2025-08-11 12:00

LAUNCESTON, Australia, Aug 11 (Reuters) - The crude oil market's rather sanguine reaction to the U.S. threats to India over its continued purchases of Russian oil is effectively a bet that very little will actually happen. President Donald Trump cited India's imports of Russian crude when imposing an additional 25% tariff on imports from India on August 6, which is due to take effect on August 28. Sign up here. If the new tariff rate does come into place, it will take the rate for some Indian goods to as much as 50%, a level high enough to effectively end U.S. imports from India, which totalled nearly $87 billion in 2024. As with everything related to Trump, it pays to be cautious given his track record of backflips and pivots. It's also not exactly clear what Trump is ultimately seeking, although it does seem that in the short term he wants to increase his leverage with Russian President Vladimir Putin ahead of their planned meeting in Alaska this week, and he's using India to achieve this. Whether Trump follows through on his additional tariffs on India remains uncertain, although the chances of a peace deal in Ukraine seem remote, which means the best path for India to avoid the tariffs would be to acquiesce and stop buying Russian oil. But this is an outcome that simply isn't being reflected in current crude oil prices. Global benchmark Brent futures have weakened since Trump's announcement of higher tariffs on India, dropping as low as $65.81 a barrel in early Asian trade on Monday, the lowest level in two months. This is a price that entirely discounts any threat to global supplies, and assumes that India will either continue buying Russian crude at current volumes, or be able to easily source suitable replacements without tightening the global market. Are these reasonable assumptions? The track record of the crude oil market is somewhat remarkable in that it quickly adapts to new geopolitical realities and any price spikes tend to be shortlived. The Russian invasion of Ukraine in February 2022 sent crude prices hurtling toward $150 a barrel as European and other Western countries pulled back from buying Russian crude. But within four months the price was back below where it was before Moscow's attack on its neighbour as the market simply re-routed the now discounted Russian oil to China and India. In other words, the flow of oil around the globe was shifted, but the volumes available for importers remained much the same. DIFFERENT THIS TIME? But what Trump is proposing now is somewhat different. It appears he wants to cut Russian barrels out of the market in order to put financial pressure on Moscow to cut a deal over Ukraine. There are effectively only two major buyers for Russian crude, India and China. China, the world's biggest crude importer, has more leverage with Trump given U.S. and Western reliance on its refined critical and other minerals, and therefore is less able to be coerced into ending its imports of Russian oil. India is in a less strong position, especially private refiners like Reliance Industries (RELI.NS) , opens new tab, which will want to keep business relationships and access to Western economies. India imported about 1.8 million barrels per day of Russian crude in the first half of the year, or about 37% of its total, according to data compiled by commodity analysts Kpler. About 90% of its Russian imports came from Russia's European ports and was mainly Urals grade. This is a medium sour crude and it would raise challenges for Indian refiners if they sought to replace all their Urals imports with similar grades from other suppliers. There are some Middle Eastern grades of similar quality, such as Saudi Arabia's Arab Light and Iraq's Basrah Light, but it would likely boost prices if India were to seek more of these crudes. If Chinese refiners were able to take the bulk of Russian crude given up by India, it may allow for a re-shuffling of flows, but that would not appear to be what Trump wants. Trump and his advisers may believe there is enough spare crude production capacity in the United States and elsewhere to handle the loss of up to 2 million bpd of Russian supplies. But testing that theory may well lead to higher prices, especially for certain types of medium crudes which would be in short supply. It's simplistic to say that higher U.S. output can supply India's refiners, as this would mean those refiners would have to be willing to accept a different mix of refined products, including producing less diesel, as U.S. light crudes tend to make more products such as gasoline. For now the crude oil market is assuming that the Trump/India/Russia situation will end as another TACO, the acronym for Trump Always Chickens Out. But the reality is likely to be slightly more messy, as some Indian refiners pull back from importing from Russia, some Chinese refiners may buy more and once again the oil market goes on a geopolitical merry-go-round. Enjoying this column? Check out Reuters Open Interest (ROI), your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI can help you keep up. Follow ROI on LinkedIn , opens new tab and X , opens new tab. The views expressed here are those of the author, a columnist for Reuters. https://www.reuters.com/markets/commodities/crude-oil-market-bets-trumps-india-threats-are-hollow-russell-2025-08-11/

2025-08-11 11:59

Defendants deny charges, claim lack of Finnish jurisdiction Cable owners face at least 60 million euros in repair costs, prosecutors say Baltic Sea region on high alert for sabotage HELSINKI, Aug 11 (Reuters) - Finland's national prosecutor's office said on Monday it had brought charges against the captain and first and second officers of the Eagle S oil tanker over the cutting of undersea cables in the Gulf of Finland in December. The Georgian and Indian nationals are suspected of aggravated criminal mischief and aggravated interference with communications by dragging the ship's anchor for around 90 km (56 miles) across the seabed, a prosecutors' statement said. Sign up here. The defendants, who are not permitted to leave Finland, have denied committing the offences and consider that Finland also lacks jurisdiction in the case as the incident took place outside Finnish territorial waters, it said. Finnish authorities have said the Cook Islands-registered Eagle S broke the Estlink 2 undersea power cable connecting Finland and Estonia as well as four internet lines. "The owners of the cables have suffered a total of at least 60 million euros ($70 million) in immediate damage in the form of repair costs alone," the prosecutors' office said. The Baltic Sea region has been on high alert for sabotage after a string of outages of power cables, gas pipelines and telecoms, although subsea infrastructure is also subject to technical malfunctions and outages caused by accidents. The Eagle S disruption caused serious risks to energy supply and telecommunications in Finland, although services were secured via alternative connections, the prosecutors' statement said. A lawyer for United Arab Emirates-based Caravella LLC FZ, the owner of the Eagle S, has previously said Helsinki lacked jurisdiction to intervene in the case. The lawyer for the company did not immediately respond to a request for comment on Monday. The prosecutors' office said a local court would set a date for hearing the case and, if necessary, determine whether it falls under Finnish jurisdiction. ($1 = 0.8590 euros) https://www.reuters.com/markets/commodities/finland-charges-eagle-s-tanker-captain-officers-over-cable-cuts-2025-08-11/

2025-08-11 11:58

US dollar steady before key US inflation data Traders expect extension of US-China tariff truce Bitcoin closes in on record high, ether surges LONDON, Aug 11 (Reuters) - The U.S. dollar was consolidating on Monday before Tuesday's deadline for Washington and Beijing to strike a tariff deal and a key U.S. inflation report that could help determine whether the Federal Reserve lowers borrowing costs next month. The dollar index was up less than 0.1% to 98.30 after last week's 0.4% fall. Against the yen, the U.S. currency traded at 147.87 , up 0.1%. Japanese markets were closed on Monday for the Mountain Day holiday. Sign up here. The euro was down less than 0.1% at $1.1636, while sterling was down 0.2% at $1.3435. The dollar softened last week as investors adjusted their expectations for interest rate cuts from the Fed after soft data on U.S. jobs and manufacturing. Fed officials have sounded increasingly uneasy about the labour market, signalling their openness to a rate cut as soon as September. Cooling inflation could cement bets for a cut next month, but if signs emerge that U.S. President Donald Trump's tariffs are fuelling price rises, that might keep the Fed on hold for now. "It's important to note ahead of tomorrow's data that the bar for a hawkish surprise is higher," said Francesco Pesole, FX strategist at ING. Pesole added that a 0.3% monthly rise in core CPI would give the Fed room to lower interest rates, given the deterioration in the labour market. Economists polled by Reuters expect core CPI to have risen 0.3% in July, pushing the annual rate higher to 3%. Money market traders are pricing in around a 90% chance of a rate cut next month, while 58 basis points of easing are priced in by year-end, implying two quarter-point cuts and around a one-in-three chance of a third. Personnel moves at the Fed have also weighed on the dollar recently. Trump is preparing to install rate-setters that support his dovish views on monetary policy, including a new chair for when Jerome Powell's term ends in May. Trade talks were also in focus as Trump's August 12 deadline for a deal between the U.S. and China neared, particularly on chip policy. "The market has fully priced in the idea that we're going to get an extension," said Chris Weston, head of research at Pepperstone Group Ltd in Melbourne, adding that another 90-day truce was most likely. With the U.S. and China seeking to close a deal averting triple-digit goods tariffs, a U.S. official told Reuters that chip makers Nvidia (NVDA.O) , opens new tab and AMD (AMD.O) , opens new tab had agreed to allocate 15% of China sales revenues to the U.S. government, aiming to secure export licences for semiconductors. "I don't know if that's going to be a good thing or a bad thing, but if it puts closure on the matter, it's not a bad outcome," Weston said. "If this is Trump saying 15% and we'll call it a day, that may not be too bad." The offshore yuan fluctuated between gains and losses, trading at 7.1913 to the dollar, after weekend data showed China's producer prices fell more than expected in July, while consumer prices were unchanged. The Australian dollar fetched $0.6514 , trading down 0.2% ahead of a rate decision on Tuesday, in which it is widely expected that the Reserve Bank of Australia will cut rates by 25 bps to 3.60%, after second-quarter inflation came in weaker than expected and the jobless rate hit a 3-1/2-year high. Cryptocurrencies jumped, with bitcoin rising as high as $122,308, not far from its July 14 record of $123,153.22, after Trump's executive order on Thursday freed up cryptocurrency holdings in U.S. retirement accounts. Ether rose as high as $4,346.01, its highest since December 2021. https://www.reuters.com/world/china/dollar-steady-before-us-inflation-report-us-china-tariff-deadline-2025-08-11/

2025-08-11 11:55

US consumer price index data due on Tuesday US gold futures down more than 2% Markets expect Fed interest rate cut in September Aug 11 (Reuters) - Gold prices fell more than 1% on Monday as investors waited for news from the White House on potential tariffs on bullion and U.S. inflation data that will provide a steer on the Federal Reserve's interest rate path. Spot gold was down 1.4% at $3,350.94 an ounce by 1135 GMT after touching $3,408.06 on Friday, its highest since July 23. Sign up here. U.S. gold futures for December delivery fell 2.5% to $3,404.90, having hit a record high of $3,534.10 on Friday after reports that Washington had imposed tariffs on imports of 1 kg (2.2 lb) bullion bars. The White House said on Friday that it would issue an executive order clarifying its stance on the tariffs. "Spot gold is tumbling, along with futures, as markets unwind the initial shock from U.S. tariffs potentially plunging bullion flows into chaos," said Han Tan, chief market analyst at investment trading platform Nemo.Money. Market attention is also focused on Tuesday's U.S. consumer price data, with tariffs expected to push core inflation up 0.3%, lifting the annual rate to 3%, well above the Fed's 2% target. "Lower than expected CPI prints that bolster bets for Fed rate cuts by year-end may restore spot gold above the psychological $3,400 level," Tan said. A recent softer than expected U.S. jobs report has prompted markets to price in a near 90% chance of a September cut to interest rates and at least one more reduction by the end of the year. Lower rates typically benefit non-yielding gold. On the trade front, a deadline for China to agree a tariff deal with Washington, due to expire on Tuesday, is expected to be extended again, while U.S. President Donald Trump and Russian leader Vladimir Putin are due to meet in Alaska on Friday to discuss ending the Ukraine war. "Rising expectations of a peace deal between Ukraine and Russia, negotiated by Trump, have reduced some safe haven demand (for gold)," SP Angel analyst John Meyer said in a note. In other precious metals, spot silver fell 1.5% to $37.74 an ounce, platinum was down 2% at $1,307.70 and palladium lost 0.2% to $1,123.43. https://www.reuters.com/world/china/gold-weakens-markets-await-clarity-bullion-tariffs-2025-08-11/

2025-08-11 11:51

Aug 11 (Reuters) - An area of low pressure located just west of the Cape Verde islands has a 90% chance of becoming a cyclone in the next 48 hours, the U.S. National Hurricane Center said on Monday. Heavy rainfall and gusty winds are expected to continue across portions of the islands off West Africa and authorities there should monitor the progress of this weather system, the NHC said in its latest advisory. Sign up here. https://www.reuters.com/business/environment/us-nhc-cites-90-chance-cyclone-near-cape-verde-islands-2025-08-11/

2025-08-11 11:19

Shares drop almost 30% after rights issue announcement Says cash will provide financial robustness in 2025-2027 Danish state to maintain majority stake in Orsted Morgan Stanley to underwrite any unsubscribed shares COPENHAGEN, Aug 11 (Reuters) - Denmark's Orsted (ORSTED.CO) , opens new tab on Monday asked its shareholders for 60 billion crowns ($9.4 billion), sending the stock sharply lower as the wind farm developer seeks to boost its finances amid U.S. President Donald Trump'sopposition to wind power. Struggling in recent years with soaring inflation and logistical problems that sent costs soaring, the offshore wind industry faced a further setback when Trump suspended licensing on his first day back in office in January. Sign up here. "Orsted and our industry are in an extraordinary situation with the adverse market development in the U.S. on top of the past years’ macroeconomic and supply chain challenges," CEO Rasmus Errboe said in a statement. Increased uncertainty in the U.S. market in recent months meant that potential investors for Orsted's Sunrise Wind project under development on the U.S. East Coast pulled out. As a result, the company is forced to cover all costs related to the project, which led to increased funding requirements of around 40 billion crowns, it said. Orsted depends on selling full or partial stakes in its offshore wind farms in order to finance new projects. The rest of the expected proceeds from the rights issue would strengthen Orsted's capital structure and help it develop the 8.1 gigawatts of offshore wind projects currently under construction by 2027, the company said. Orsted shares fell as much as 29% to a nine-year low on Monday. At 1039 GMT, they were down 27.6% at 223.2 crowns. "The U.S. offshore wind market was crippled after Trump took office," said Sydbank analyst Jakob Pedersen. "Orsted's plan to raise capital was not just the correct option, it was the only option." SHOCKWAVES Trump campaigned on a promise to end the offshore wind industry, saying it is too expensive and hurts whales and birds. In April, his administration ordered Equinor (EQNR.OL) , opens new tab to halt development of a fully-permitted wind farm off New York, sending shockwaves through the industry. The order was, however, reversed the following month. Errboe, who replaced former CEO Mads Nipper earlier this year, has sought to cut costs and cancelled projects in the U.S. and UK. The rights issue is worth almost half of Orsted's market value of around 130 billion crowns as of Friday's close. Jefferies analysts said in a note that while the fundraising would help to de-risk the company's balance sheet, the near-term dilution for shareholders "seems substantial". Orsted said in a statement that the Danish state, which owns 50.1% of the company, had agreed to subscribe to a similar portion of the share issue, thus retaining a majority stake. "Orsted is an extremely important company in the green transition, and there is also a security policy dimension where we need to be independent of energy from Russia," Denmark's Finance Minister Nicolai Wammen told broadcaster TV2. A spokesperson for Equinor, which holds a 10% stake in Orsted, said it would "assess the proposal". Shares not subscribed for by the existing shareholders or other investors will be fully underwritten by Morgan Stanley, Orsted said. The company also said it expects to raise more than 35 billion crowns from selling its European onshore wind business as well as from planned divestments of stakes in its Changhua 2 offshore wind farm in Taiwan and Hornsea 3 in Britain. ($1 = 6.3953 Danish crowns) https://www.reuters.com/world/europe/denmarks-orsted-seeks-94-billion-us-wind-market-falters-2025-08-11/