IMF Warns Inflation and War Could Push Global Economy to Brink of Recession
July 27, 2022
The API report estimated crude stocks down 4 million barrels, gasoline stocks down 1.1 million barrels and distillates stocks down 554,000 barrels.
The International Monetary Fund cut global growth forecast again on Tuesday, warning the downside risks from high inflation and the Ukrainian war were materializing and could push the world economy to the brink of recession if left unchecked.
The Russian central bank said India increased its Russian oil imports by 4.7 times in April-May or by more than 400,000 bpd on the year due to a price discount. The central bank also said that China increased Russian oil purchases by 55% in May as Russia surpassed Saudi Arabia as the top oil seller to China.
The Biden administration announced more crude oil sales from the SPR. This marks the fifth sale that the President has authorized in an effort to shore up crude supplies in the wake of Russia’s invasion of Ukraine. This news comes just after a Biden official said we had to stop these sales and shore up the reserve. This was confusing and it confused the market which sold off after the news of this released. The administration had to come out and clarify what they meant and said this sale was part of the previously announced sale. The US has already sold 125 million barrels from the reserve with nearly 70 million barrels already delivered to purchasers. In May, the Department of Energy said the US will take bids in autumn to begin the process of buying back 60 million barrels of crude for the reserve, a first step in replenishing the stockpile.
“The world may soon be teetering on the edge of a global recession,” the chief economist of the International Monetary Fund said.
E.U. nations reached a deal to reduce their natural gas consumption, a move meant to weaken Moscow’s influence over the energy market.
The US Consumer Confidence Index fell to a reading of just 95.7 in July from 98.4 in June, which was well below economists’ estimates of 96.8.
John Kemp of Reuters points out that three of the top five stories featured on the front page of the Wall Street Journal today are about slower sales, slower corporate earnings, and slower hiring.
The Fed will conclude its two day meeting today and the expectation is that they will raise rates by 75 basis points.
The average estimate for today’s propane inventory update if for supplies to increase by 1.65 million barrels.