CCTV Transcripts

CCTV Script 21/06/19


— This is the script of CNBC's news report for China's CCTV on June 21, 2019, Friday.

After Iran shot down a U.S. military drone, the market was concerned about the increased likelihood of a military confrontation between Tehran and Washington, which sent oil prices soaring immediately after Trump's tweet.

U.S. WTI light crude oil futures ended up 5.4% overnight after surging more than 6% in intraday trading

Meanwhile, London Brent crude futures closed up 4.5 percent overnight and both futures continued to climb this morning

This, then, suggests market anxiety about the current geopolitical outlook in the Middle East. It should also be noted that the potential for such a military confrontation also drives safe-haven assets higher in recent days.

The price of gold has climbed to its highest level in more than five years.

Of course, for commodities like gold and oil, the contributor to the rapid rise in prices is the fed. After the fed's statement, the market thought a rate cut was imminent, so that sentiment sent stocks higher and the dollar lower. And the dollar's decline has helped push up commodity prices, which are priced in dollars.

The dollar fell 0.47 percent overnight, the biggest two-day drop since February 2018.

At the same time, we saw the 10-year Treasury yield fall below the key 2% level overnight for the first time since 2016, which could signal continued downward pressure on the dollar in the near term.

Finally, we come back to oil prices, which have been driven up by factors other than geopolitics. While the fed's interest rate cuts makes the dollar weaker and pushes up potential future oil demand, OPEC factors cannot be ignored.

The market is paying close attention to the upcoming OPEC + meeting on July 1 and 2. OPEC members and their allies, including Russia, will then discuss whether to extend the current supply cut of 1.2m barrels a day. There is a view in the market that the current geopolitical situation will bring some uncertainty to the OPEC meeting.

Bart Melek



It complicates a little bit, but i think the message gonna sustain as it was before that OPEC will do what it has to do in order to keep this market and balance, and should circumstance arise what they have to supply more, they will, but I don't think the message will be ambiguous. But I think it cannot afford to signal that it will oversupply the market, in respect of the fact that we have a, you know, geopolitical risk at this point.

Judging from the current news, there is a broad support within OPEC to extend the agreement. But Russia's position remains highly ambiguous. And we've seen the third largest oil company in Russia, Gazprom, calling for an end to the OPEC + agreement as the current oil price is acceptable for Russia. As a result, the next OPEC meeting is also full of uncertainty. We will keep an eye on this issue.