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Crude oil futures up in Asia on bargain hunting, but rising COVID-19 case numbers continue to sap market sentiment

August 10/2021

MOSCOW (MRC) -- Crude oil futures ticked higher during mid-morning trade in Asia Aug. 10 on bargain hunting following an overnight plunge, but rising COVID-19 case numbers continued to sap market sentiment, reported S&P Global.

At 11:18 am Singapore time (0318 GMT), the ICE October Brent futures contract was up 18 cents/b (0.26%) from the previous close at USD69.22/b, while the NYMEX September light sweet crude contract was 36 cents/b (0.54%) higher at USD66.84/b.

The markers had settled 2.35% and 2.63% lower Aug. 10 as the rapid spread of the delta variant of the coronavirus raised fears of further demand destruction.

An uptrend in COVID-19 infection numbers in oil-consuming behemoths China and the US were of particular concern to the market. China is battling its biggest outbreak of the coronavirus since it emerged in Wuhan in 2019.

Analysts at St. George Economics said in an Aug. 10 note that the pandemic resurgence has exacerbated concerns over China's economy that had arisen earlier due to global supply bottlenecks and higher raw material costs, and cautioned that lower domestic economic activity could weigh on oil and energy demand.

Crude oil prices were also pressured overnight by a stronger dollar buoyed by a rise in Treasury yields after the release of a better-than-expected US non-farm payrolls report and hawkish comments from some members of the Federal Reserve. At 11:06 am, the ICE Dollar Index was trading at 92.98, up 0.194% from the Aug. 6 close.

We remind that as MRC informed earlier, Saudi Arabia, the world's top crude oil exporter, will supply full contractual volumes of August-loading crude to at least five Asian customers. However, Saudi Aramco has turned down two of the buyers' requests for extra barrels.

We also remind that Mukesh Ambani, chairman and managing director of Reliance Industries Ltd (RIL), said in June he expects the company's deal with Saudi Aramco to materialise this year. Meanwhile, Yasir Al-Rumayyan, chairman of Saudi Aramco and the Governor of the Public Investment Fund, joined the board of Reliance as an independent director.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,176,860 tonnes in the first half of 2021, up by 5% year on year. Shipments of exclusively low density polyethylene (LDPE) decreased. At the same time, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.
Author:Margaret Volkova
Tags:Asia, crude and gaz condensate, medicine, petrochemistry, Reliance Industries, Saudi Aramco, India, China, Saudi Arabia, USA.
Category:General News
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