Will Rising Jet Fuel Imports Hurt Domestic Refiners?
Jet fuel imports were 104.3% higher in 2015 than in the same period last year. Jet fuel production was 2.5% higher than in the same period last year.
Distillate demand fell by 4.2 million barrels per day for the week ended November 20, 2015. At the same time, inventories rose by 1.1 million barrels.
The fall in propane demand leads to inventory builds. This is bearish for propane prices and could negatively impact propane distributors and producers.
Gold miners’ (GDX) efforts to reduce costs by cutting expenditure on general and administrative expenses, exploration, and development have paid off in the form of a reduction in all-in sustaining costs.
The Fed rate hike has been a major driver for gold prices since mid-2015. Higher interest rates usually diminish gold’s appeal due to its non–interest yielding nature.
The short-to-medium-term course of gold prices will depend on the timing, frequency, and amount of the Fed rate hike.
Gold’s safe haven appeal might lead investors to gold and other precious metals in terms of heightened geopolitical tensions and war.
If you expect this positive correlation to resume, then gold would seem very cheap at its current levels, suggesting an upside in gold prices in the long term.
ETFs form a significant portion of overall gold investment demand. Outflows from ETFs led to a ~28% fall in gold prices in 2013.
The World Gold Council (or WGC) reported that central banks continued building their gold reserves. They were net buyers for the nineteenth consecutive quarter.
In a hope to reduce gold imports and the current account deficit, the government of India launched two major gold initiatives in November 2015.
Tracked by the Federal Reserve, the weekly US Dollar Index (UUP) measures the value of the dollar compared to its six significant trading partners.
After getting a good start to the year—driven by strong demand from Asia, the Greek crisis, and the Swiss currency cap removal—gold prices started pulling back in April.
Will further quantitative easing from the ECB lift gold prices, or will the potential tightening of the economy by the Federal Reserve push gold lower?
The population of India doesn’t seem to appreciate the Indian government’s well-planned gold monetization scheme. The response to the scheme has been fairly muted.
Part of India’s gold monetization scheme is an attempt to put the gold to use that lies with individuals and institutions. It would convert the gold into an interest-bearing asset like Treasuries.
The Indian government is aiming to improve the balance of payment by slashing gold imports. Its gold-hoarding behavior has impacted the current reserves, adding to the country’s deficit.
As the Fed will likely raise the interest rate in December, the prices of precious metals such as gold, which are non-interest bearing, may retreat.
Gold’s haven appeal seems to have diminished. It was unable to rise for a second day following tensions between Turkey and Russia.
The EIA reported that the demand for distillates fell from ~4.2 MMbpd in the week ended November 13 to 3.7 MMbpd in the week ended November 20.