Japan's next-day power hits a three-year high as Hormuz traffic falls below 20 ships
Brent fell more than a dollar as fewer than 20 commodity ships crossed Hormuz. Japan's next-day power rose 20 per cent to a three-year high. Six EU finance ministers asked Ireland to table a windfall tax in Dublin.
Economics & Markets··Morning
Brent falls more than a dollar as fewer than 20 ships cross Hormuz
Brent fell 1.01 dollars, or 1.1 per cent, to 93.38 dollars, while US crude lost 1.42 dollars, or 1.6 per cent, to 85.64 dollars. Shipping data showed fewer than 20 commodity vessels transited the Strait of Hormuz at the weekend. Investors took profits after two weeks of gains and waited for details of the expected sanctions package. Morgan Stanley raised its Brent forecast on inventory draws and a longer-lasting regional disruption, projecting a peak of 100 dollars in the fourth quarter. Fatih Birol, head of the International Energy Agency, said a second release from strategic reserves is not currently being discussed.[1]
Heat and costly gas lift next-day power to 25.18 yen a kilowatt-hour
Japan's nationwide next-day power price rose 20 per cent from the previous week on Monday to 25.18 yen, or 0.16 dollars, a kilowatt-hour, the highest level since January 2023 according to Japan Electric Power Exchange data. The weather agency issued a warning for unusually hot weather nationwide from Wednesday, with 35 degrees Celsius expected around Tokyo and Kansai and 37 degrees Celsius in Nagasaki. Asian spot prices for liquefied natural gas are more than double their level before the attacks on Iran began in late February. Visible shipments of the fuel through the Strait of Hormuz have been at a standstill since an attack on a Qatari-owned tanker in July.[2]
Six finance ministers put an oil windfall tax on Ireland's Dublin agenda
Germany, Spain, Portugal, Italy, Poland and Austria asked Ireland, which holds the rotating presidency, to place the taxing of oil companies' windfall profits on the agenda of the finance ministers' meeting in Dublin on 18 and 19 September. Their stated reason is the jump in profits after Iran's blockade of the Strait of Hormuz. In the letter the ministers wrote that they were experiencing one of the biggest supply shocks in decades and said measures taken so far had not been enough to lower prices durably. They want the lessons of 2022 revisited, this time with a closer analysis of how the foreign profits of multinational oil companies could be captured. Oil rose about 25 per cent since the war began on 28 February, while in Europe diesel is up more than 70 per cent and petrol about 20 per cent.[3]
