Best in Energy – 22 September 2022

U.S/EU rivalry for high-energy industry ($WSJ)

South Korea reverts to coal generation ($BBG)

California relied on gas generation in heatwave

UAE oil firm explores Gunvor purchase ($BBG)

U.S./China banking and national security ($FT)

U.S. INTEREST RATE traders expect an imminent business cycle downturn is virtually certain and will be relatively severe. The U.S. Treasury yield curve between two-year and ten-year securities is more inverted than at any time since September 1981, when the economy was entering the second instalment of what proved to be double-dip recession. Like the early 1980s, the central bank finds itself forced to continue tightening monetary policy even as the economy weakens to bring inflation back under control:

LA NIÑA conditions are entering their third year, with sea surface temperatures in the central-eastern Pacific almost -1.0°C below the seasonal average last month:

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Best in Energy – 15 July 2022

White House downplays hopes for more oil

Middle East imports more Russian fuel oil

Japan plans reactor restarts before the winter

United Kingdom heads for winter crisis ($BBG)

Germany is moving into a recession ($BBG)

ERCOT confident will avoid blackout ($BBG)

U.S. household finances and inflation ($WSJ)

Russia/NATO conflict is test of resolve ($BBG)

Central banks turn hawkish on inflation

U.S. CENTRAL BANK is expected to raise short-term interest rates to 3.50-3.75% by February 2023 up from 1.50-1.75% at present to curb inflation. From the second quarter of 2023, however, policymakers are expected to start reducing interest rates as the economy slows and inflation decelerates:

U.S INTEREST RATE traders anticipate a recession has become virtually certain following the continued acceleration of inflation. The yield curve spread between 2-year and 10-year maturities is now in the 98th percentile for all months since 1990:

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