The Mercantile Exchange of VietNam (MXV) announced that the energy and agricultural markets were vibrant with gains in yesterday's trading session (August 29). Oil prices surged amid prolonged supply disruptions in Libya, while Iraq prepared to cut production in September. Additionally, strong buying dominated the agricultural markets following the release of favorable U.S. export data by the USDA. By the close, the MXV-Index increased by 0.71% to 2,151 points.

Oil Prices Surge Amid Supply Concerns

According to MXV, oil prices rebounded in yesterday's trading session as oil supplies in Libya continued to be disrupted, and Iraq's plans to reduce production raised concerns about further tightening in the global market. By the close, Brent crude oil prices rose by $1.29, or 1.6%, to $79.94 per barrel. WTI crude oil increased by nearly 1.9%, reaching $75.91 per barrel.

The supply disruption in Libya has extended into its fifth day, leading to a more than 50% drop in the country's oil output, with exports being halted. Reuters estimates that around 700,000 barrels per day of Libya's total production capacity of over 1 million barrels per day are affected. This supply risk from Libya has fueled price increases in a market already tightened by OPEC+ production cuts.

Additionally, Iraq plans to reduce oil production in September as part of a strategy to compensate for exceeding its agreed quota of 4 million barrels per day with OPEC+. According to Reuters, Iraq, which produced 4.25 million barrels per day in July, will reduce production to between 3.85 million and 3.9 million barrels per day next month.

The expected rise in crude oil imports in Asia in August also contributed to the upward momentum in the market. Specifically, data compiled by LSEG Oil Research shows that total imports in August are expected to reach 26.74 million barrels per day, up from 24.56 million barrels per day in July. However, it should be noted that the 2.18 million barrels per day increase from the previous month comes after Asia's imports fell to a two-year low in July.

Expectations that the U.S. Federal Reserve will begin cutting interest rates next month also supported oil prices. Raphael Bostic, President of the Federal Reserve Bank of Atlanta, mentioned in a recent speech the possibility of rate cuts, citing that inflation has been somewhat controlled and unemployment has risen more than expected.

Soybean Prices Soar After Positive U.S. Export Report

At the close of yesterday's trading session, six out of seven agricultural commodities posted gains, with soybeans leading the trend. After a previous weakening session, November soybean prices rebounded, rising by 1.59%. Buying dominated the market for most of the trading session, with the market's focus on positive U.S. export results from the past week.

In the Export Sales report released yesterday, the U.S. Department of Agriculture (USDA) reported that U.S. soybean sales for the 2024-2025 season totaled 2.61 million tons for the week ending August 22, a significant increase from 1.67 million tons the previous week and exceeding market expectations of 1.5 to 2.5 million tons. Of this, 870,000 tons of soybeans were sold to China, and 845,600 tons to unidentified buyers, indicating a renewed strong demand for U.S. soybeans, which had a bullish impact on prices.

On the other hand, favorable weather conditions in the U.S. limited the rise in soybean prices during yesterday's session. After rain appeared in the Midwest, weather forecasts indicate more moderate temperatures this weekend, which will support crops in their final growth stage. This eased market concerns about the outlook for this year's U.S. soybean production.

Green also dominated the price board for soybean products on August 29. The December soybean meal contract saw some volatility, with prices rallying immediately after the open, closely following soybean price movements, but weakening by the close under market profit-taking pressure. However, soybean meal prices still recorded a nearly 1% increase by the end of the session. Meanwhile, soybean oil was the biggest gainer in the group yesterday, surging by 3.46%.

Source: MXV