OPEC ups production
The oil price has gained traction. It has increased 10% over the past month and oil is now trading at USD79/bbl. Falling US inventories, concerns about the impact of Hurricane Florence in the US, the impact of sanctions against Iran and finally a weaker USD have been the main factors leading to the price rise. Against this OPEC, and in particular Saudi Arabia, has increased production, which acts as a mitigating factor.
US/China trade war escalates
Mid-September, Trump announced a 10% tariff on an additional USD200bn worth of Chinese goods, which brings the total to USD250bn, or roughly 50% of Chinese imports. The tariff level at 10% is somewhat positive, although it is certainly an escalation of the conflict. Not surprisingly, China, who has pledged to retaliate any US escalation, announced its own tariffs shortly after on USD60bn worth of goods. While China is running out of goods to put tariffs on, it might make life more complicated for US companies who are producing in China by restricting sales of materials and equipment to them.
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