but now there seems to be an additional factor: the increasing likelihood that former Vice President Joe Biden will be elected U.S. president and ease sanctions on Iran.

As this Bloomberg News story explains, if the economic sanctions on Iran that President Donald Trump imposed and recently tightened were eased, it would open the sluices for more than 2 million barrels a day of Iranian crude exports. “Within a few months after a Biden election, we expect some Iranian oil will be coming to market,” Iman Nasseri, the London-based managing director for the Middle East at consulting firm FGE, told Bloomberg. “It’s going to be a real headache for OPEC.”

Cheap oil used to be a pure win for Americans, but now that the U.S. exports almost as much petroleum as it imports, the equation has changed. And for Saudi Arabia and the Gulf states, cheap oil is a pure loss. Today’s prices are far below what they need to cover their governments’ expenses—thus, unsustainable.

Biden has expressed openness to returning to the Joint Comprehensive Plan of Action—the multilateral pact that aims to keep Iran from developing nuclear weapons—if Iran would return to full compliance with its terms. Iran, meanwhile, says it won’t return to full compliance until sanctions are lifted, so this is not an easy lift. But setting aside the merits of easing up on Iran, is there a way that Biden could do it without crashing the oil market?

Israeli-Grown Produce Could Be on Sale in #UAE by Early November - Bloomberg

Israeli-Grown Produce Could Be on Sale in UAE by Early November - Bloomberg

Israeli farmers, who face stiff competition in their main export markets in Europe, might be able to sell their produce in the Persian Gulf as early as November.

The United Arab Emirates this week authorized the import of Israeli produce following the two nations’ normalization agreement, Israel’s Agriculture Ministry said in announcing the possible start date.

While Israeli exporters have diversified their markets in response to the mounting competition in Europe, demand hasn’t been sufficient, the ministry said. The UAE imported 80% of the $10 billion in fresh produce sold there in 2018, according to the ministry, and is a trade hub for goods sent on to eastern Asia.

Israel’s agricultural exports totaled $1.15 billion in 2018, according to ministry figures.

Oil losses deepen as anxiety builds over lockdowns, U.S. elections | Reuters

Oil losses deepen as anxiety builds over lockdowns, U.S. elections | Reuters

Global oil prices fell more than 1% on Friday, extending losses and on track for a second monthly fall, on growing concerns that the rise in COVID-19 cases in Europe and the United States could hurt fuel consumption.

Brent crude slipped for a third day and was down 60 cents, 1.6%, at $37.05 a barrel by 0720 GMT after touching a five-month low in the previous session. December Brent contract expires on Friday.

U.S. West Texas Intermediate (WTI) crude declined 53 cents, or 1.5%, to $35.64 a barrel after dipping to its lowest since June on Thursday.

Prices had swung between parity and a more than 2% decline during Friday’s session as the “market is anxious” over renewed lockdowns in Europe and U.S. elections next week, a Singapore-based oil trader said.

OCBC’s economist Howie Lee said: “Selling pressure is piling up again.”