Information from the Vietnam Commodity Exchange (MXV), at the end of the first session of the week (April 3), the strong buying force in the energy market pulled the MXV-Index up by 4. 1,2% to 2.333 points, extending the rally to the 3rd consecutive session. The transaction value of the whole Department reached nearly 5.200 billion VND.
Oil prices rise more than 6%
Crude oil prices rebounded to their highest in nearly a month after the Organization of the Petroleum Exporting Countries and its allies (OPEC+) cut output. Ending the session on April 03, WTI crude oil price increased by 04% to 6,28 USD/barrel, Brent crude oil price increased by 80,42% to 6,31 USD/barrel.
Strong buying power since the opening of the week, OPEC, and its allies including Russia announced plans to cut production by an additional 1,16 million bpd, starting from May until the end of this year. Saudi Arabia and Russia are the two pioneers in this cut, with each planning to cut production by about 5 bpd, along with other members such as the United Arab Emirates (UAE). , Iraq, Kuwait, Algeria, Oman, Kazakhstan and Gabon.
The commitments will bring the total amount of OPEC+ cuts since November to 11 million bpd, including the 3,66 million bpd cut last October, or about 2% of global demand. bridge.
This move has raised concerns about supply, and it is difficult for even the US to accelerate production to fill the gap left by OPEC+. Currently, US oil production is 12,2 million bpd, still about 500.000 bpd below pre-pandemic levels.
According to Bloomberg, this cut will wipe out the current supply surplus and push the oil market into a deeper deficit since the third quarter of this year. Bloomberg estimates also show that the deficit in the fourth quarter will widen to 1,87 million bpd, nearly 60% higher than 1,17 million bpd in the OPEC+ no-cut scenario.
Many large financial institutions such as Goldman Sachs Bank forecast Brent oil price will reach 95 USD/barrel in December, and UBS Bank raised oil price estimate to 12 USD/barrel in June. forecast, the increase in Brent oil price could push the price of crude oil and other petroleum products of Russia to higher than the limit set by G100.
US President Joe Biden has spoken to reassure people, however, this somewhat unexpected cut by OPEC + may cause gasoline prices in the US to rise back to 4 USD/gallon (3,79 liters) from the previous level. $3,50/gallon today. US Treasury Secretary Janet Yellen also expressed that the OPEC+ cuts will add to the inflation burden and become a drag on global economic growth.
The International Energy Agency (IEA) also said the cuts risked exacerbating a tense market and pushing up oil prices as inflationary pressures remained subdued in many parts of the world. world, especially Europe.
The escalation of energy prices will put pressure on central banks around the world in managing monetary policies. The CME's tracking tool shows that the scenario that the US Federal Reserve (Fed) will raise interest rates by 25 basis points at the May meeting is overwhelming compared to the unchanged scenario. The European Central Bank (ECB) may raise interest rates by 5 basis points if inflation does not cool down.
The global economy, which is already slowing down, is now at risk of a recession. In the US, pressure from Fed rate hikes caused manufacturing activity in March to fall to a nearly three-year low as new orders fell. According to data from the American Institute of Supply Management (ISM), the manufacturing PMI fell to 3 points, lower than the previous month and estimates. This is also the lowest level since June 3.
Oil prices may decline again in the medium and long term, if the world economy slows down due to pressure from monetary policy, causing consumption demand to weaken more strongly than supply.
Arabica coffee increased sharply
At the end of the first trading day of the week, green color dominated the price list of industrial raw materials. Arabica coffee surprised by leading the group's gain while the boom in oil prices supported raw sugar prices to set a new high price record.
Despite the market's expectation that coffee production in the upcoming 2023/24 crop year will loosen more than the previous two periods, Arabica suddenly rebounded sharply by 2% after touching the lowest level in 3,37 months. Standard Arabica inventories on ICE London fell to a three-and-a-half-month low at 2 3kg bags, which partly supported prices yesterday.
Thanks to the pull from Arabica as well as concerns about supply scarcity, Robusta prices continued to prosper with an increase of 1,04% yesterday. Although Brazil has begun to harvest, production is forecast by Conab to have a slight decline compared to 2022. Along with that, Reuters' warning about supply shortages in Vietnam and Indonesia caused the market to witness the general picture of a short-term supply contraction, thereby supporting the uptrend of prices.
After touching the highest level in more than 6 years, raw sugar price continued to prosper yesterday but the gain has been corrected with a slight increase of 0,67%. The market continues to be dominated by supply shortage concerns as major producing countries such as India, Thailand and China are all forecasting a decrease in output in the current crop year. Besides, crude oil price rebounded strongly yesterday, also led to the uptrend of sugar price.
Domestic coffee prices regain momentum
On the domestic market, recorded this morning, the price of green coffee beans in the Central Highlands and Southern provinces increased again with an increase of 400 VND/kg. Accordingly, domestic coffee is purchased in the range of 48.600 - 49.000 VND/kg; 1.000 VND/kg higher than the same period last month.
According to the General Statistics Office, coffee exports in March of our country increased by 3% over the same period last year, to 9,24 tons. Thereby, bringing coffee exports in the first 230.000 months of the current crop year 6/2022 to approximately 2023 tons, up 977.913% over the same period last crop year.
