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Brent gains amidst Iraq’s decision to cut crude exports

Brent price rose 0.49% to $87.28pb today on lower crude exports from Saudi Arabia and Iraq. Iraq, the second-largest producer of crude in OPEC, pledged to cut its crude exports by 21.42% to 3.3m barrels per day from 4.2m barrels per day in the coming month. Iraq’s decision complies with the OPEC+ decision to extend production cuts into the second quarter of 2024. In the near term, oil prices will remain elevated on tight supplies from OPEC+, further supported by stronger economic growth in China and the U.S., signaling higher energy consumption.Top of Form

Cocoa hits a record high of $8,348/mt

The global price of cocoa has almost doubled (YTD), surging by 95.27% to $8,348/mt from $4,275/mt. This significant price increase is attributed to reduced supply from West African cocoa-producing countries, which are facing adverse weather conditions. Cocoa exports accounted for 26.23% of total agricultural products in Nigeria in the first nine months of 2023. An increase in cocoa prices bodes well for cocoa farmers and Nigeria’s fiscal earnings. Meanwhile, Nigeria, which is the fourth largest global cocoa producer and exporter, will be unable to benefit from the elevated global cocoa prices to boost export earnings due to low output. The latest data from the International Cocoa Organisation revealed that Nigeria’s cocoa exports declined by 3.45% to 280,000 metric tons in 2022-23 season. The price of cocoa is expected to remain high on strong demand for cocoa by chocolate manufacturers and poor weather conditions, contracting supply in the short term.

FDC’s senior analyst, Dr. Desola Sunmoni, discussed these and other burning economic issues on Channels TV Business Morning programme.

Click the link to watch the video.