Oil prices continue to "heat up", agricultural product prices fall across the board due to profit-taking pressure

At the end of yesterday's trading session (October 3), the energy market was bright green, in which oil prices soared more than 5% and were heading towards the 80 USD/barrel mark amid concerns that widespread conflicts could disrupt global crude oil flows. On the contrary, agricultural product prices turned to decrease under the pressure of profit-taking in the market. Closing, the MXV-Index increased by 0.63% to 2,246 points.

The Middle East “fire pan” “heats up” the world oil market

At the end of yesterday's trading session, world oil prices recorded a strong increase due to concerns that the conflict in the Middle East region may continue to escalate after Iran's attack. At the end of the session, WTI crude oil prices increased by 5.15% to 73.71 USD/barrel, Brent crude oil prices increased by 5.03% to 77.62 USD/barrel.

Iran's surprise attack on Israel in the early hours of October 2 has further raised tensions in the region. Market concerns are growing that Israel may target Iranian oil infrastructure in retaliation. The Pentagon said it was discussing with Israeli officials a possible response to Iran's missile attack but declined to provide details and left open the possibility of carrying out attacks on Iranian crude infrastructure.

Iran is a member of the Organization of the Petroleum Exporting Countries (OPEC) with an output of about 3.2 million barrels per day, equivalent to 3% of global production. If the war between the two countries spreads, not only the supply from Iran will be affected, but the flow of about 20 million barrels per day through the Strait of Hormuz, a strait under Iran's control, will also be put on alert.

Analysts warn that such an escalation could prompt Iran to block the Strait of Hormuz or even attack the infrastructure of countries with close ties to the US in the region, as it did in 2019. Despite this, Gulf Arab states have sought to reassure Iran of their neutrality in the conflict due to concerns that further violence could threaten regional oil facilities.

In another development, the Houthi forces continued to issue warnings to Western commercial ships passing through Bab El Mandeb. The Houthis have carried out nearly 100 attacks on ships crossing the Red Sea since November 2023 and said they will not stop if Israel does not end its military operations.

Meanwhile, supply pressure from OPEC as unrest disrupted Libyan supplies and Iraq implemented cuts to offset overshooting production also supported the price rally. The Organization of the Petroleum Exporting Countries (OPEC) pumped 26.14 million barrels a day last month, down 390,000 barrels a day from a month earlier to its lowest level this year.

Corn prices break 4 consecutive session increase streak

Going against the grain market yesterday, the agricultural market was dominated by red. December corn futures fell nearly 1% yesterday, ending a four-session winning streak. In addition to the ongoing harvest pressure, the market was also under pressure from technical selling pressure after corn rebounded strongly this week.

According to data from the Ministry of Agriculture of Ukraine, Ukraine's cumulative grain exports from the start of the 2024-2025 crop year to October 2 reached 10.65 million tons, a sharp increase from 6.68 million tons in the same period last year. In October alone, Ukraine exported 197,000 tons of grain, compared to just 7,000 tons in the same period last year. The increased exports from Ukraine have erased concerns that shipments from the Black Sea could be disrupted due to geopolitical conflicts, putting pressure on prices.

On the other hand, in the USDA’s weekly Export Sales report, the USDA reported that US corn sales for the week ending September 26 reached 1.68 million tons, a jump of nearly 215% from the previous week. This figure was also higher than market expectations, showing that demand for US corn is at a high level despite some transportation difficulties. This is a factor that has restrained the price decline yesterday.

Wheat’s three-day winning streak came to a halt yesterday. The market was under pressure from the opening bell and ended down more than 11 cents.

The East Coast dockworkers strike entered its third day. President Biden announced progress in negotiations between labor and employers. Employers said they were open to new negotiations after the president publicly urged higher wages. However, there has been no new information on the negotiations. The dockworkers' strike will affect U.S. grain exports to some extent, which will spur selling in the wheat market.

HQ (according to Tin Tuc newspaper)

Source: https://baohaiduong.vn/gia-dau-tiep-tuc-nong-gia-nong-san-dong-loat-giam-truoc-ap-luc-chot-loi-394801.html