OAS

Oasis Petroleum Inc.

0.1362
USD
-19.65%
0.1362
USD
-19.65%
0.1503 3.6500
52 weeks
52 weeks

Mkt Cap 49.80M

Shares Out 321.31M

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VEGOILS-Palm drops 10% on recession fears, higher inventory outlook

KUALA LUMPUR, July 6 (Reuters) - Malaysian palm oil futures tumbled 10% on Wednesday to a near one-year low, on fears of rising stockpiles and a sell-off in commodities due to concerns around a global recession. The benchmark palm oil contract FCPOc3 for September delivery on the Bursa Malaysia Derivatives Exchange fell 417 ringgit, or 10%, to 3,757 ringgit ($849.42) a tonne by the midday break. Palm extended losses for a fourth straight session, hitting its lowest since July 8, 2021. The main factors for the meltdown are fund selling, Indonesia's rising export quota and improving production, said Paramalingam Supramaniam, director of Selangor-based brokerage Pelindung Bestari. "We are entering into peak production months with worries of end-stocks bulging towards 2 million tonnes by September." A Reuters poll showed Malaysia's end-June palm oil inventories likely climbed 12.3% from the month before to their highest levels in seven months, as exports plunged following top producer Indonesia's return to the export market. Meanwhile, Indonesia this week lifted its export quota to seven times the amount producers sell at home, up from five earlier, in a bid to cut soaring inventories of the edible oil. Higher Indonesian stocks, external recession fears, and crumbling prices of Dalian edible oils and crude futures over the past two days also helped spur traders to exit, said Sandeep Singh, director of the Farm Trade, a firm based in Kuala Lumpur. Dalian's most-active soyoil contract DBYcv1 fell 7.7%, while its palm oil contract DCPcv1 plunged 10%. Soyoil prices on the Chicago Board of Trade BOcv1 were down 2.3%. Palm oil may test a support at 3,900 ringgit per tonne, a break below could open the way towards 3,592-3,782 ringgit range, Reuters technical analyst Wang Tao said. TECH/C ($1 = 4.4230 ringgit) (Reporting by Mei Mei Chu; Editing by Rashmi Aich and Uttaresh.V) ((Meifong.chu@thomsonreuters.com)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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