Oil extended gains in Asian trade Tuesday after a gathering of top producers fell apart without any agreement on a plan to lift output despite stockpiles shrinking and demand surging along with the global economic recovery.

The breakdown of talks between OPEC and other key crude nations raised the possibility of $100 a barrel -- a level not seen since 2014 -- and stoked fresh fears about inflation, which could force central banks to taper their monetary policy or hike interest rates earlier than thought.

Equity markets were mixed in Asia, with the US Independence Day break Monday meaning there were few buying catalysts.

Hong Kong's tech firms remained in focus owing to fears that a new crackdown on the sector by Chinese authorities will make them unattractive to investors.

But eyes were on oil after Brent broke above $77 for the first time since 2018 while WTI also rallied.

The OPEC+ group on Monday cancelled a planned meeting that was supposed to overcome an impasse between the United Arab Emirates and other members on how to lift output. No new date has been set.

The countries have been slowly lifting production in recent months after turning the taps down last year in response to a collapse in prices caused by coronavirus lockdowns.

With demand rocketing on the back of the global rebound -- and the US holiday driving season under way -- officials had planned to hike output by 400,000 barrels a day each month from August to December, but the deadlock means no new supplies will be forthcoming.

But while prices are spiralling higher, analysts said there were several possible scenarios. In one, there is no deal and no increase in production, sending oil prices shooting up, while another sees the grouping falling apart and countries fighting for market share by slashing prices.

"The failure of OPEC+ to come to an agreement will only add further uncertainty to the oil market," said Warren Patterson from ING Group NV.

"Assuming we don't get a quick resolution, the uncertainty over OPEC+ output in the months ahead does suggest increased volatility."

- Fed paying attention -

The brewing crisis has also brought inflation back into play, with the rally in commodities playing a key role in the spike in prices around the world in recent months.

The risk of oil at $100 a barrel "is so correlated with short-run inflation that it will make the market very, very edgy, and we know that the Federal Reserve is both watching the economic data but also markets", Alan Higgins, at Coutts & Co, told Bloomberg TV.

On equity markets, Tokyo, Singapore, Seoul, Mumbai, Bangkok and Jakarta all rose but Shanghai, Sydney, Wellington, Taipei and Manila were in negative territory.

Hong Kong extended Monday's losses as traders remain on edge following Beijing's ban of Chinese ride-hailing giant Didi Chuxing from app stores after a probe of its use of personal data, days after the firm's massive New York IPO.

Mainland officials then widened their probe to two other US-traded Chinese tech firms, leading to concerns about a fresh drive against the industry.

On Tuesday, Hong Kong's leader brushed off a warning by tech titans including Google, Facebook and Twitter that they could quit the city if it pushes ahead with a new privacy law they fear could hold them and their employees liable to prosecution for users' content.

The law takes aim at "doxxing" -- publishing someone's private details online so they can be harassed -- but the wording of the proposals is considered too broad for the companies' liking.

Traders are now awaiting the release of minutes from the US Federal Reserve's June meeting hoping for an idea about its plans for monetary policy as the recovery in the world's top economy thunders along.

London, Paris and Frankfurt were all down in the morning.

- Key figures at 0720 GMT -

West Texas Intermediate: UP 2.3 percent at $76.88 per barrel

Brent North Sea crude: UP 0.8 percent at $77.76 per barrel

Tokyo - Nikkei 225: UP 0.2 percent at 28,643.21 (close)

Hong Kong - Hang Seng Index: DOWN 0.3 percent at 28,072.86 (close)

Shanghai - Composite: DOWN 0.1 percent at 3,530.26 (close)

London - FTSE 100: DOWN 0.2 percent at 7,151.32

Dollar/yen: DOWN at 110.80 yen from 110.92 yen

Pound/dollar: UP at $1.3864 from $1.3851

Euro/dollar: DOWN at $1.1863 from $1.1865

Euro/pound: DOWN at 85.55 pence from 85.66 pence

New York - Dow: Closed for a holiday

-- Bloomberg News contributed to this story --

dan/je

FACEBOOK

Twitter

GOOGLE

Related Links
China News from SinoDaily.com

Tweet

Thanks for being here; We need your help. The SpaceDaily news network continues to grow but revenues have never been harder to maintain. With the rise of Ad Blockers, and Facebook - our traditional revenue sources via quality network advertising continues to decline. And unlike so many other news sites, we don't have a paywall - with those annoying usernames and passwords. Our news coverage takes time and effort to publish 365 days a year. If you find our news sites informative and useful then please consider becoming a regular supporter or for now make a one off contribution.
SpaceDaily Contributor $5 Billed Once credit card or paypal		SpaceDaily Monthly Supporter $5 Billed Monthly paypal only

Six school kids among nine Hong Kongers arrested for 'bomb plot'
Hong Kong (AFP) July 6, 2021
Six secondary school children were among nine Hong Kongers arrested on terror charges for allegedly trying to manufacture a powerful explosive, police announced Tuesday. Five males and four females aged between 15 and 39 were arrested Monday on suspicion of "conspiracy to use explosives for terrorist activities", police said. "The operation we conducted yesterday was against gangsters (who) tried to manufacture TATP explosive inside a home-made laboratory inside a hostel," senior superintendent ... read more