Oil prices fall on Monday after rising by more than 15% last week amid the decision of OPEC + to cut production immediately by 2 million barrels per day (b / d).
Market fears related to the possibility of falling energy demand following the weakening of the global economy as a result of the rapid tightening of policies by world central banks remain, Bloomberg notes.
US unemployment statistics released last Friday showed that the US labor market is still strong. This was taken by traders as a signal that the Federal Reserve (Fed) may again raise the rate by 75 basis points (bp) at the next meeting.
The price of December futures for Brent crude on London’s ICE Futures exchange is $97.08 per barrel by 8:10 qoq on Monday, which is $0.84 (0.86%) lower than the closing price of the previous session. As a result of trading on Friday, these contracts rose by $3.5 (3.7%) to $97.92 per barrel.
The price of futures for WTI oil for November in electronic trading on the New York Mercantile Exchange (NYMEX) fell by this time by $0.77 (0.83%), to $91.87 per barrel. By the close of previous trading, the value of these contracts increased by $4.19 (4.7%) to $92.64 per barrel.
As a result of the week, Brent has risen in price by 15%, WTI – by 16.5%.
As reported, OPEC+ last week decided to cut its November production quota by 2 million barrels per day compared to October, the largest cut since the start of the coronavirus pandemic.
“In reality, the decline will be only about 1 million b / d, since oil production in many countries was already lagging behind quotas,” Commerzbank analysts cited by Bloomberg said. “This, however, will be enough to prevent an excess of supply on market forecast for the fourth quarter.
Stock markets in the Asia-Pacific region are falling during trading on Monday.
Exchanges in Japan are closed due to the celebrations on the occasion of Health and Sports Day.
Chinese stock indexes show the most severe decline after the US stepped up measures to control the export of semiconductor products to China.
The Hong Kong Hang Seng fell 2.5% by 8:15 qoq, the Shanghai Shanghai Composite – 0.4%.
The stock prices of microelectronics manufacturers Semiconductor Manufacturing International Corp. are falling most significantly on Chinese stock exchanges. (-2.7%), Advanced Micro-Fabrication Equipment Inc. (-17.6%) and GigaDevice Semiconductor Inc. (-7%).
US authorities on Friday imposed new restrictions on the supply of advanced chips and equipment for the production of semiconductors to China to prevent the development of the Chinese military industry through these products.
Among the drop leaders on the Hong Kong Stock Exchange are also shares of casino operator Sands China Ltd. (-7.6%), China Merchants Bank Co. Ltd. (-6%) and IT company Meituan (-5.9%).
Purchasing Managers’ Index (PMI) for China Services, calculated by Caixin Media Co. and S&P Global, fell to 49.3 points in September from 55 points in August due to the negative impact on the sector of coronavirus restrictions.
An index value below 50 points indicates a drop in business activity in the service sector. The indicator fell below this mark for the first time in four months.
The South Korean Kospi index decreased by 0.2% by 8:25 a.m.
The value of shares of automaker Hyundai Motor fell by 1.4%.
Quotes of securities of one of the world’s largest manufacturers of chips and electronics Samsung Electronics Co. are down 0.2%, while shares of its rival LG Electronics are up 1.4%.
The Australian S&P/ASX 200 fell 1.2%, following shares of mining companies.
The price of Silver Lake Resources Ltd. fell 7%, Chalice Mining Ltd. – by 6.8% and Evolution Mining Ltd. – by 6.7%.
President of Ukraine Volodymyr Zelensky has welcomed the decision of the International Monetary Fund (IMF) to provide Ukraine with a $1.3 billion tranche.
“The Executive Board of the IMF has just supported the provision of about $1.3 billion to Ukraine under the Rapid Financing Instrument. The money will go to Ukraine today. Thanks Kristalina Georgieva and the IMF Executive Board for the support!” he said on Twitter on Friday.
In turn, Ukrainian Prime Minister Denys Shmyhal also said that the IMF will provide Ukraine with additional $1.3 billion.
“This means that the financing from the Fund since the beginning of the war will total $2.7 billion. The tranche will be directed at the support for our defense capacity, payment of pensions and social programs, as well as our economic resilience,” he said on the Telegram channel.
Ukraine’s international partners have provided it with around $20 billion since the beginning of the full-scale war. Thanks to this assistance “we understand how we can finance all necessary expenditures this year,” the PM said.
“We are expecting a new large IMF program next year, as well as financing from the U.S., the EU and other G7 Member States,” Shmyhal said.
US President Joe Biden on Sunday held a telephone conversation with German Chancellor Olaf Scholz, during which the leaders discussed assistance to Ukraine and the situation on the global energy market, the White House said.
“President Biden spoke today with German Chancellor Olaf Scholz,” the statement said.
It notes that the heads of state discussed the situation in Ukraine, as well as “the obligation to provide assistance to Ukraine in the field of economy and security.”
According to the White House, Biden and Scholz also discussed “recent developments in global energy markets and the importance of securing stable and affordable energy supplies.”
LUN, through its international brand Korter, has sold more than 200 apartments abroad, LUN development director Andriy Mima told Interfax-Ukraine.
“During the nine months of this year, we sold more than 200 apartments abroad, most of them in Georgia. In September, we unexpectedly received our first income in the UAE: a buyer bought an apartment from a developer through our website https://Korter.ae, and we received this is a commission,” Mima said.
He recalled that Korter is an international brand of LUN, with a similar product, a catalog of new buildings. The service launched a few years ago in several countries in Europe, Asia and the Middle East. At the same time, Korter’s business processes are slightly different from the parent company.
“In some countries, developers are not used to paying for marketing, so our business model “like in Ukraine” did not work. But they are happy to pay success-fee in the form of a commission. We had to restructure business processes to bring buyers from the site directly to sales departments,” Mima explained.
According to Mima, the user contacts the support service, Korter agents help him complete the transaction. For example, if necessary, the client is met at the airport and brought to the sales department.
He added that at present, the company’s international revenue exceeded its domestic one.
The Executive Board of the International Monetary Fund (IMF) has approved $1.3 billion in emergency financial support for Ukraine under the new Rapid Financing Instrument (RFI) food shock window to meet Ukraine’s urgent balance of payments needs.
“More than seven months after the start of the Russian invasion of Ukraine, humanitarian and economic losses remain enormous, leading to large and urgent fiscal and external financing needs,” the IMF said on its website on Saturday night.
The IMF points out that the scale and intensity of Russia’s war against Ukraine, which began more than seven months ago, has caused enormous human suffering and economic damage. With massive population displacement and destruction of housing and basic infrastructure, Ukraine’s real GDP is projected to contract by 35% in 2022 compared to 2021, and financing needs remain very large.
“This RFI payment (equivalent to 50% of Ukraine’s IMF quota) will help meet the urgent needs of the balance of payments, including due to a large reduction in grain exports, and will also play the role of a catalyst for further financial support from Ukraine’s creditors and donors,” the Fund stressed.
The IMF noted that the Ukrainian authorities are to be commended for maintaining largely macro-financial stability in these extremely challenging circumstances and have requested board-level monitoring of the program to bolster their policy commitment and further galvanize donor support.
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