AI disruption dominates markets, as gold and silver continue to recover

Syria's state-owned petroleum company has signed a memorandum of understanding with U.S. energy firm Chevron and Qatar-based Power International Holding to develop the nation's first offshore oil and gas field.

The deal was finalized on Wednesday in Damascus, with U.S. Special Envoy to Syria, Tom Barrack, in attendance. This agreement marks Syria's first official move into offshore energy exploration as its new government works to expand hydrocarbon production and attract foreign investment.

Unpacking the Energy Partnership

According to Syria's state news agency, SANA, the agreement is designed to build strategic partnerships within the energy sector. The cooperation will focus on several key areas:

• Offshore exploration and development of oil and gas resources within Syria's territorial waters.

• Broader initiatives to support investment and growth in the country's energy infrastructure.

This pact represents a significant step for Syria as it seeks to leverage international partnerships to unlock its untapped offshore potential.

Rebuilding a Battered Oil Industry

Syria's oil and gas sectors were severely damaged during the country's nearly 15-year conflict, which resulted in widespread destruction and the loss of half a million lives.

Before the conflict began in March 2011, the oil sector was a cornerstone of the Syrian economy. In 2010, the country produced approximately 380,000 barrels of oil per day, with exports, primarily to Europe, generating over $3 billion. At the time, oil revenue accounted for about a quarter of the government's budget.

New Leadership Focuses on Economic Revival

The country's new authorities, which came to power after removing President Bashar Assad in December 2024, are prioritizing economic recovery.

This energy deal follows recent developments on the ground. Last month, Syrian government forces captured large areas of the oil-rich northeast and eastern regions from Kurdish-led fighters. This strategic gain could open up some of the country's largest oil fields for further exploration and development, aligning with the new government's economic agenda.

Source: kitco

Chinese President Xi Jinping and U.S. President Donald Trump held a phone conversation on Wednesday, as reported by China's state-run Xinhua News Agency.

The official report confirmed the discussion took place but did not provide any specific details about its content. The call occurred just hours after President Xi had also spoken with his Russian counterpart, Vladimir Putin.

A Tenuous Stability in US-China Relations

The high-level communication comes during a period of relative calm between the world's two largest economies. Relations have largely stabilized since Xi and Trump agreed to a one-year trade truce in South Korea last year.

Looking ahead, the two leaders are slated to meet four times this year. A potential summit could be scheduled as soon as April, continuing the dialogue established by the temporary trade agreement.

Persistent Geopolitical Friction Points

Despite the recent calm, ongoing geopolitical tensions threaten this fragile peace. President Trump's actions related to countries allied with China, including Venezuela and Iran, are testing the limits of the current understanding.

Further complicating the relationship, the U.S. president has criticized Canada for its trade agreements with Beijing. In a move aimed at reducing economic dependency on China, the Trump administration has also begun efforts to secure alternative supplies of rare earths, seeking to loosen China's control over the critical mineral market.

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Source:ig

Indian refiners are facing a critical decision as sellers offer Russia's flagship Urals crude at an increasingly steep discount to Brent, a move that directly challenges a new trade agreement with the United States designed to limit Russian oil purchases.

A Widening Price Gap on Urals Crude

Sellers are now marketing Urals crude at an $11 per barrel discount, a significant increase from the $9 discount seen just ten days ago, according to traders familiar with the matter.

Under normal circumstances, such a favorable price difference would trigger a wave of buying from Indian refineries eager to lock in cheaper supply. However, the current market dynamics are far from typical.

The US-India Trade Pact Reshapes the Market

The primary complication is a new trade deal announced by U.S. President Donald Trump. This agreement ties lower U.S. tariffs on Indian products to a commitment from New Delhi to significantly reduce its imports of Russian crude oil.

The deal explicitly pushes India to increase its purchases of American oil and other commodities. In exchange for cutting ties with Russian supply, the U.S. has also suggested that Indian buyers could gain access to crude from Venezuela and potentially even Iran, offering alternative sources.

Refiners Pause and Await Government Clarity

In response to the deal, Indian refiners are reportedly halting new purchases of Russian oil as they seek official guidance from their government. Sources indicate that companies are preemptively pausing transactions until they receive clarification on how to navigate the new trade relationship with the U.S.

India's Major Shift in Oil Imports

The situation marks a potential turning point for India, the world's third-largest oil importer. Following Russia's invasion of Ukraine in early 2022, India dramatically ramped up its intake of discounted Russian crude.

For nearly four years, this strategy made Russia its single largest oil supplier, accounting for approximately one-third of the nation's total crude imports. Now, refiners must weigh the immediate benefit of cheap Russian oil against the broader economic implications of the U.S. trade agreement.

Chinese foreign direct investment (FDI) abroad surged by 18% in 2025, reaching $124 billion in a clear strategic shift away from Western nations and toward emerging markets in Africa, the Middle East, and Asia. This marks the highest level of outbound investment since 2018, though it remains below the peak seen in 2016.

According to a report released Wednesday by the Rhodium Group, a New York-based research firm, this new wave of capital is overwhelmingly focused on energy and basic materials. The trend highlights how the world's second-largest economy is adapting to global trade tensions and rising resource demand.

Energy and Commodities Drive Investment Boom

Nearly half of all announced Chinese outbound investments last year targeted the energy sector—spanning both fossil fuels and renewables—and essential commodities. This surge is propelled by escalating trade and technology disputes between Washington and Beijing that have disrupted supply chains, as well as the growing energy needs of data centers worldwide.

"Energy and basic materials investment will continue [this year], partly because these sectors are naturally high-value and long-term in nature," noted Danielle Goh, a senior research analyst at Rhodium. "Commodities like these tend to attract follow-on investment over time."

In contrast, the automotive sector's share of Chinese FDI fell to its lowest point since 2020. The slowdown reflects a deceleration in new electric vehicle manufacturing and upstream supply chain projects abroad, even as Chinese firms continue to localize some production in regions like Eastern and Central Europe. However, the report notes that overseas markets are still primarily served by exports from China's domestic manufacturing base.

Mapping the Geographic Pivot to the Global South

The flow of Chinese capital has decisively turned toward Asia and sub-Saharan Africa. Asia received approximately $40 billion in new transactions, while Africa saw several landmark deals.

Key projects in 2025 that underscore this trend include:

• Guinea: Major investment in the Simandou iron ore mine.

• Nigeria: Two significant lithium processing plants.

• Indonesia: A $5.9 billion joint venture for a refining and chemical complex by Tongkun Group, Xinfengming Group, and Tingshan Group, one of the year's largest transactions.

Separate research from Griffith Institute Asia and Shanghai's Green Finance & Development Center confirms that China's Belt and Road Initiative (BRI) also remains highly active, with most funds directed toward mineral processing in metals and mining. In 2025, Kazakhstan emerged as the top recipient, securing about $25.8 billion for projects related to aluminum and copper.

Greenfield Projects Lead as M&A Activity Rebounds

While Chinese FDI remains dominated by greenfield investments focused on new manufacturing facilities, mergers and acquisitions (M&A) are making a strong comeback. After a steady decline from 2016, the value of M&A transactions has nearly doubled since 2022, partly driven by Chinese consumer goods companies expanding abroad.

Figure 1: Chinese outbound FDI from 2021-2025 shows a consistent rise, with greenfield projects accounting for the majority of growth while acquisition activity has recently gained momentum.

The Rhodium report also highlighted that Chinese firms have leveraged capital made available from the deleveraging of the domestic property sector to expand manufacturing capacity at home, which continues to outpace overseas investment.

The Retreat from Western Markets

The pivot toward emerging economies coincides with a sharp decline in investment in developed nations. According to Rhodium, North America, Europe, and Oceania now account for less than 20% of total announced Chinese FDI, a drop of roughly 70% from 2016 levels.

This retreat is a direct response to increasing scrutiny and protectionist policies from Western governments. Germany has blocked several Chinese acquisition attempts, and Switzerland recently passed legislation to screen Chinese investments in strategic industries.

US Market Sees Heightened Caution

Chinese companies have become particularly guarded about investing in the United States amid rising geopolitical tensions. Last year, the White House instructed the Committee on Foreign Investment in the U.S. (CFIUS) to intensify its reviews of Chinese investments in advanced technology, infrastructure, and farmland.

This cautious environment has led to a reluctance to commit significant capital. "There's growing risk that projects may not ultimately move forward, so Chinese companies have been reluctant to invest heavily," said Goh.