U.S. shipping companies increase shipments of uranium and palladium to the U.S. from Russia
In October 2022, U.S. shipping companies imported $732 million worth of goods from Russia – the highest amount in five months. Russian exports to the U.S. were limited to nuclear fuel, fertilizers, and platinum group metals
In October 2022, the United States imported $732.4 million worth of goods from Russia – 2.2 times more than in September ($332.1 million). This is the highest amount in monetary terms in the past five months, according to data from the U.S. Census Bureau. A disruption of such important shipments could hurt even the S&P 500 index.
Among U.S. shipments
In the spring of 2022, the U.S. banned imports of Russian oil and petroleum products, diamonds and seafood, and in the summer also imposed a 35 percent tariff on imports of Russian steel, certain aluminum products, rubber, wood, etc., which resulted in a five-fold drop in merchandise imports from Russia as compared to February’s figure of $2.6 billion.
As detailed data from U.S. authorities show, October shipments from Russia to the U.S. were effectively reduced to nuclear fuel, mineral fertilizers, and platinum group metals. These goods are not under sanctions, and U.S. importers are making the most of trade opportunities.
Russia stopped publishing customs and foreign trade statistics in February
Russia’s imports of enriched uranium (uranium fluoride) from the United States in October totaled $184.7 million, the highest since November 2016 (then it was $236.5 million). There were no shipments of uranium from Russia in September 2022, according to U.S. customs statistics.
Russia is the largest supplier of enriched uranium to the United States, accounting for more than a quarter of all imports of the product ($644 million) in January-October. During the same period the Netherlands shipped $569 million worth of enriched uranium to the United States, Germany $527 million and Great Britain $482 million (these shipments are believed to be in the interests of the URENCO corporation, which owns enrichment facilities in the Netherlands, Germany and Great Britain).
Earlier, we reported that large U.S. companies by market capitalization are beginning to think more about cutting investments and personnel – a survey.
Brent crude oil futures its lowest since 2021 amid banking crisis
The cost of May futures on Brent crude oil fell to $72.74 per barrel, losing 0.31%, according to data from the ICE exchange. Brent was trading at about $70 a barrel at its low for the day. That’s a record low for at least 15 months, that is, since December 2021.
WTI prices are also falling, with futures prices down to $66.43 a barrel (-0.46% from last week’s close), according to the exchange. WTI was trading at $64.12 a barrel at its low for the day. This is also the lowest value since at least December 2021.
The market is thus responding to the banking crisis: since the beginning of March, three banks (Silvergate Bank, Silicon Valley Bank, Signature Bank) have closed their doors in the US, and the day before, on March 19, Swiss UBS took over its rival, Credit Suisse, buying the bank for $3.2bn amid fears of its collapse. Investors fear a recession, which may cause a crisis in the banking sector, as a recession, in turn, would lead to lower demand for fuel, the agency said.
“Oil prices are moving mainly because of fears [of further oil price dynamics]. Supply and demand fundamentals are almost unchanged, only the banking problems have an impact,” said Price Futures Group analyst Phil Flynn.
Oil prices lifted from daily lows helped the S&P 500 and Dow Jones indices, which rose Monday, writes Reuters. Traders raised their expectations that the U.S. Federal Reserve would refuse to raise rates this Wednesday to protect financial stability amid banking problems, the agency noted.
“Volatility is likely to persist this week, with broader financial market concerns likely to remain at the forefront,” ING Bank analysts said in a note. They add that the impending Fed decision adds to uncertainty in markets.
Earlier we reported that the price of Brent dropped below $75 per barrel for the first time in more than a year.
Gold prices will reach $2,075 “in the coming weeks”
Gold prices may continue to rise, analysts polled by the CNBC TV channel said. In their opinion, the difficulties of banks and a possible turning point in the policy of the Federal Reserve indicate the possibility of a new rise in gold prices.
“I think it’s likely that we’ll see a strong move in gold in the coming months. The stars seem to be aligned for gold, and it could soon break new highs,” said Craig Erlam, senior market analyst at brokerage Oanda.
The expert explained that interest rates are now at or close to their peak, and the market, amid recent developments in the banking sector, is laying on an earlier than previously expected start of rate cuts. They also added that this situation would boost demand for gold even if the U.S. dollar weakens.
This month, Fitch Solutions rating agency predicted that gold prices would reach $2,075 an ounce “in the coming weeks” amid global financial instability, writes RBC. The company also added that gold prices will remain at a higher than pre-pandemic levels in the coming years. Craig Erlam confirmed this forecast.
Other Wall Street experts are also predicting a long-term rise in gold prices. For instance, Tina Teng, analyst for British financial company CMC Markets, thinks that the U.S. Federal Reserve’s sooner departure from its policy of raising interest rates might provoke another rally in gold prices due to the weakening U.S. dollar and falling bond yields.
Earlier we reported that oil prices accelerated their decline, continuing a trend from the beginning of the week.
Analysts at U.S. bank Goldman Sachs revised its forecast on oil prices
Analysts at U.S. bank Goldman Sachs, one of the most optimistic forecasts about the cost of oil, changed its earlier forecast about the growth of oil prices to $100 in the next 12 months, Bloomberg said.
Now analysts predict that Brent crude oil will reach $94 per barrel in the next 12 months and $97 per barrel in the second half of 2024, the publication said.
The bank said oil prices have fallen despite rising demand in China, given pressure on the banking sector, recession fears and investor withdrawal.
“Historically, after such traumatic events, price adjustments and recoveries are only gradual,” the bank notes.
This week, the situation surrounding Swiss bank Credit Suisse triggered panic in the markets as oil plummeted to a 15-month low and Brent crude fell 12% to below $73 a barrel.
After the price decline, the bank expects OPEC producers to increase production only in the third quarter of 2024, contrary to Goldman’s forecast that it will happen in the second half of 2023. Analysts at the bank believe a barrel of Brent blend will reach $94 in the next 12 months and trade at $97 in the second half of 2024.
Bloomberg reported that the largest oil exporter, Saudi Arabia, announced higher April oil prices for markets in Asia and Europe.
Earlier, we reported that Iraq and OPEC advocated for guarantees of no fluctuations in oil prices.
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