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Commodities open under pressure as US lines up huge carbon cutting plan

Bean oil and gasoil are both opening under downward pressure this morning as supply fundamentals continue to outpace demand expectations across the commodities complex. Iran has outlined plans to quickly ramp up crude oil output as soon as sanctions are lifted against a backdrop of concern over slowing Chinese demand.

Improved US weather forecasts meanwhile are lifting expectations for the 2015 harvest, dragging the front month bean oil futures contract below 30¢/lb on Friday for the first time since late January. Carbon reduction will move to the top of the US news agenda later today as President Obama unveils plans to impose swingeing emissions cuts on the US utility sector.

The plan would require utilities to bring their carbon emissions 32% below 2005 levels by 2030. EU lawmakers are pursuing similarly ambitious carbon reduction plans, with road fuel emissions likely to be folded into existing carbon emissions schemes once existing EU-wide mandatory requirements fade post 2020.

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