2025-02-25 11:25

Asia's economic growth to drive LNG demand increase China and India expand LNG infrastructure amid rising demand US and Qatar to dominate LNG supply by 2035 LONDON/SINGAPORE, Feb 25 (Reuters) - Global demand for liquefied natural gas is estimated to rise by around 60% by 2040, driven largely by economic growth in Asia, AI impact and efforts to cut emissions in heavy industries and transportation, Shell said in an annual report on Tuesday. Demand for natural gas continues to rise globally as the world transitions to cleaner fuels. Industry forecasts LNG demand to reach between 630 million and 718 million metric tons a year by 2040, Shell said in its 2025 annual LNG outlook. The latest view from the world's largest LNG trader is higher than last year's forecast, which pegged global LNG demand in 2040 at 625 million to 685 million tons per year. "Upgraded forecasts show that the world will need more gas for power generation, heating and cooling, industry and transport to meet development and decarbonisation goals," said Tom Summers, Shell's senior vice president for LNG marketing and trading. China, the world's top LNG importer, and India are increasing LNG import capacity and gas related infrastructure to meet rising demand, Shell added. Natural gas imports into China are forecast to rise this year as economic stimulus plans lift industrial demand, although trade tensions with the U.S. may cap growth. China saw total natural gas imports, including pipeline supply, of 131.69 million tons last year, the highest since at least 2013. Of that volume, 76.65 million tons was LNG, according to its customs data. In India, the International Energy Agency expects natural gas consumption to jump 60% between 2023 and 2030, doubling the country's need for LNG imports, as domestic output is expected to grow much more slowly than demand. While a young population and economic growth are driving an increase in gas demand in emerging markets Algeria, Egypt, Malaysia and Indonesia, domestic production in those markets is seen declining over the next 15 years by up to 50 million tons, equating to less available gas for export, the report said. SUPPLY SIDE To meet rising demand, particularly in Asia, more than 170 million tonnes of new LNG supply is set to be available by 2030, said Shell. The start-up timings of new LNG projects, however, are uncertain, Shell said. Several LNG projects have seen delays over the past two years due to geopolitical tensions, regulatory hurdles, labour shortages and supply chain bottlenecks, delaying the availability of around 30 million tons of new LNG supply, the size of India's LNG imports, to 2028. In 2024, global LNG trading rose by only 2 million tons to 407 million tons due to constraints on development of new supply, marking the smallest annual increase in the past decade, the report said. The report showed that anticipated supply during the period was between 7 million and 20 million tons but it undershot even the lowest end of the forecast range. The report expects Europe's LNG demand to grow in 2025 and beyond. "Europe will continue to need LNG into the 2030s to balance the growing share of intermittent renewables in its power sector. In the longer term, existing natural gas infrastructure could be used to import bio-LNG or synthetic LNG and be repurposed for the import of green hydrogen," the report said. Significant growth in LNG supply will come from top exporter the United States, potentially reaching 180 million tons a year by 2030 and accounting for a third of global supply. Analysts expect that together with Qatar’s massive North Field expansion project set to come online in 2026, the United States and Qatar could provide around 60% of global LNG supply by 2035. Sign up here. https://www.reuters.com/business/energy/shell-expects-60-rise-global-lng-demand-by-2040-2025-02-25/

2025-02-25 11:16

A look at the day ahead in U.S. and global markets from Mike Dolan Rancorous geopolitics continues to grab most headlines again this week, but it's creeping anxiety about a slowing U.S. economy that's unnerving investors most about Wall Street stocks. Wary of Wednesday's results from megacap chip giant Nvidia (NVDA.O) , opens new tab, the S&P500 (.SPX) , opens new tab lost its 6,000 handle for the first time in three weeks on Monday and both the tech-heavy Nasdaq (.IXIC) , opens new tab and small cap Russell 2000 (.RUT) , opens new tab are now negative for the year to date. Even the meagre 1% gain in the S&P500 for 2025 so far is a third of MSCI all-country (.MIWD00000PUS) , opens new tab and far below the 13% gain in Germany's blue-chip DAX (.GDAXI) , opens new tab, which was emboldened this week after the election results there and hopes for some fiscal easing. The VIX 'fear index' (.VIX) , opens new tab of S&P500 implied volatility also jumped above 20 for the first time since February 3 and was eyeing up its highest close of the year ahead of today's bell. Adding to the tech angst ahead of Nvidia's update, Chinese mainland and Hong Kong stock indexes (.CSI300) , opens new tab, (.HSI) , opens new tab both lost more than 1% earlier on Tuesday after a Bloomberg report said President Donald Trump plan to toughen chip restrictions on China - expanding predecessor Joe Biden's efforts to hamper Beijing's tech development. 'ON SCHEDULE' Keeping trade threats on the front burner, Trump also said overnight that tariffs on Canadian and Mexican imports are "on time and on schedule" despite both countries' moves on border security and fentanyl trafficking ahead of a March 4 deadline. And yet market jitters about pricy U.S. stocks were sourced even closer to home, with US stock futures remaining in the red overnight. Alongside the tech anxiety, the economic numbers this week continue to challenge the 'no landing' consensus that has recently built up around direction of overall activity. With a withering array of new policy initiatives involving import duties, migrant curbs, federal worker cuts and broken international alliances, there's concern that the uncertainty of the impact is weighing on business and consumer planning. Retail sales have disappointed into the new year and business surveys are starting to splutter, with one last week showing the dominant U.S. service sector contracting for the first time in two years this month. The drip-drip of slowing activity was reinforced on Monday by Dallas and Chicago Federal Reserve surveys, too. The University of Michigan's household survey on Friday, meantime, shows consumer confidence at 15-month lows in February and the Conference Board's equivalent consumer sentiment readout today will likely be pivotal during Tuesday's trading session. Consensus forecasts are for a drop in the gauge to five-month lows. The underwhelming picture is captured best by a drop in the U.S. economic surprise index over the past week to its most negative since September. CONSUMER CONFIDENCE And there's also growing fears that any shakeout in stocks from here could well compound a consumer confidence retreat by sapping the 'wealth effect' in richer households who dominate retail spending aggregates. The concern is significant enough to shift the dial on Treasuries too. Ten-year Treasury yields have plunged to their lowest for the year at 4.33%, clocking losses of 20 basis points in less than two weeks. Two-year yields plumbed as low as 4.11% to their lowest since December 11. And even Fed futures have sat up and taken notice - with another rate cut now fully priced again before July and more than two full cuts in price for whole year. In that environment, the dollar (.DXY) , opens new tab has held remarkably steady so far - caught between the domestic economic stumble and yield moves and the pressure of upcoming tariff rises. Mexico's peso , Canada's dollar and China's yuan were marginally weaker. But the wider market risk environment is fraying at the edges. Bitcoin plunged back below $90,000 for the first time in a month to hit its lowest since November, shortly after Trump's election was supposed to usher in some new era for the crypto world. Elsewhere, the focus continued to be on Europe's stock outperformance - with cheaper valuations there, repatriation of European money from Wall Street, this week's German election results and hopes for euro-wide fiscal boosts playing a part. Despite losses on Wall Street and in China over the past 24 hours, the pan-European STOXX 600 index (.STOXX) , opens new tab rose 0.3% on Tuesday. Fears that a messy U.S.-Kremlin brokered deal to end the Ukraine war without rolling back Russia's three-year old invasion of the eastern part of the country have sent shockwaves across Europe and defense spending is now a huge priority. The European aerospace and defence index (.SXPARO) , opens new tab jumped again on Tuesday, adding 1.3% as traders pointed to reports that Germany was discussing 200 billion euros for an emergency defence fund. Key developments that should provide more direction to U.S. markets later on Tuesday: * US Conference Board's February consumer confidence survey, Richmond Federal Reserve Feb business surveys, Dallas Fed Feb services survey * Federal Reserve Vice Chair for Supervision Michael Barr, Dallas Fed President Lorie Logan, Richmond Fed chief Thomas Barkin all speak; European Central Bank board member Isabel Schnabel and Bank of England chief economist Huw Pill speak * US corporate earnings: Home Depot, First Solar, Workday, Keurig Dr Pepper, Public Service Enterprise, Sempra, Pinnacle West, Intuit, Henry Schein, American Tower, Axon, Caesars Entertainment, Keysight, Extra Space Storage etc * US Treasury sells $70 billion of 5-year notes Sign up here. https://www.reuters.com/markets/us/global-markets-view-usa-2025-02-25/

2025-02-25 11:05

FRANKFURT, Feb 25 (Reuters) - The European Central Bank has room to cut its interest rates further if inflation eases to its 2% goal this year as it expects, ECB policymaker Joachim Nagel said on Tuesday, adding the outlook for prices was "encouraging". The ECB is widely expected to cut rates for a fifth straight time next week after seeing inflation fall from double digits after Russia's 2022 invasion of Ukraine to just over 2% in recent months. Nagel said incoming data, especially the latest developments on price growth, suggested the ECB was likely to achieve its target this year. "This would allow us on the Governing Council to lower the key interest rates further," he said in a speech as he presented the Bundesbank's annual accounts. "Overall...the outlook for prices is fairly encouraging," he added, while cautioning about "persistently elevated core inflation and the undiminished strength of services inflation". Meanwhile the Bundesbank, as the ECB's main shareholder, was still paying a high price for its past largesse in the form of massive bond purchases, and the subsequent bout of high inflation. The German central bank posted yet another loss in 2024 as meagre income from bonds it bought when rates were low was outweighed by large interest payments to banks. The 19.2 billion-euro ($20.10 billion) loss wiped out the Bundesbank's reserves and was carried forward to this year. The German central bank said it expects to record losses for some time to come, meaning it won't be able to pay dividends to the German federal government. But Nagel stressed the Bundesbank had a sound balance sheet, including revaluation reserves worth 267 billion euros. "The Bundesbank is fully unrestricted in its ability to act," Nagel said. ($1 = 0.9553 euros) Sign up here. https://www.reuters.com/markets/rates-bonds/ecbs-nagel-sees-more-rate-cuts-inflation-outlook-encouraging-2025-02-25/

2025-02-25 08:22

MUMBAI, Feb 25 (Reuters) - The Indian central bank likely intervened to support the rupee after it dropped past 87 per U.S. dollar on Tuesday due to demand for the greenback related to derivatives expiry, four traders told Reuters. The rupee slid to 87.2450 before the Reserve Bank of India's intervention helped it recover to 87.1225. Still, the local currency was down 0.5% on the day. The RBI sold dollars "relatively quickly" via state-run between 87.20-87.24, a spot trader at a small private bank said. Sign up here. https://www.reuters.com/world/india/indian-central-bank-likely-intervened-halt-rupees-decline-traders-say-2025-02-25/

2025-02-25 07:49

China suspended Thai syrup, premixed powder imports in December Thai officials say Chinese authorities have yet to respond Damages to Thai firms exceed $59 million -industry official BANGKOK, Feb 25 (Reuters) - Thai firms grappling with losses of about $60 million from China's ban on sugar syrup face shutdowns as soon as next month, an industry body said, while negotiations by officials of the Southeast Asian nation to lift the measure yielded no fruit. Concerns about factory hygiene prompted China to suspend imports of syrup and premixed powder from the world's second-largest sugar exporter in December. Last month Thai officials said it had asked Thailand to inspect dozens of factories before starting talks to lift the ban. "No factories are purchasing raw sugar, and operations have been halted for over two months," said Todsaporn Ruangpattananont of the Thai Sugar Product Association, which typically buys a million tons of the sweetener each year. "If there's no way out by March, they'll shut down." Thailand has not yet received a response from China to a list of factories licenced by its Food and Drug Administration, along with details of food safety regulations, sent on January 14, two Thai government officials told Reuters. "We are still waiting for a response from the Chinese government," said one of the officials, who both sought anonymity, as they were not authorised to talk to the media. "Thailand is prepared to set up an inspection system in line with what China requires." Thailand's National Bureau of Agricultural Commodity and Food Standards, the main agency handling the matter, did not respond to emailed questions. China's commerce ministry did not immediately respond to a request for comment. About 40,000 metric tons of syrup and premixed powder shipped to Chinese ports had been returned to Thailand, said Todsaporn, whose association represents 42 sugar mills that primarily supply to China. The resulting financial losses to Thai firms exceeded 2 billion baht ($59.51 million), or twice the previous estimate, Todsaporn added, reflecting shipping and transport costs, fines at Chinese ports and lower selling prices. Thailand was China's main supplier of liquid sugar last year, with shipments of more than 1.2 million metric tons, says supply chain services company Czarnikow. Thammasorn Nawilaijaroen, a senior executive at SMC Food Thailand and Hefty Food Thailand, which exports syrup and premixed power to China and Japan, said both his firms had been hit by losses of around 100 million baht because of the ban. Hefty Food, which exports syrup solely to China and shipped 120,000 tons last year, has stopped production, he told Reuters. "There are 300 containers that have been brought back," Thammasorn said, "We still don't know who to sell them to." ($1=33.6100 baht) Sign up here. https://www.reuters.com/markets/commodities/thai-firms-suffer-60-million-loss-risk-shutdown-chinas-ban-sugar-syrup-2025-02-25/

2025-02-25 07:46

US consumer confidence falls in February German economy shrinks in Q4 2024 Nigeria boosts oil output, Iraq signs production deal with BP Market awaits US oil inventory data from API and EIA NEW YORK, Feb 25 (Reuters) - Oil prices fell about 2% to a two-month low on Tuesday on weak economic news from the U.S. and Germany that fed fears of slower energy demand, along with signs from several countries that oil output was on track to increase. Brent futures fell $1.76, or 2.4%, to settle at $73.02 a barrel, while U.S. West Texas Intermediate (WTI) crude fell $1.77, or 2.5%, to settle at $68.93. That was the lowest close for Brent since December 23 and WTI since December 10. U.S. data showed consumer confidence in February deteriorated at its sharpest pace in 3-1/2 years, with 12-month inflation expectations surging. Analysts said President Donald Trump's stated plans for higher tariffs have raised inflation worries at the U.S. Federal Reserve. This could lead the Fed to keep interest rates higher, which in turn could slow economic growth and energy demand. Trump said tariffs against Canadian and Mexican imports, scheduled to start on March 4, are "on time and on schedule," which may boost oil prices by reducing supplies from both countries. But "tariffs are increasingly being viewed as a negative influence on global economic growth that could force additional downside revisions in world oil demand," analysts at energy advisory firm Ritterbusch and Associates said. Data showed the German economy shrank by 0.2% in the final quarter of 2024 from the previous quarter. German election winner Friedrich Merz ruled out a quick reform to state borrowing limits known as the "debt brake," which some investors have urged to boost the economy. OIL OUTPUT COULD RISE Also weighing on oil prices was the possibility of a peace deal between Russia and Ukraine that "foreshadows the lifting of Russian sanctions, potentially welcoming unfettered Russian supply back to the market," said Tamas Varga at oil broker PVM. Russia is the third-biggest oil producer behind the U.S. and Saudi Arabia and a member of OPEC+, the Organization of the Petroleum Exporting Countries (OPEC) and allied countries. In Iraq, the second-largest OPEC producer, oil major BP (BP.L) , opens new tab signed a deal to redevelop four Kirkuk oil and gas fields. Iraq is also waiting for Turkey's approval soon to restart oil flows from the Iraqi Kurdistan region. In Nigeria, another OPEC member, oil production rose to 1.8 million bpd, up from just 1 million bpd over a year ago. In the U.S., Trump said he wanted the Keystone XL pipeline built and pledged easy regulatory approvals for the project that would move crude from Canada to the U.S. U.S. OIL INVENTORIES U.S. oil inventory data from the American Petroleum Institute (API) trade group is due on Tuesday and U.S. Energy Information Administration data is due on Wednesday. , Analysts forecast energy firms added about 2.6 million barrels of oil to U.S. stockpiles during the week ended February 21. If correct, that would be the first time energy firms added oil into storage for five weeks in a row since March 2024. That compares with an increase of 4.2 million barrels during the same week last year and an average build of 2.3 million barrels over the past five years (2020-2024). Sign up here. https://www.reuters.com/business/energy/oil-prices-gain-second-day-us-sanctions-iran-raise-supply-concerns-2025-02-25/