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Mega-Refiner’s Oil Buying a Bright Spot for Constrained Market By Bloomberg

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© Bloomberg. A crew man stands on the deck of the crude oil tanker ‘Devon’ as it sails through the Persian Gulf towards Kharq Island oil terminal to transport crude oil to export markets in the Persian Gulf, Iran, on Friday, March 23, 2018. Geopolitical risk is creeping back into the crude oil market. Photographer: Ali Mohammadi/Bloomberg

(Bloomberg) — A Chinese mega-refiner is snapping up barrels of Middle Eastern crude in a rare bright spot for a market hampered by dwindling import quotas after a buying spree earlier in the year.

Rongsheng Petrochemical Co.’s Singapore unit has purchased at least 7 million barrels in the spot market so far this month for delivery in December and January, according to traders who asked not to be identified because the information is private. The company is buying up crude to feed a trial run operation of its expanded refinery in Zhejiang province this quarter.

Chinese crude imports rose in September for the first time in three months as companies sought oil for new and expanding plants. Inbound shipments may struggle to reach June’s peak through the rest of the year after independent refiners used up most of their quotas. The processors, known as teapots, played an outsized role in supporting oil prices this year after a buying frenzy following a rapid recovery from the pandemic.

Rongsheng’ Singapore unit purchased medium-sour grades from the Persian Gulf — the baseload for its refinery — such as Abu Dhabi’s Upper Zakum, Qatar’s Al-Shaheen and Iraq’s Basrah Light cargoes, according to the traders. The phase 2 expansion of its Zhoushan-based refinery is expected to double processing capacity to 800,000 barrels a day.

Rongsheng Petrochemical didn’t immediately respond to an email seeking comment on the matter.

Teapots are expected to ramp up crude purchases for January-arrival, traders said, with some companies already showing interest for spot purchases.

Beijing started allowing teapots to directly import crude in 2015 as part of an effort to increase private investment in the energy industry. The independent refiners, mainly based in Shandong province, have been using light-cycle oil and diluted bitumen as alternatives to crude after running short of quota.

©2020 Bloomberg L.P.

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Drop in leisure driving stalls global recovery in fuel demand By Reuters

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By Stephanie Kelly

NEW YORK (Reuters) – Brandon Thompson was planning on making an eight-hour drive this year from his home in Iowa to Ann Arbor, Michigan, to see his favorite college football team play. Then the pandemic hit.

“We realized very early on if there was a season, there would be no fans,” said Thompson, a University of Michigan Wolverines fan.

Millions of people like Thompson worldwide continue to cancel or curtail leisure trips as the COVID-19 pandemic maintains its grip on many countries. That is contributing to a slower-than-expected recovery in fuel demand.

Thompson would have driven more than 500 miles (805 km) to see the game and go tailgating, where thousands of fans arrive hours early to sit in the parking lot and eat and drink. Across the country, fans of many sports would have made similar journeys.

Traffic outside of the 7 a.m. to 10 a.m. and 4 p.m. to 7 p.m. rush hours accounts for about 55% of overall U.S. fuel demand, according to Rystad Energy. That includes trips to sporting events, shuttling kids to activities, or going to the movies. Non-rush leisure travel was down by 12% from pre-virus levels as of early October, Rystad said.

Mobility is again declining in Europe, where several nations are reimposing lockdowns due to a spread in cases, which are soaring as well in India and Brazil.

“The downwards trend in European mobility indicators is likely to continue, with pressure on road transportation fuels demand probable in the weeks ahead,” JBC Energy said in a note.

The Organization of the Petroleum Exporting Countries (OPEC) warned that the recovery in fuel demand from strict lockdowns earlier this year has been anemic and could hamper oil markets for months to come.

The United States at 9 million barrels per day is the world’s biggest gas guzzler, more than double the second-largest consumer, China, according to U.S. Energy Department figures. Demand in China has rebounded more than in other major world economies.

Non-rush traffic had been recovering in the United States until September when it stalled, according to Artyom Tchen, senior oil market analyst at Rystad.Non-rush traffic levels globally are currently off by 1 million barrels per day from pre-COVID levels, Tchen said, to about 25.2 million barrels per day.

“The kids today, their parents are crazy: They’ll drive like 300 miles for a hockey game,” said John Kilduff, partner at Again Capital in New York. Without those trips, gasoline demand is likely to remain near its current 8.5 million barrels per day, Kilduff said.

The United Kingdom is one of the worst hit countries in Europe, with its driving mobility falling to levels last seen in March, when the first round of restrictions came into effect, according to Apple (NASDAQ:) mobility data. 

In Germany, traffic is even lower, with visits to restaurants, cafés, shopping centers, theme parks, museums, libraries and cinemas falling by 12% last week.

EMPTY STADIUMS

College football in parts of the United States has been cancelled, leaving towns that normally swell to 100,000 or more on game day empty. Teams in the U.S. Big Ten Conference, home to storied football schools like Ohio State and Michigan, started its schedule last weekend, several weeks late, with fewer fans.

“Think of all of the idling vehicles waiting in line to get into the tailgate areas and then parking,” said Neal Hawkins (NASDAQ:), associate director of the Institute for Transportation at Iowa State University. “Game day versus no game day, there’s a significant impact.”

In 2013, more than two-thirds of fans who attended University of Nebraska games came from outside the Lincoln metropolitan area, many driving at least 60 miles, according to Eric Thompson, professor of economics at the University of Nebraska in Lincoln.

Stephanie Reinhardt, a librarian from Bay City, Michigan, used to travel or dine outside almost every weekend, but with winter coming, those opportunities are disappearing.

“It’s going to be hard as the weather cools. There’s not a lot of places to go out and see people,” said Reinhardt, 32.





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Gold Down Over Strong Dollar, Fading Hopes for U.S. Stimulus Measures By Investing.com

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© Reuters.

By Gina Lee

Investing.com – Gold was down on Wednesday morning in Asia over a strengthening dollar and fading hopes of the U.S. Congress passing the latest stimulus measures before the country’s presidential election.

edged down 0.14% at $1,909.30 by 12:30 AM ET (4:30 AM GMT), remaining above the $1,900 mark. The dollar was up on Wednesday.

President Donald Trump admitted that the measures were not likely to be passed before the Nov. 3 election, now less than a week away, as the chasm between the Republicans and Democrats over the measures’ price tag remains.

Data released on Tuesday also added to concerns over U.S. economic health. The fell to 100.9 in October, lower than the 102 predicted in forecasts prepared by Investing.com and the previous month’s reading of 101.3. More data, including the third-quarter , is due to be released on Thursday

Across the Atlantic, a second wave of COVID-19 cases continues, and the numbers continue to rise. French president Emmanuel Macron will address his nation, which has recorded the highest number of deaths from the virus since April in a televised speech later in the day. Macron is expected to announce the re-implementation of a national lockdown to begin on Thursday. Elsewhere in Europe, Italy recorded a record number of cases.

John Berrigan, head of the European Commission’s financial services unit, said on Tuesday that the U.K. must indicate how far it will diverge from European Union (EU) regulations if it wants access to the EU financial market from January. Berrigan also requested more clarification on the U.K.’s intentions to work out what is an “acceptable level” of divergence.

A recovery in demand saw China’s net gold imports surge to a six-month high in September as an uptick economic activity increased demand in the world’s top consumer of the yellow metal. Holdings in the SPDR Gold Trust (P:) rose 0.23% to 1,266.72 tons on Tuesday, data showed.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Oil falls on oversupply fears after build in U.S. crude stocks By Reuters

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© Reuters. FILE PHOTO: The sun is seen behind a crude oil pump jack in the Permian Basin in Loving County

TOKYO (Reuters) – Oil prices slid more than 1 percent on Wednesday, paring the previous day’s gains, as a jump in U.S. crude inventories and surging COVID-19 cases raised fears of an oversupply of oil and weak fuel demand.

In early Asia, Brent crude () was down 61 cents, or 1.5%, at $40.59 a barrel by 0033 GMT, having climbed nearly 2% the previous day. U.S. oil () was down 66 cents, or 1.7%, at $38.91 a barrel, after gaining 2.6% on Tuesday.

U.S. crude oil and gasoline stocks rose last week, data from industry group the American Petroleum Institute showed, with crude inventories rising by 4.6 million barrels to about 495.2 million barrels, against analysts’ expectations in a Reuters poll for a build of 1.2 million barrels. [EIA/S]

“The higher-than-expected build in U.S. crude stocks prompted fresh selling while concerns over supply disruption from Hurricane Zeta have receded,” said Hiroyuki Kikukawa, general manager of research at Nissan (OTC:) Securities.

Energy firms and ports along the U.S. Gulf Coast prepared on Tuesday for another test as Zeta, the 11th hurricane of the season, entered the Gulf of Mexico.

“Rising COVID-19 cases with the lack of a U.S. coronavirus fiscal relief package also dented investors’ risk appetite,” Kikukawa said, predicting that the gloomy sentiment will keep prices under pressure over the coming day.

Infections are surging again in the United States, with nearly half a million people having contracted the coronavirus in the last seven days. European governments, meanwhile, prepared to introduce new restrictions to keep cases under control.

President Donald Trump acknowledged on Tuesday that a coronavirus economic relief deal would likely come after the Nov. 3 election, with the White House unable to bridge differences with fellow Republicans in the U.S. Senate as well as congressional Democrats.

Adding to pressure, Libya’s production should rebound to 1 million bpd in coming weeks, complicating efforts by other OPEC members and allies to restrict output.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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