Oil prices fell as Norway's government moves to halt a strike that could have shut down all of their oil output but a drop in commodity demand by China could signal more stimuli. In China imports of key industrial commodities were lower almost across the board last month when compared to a month earlier. Iron ore imports were down 9% from May. Crude oil imports fell 15% to a seven-month low. Copper shipments declined nearly 18% according to Dow Jones. The shrinking import volumes are in line with the broader picture of an economic slowdown. But month-on-month import figures are misleading. May's figures were distorted by stockpiling purchases as Chinese importers took advantage of an arbitrage opportunity in the difference between low international and high domestic prices. That stems from Chinese market protection and global oversupply of some commodities. That helped push May imports of cotton above 501,000 tons, 3.5 times the level a year earlier. Compared to a year ago, import volumes are robustly higher. Iron ore is up 14%. Crude oil is up 10%. Copper is up 24%. Soybeans are up both on-month and on-year.
Bottom line oil still range bound!
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