Geopolitics, regulations, and changing risk appetite shaped the global markets as they closed out on Tuesday.
US plans for Venezuela’s oil industry met with skepticism by energy giants while NVIDIA’s China ambitions are stuck in policy gridlock.
Gold surged to record highs on the back of dovish Fed signalling and political unrest.
Antitrust authorities in India have widened an extensive probe into steel-price collusion, raising the possibility of harsh penalties and renewed scrutiny on corporate governance.
Venezuelan oil bets are met with reality
Trump’s swagger about Venezuela’s oil bounty was shattered Monday, when Reuters revealed that US oil giants Chevron ExxonMobil and ConocoPhillips had not been briefed on the US intervention.
The silence before the meeting between Energy Secretary Chris Wright, and Secretary of state Marco Rubio signals that there is trouble.
Rystad energy estimates that rebuilding Venezuela’s infrastructure, which has been ravaged by the country’s civil war and economic collapse could take up to 2030.
Chevron is cautious, even though it operates under an exemption. Exxon, ConocoPhillips, and others were previously expropriated and destroyed.
Trump says companies are “excited” but insiders in the industry tell a completely different story. They are reluctant to invest billions of dollars into an uncertain political environment with ambiguous return dates.
It’s a shame: The administration has maintained its oil blockade to prevent Venezuela from freely exporting crude.
NVIDIA China sales stalled
NVIDIA’s CFO Colette Kress said Monday Washington was “working feverishly to process export licenses of H200 for China”, but that no date had been set.
Chinese companies have placed orders for 2+ millions H200 units by 2026. This is six times the current inventory of 700,000 units.
ByteDance plans to buy 100 billion yuan (14 billion dollars) of chips in 2014 if both governments approve.
NVIDIA’s Jensen Huang stressed “strong demand,” however, the bottleneck in supply is policy.
Washington has approved in principle exports with a revenue-sharing of 25%, but the Commerce Department’s licensing process remains opaque.
Beijing also hasn’t authorized imports, as it is evaluating whether the H200 will align with its domestic AI chip autonomy goals.
Gold nears record-high price
The price of gold rose to $4470 an ounce on Tuesday. This is tantalizingly close to the record set by $4550 per ounce in December.
The safe-haven rally was driven by two converging factors. The first is the dovish Fed’s rhetoric. Minneapolis President Neel Kahkari said that inflation was easing and unemployment could rise, which pushed odds of at least two rates cuts in this year.
The second reason was Venezuela’s implosion geopolitically after Trump’s takeover of Nicolas Maduro. This triggered a capital flight to hard assets.
In 2025, silver will have risen 147% to $79.18. This is a far greater increase than gold, which has climbed 64%. Platinum rose 2.8% to 2,334.
If employment is disappointing, gold will smash all previous records as traders price in rate cuts.
India probes steel price collusion
Reuters reported that India’s antitrust regulator dropped a bombshell on Tuesday. It found out that Tata Steel and JSW Steel colluded with 25 other companies between 2015 and 2030 to fix steel prices.
In a confidential order dated October, 56 senior executives were named. This included billionaire Sajjan Jidal of JSW and Tata Steel’s CEO T.V. Narendran is personally responsible.
WhatsApp messages between regional steel groups discussing explicit price fixing and production reductions.
CCI’s penalty can be brutal. It could cost Tata and JSW up to $1.4billion (FY2025 revenue) or as much as three times their profit for each violation.
This investigation was sparked by allegations that builders in 2021 had raised prices 55%. It has now expanded from 9 companies to 31.
The post Evening Digest: Venezuelan oil, NVIDIA China, Gold near record may change as new information unfolds
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