- Russia’s Gazprom tightens squeeze on gas flow to Europe.
- Fed expected to hike rates 75 bps on Wednesday.
- Brent premium to US crude hits widest in three years.
LONDON: Oil prices rose on Tuesday for a second day on increasing concerns about tightening European supply after Russia, a key energy supplier to the region, cut gas supply through a major pipeline.
Brent crude futures rose $1.14, or 1.1%, to $106.29 a barrel by 1029 GMT, extending a 1.9% gain the previous day.
US West Texas Intermediate (WTI) crude futures increased $1.31, or 1.4%, to $98.01 a barrel, having gained 2.1% on Monday.
Russia tightened its gas squeeze on Europe on Monday as Gazprom said supplies through the Nord Stream 1 pipeline to Germany would drop to just 20% of capacity.
The cut in supplies will leave countries unable to meet their goals to refill natural gas storage ahead of the winter demand period. Germany, Europe’s biggest economy, faces potentially rationing gas to industry to keep its citizens warm during the winter months.
“The announcement revived fears that Russia, despite its cynical denial, will not shy away from using its energy as a weapon in order to gain concessions in its war against Ukraine and…could probably expect short-term success,” Tamas Varga from oil brokerage PVM said.
The European Union has repeatedly accused Russia of resorting to energy blackmail, while the Kremlin says shortfalls have been caused by maintenance issues and the effect of Western sanctions.
On Tuesday, EU countries agreed on an emergency regulation to curb their gas use this winter.
Europe’s crude, oil product and gas supplies have been disrupted by a combination of Western sanctions and payment disputes with Russia since its Feb. 24 invasion of Ukraine, which Moscow calls a “special military operation.”
Still, falling demand because of recent high crude and fuel prices and the expectation of an increase in interest rates in the United States have put pressure on prices.
The US central bank is widely expected to raise interest rates by 75 basis points at the conclusion of its policy meeting on Wednesday. That increase may reduce economic activity and thus impact fuel demand growth.
Morgan Stanley said that 77% of global central banks have hiked rates in the last six months, with that percentage reaching a 40-year high, and “making this the most-synchronised cycle of rate hikes since the early 1980s”.
The bank lowered its demand growth forecasts for this year and next. It forecasts Brent crude prices at $110 a barrel in the third quarter and WTI at $107.50, each $20 lower than their previous forecast.
The gap between European and international oil benchmark Brent and US benchmark WTI has widened to levels not seen since June 2019 as easing gasoline demand in the United States weighs on US crude while tight supply supports Brent.
Prompt Brent inter-month spreads reached $5 a barrel on Tuesday, their highest level in three weeks. In a backwardated market, front-month prices are higher than those in future months.
PKR on track to become top-performing currency this month: Bloomberg
- Pakistani currency rose around 6% this month against dollar.
- Authorities curb leakages happening through illegal channels.
- Crackdown on illegal dollar traders helps local currency.
The Pakistani rupee is on track to become the top performer globally in September as the caretaker government continues its crackdown on illegal dollar trade, Bloomberg reported Thursday.
The local currency rose around 6% this month against the dollar — an amazing feat despite the Thai baht and South Korean won tumbling against the greenback.
Major currencies lost ground against the dollar on speculations that the US interest rates will stay elevated for longer.
The rupee increased 0.1% to 287.95 per dollar on Thursday, after sliding to a record low of about 307 this month. Pakistan’s currency market will remain closed for the Eid Miladun Nabi holiday on Friday.
“Many leakages were happening through illegal channels of hawala and hundi trade from the open market,” Khurram Schehzad, chief executive officer of Alpha Beta Core Solutions Pvt Ltd, told Bloomberg.
“When the dollar rate reverses everybody, the hoarders, the exporters who are holding their export proceeds, start selling their dollars,” Schehzad said.
The interim rulers have intensified efforts by launching a crackdown on people involved in the illegal dollar trade, allowing the currency to gain some lost ground.
The Federal Investigation Agency, Bloomberg reported, conducted raids across the country and security officials in plainclothes were deployed at money exchanges to monitor dollar sales as part of the crackdown.
Caretaker Prime Minister Anwaar-ul-Haq Kakar this week said the rupee’s gain is “fostering optimism for stability.”
For its part, the State Bank of Pakistan raised the capital requirements of smaller exchange companies and ordered large banks to open their own exchange companies to make the retail foreign exchange market more transparent and easier to monitor.
Pakistan issues tender for LNG cargoes to meet winter demand
inDrive now available in five more Pakistani cities
KARACHI: inDrive, a popular ride-hailing service in Pakistan, has now expanded its network to five more cities across Pakistan including Larkana, Kāmoke, Sheikhupura, Hafizabad, and Okara.
In a statement issued by the transport company, the inclusion of these cities reflects inDrive’s dedication to bringing innovative transportation options to both urban centres and suburban areas.
Speaking about the expansion, Senior Business Representative at inDrive Hasan Qureshi said: “We are excited to extend the convenience and reliability of inDrive to residents of Larkana, Kāmoke, Sheikhupura, Hafizabad, and Okara.”
“Our mission is to redefine transportation by providing safe, affordable, and accessible rides to everyone. With this expansion, we are not only enhancing the commuting experience but also contributing to the economic growth and empowerment of these communities.”
PR Manager Sidra Kiran said that their new service offers city residents the convenience of accessing transport from their homes, eliminating the need to search for it.
“Both drivers and passengers stand to gain significant benefits, including time-saving and the elimination of challenges associated with street hailing. This service addresses issues such as locating rides during odd hours like early mornings or late nights,” she stated.
She further added: “inDrive ride-hailing presents numerous benefits to drivers in small cities, including flexible opportunities, reduced unemployment, supplemental income, enhanced community connection, and positive contributions to the local economy.”
The launch of the company in these cities would benefit both riders and driver-partners.
inDrive further said that it remains committed to upholding the highest standards of safety, affordability, customer service, and technological innovation.
inDrive is Pakistan’s premier ride-hailing service and is revolutionising the way people travel. With a commitment to providing safe, affordable, and reliable transportation.
The company allowed riders to connect with nearby drivers with its app.
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