The market continues to bid up oil. WTI settled up $5.16 to $99.64 but shortly before settlement it hit $100 per barrel for the first time since Monday, when Trump pushed back his deadline.
The market is increasingly seeing longer timelines on resolving this war.
WTI daily chart
Eyes are also on the steel market. A US-Israeli strike occurred today on a large Iranian steel plant. In response, Iran has just released a target list of steel plants it will hit in the coming hours.
- Kuwait Steel (United Steel Industrial Corporation) — Kuwait City, Kuwait
- EMSTEEL Group (United Iron and Steel Company) — Abu Dhabi, UAE
- Yehuda Steel Ltd. — Ashdod, Israel
- Saudi Iron & Steel Co. (Hadeed) — Al Jubail City, Eastern Saudi Arabia
- Foulath Holding — Khalifa bin Salman Port, Bahrain
- Qatar Steel QPSC — Mesaieed Port, Qatar
The messages showing the various plants look like this:
What strikes me first is that Qatar is on the list. They had sent some less-aggressive messages about Iran and there was some speculation they had reached a deal to minimize hostilities but that doesn’t appear to be the case based on these messages.
The largest facilities are in Saudi Arabia and produce about 7.0 Mt of steel annually. Combined, the facilities make about 15 Mt of steel, which is mostly rebar, billet and construction steel. The Bahrain facilities also produces 13 million tons of premium iron-ore pellets, making it the world’s largest DR merchant pelletizing producer.
For some sense of size, the largest US producer is Nucor, which produces 30 Mt across 26 facilities in the US.
In terms of the global economy, taking steel production off line wouldn’t be too big of a problem as it can be redirected from China, India and Turkey, which all have substantial overcapacity.
