The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.
0922 ET - Oil futures are lower in early U.S. trading, while remaining on track for solid gains in the week that saw a renewal of fighting in the Persian Gulf. "Markets don't proceed higher in straight-line fashion and major price up-spikes tend to be followed by occasional pullbacks," Ritterbusch & Associates says in a note. With no end of the conflict in sight and a resumption of talks still not on the radar, "we view it as premature to suggest that a price top has been established," the firm adds. WTI is off 1% at $90.38 a barrel and Brent is down 0.9% at $94.63. (anthony.harrup@wsj.com)
0852 ET - Gold futures fall following a U.S. employment report showing a much bigger-than-expected 162,000 increase in August payrolls and upward revisions to the previous two months. An easing in Treasury yields and weaker dollar had helped lift gold the previous two sessions as investors awaited the closely watched jobs numbers. Yields are up and the dollar is stronger following the report. Gold for December delivery is down 2.4% in New York at $4,429.50 a troy ounce. Silver falls 2.7% to $65.875 a troy ounce. (anthony.harrup@wsj.com)
0829 ET - Yields on long-maturity U.K. government bonds, or gilts, risk climbing further as the U.K. could face more intense inflationary pressures than its eurozone peers, RBC BlueBay Asset Management's Mark Dowding says in a note. The U.K. lacks gas storage of its own, leaving it exposed to rising energy prices, he says. The Bank of England could raise interest rates in the coming months to tackle inflation which could cause long-dated gilt yields to accelerate, Dowding says. Thirty-year gilt yields surged to 5.904% this week, the highest since 1998, LSEG data show. (miriam.mukuru@wjs.com)
0756 ET - Sterling looks vulnerable over the coming months as the U.K. is expected to face increased inflationary and fiscal pressures, RBC BlueBay Asset Management's Mark Dowding says in a note. The U.K. is exposed to greater inflationary pressure from high energy prices than its eurozone peers as it lacks gas storage facilities, Dowding says. In addition, high government borrowing costs could put further strain on public finances and hurt the economy, he says. RBC BlueBay Asset Management has an underweight position on sterling as its sees few catalysts that would support a rally in the currency over the coming months. Sterling edges up 0.1% to last trade at $1.3533. (miriam.mukuru@wsj.com)
0657 ET - Palm oil closed higher on stronger soybean oil prices and ongoing concerns about medium-term output amid El Nino weather conditions affecting Malaysia and Indonesia, says David Ng, a trader at Kuala Lumpur-based Iceberg X. Ng sees support at 4,900 ringgit a ton and resistance at 5,050 ringgit a ton. The Bursa Malaysia Derivatives contract for June delivery ended 27 ringgit higher to 4,931 ringgit a ton. (jiahui.huang@wsj.com; @ivy_jiahuihuang)
0554 ET - The 2.5% rise in German manufacturing orders in July looks goods news but only at first glance, Commerzbank economist Marco Wagner says in a note. Excluding large orders worth more than 50 million euros, orders fell on month by 1.4%. "This means the underlying trend continues to move sideways at a low level," Wagner says. Looking at the core trend that excludes the larger orders, the recovery that had begun to take hold has once again fizzled out, he says. That means a recovery in German industrial production is unlikely for the time being, especially given low water levels in the Rhine River in recent weeks and the fact that energy prices have risen again. "The German economy will therefore recover only moderately," he says. (edward.frankl@wsj.com)
0548 ET - The Gulf's push to build new trade, energy and logistics infrastructure is likely to continue regardless of the near-term outcome of the Iran war, the Arab Gulf States Institute says. Bypassing the Strait of Hormuz is one objective, but the investment drive extends to pipelines, railways, roads, ports and new economic corridors across the region, says ASGI non-resident fellow Robert Mogielnicki. Saudi Arabia stands to benefit from a westward shift in economic activity, while the U.A.E. is developing eastern export and logistics hubs and Oman is gaining from routes that avoid regional chokepoints. (farhan.rafid@wsj.com)
0358 ET - The budget for the Vicuna copper project BHP is developing with Lundin Mining is likely to rise above the current phase-one estimate of $7 billion-$8 billion, Barclays says following an analyst roundtable with BHP's CEO and CFO. "It was clear from the discussion that a higher number is likely," Barclays says. The budget for a new concentrator at BHP's Escondida mine is seen as "less at risk," the bank says. At its FY26 results, BHP increased its capex estimate for the concentrator project by 14%, to $5.4 billion-$6.3 billion, but the increase mainly reflects a larger project scope, says Barclays. "BHP feels relatively more comfortable about the capex risks" there, it says. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)
0351 ET - Yields on U.K. government bonds rise slightly, reversing some of the previous day's falls as focus turns to key U.S. jobs data at 1230 GMT amid uncertainty over the timing of a possible U.S. interest-rate rise. Meanwhile, oil prices remain elevated, keeping alive concerns about inflation. Middle East tensions and the blockade on the Strait of Hormuz are contributing to rising energy prices. Investors fully price in two quarter-point interest-rate rises by the Bank of England by March 2027, LSEG data show. The price of a barrel of Brent crude edges down 0.4% but remains high at $95.11. Ten-year gilt yields rise 0.6 basis points to last trade at 5.157%, Tradeweb data show. (miriam.mukuru@wsj.com)
0325 ET - Saudi Arabia's decision to keep the price of its flagship crude grade for Asian customers unchanged for next month suggests some easing in physical-market tightness, according to analysts. State producer Saudi Aramco kept the official selling price for October shipments of its Arab Light crude to Asia--the largest market for Middle Eastern oil--at a discount of $2 a barrel to the Oman/Dubai benchmark. The move suggests "the market is not as tight as thought," analysts at ING say. Prices for grades sold to Northwest Europe and the Mediterranean were also left unchanged, while U.S. customers saw a $1-a-barrel increase. (giulia.petroni@wsj.com)
0310 ET - Oil prices are on track for their largest weekly gain since mid-July as a flare-up in hostilities between the U.S. and Iran this week fueled fears that Persian Gulf flows might be constrained into next year. In early European trading, Brent crude ticks 0.2% higher to $95.75 a barrel, while WTI futures rise 0.3% to $91.58 a barrel. The benchmarks are up 8.6% and 9.8% on the week, respectively. "The market is entering a delicate adaptation phase," analysts at ANZ say. "Elevated inventories helped absorb the initial supply crisis, but the challenge is now to keep the market balanced as those buffers diminish." While the escalation is propping up crude, some market watchers say the rally might lose traction if oil continues to flow through Hormuz. (giulia.petroni@wsj.com)
0234 ET - Bangkok Expressway and Metro likely has positive catalysts over next 2 years, ttb wealth securities' Saksid Phadthananarak says in a report. The transport company is expected to secure bondholder approval this month to raise debt covenant ratio to 3.0x from 2.5x, easing concerns over potential cash calls. Also, the Thailand company is likely to be awarded two projects in 2027 and is expected to deliver a THB10-per-trip toll increase in September 2028 that should drive earnings to a record high in 2029. The brokerage raises the stock's target price to 8.20 baht from THB8.00 to reflect a base-year rollover, with an unchanged buy rating. Shares are 0.8% higher at THB6.65.
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