Hot Review: Market Confusion Intensifies, IEA to Finalize Diesel Reserve Release Details Next Week

(1) Statistics Canada reported that goods exports in August rose by 2.5% month-on-month to 77.9 billion Canadian dollars, reversing from a previous decline of 2.6%, while imports fell by 2% to 73.7 billion Canadian dollars. The trade surplus expanded to 4.2 billion Canadian dollars, much higher than market expectations of 1.55 billion Canadian dollars. The previous value was revised upward to 787 million Canadian dollars. (2) During the period, exports of energy products (including refined oil products and crude oil) increased by 4.7% to 19.03 billion Canadian dollars; excluding energy products, exports rose by 1.8%. (3) To avoid the newly imposed 50% US tariffs, Canadian exporters shipped goods to the US ahead of schedule. In August, Canada’s exports to the US rose by 8.1%, while imports fell by 2.5%. The trade surplus with the US reached 11.2 billion Canadian dollars, the highest in 19 months. (4) The new US tariffs on Canadian goods cover approximately 20 billion US dollars’ worth of products and took effect on August 22. Economists expect that the September data will more accurately reflect the impact of the new US tariffs.

Kengo Suzuki, Senior Strategist at Mizuho Investor Relations' Investment Analysis Department, stated that the U.S. economy is mainly supported by the artificial intelligence (AI) boom, but signs of slowing have already appeared. He expects the yen to strengthen to around 153 against the U.S. dollar by the end of the year. Suzuki also remarked that the current strength of the dollar is "excessive," and projects that by the end of March 2027, the yen will rise to around 150 per dollar. Given that U.S. mortgage rates are above 7%, the U.S. economy may gradually start to slow within the next six months, thereby limiting the dollar’s upside. If the yen exchange rate approaches 159, the bullish outlook for the yen may need to be re-evaluated, and the 158.5 level, which corresponds to the 200-day moving average, will draw attention. The consensus between Japan and the U.S. to prevent the yen from depreciating significantly is of great importance; if the yen continues to weaken and falls below 160, expectations of intervention are likely to suppress further short-selling of the yen.

(1) This week, several market traders reported that Indian oil companies purchased 3 million barrels of Middle Eastern and West African crude oil through tenders, which will be delivered to multiple ports in India in November. (2) Trafigura sold 1 million barrels of Abu Dhabi Murban crude oil at a premium of $13-14 per barrel over the Brent spot price, with delivery to Vadinar. (3) Macquarie sold 1 million barrels of Iraqi Basrah Medium crude oil at approximately the Brent spot price, with delivery to Chennai. (4) Chevron sold 1 million barrels of Angolan Nemba crude oil at a premium of $18 per barrel over the Brent spot price.

This week, several market traders reported that Indian oil companies procured 3 million barrels of Middle Eastern and West African crude oil through tenders, to be delivered to multiple ports in India in November. Trafigura sold 1 million barrels of Abu Dhabi Murban crude at a premium of $13–14 per barrel over Brent spot prices, with delivery to Vadinar; Mercuria sold 1 million barrels of Iraqi Basrah Medium crude at roughly flat to Brent spot prices, with delivery to Chennai; Chevron sold 1 million barrels of Angolan Nemba crude at a premium of $18 per barrel over Brent spot prices.