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Saudi Arabia Lifts Selling Prices to Asia for All Crude Grades — Commodities Roundup

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MARKET MOVEMENTS:

–Brent crude oil is up 0.8% to $83.66 a barrel.

–European benchmark gas is up 5.3% to EUR32.12 a megawatt-hour.

–Gold futures are up 0.9% to $2,328.60 a troy ounce.

–LME three-month copper futures are flat at $9,914.00 a metric ton.

TOP STORY:

Saudi Arabia Lifts Selling Prices to Asia for All Crude Grades

Top oil exporter Saudi Arabia raised the June price for its flagship Arab Light crude to Asian customers for the third consecutive month, signaling confidence in the demand outlook.

State-owned oil giant Saudi Arabian Oil Co., known as Aramco, set its official selling price for June loadings of Arab Light to Asia at $2.90 a barrel over the Oman/Dubai average, from $2 a barrel in May. Prices for other lighter and heavier crude grades to Asia were also raised.

Looking at other importing regions, the oil producer increased its June prices for all grades for customers in northwest Europe and the Mediterranean, but not to the U.S.

OTHER STORIES:

Geely-Backed EV Maker Zeekr Targets $5.1B Valuation in IPO

Geely Automotive-backed electric-vehicle maker Zeekr Intelligent Technology Holding is targeting a valuation of up to $5.12 billion in its initial public offering, the company said Friday.

The company said in a regulatory filing that it was expecting to sell 17.5 million American depositary shares, representing 175 million common shares, for between $18 and $21 in its IPO.

The Dictator’s Son Wanted His Yacht Back. That’s When Trouble Started for Two Oilmen.

Vice President Teodorin “Teddy” Nguema Obiang was in a mood for payback.

The Obiangs have run the oil-rich Central African country of Equatorial Guinea like a family ATM since 1979, accumulating mansions in Paris and Malibu, Ferraris and Bugattis, and at least three superyachts, according to court documents. And now a South African court was seizing Nguema Obiang’s two high-end Cape Town villas and the Blue Shadow, the yacht that carries his jet-ski collection while he vacations on one of the other two.

MARKET TALKS:

Gold Futures Rise on Promising U.S. Economic Data — Market Talk

0756 GMT – Gold futures rise 1% to $2,331.5 a troy ounce on improved hopes for U.S. interest rate cuts after promising economic data on Friday. The U.S. private sector added jobs in April at a slightly slower pace as pay growth cooled, a monthly report said in positive news for investors hoping the Federal Reserve will ease monetary policy. Gold, historically, has a close relationship with interest rates, with higher rates for longer reducing the appeal of non-interest bearing bullion. Additionally, central banks, led by China, are still increasing their reserve gold allocation, potentially to divest away from the U.S. dollar, Bank of America analysts say in a note. (joseph.hoppe@wsj.com)

Oil Rises as Ceasefire Hopes Dim, Saudi Arabia Lifts Crude Prices

0753 GMT – Oil prices are rising as ceasefire talks between Israel and Hamas show little progress and Saudi Arabia lifts its official selling prices for June loadings for most regions. Brent crude is up 0.8% at $83.65 a barrel, while WTI trades 1% higher at $78.85 a barrel. Last week, both benchmarks declined to levels last seen in mid-March on prospects of higher-for-longer interest rates in the U.S. and hopes for an imminent deal in Gaza. But ceasefire talks hit a standstill once again, reigniting fears of further escalation in the region amid Israel’s planned invasion of Rafah. Meanwhile, Aramco’s flagship Arab Light crude to Asia was raised by $0.90 a barrel compared to the previous month, signaling expectations of stronger demand and tightening supplies this quarter, according to analysts. (giulia.petroni@wsj.com)

Iron Ore Rise Amid Positive Sentiment on Property Sector — Market Talk

0331 GMT – Iron ore prices are higher in early Asian trade, supported by positive sentiment on China’s property sector. Chinese Politburo’s meeting last week may signal a policy pivot to reduce oversupply in the housing sector, Daiwa analyst William Wu wrote in a recent note. The authorities used a new phrase for the first time, which implied they may contemplate new stimulus measures later this year, Wu added. The positive sentiment in the property sector may have further supported iron ore prices, Nanhua Futures analysts write in a note. The most-traded iron-ore contract on the Dalian Commodity Exchange is up 2.1% at CNY891.0 a ton. (jiahui.huang@wsj.com; @ivy_jiahuihuang)

BHP Seen Favoring All-Scrip Bid in Pursuit of Rival Anglo American — Market Talk

0300 GMT – A higher bid from BHP for rival Anglo American is both warranted and required, says Ben Cleary, portfolio manager for Tribeca Global Natural Resources Fund. Tribeca holds shares in both BHP and Anglo. “An all-scrip bid is obviously favored by BHP as it does not stretch their balance sheet while also leaving cash to pursue their growth ambitions,” Cleary tells WSJ. A scrip bid may be easier for the Anglo board to eventually recommend, he says, as unlike a cash bid, it gives shareholders ongoing exposure to the assets. “There are the obvious risks related to potential flowback of BHP stock given it is no longer contained in any European indices, but that would be somewhat countered by increased weight in the Australian market along with the prospect of greater flow into a more attractive diversified investment proposition.” (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

Palm Oil Rises on Renewed Buying Interest — Market Talk

0237 GMT – Palm-oil prices are higher in Asian trading, amid renew buying interest from key markets like India and China, AmInvestment Bank says in a note. This is because the recent price correction in palm oil has eliminated the spread against rival oils, it says. Still, the overall technical outlook remains bearish based on market sentiment, with all indicators pointing downward, the bank says, recommending traders to sell if prices rebound. AmInvestment Bank pegs support for crude palm-oil futures at MYR3,800 and resistance at MYR3,885. The Bursa Malaysia Derivatives contract for July delivery is MYR12 higher at MYR3,856 a ton. (yingxian.wong@wsj.com)

Steelmaking Coal Price Outlook Stronger Than Thermal on Supply Concerns — Market Talk

0151 GMT – While supply shocks in the thermal-coal market are now in the rearview mirror, for steelmaking coal, continued supply headwinds could help push prices higher this year, Morgan Stanley analysts say in a note. Australian mines account for more of the world’s steelmaking coal–at 43% of global exports, versus 18% of world thermal-coal cargoes–and investment there has been affected by increased royalties and higher emissions costs, the MS analysts say. Adverse weather has also disrupted shipments, they add. “Continued headwinds to Australia’s supply base, and India’s growing pull on imports, underpin a fundamentally more constructive outlook for met coal than thermal,” say the analysts. They expect Australian metallurgical coal prices to average around US$290/metric ton in 4Q, from around US$240/ton now. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

Write to Barcelona Editors at barcelonaeditors@dowjones.com

(END) Dow Jones Newswires

05-06-24 0654ET

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