Business news from Ukraine

Oil prices are weak Thursday morning after a sharp decline in trading on Wednesday amid talks on the introduction of a ceiling on Russian oil prices.
The price of January Brent futures on London’s ICE Futures Exchange stood at $85.12 a barrel by 7:12 a.m. CST, down $0.29 (0.34%) from the previous session’s closing price. At the close of trading on Wednesday these contracts have fallen by $2.95 (3.3%) to $85.41 per barrel.
The price of WTI futures for January at electronic trades of the New York Mercantile Exchange (NYMEX) makes $77.73 per barrel by that time, which is $0.21 (0.27%) lower than the final value of the previous session. The contract fell by $3.01 (3.7%) to $77.94 a barrel at the end of last session.
The U.S. and allied countries are planning to agree on a price ceiling on Russian oil of no more than $70 per barrel, The Wall Street Journal earlier reported, citing sources.
It was expected that a decision could be made as early as Wednesday, but EU countries have so far failed to come to a unified position, Bloomberg reported. According to the agency, the European Commission offered a $65 a barrel level, but Poland and the Baltic states found it too high. In turn, countries with a powerful shipping industry – Greece and Malta – do not want prices below $70.
“The higher the price ceiling, the easier it will be for buyers from India and China to get access to transport, insurance and other services from G7 countries,” Mizuho analysts wrote.
Also, market participants assessed the official data on energy stocks in the United States, which pointed to a sharp decline in oil reserves and an increase in petroleum products stocks last week.
Commercial oil inventories in the U.S. last week decreased by 3.69 million barrels, data from the weekly report of the U.S. Department of Energy showed. Experts had expected a decline of 2.61 million barrels.
Meanwhile, marketable gasoline inventories rose by 3.06 million barrels and distillates by 1.72 million barrels. Analysts were expecting the growth of the first indicator by 1.15 million barrels, the second – by 650 thousand barrels.

Oil prices are falling moderately on Wednesday morning after a rise in the previous session, during which quotations renewed a three-week low.
The value of January futures for Brent on London’s ICE Futures Exchange stood at $93.28 a barrel by 7:08 a.m., down $0.58 (0.62%) from the close of the previous session. Those contracts rose $0.72 (0.8%) to $91.53 per barrel at the close of trading on Tuesday.
The price of WTI futures for December at electronic trades of the New York Mercantile Exchange (NYMEX) is $86.2 per barrel by that time which is $0.72 (0.83%) lower than the final value of the previous session. The day before contract rose by $1.05 (1.2%) to $86.92 per barrel.
The International Energy Agency (IEA) on Tuesday raised its forecast for oil demand growth by 180,000 bpd in 2022, but the forecast for 2023 was lowered by 40,000 bpd.
The agency also noted that by December 5, when the European embargo on Russian oil imports takes effect, Russia will need to divert another 1.1 million b/d to exports to other countries.
Oil also reacted to news about a rocket explosion in Poland, which killed two people. A number of media wrote that the missile could have come from Russian territory, but the Russian Defense Ministry denied that it was Russian missiles, noting that the military did not strike targets near the Ukrainian-Polish border.
Also, the market is waiting for the weekly U.S. fuel inventories data, which will be published at 5:30 p.m. Wednesday.
The American Petroleum Institute’s (API) report, released the previous evening, showed a 5.8 mln barrel drop in crude stocks last week. Gasoline stocks, according to API data, grew by 1.7 mln barrels, distillates – by 850,000 barrels.

Oil prices continue to decline on Tuesday after a 3% decline the day before following OPEC’s worsening forecast of oil demand.
The oil market is also pressured by weak statistical data from China, which increased traders’ pessimism about demand prospects.
China’s industrial output growth slowed in October while retail sales fell for the first time in five months, China’s State Statistics Office (SSC) reported on Tuesday.
January Brent crude futures on London’s ICE Futures exchange stood at $92.88 a barrel by 8:15 a.m. KSC on Tuesday, down $0.26 (0.28%) from the previous session’s close. Those contracts fell $2.85 (3%) to $93.14 a barrel at the close of trading on Monday.
The price of WTI futures for December at electronic trades of NYMEX fell by that time by $0.52 (0.61%) to $85.35 per barrel. By the close of previous trading, those contracts had fallen $3.09 (3.5%) to $85.87 a barrel.
“Weak statistical data from China only confirms the view that oil demand in the country will remain weak as long as tight quarantine restrictions persist,” notes Vanda Insights founder Vandana Hari in Singapore, cited by Bloomberg.
On the eve of OPEC lowered its estimate of the demand for oil in 2022 by 100 thousand barrels per day – up to 99.57 million bpd, in 2023 – also by 100 thousand bpd, to 101.82 thousand bpd.
Thus, OPEC predicts that global oil consumption in 2022 will increase by 2.55 million bpd, and in 2023 – another 2.24 million bpd, according to a monthly report of the organization.
The International Energy Agency (IEA) will publish its forecasts on Tuesday.

Oil prices rose for the third session in a row thanks to expectations of growth in demand in China as a result of changes in the authorities’ policy to combat COVID-19, as well as new measures to support the economy.
Last week Beijing announced a cut in mass testing of people for the coronavirus as well as the dissolution of “quarantine camps”. On Saturday, authorities said they were planning further gradual changes that would make the covid restrictions more focused, but not softer.
“China’s adjustment of its ‘zero tolerance’ coronavirus policy sends a strong signal to the oil market,” notes SPI Asset Management analyst Stephen Innes.
The value of January futures for Brent crude oil on London’s ICE Futures exchange is $96.19 a barrel by 7:15 PM on Monday, up $0.2 (0.21%) from the previous session’s closing price. Those contracts rose $2.32 (2.5%) to $95.99 a barrel at the close of trading on Friday.
The price of WTI futures for December at electronic trades of NYMEX grew by that time by $0.14 (0.16%) to $89.1 per barrel. By closing of previous trades the cost of those contracts grew by $2.49 (2.9%) to $88.96 per barrel.
Brent had fallen by 2.6% and WTI by 3.9% at the end of previous week.
The increase in oil consumption in China may coincide with a reduction in supply in the market in connection with the forthcoming entry into force of the European embargo on imports of Russian oil and reduce OPEC production +, notes Bloomberg.
U.S. Treasury Secretary Janet Yellen said over the weekend that a European embargo on oil purchases from Russia that enters into force Dec. 5 will “very likely” force Moscow to sell some oil at a price no higher than the ceiling set by the United States and its allies, if Russia wants to avoid a significant reduction in oil exports.

Oil prices are declining on Monday morning after a strong growth following last week’s results, driven by hopes for a softening of the approach of the Chinese authorities to combat the coronavirus.
The price of January futures for Brent at London’s ICE Futures Exchange stood at $97.59 per barrel by 7:06 a.m., down $0.98 (0.99%) from the close of the previous session. At the close of trading last Friday those contracts grew by $3.9 (4.1%) to $98.57 per barrel.
The price of WTI futures for December at the electronic trading on the New York Mercantile Exchange (NYMEX) is $91.44 per barrel by that time, down $1.17 (1.26%) from the previous session. The contract rose by $4.44 (5%) to $92.61 per barrel at the end of last session.
Brent gained 5.1% last week to finish at its highest level since late August, while WTI gained 5.4%.
The Wall Street Journal wrote last Friday, citing several sources, that Zeng Guang, a former top epidemiologist at China’s Center for Disease Control and Prevention (CDCP), said during a conference that a significant change in the country’s authorities’ approach to the coronavirus pandemic was expected in 2023.
Over the weekend, however, Beijing reiterated its intention to adhere “rigorously” to a “zero tolerance” policy for COVID-19.
“Traders believe China will be a driver of fuel demand growth at some point next year on the back of the country’s accelerating economic growth,” said SPI Asset Management managing partner Stephen Innes.