Profit-taking pressure increased as supply risks eased in the energy market.
According to the Vietnam Commodity Exchange (MXV), the crude oil market experienced a significant correction yesterday after positive signals from the US and Iran helped alleviate concerns about supply disruptions in the Middle East.
On the afternoon of May 5th, US President Donald Trump announced a temporary halt to the escort of ships through the Strait of Hormuz amid progress in negotiations with Iran. Simultaneously, the US Secretary of Defense confirmed that the ceasefire agreement remains in effect, contributing to market stability.
Earlier, oil prices surged 4-6% on May 4th as the market reacted to escalating tensions in the Strait of Hormuz – a vital global energy shipping route. However, as the parties returned to the negotiating table, the market quickly adjusted its expectations regarding supply risks.
In this context, buying pressure weakened as many investors holding previously long positions tended to take profits to protect their gains, causing oil prices to quickly correct. This is a common reaction in the futures market, where long positions are closed after a sharp increase, increasing selling pressure and pulling prices down in the short term.
At the close of trading, Brent crude oil prices fell nearly 4%, dropping below $110 per barrel; while WTI crude oil also fell by about 3.9%, settling below $102.3 per barrel.
Amidst volatile global oil prices, several domestic policies are being adjusted to simplify procedures and facilitate business operations. Recently, the Government issued Resolution 19/2026/NQ-CP aimed at decentralizing, reducing, and simplifying administrative procedures and business conditions in 10 sectors under the Ministry of Industry and Trade , with petroleum being a sector experiencing notable changes.
The resolution suspends certain procedures for reissuing, amending, and supplementing certificates of eligibility for petroleum general agents; and simplifies procedures for primary traders, distributors, agents, and retail outlets. Notably, business conditions for the service of leasing ports, storage facilities, and transporting petroleum products have also been abolished.
These adjustments are expected to help reduce administrative barriers and create more favorable conditions for the domestic petroleum business.
Cotton prices hit a 23-month high amid concerns about supply shortages.
In contrast to the energy sector, industrial raw materials closed yesterday's session in positive territory (except for RSS3 rubber). Notably, cotton led the group's gains, extending its upward trend over the past two months and reaching its highest level in almost two years.
The main driving force comes from a combination of rising input costs and supply risks. Specifically, persistently high oil prices have driven up the production costs of polyester—a synthetic fiber—leading many manufacturers to switch to cotton as an alternative.
In addition, rising fertilizer costs are putting pressure on agricultural production. In the US, West Texas – the largest cotton-growing region – is currently entering the planting season, but as many as 86% of farmers cannot afford the full cost of fertilizer, raising concerns about a potential drop in yields next season.
Weather conditions also continue to be unfavorable, with drought affecting approximately 98% of the US cotton growing area. Due to its high dependence on seasonality and natural conditions, cotton prices typically react strongly to supply risks, especially in the early stages of the season.
Given these supporting factors, July cotton futures continued to rise by 2.27% during the session, bringing the total increase since the beginning of the month to over 16%, currently trading around $1,869.5 per ton. This development indicates that market capital flows are reflecting expectations of a supply shortage in the near future, thereby pushing futures contract prices higher.
In Vietnam, cotton imports from the beginning of the year to mid-April reached over 516,000 tons, a decrease of 4% in volume and 11.7% in value compared to the same period last year. In the context of volatile prices, using forward trading instruments can help businesses be more proactive in managing price risks, especially for input materials like cotton.
Source: https://baotintuc.vn/thi-truong-tien-te/chi-so-mxvindex-cham-dut-chuoi-tang-11-phien-lien-tiep-20260506110725823.htm
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