Iran-backed Yemen Houthi increased the heated-already tension in Middle East - Photo by NIOC

JAKARTA (TheInsiderStories) — Good morning! Yemen Houthi’ drone targeting to attack two Saudi Arabian’ tankers and main pipe channels is considered not only hitting security, but also world oil supply and global economy.

Iran-backed Houthi’ action is also increasing the heated-already tension in Middle east. Saudi is known as the world’ biggest oil exporter, with 10 million barrels per day (bpd) production and around 7 million bpd export per day.

Its two pumping stations n the east-west pipeline transport five million barrels of crude oil per day, also provide a strategic alternative route for Saudi exports if the shipping lanes from the Gulf through the Strait of Hormuz is closed.

Meanwhile, Saudi tankers Al-Marzoqah and Amjad experienced significant damage in sabotage attacks at the Oman Sea, United Arab Emirates region. Houthi rebels, who have claimed responsible for the attack, stated that the action is a response for Saudi Arabia and its allies.

The attacked was occurred amid the increasing spat between the United States (US) and Iran over nuclear agreement. Yesterday, Brent oil price declined by 0.29 percent to US$ 71.03 a barrel, after rocketing 1.44 percent on the previous day. West Texas Intermediate decreased by 0.57 percent to US$61.4/barrel.

US Treasury Secretary Steven Mnuchin said that he will likely travel to China soon to continue talks as Washington and Beijing seek to resolve a trade war, that has cast a pall over the global economy and financial markets.

He remarked dovetailed with a cooling of the President Donald Trump administration’ rhetoric toward China after another round of tit-for-tat tariffs between the world’s two largest economies and a selloff on global stock markets.

A day before, Trump denied the talks with China had collapsed and sounded an optimistic note about the chance of a deal to end the trade war, saying he had an extraordinary relationship with Chinese President Xi Jinping. Trump, who plans to meet Xi at a G20 summit in Japan next month, also urged China to buy more US farm products.

Indonesia’ palm oil export, including CPO, biodiesel, oleochemical, and its derivative products recorded increasing by 16 percent to 9.1 million tons in the first quarter of 2019. Based on Indonesian Palm Oil Association data, throughout March, palm oil exports were recorded at 2.96 million tons, or 3 percent higher compared to the previous month.

The sentiment of the European Union’ Renewable Energy Directive II policy eroded Indonesia’ export performance throughout the first quarter. Another factor, India’ sluggish economy as the main export destination, and the endless US-China trade war that affected the two countries’ soybean trade and accumulated soybean stocks in the US.

Indonesian Rupiah against US Dollar weakened by 0.02 percent, following ugly trade balance deficit announcement to 14,445. Bank Indonesia 7-Days Reverse Repo (BI 7-DRR) rate announcement today its expecting give a new energy to the financial market.

Last April, BI decided to maintain a 7-DRR at 6 percent by considering global and domestic economic conditions amid the US economy grew slowly and limited fiscal stimulus. Similarly, China’ economy is still slowing, despite fiscal expansion through tax cuts and infrastructure development.

While, improvements in the European economy are predicted to be slower due to weaker exports and unfinished financial sector problems and continued structural challenges related to the condition of the aging population.

May you have a profitable day!

Written by Linda Silaen and TIS Intelligence Team, Please Read Our Insight to Get More information about Indonesia