International News 01/07
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Oil prices are steady as stocks are cut and there are Middle East risks.
On Wednesday, oil prices remained stable at approximately $85 per barrel for Brent crude. This follows predictions of declining inventories during the peak summer demand season in the third quarter, as well as concerns regarding geopolitical risks stemming from conflicts in the Middle East. Brent crude futures declined by 9 cents, reaching $84.92 per barrel, while US West Texas Intermediate (WTI) crude oil futures fell by 7 cents, reaching $80.76 per barrel. The American Petroleum Institute (API) has reported that US crude stocks increased by 914,000 barrels last week. However, analysts still anticipate a decrease of 2.9 million barrels in official inventory data from the Energy Information Administration. The dollar has strengthened, making oil priced in dollars more costly for non-dollar buyers. Despite concerns over demand, the market anticipates inventory declines.
BRICS has not reduced global dependence on the dollar.
A study by the Atlantic Council's GeoEconomics Centre found that the US dollar is still the most used global reserve currency. The research showed that the dollar is still the most used currency in the world. The dollar will remain the main global reserve currency in the short and medium term because the US economy is strong, interest rates are low, and there are more geopolitical risks. The report said that Western sanctions on Russia have made the BRICS countries work harder to create a currency union, but have not reduced their dependence on the dollar.
Wheat and corn prices fall to two-month lows.
Wheat futures in Chicago have continued to decline, attributed to the winter harvest in the United States and improved weather conditions in Russia, the world's largest wheat exporter. Corn prices also fell, while soya saw a slight increase as markets evaluated the impact of flooding on crops in the US Midwest. The most active wheat contract on the Chicago Board of Trade (CBOT) dropped to its lowest level since 19th April, reaching $5.56-3/4 per bushel. The US harvest progress, along with better weather conditions in Russia after weeks of drought and frost, have resulted in added pressure on wheat prices. Although the US Midwest experienced further flooding, some traders speculate that the excess moisture will ultimately benefit crops. Additionally, a predicted heatwave in Europe this week is expected to significantly impact summer crops.