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15e8ec3dc2973474623806fb141eb863 | https://www.reuters.com/article/us-global-oil/oil-near-five-month-high-in-most-bullish-week-since-july-idUSKCN1BN03M | Oil holds near five-month high in most bullish week since July | Oil holds near five-month high in most bullish week since July
By Jessica Resnick-Ault4 Min Read
NEW YORK (Reuters) - Brent oil prices held near five-month highs on Friday, and were on track for the biggest weekly gain since late July, on forecasts for rising demand and the gradual restart of U.S. oil refineries.
FILE PHOTO - A pump jack is seen at the Ashalchinskoye oil field owned by Russia's oil producer Tatneft near Almetyevsk, in the Republic of Tatarstan, Russia, July 27, 2017. REUTERS/Sergei Karpukhin
The Organization of the Petroleum Exporting Countries this week forecast higher demand for its oil in 2018 and pointed to signs of a tighter global market, indicating its deal with non-OPEC states to cut output is helping tackle a glut.
That was followed by a report from the International Energy Agency (IEA) saying the glut was shrinking thanks to strong European and U.S. demand, as well as production declines in OPEC and non-OPEC countries.
“This boost to the market is attracting fresh speculative length,” said Gene McGillian, director of market research at Tradition Energy in Stamford.
To sustain current high prices, continued strength in demand is needed, he said, noting that a weak fourth quarter in the U.S. could prompt traders to back off of long positions.
Brent crude LCOc1 was down 3 cents at $55.44 a barrel by 1:11 p.m. EDT (1711 GMT), in a volatile session that saw it stretch from an intraday low of $54.86 to a high of $55.85 a barrel.
The benchmark was on track for its third straight weekly gain, rising 3.1 percent so far, which would be the highest weekly rise since the end of July.
Related CoverageGlobal oil inventories shrinking on robust demand: IEA
U.S. West Texas Intermediate crude CLc1 was down 21 cents at $49.68 a barrel. The contract looked set for a nearly 5 percent weekly gain, also its strongest in almost two months.
Data on this week’s U.S. oil rig count, an early indicator of future output, showed energy firms last week cut the most oil rigs in a week since January as a 14-month drilling recovery stalled due to weak crude prices. [RIG/U]
Drillers cut seven oil rigs in the week to Sept. 15, bringing the total count down to 749, the least since June, General Electric Co's GE.N Baker Hughes energy services firm said in its closely followed report.
“Prices have now advanced for the last two weeks off increased demand forecasts from both OPEC and the IEA combined with the near-term demand uplift expected as U.S. oil refineries seek to restart operations post-Hurricane Harvey,” analysts at Panmure Gordon said.
Oil investors eyed further impact from increasing crude demand from U.S. oil refineries restarting after hurricane outages.
On Wednesday, 13 of 20 affected U.S. refineries were at or near normal operating rates and another five were restarting or ramping up, according to IHS Markit. The largest U.S. refinery, Motiva Enterprises plant in Port Arthur, Texas, was at half its full capacity, the company said Wednesday.
Analysts at HSBC said that despite the U.S. refinery outages, 2017 was set to be an “extremely strong year” for oil demand growth, a key factor underpinning a rise in prices.
“We remain convinced of longer-term upside to crude prices. With the lack of new major project sanctions, we expect conventional non-OPEC supply to start declining post-2018,” they said.
They maintained their 2018 and 2019 Brent price assumptions at $65 and $70 a barrel, respectively.
Additional reporting by Aaron Sheldrick in Tokyo and Karolin Schaps in Amsterdam; Editing by Marguerita Choy and Susan FentonOur Standards: The Thomson Reuters Trust Principles.
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f64639837c917a46118fc4ecb87dbddb | https://www.reuters.com/article/us-global-oil/oil-near-flat-as-opec-supply-hike-appears-less-certain-idUSKBN1J7022 | Oil near flat as OPEC supply hike appears less certain | Oil near flat as OPEC supply hike appears less certain
By Ayenat Mersie3 Min Read
NEW YORK (Reuters) - Oil prices were little changed on Monday as comments from the Iraqi oil minister cast doubt as to whether the Organization of the Petroleum Exporting Countries would decide to boost output at its upcoming meeting.
FILE PHOTO: An oil well pump jack is seen at an oil field supply yard near Denver, Colorado, U.S., February 2, 2015. REUTERS/Rick Wilking/File Photo
Global benchmark Brent crude LCOc1 was unchanged to settle at $76.46 a barrel. U.S. West Texas Intermediate crude CLc1 rose 36 cents to settle at $66.07, its highest level since June 1.
U.S. crude’s relative gains were the result of profit-taking on the wide spread between the two benchmarks, said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois.
Oil had some support thanks to gains in the equities market, analysts said. All three major U.S. stock indexes were trading in positive territory on Monday, just hours ahead of the meeting in Singapore between President Donald Trump and North Korean leader Kim Jong Un.
Prices were also weighing uncertainty on OPEC supply hikes.
For 18 months, OPEC and its allies have curbed production in the hopes of stabilizing markets and supporting prices. The group is set to meet June 22-23 in Vienna and decide how to move forward with its supply curb policy against the backdrop of tumbling Venezuelan output and looming sanctions against Iran, the third-largest OPEC producer.
“Last week, we saw some news stories indicating that the Trump administration had asked OPEC to increase oil production. But the week went out and we saw those stories walk back. And now we’re seeing a number of OPEC producers who are in favor of the status quo,” said Andrew Lipow, president of Lipow and Associates in Houston.
Iraq’s Oil Minister Jabar al-Luaibi said that prices still require support and stability, and producers “should not over-exaggerate” the oil market’s need for more supplies. According to a statement, the minister also “rejects unilateral decisions by some oil producers without consulting the rest of the members” of the agreement.
Top exporter Saudi Arabia told OPEC that it raised oil output to slightly more than 10 million barrels per day (bpd) in May, a source familiar with the matter said, but still within its agreed target.
Even as OPEC trims output, production from non-OPEC members, including the United States and Russia, is rising.
Russian news agency Interfax said on Saturday that the country’s production had surpassed its target, hitting 11.1 million bpd in early June.
In the United States, the number of new rigs drilling for oil rose by one last week to 862, its highest since March 2015, data from energy services company Baker Hughes showed. [RIG/U]
That suggests U.S. output, already at a record 10.8 million bpd, will climb further.
(GRAPHIC: U.S. oil rig count - reut.rs/2JAMsXg)
Additional reporting by Christopher Johnson in London and Henning Gloystein in Singapore; editing by Marguerita Choy, David Goodman and G CrosseOur Standards: The Thomson Reuters Trust Principles.
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53c05af7729dd76104a40e1266a92841 | https://www.reuters.com/article/us-global-oil/oil-prices-climb-as-opec-extends-output-cuts-into-april-idUSKBN2AX04X?il=0 | Oil surges after OPEC+ holds cuts, strong U.S. jobs growth | Oil surges after OPEC+ holds cuts, strong U.S. jobs growth
By Scott DiSavino, Jessica Resnick-Ault4 Min Read
NEW YORK (Reuters) - Oil prices jumped about 3% on Friday, hitting their highest levels in more than a year, following a stronger-than-expected U.S. jobs report and a decision by OPEC and its allies not to increase supply in April.
Brent futures rose $2.62, or 3.9%, to settle at $69.36 a barrel. The session high for the global benchmark was its highest since January 2020.
U.S. West Texas Intermediate (WTI) crude rose $2.26, For the week, Brent gains 5.2% gain, WTI up 7.4%or 3.5% to settle at $66.09 a barrel.
For the week, Brent was up 5.2%, rising for a seventh week in a row for the first time since December, while WTI was up about 7.4% after gaining almost 4% last week.
Both contracts surged more than 4% on Thursday after the Organization of the Petroleum Exporting Countries and allies, together known as OPEC+, extended oil output curbs into April, granting small exemptions to Russia and Kazakhstan.
“OPEC+ settled for a cautious approach ... opting to increase production by just 150,000 barrels per day (bpd) in April while market participants looked for an increase of 1.5 million bpd,” said UBS oil analyst Giovanni Staunovo.
Investors were surprised that Saudi Arabia had decided to maintain its voluntary cut of 1 million bpd through April even after the oil price rally of the past two months on the back of COVID-19 vaccination programs around the globe.
Some forecasters revised their price expectations upward following the OPEC+ decision.
Goldman Sachs raised its Brent crude price forecast by $5 to $75 a barrel in the second quarter and $80 a barrel in the third quarter of this year. UBS raised its Brent forecast to $75 a barrel and WTI to $72 in the second half of 2021.
In addition, the market got a boost after a report showed the U.S. economy created more jobs than expected in February.
The nonfarm payroll report “shows that Americans are closer to pre-pandemic behavior that will drive strong demand for crude,” said Edward Moya, senior market analyst at OANDA in New York.
Traders also noted the rising dollar, which hit its highest since November, was limiting the gain in crude prices. A stronger dollar makes oil more expensive for holders of other currencies.
However, analysts and traders have said that slow physical crude sales and recovery for demand not predicted until around the third quarter suggest that the price rally is unwarranted.
“The market suggests a tightness that does not exist. Therefore, we continue to believe that the price risk is mainly downward and that the current price is overshooting,” said Hans van Cleef, senior energy economist at ABN Amro.
India, the world’s third-biggest oil importer and consumer, said that the OPEC+ decision to extend cuts as prices move higher could threaten the consumption led-recovery in some countries.
The recovery in oil prices to pre-pandemic levels has also spurred U.S. oil drillers to return to the well pad. The oil rig count rose by one this week after rising for six straight months, according to energy services firm Baker Hughes Co. [RIG/U]
Additional reporting by Noah Browning in London, Sonali Paul in Melbourne and Koustav Samanta in Singapore; Editing by Marguerita Choy, Will Dunham and Emelia Sithole-MatariseOur Standards: The Thomson Reuters Trust Principles.
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dcfb7d497577148a6c8647206db118e3 | https://www.reuters.com/article/us-global-oil/oil-prices-dip-on-weak-demand-outlook-supply-concerns-idUSKBN1X002G | Oil prices fall 1% as global demand concerns grow | Oil prices fall 1% as global demand concerns grow
By Stephanie Kelly3 Min Read
NEW YORK (Reuters) - Oil prices fell nearly 1% on Monday after comments from a U.S. official fed concerns surrounding the U.S.-China trade war, adding to worries that a slowing global economy would reduce demand for oil.
FILE PHOTO: Oil rigs are seen at Vaca Muerta shale oil and gas drilling, in the Patagonian province of Neuquen, Argentina January 21, 2019. REUTERS/Agustin Marcarian
Brent crude futures fell 46 cents, or 0.8%, to settle at $58.96 a barrel. U.S. West Texas Intermediate (WTI) crude futures fell 47 cents, or 0.9%, to settle at $53.31 a barrel.
Although President Donald Trump has said he would like to sign a deal when he meets his Chinese counterpart at November’s APEC summit, the U.S. commerce secretary said an initial trade deal does not need to be finalized next month.
“The key thing is to get everything right that we do sign. That’s the important element. That’s what the president is wedded to,” Wilbur Ross said, after being asked if he would mind skipping an APEC signing.
U.S. Trade Representative Robert Lighthizer told reporters that the administration’s target is still to finish phase one by the time the APEC meetings take place in Chile on Nov. 16 and 17. He added there are outstanding issues to resolve.
Adding to tensions, China is seeking $2.4 billion in retaliatory sanctions against the United States for non-compliance with a WTO ruling in a tariffs case dating back to the era of President Barack Obama, a document showed.
“The complex remains trapped in a tight trading range amidst an ongoing tug of war between the supportive influence of a steady equity trade and the bearish influence of continued concerns over a major trade war that could force further slowing in global economic growth,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a report.
On the supply side, Russia, the world’s second-largest oil producer, said on Sunday it did not meet its supply reduction commitment in September because of an increase in natural gas condensate output ahead of winter.
The Organization of the Petroleum Exporting Countries, Russia and other oil producers, an alliance known as OPEC+, agreed in December to cut supply by 1.2 million barrels per day (bpd).
“Russia intends to fully comply with the agreed production cut in October, though it is reasonable to doubt whether this will actually be achieved,” Commerzbank analyst Carsten Fritsch said.
European refinery production in September fell 4% from the previous month and 4.2% year-on-year, data from Euroilstock showed on Monday. Production hit 10.451 million barrels per day (bpd), with output declining across all refined products.
Offering some encouragement, European shares opened slightly higher as investors remained hopeful Britain would avoid a disorderly exit from the European Union.
Analysts have said any British-EU agreement that avoids a no-deal Brexit should boost economic growth and oil demand.
Reporting by Stephanie Kelly in New York; Editing by David Gregorio; Additional reporting by Bozorgmehr Sharafedin in London and Roslan Khasawneh in Singapore; Editing by Kirsten Donovan and Matthew LewisOur Standards: The Thomson Reuters Trust Principles.
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01825f53de35e22e4d0379d8bdd6d544 | https://www.reuters.com/article/us-global-oil/oil-prices-down-as-u-s-china-trade-deal-has-no-outcome-idUSKBN1WT00V | Oil falls more than 2% on U.S.-China trade deal doubts, stronger dollar | Oil falls more than 2% on U.S.-China trade deal doubts, stronger dollar
By Laila Kearney4 Min Read
NEW YORK (Reuters) - Oil prices lost about 2% on Monday on worries that global crude demand could stay under pressure as few details about the first phase of a U.S.-China trade deal did little to assure a quick resolution to the tariff fight.
FILE PHOTO: Oil rigs are seen at Vaca Muerta shale oil and gas drilling, in the Patagonian province of Neuquen, Argentina January 21, 2019. REUTERS/Agustin Marcarian/File Photo
Oil prices also felt pressure as the U.S. dollar .DXY, which has an inverse relationship with crude prices, gained as waning trade deal hopes and ongoing concerns over Britain's exit from the European Union attracted safe-haven investments.
Brent crude LCOc1 settled at $59.35 a barrel, shedding $1.16, or 1.92%, while U.S. West Texas Intermediate (WTI) crude CLc1 settled at $53.59 a barrel, losing $1.11, or 2.03%.
“The complex is in (the) process of relinquishing a major portion of the late week trade inspired gains as conflicting indications out of the U.S. and China regarding trade progress is reducing risk appetite,” said Jim Ritterbusch of Ritterbusch and Associates.
Late on Friday, Washington and Beijing outlined the first stage of a trade deal and suspended this week’s scheduled U.S. tariff hikes. Brent and WTI rose more than 3% last week, their first weekly increase since the week starting Sept. 20, on signs of progress toward a trade deal that would boost crude demand.
But optimism that the trade negotiations would prove successful faded, as China indicated further discussions were needed and U.S. Treasury Secretary Steven Mnuchin said the next round of tariffs on Chinese imports are still set to take effect on Dec. 15 if a deal has not been reached by then.
But existing tariffs remain in place and officials on both sides said much more work was needed before an accord could be agreed.
A good portion of the gains last week came after the United States announced on Friday it was deploying more troops to Saudi Arabia, and after an Iranian oil tanker was attacked in the Red Sea.
Oil prices had drawn some support from worries that further escalation along the Syrian and Turkish border could affect output or exports from Iraq. Syrian troops entered a northeastern town on Monday.
The Saudi energy minister, Prince Abdulaziz bin Salman, said oil exporters were showing serious commitment to global output cuts in a deal between OPEC and its allies, a grouping known as OPEC+.
Russian Energy Minister Alexander Novak said there were no talks underway to change the OPEC+ deal.
Kuwait’s oil minister said it was too early to discuss a possible buildup in oil inventories in 2020. Khaled al-Fadhel said a price range of $50 to $70 per barrel would be acceptable.
The compliance of OPEC+ producers with the supply-reduction agreement was seen at above 200% in September, sources familiar with the matter said.
Bin Salman also said on Monday that Saudi Arabia’s oil production will recover in October and November to levels above those seen before attacks on its energy installations in September, which weighed on oil prices.
(GRAPHIC: Iran oil tanker hit by missiles off Saudi coast IMG - tmsnrt.rs/2B4p0iu)
(GRAPHIC: Call on OPEC crude - tmsnrt.rs/2OCPCzd)
Additoinal reporting by Bozorgmehr Sharafedin in London, Florence Tan and Seng Li Peng; Editing by David Gregorio and Lisa ShumakerOur Standards: The Thomson Reuters Trust Principles.
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4887b63d7a8e8b4741e99391f8922ee4 | https://www.reuters.com/article/us-global-oil/oil-prices-edge-up-ahead-of-u-s-inventories-data-idUSKBN2B2071 | Oil ticks up on global economic outlook, plummeting U.S. fuel inventories | Oil ticks up on global economic outlook, plummeting U.S. fuel inventories
By Laila Kearney3 Min Read
NEW YORK (Reuters) - Oil prices rose on Wednesday on an upbeat forecast for global economic recovery and as U.S. gasoline inventories plummeted, but prices were limited due to a surge in crude oil inventories in the aftermath of last month’s Texas winter storm.
FILE PHOTO: The sun sets behind the chimneys of the Total Grandpuits oil refinery, southeast of Paris, France, March 1, 2021. REUTERS/Christian Hartmann
Brent crude settled at $67.90 a barrel, gaining 38 cents, or 0.6%. U.S. West Texas Intermediate crude settled at $64.44 a barrel, rising 43 cents, or 0.7%.
U.S. gasoline stocks dropped by 11.9 million barrels last week and distillates, which include diesel and heating oil, fell 5.5 million barrels, the Energy Information Administration said, sharper than analysts’ expectations in a Reuters poll for a 3.5 million-barrel drop each. [EIA/S]
Crude oil stocks, however, jumped 13.8 million barrels last week, far exceeding forecasts for a 816,000-barrel rise, as the nation’s oil industry continued to feel the effects of a winter storm mid-February that stalled refining and forced production shut-ins in Texas. [EIA/S]
“Production has rebounded back to pre-storm levels while refinery runs struggle to recover,” said Matt Smith, director of commodity research at ClipperData.
The pandemic-hit global economy is set to rebound with 5.6% growth this year and expand 4% next year, the Organisation for Economic Cooperation and Development (OECD) said in its interim economic outlook. Its previous forecast had been for growth of 4.2% this year.
“When it comes to lifting market sentiment, there is very little that can rival an upgrade to the post-COVID economic recovery,” said Stephen Brennock of broker PVM.
Oil prices have been steadily rallying for several months as OPEC+ - consisting of the Organization of the Petroleum Exporting Countries and allies - kept supply curbs in place. After briefly touching $70 per barrel earlier this week, Brent crude has edged off.
OPEC+ agreed last week to largely maintain production cuts in April.
Saudi Arabia’s foreign minister said that the kingdom and Russia were keen for fair oil prices and will continue their cooperation in the framework of the OPEC+ group.
Additional reporting by Bozorgmehr Sharafedin in London, Stephanie Kelly in New York and Florence Tan in Singapore; Editing by Marguerita Choy David Goodman and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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8ece35b891f0fabd3ed9c864719ae3e6 | https://www.reuters.com/article/us-global-oil/oil-prices-edge-up-on-stimulus-support-despite-ample-supplies-idUSKBN25R042 | Oil dips as prices struggle to break through demand uncertainty | Oil dips as prices struggle to break through demand uncertainty
By Laila Kearney3 Min Read
NEW YORK (Reuters) - Oil prices dropped on Monday, with Brent slipping from a five-month high as global demand remained below pre-COVID levels while U.S. production edged up.
FILE PHOTO: The sun sets behind a crude oil pump jack on a drill pad in the Permian Basin in Loving County, Texas, U.S. November 24, 2019. REUTERS/Angus Mordant/File Photo
Brent crude futures settled at $45.28 a barrel, down 53 cents, or 1.2%. U.S. West Texas Intermediate crude CLc1 settled at $42.61 a barrel, down 36 cents, or 0.8%.
Brent still closed out August up 7.5% for a fifth successive monthly price rise. WTI logged a fourth monthly gain at 5.8% after hitting a five-month high of $43.78 a barrel on Aug. 26 when Hurricane Laura struck.
Still, with key economies around the world limply recovering from coronavirus lockdowns, analysts said the market could remain oversupplied with fuel.
“The issues over demand just aren’t showing signs of any real improvement,” said John Kilduff, partner at Again Capital in New York.
At the same time, U.S. oil production climbed 420,000 barrels per day in June to 10.44 million barrels a day, the U.S. Energy Information Administration said, putting further pressure on prices.
Oil output in the U.S. Gulf Coast was lower as energy companies continued efforts to restore platforms and refineries shut before two storms struck last week.
“There is still some concern about the lagging effects of Hurricane Laura and what that’s going to mean for refinery operations as well as the impact on demand and exports,” said Phil Flynn, senior analyst at Price Futures Group in Chicago.
The U.S. Department of Energy said the West Hackberry Strategic Petroleum Reserve site in Louisiana “sustained considerable damage” from Hurricane Laura.
Abu Dhabi National Oil Company told its customers on Monday it will reduce October supplies by 30%, up from a 5% cut in September, as directed by the United Arab Emirates government to meet its commitment to the recent OPEC+ agreement.
A mildly improved forecast of Germany’s 2021 growth and a survey on Monday showing strength in China’s services sector supported oil prices, analysts say, but hurdles for crude going forward remain.
China’s crude imports in September are set to fall for the first time in five months as record volumes of crude are stored in and outside of the world’s largest importer, data from Refinitiv and Vortexa showed.
Additional reporting by Noah Browning and Florence Tan, editing by Louise Heavens and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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82cde4f8e41b31123c23b10dcda8ee4a | https://www.reuters.com/article/us-global-oil/oil-prices-fall-on-demand-concerns-as-g20-warns-of-risks-to-growth-idUSKBN1KD01Z?il=0 | Crude pulls back as focus returns to oversupply | Crude pulls back as focus returns to oversupply
By Jessica Resnick-Ault4 Min Read
NEW YORK (Reuters) - Oil prices edged lower on Monday as the focus turned to oversupply worries, moving away from escalating tensions between the U.S. and Iran, which had driven prices higher early in the session.
Brent crude oil LCOc1 settled down 1 cent at $73.06 a barrel. U.S. crude CLc1 was down 37 cents at $67.89 a barrel, down from a session high of $69.31.
The market gave up gains as attention returned to oversupply risk. Saudi Arabia and other large producers are ramping up production to offset losses from Iran that are likely to come with the approach of the November deadline for other countries to comply with U.S. sanctions on crude sales from Iran, said Phil Flynn, an analyst at Price Futures Group in Chicago.
“They’re just continuing to chase from one headline to another,” Flynn said. The market is continuing volatile swings that were seen last week, he said.
U.S. crude inventories at the delivery hub at Cushing, Oklahoma gained in the most recent four days to Friday, according to information supplier Genscape, traders said. On a weekly basis, stockpiles at the hub were expected to fall for the 10th consecutive week, traders said.
The market was also weighed down by concerns about the impact on global economic growth and energy demand of the escalating trade dispute between the United States and its trading partners.
Finance ministers and central bank governors from the world’s 20 biggest economies ended a meeting in Buenos Aires over the weekend calling for more dialogue to prevent trade and geopolitical tensions from hurting growth.
“Downside risks over the short and medium term have increased,” the finance leaders said in a statement.
The talks occurred amid escalating rhetoric in a trade dispute between the United States and China, the world’s largest economies, which have already slapped tariffs on $34 billion worth of each other’s goods.
U.S. President Donald Trump threatened on Friday to impose tariffs on all $500 billion of Chinese exports to the United States unless Beijing agreed to major changes to its technology transfer, industrial subsidy and joint venture policies.
Economic and oil demand growth are correlated as expanding economies support fuel consumption for trade and travel, as well as for automobiles.
Early in the session, the market climbed after tensions worsened between Iran and the United States, while some offshore workers began a 24-hour strike on three oil and gas platforms in the British North Sea.
Iranian Supreme Leader Ayatollah Ali Khamenei on Saturday backed a suggestion by President Hassan Rouhani that Iran could block Gulf oil shipments if its exports were stopped.
The Iranian leadership was responding to the threat of U.S. sanctions after Trump in May pulled out of a multinational agreement to trade with Tehran in return for its commitment not to develop nuclear weapons.
Late on Sunday night, Trump tweeted that Iran risked dire consequences “the like of which few throughout history have suffered before” if the Islamic Republic made more threats against the United States.
“Attention is being focused on geopolitical tensions, particularly between U.S. and Iran,” said Gene McGillian, director of market research at Tradition Energy in Stamford, Connecticut. “Fundamentally, we do have a tighter picture than we had twelve months ago.”
Reporting by Christopher Johnson and Parissa Hedvat in LONDON, Aaron Sheldrick in TOKYO and Jane Chung in SEOUL; editing by Marguerita Choy and David EvansOur Standards: The Thomson Reuters Trust Principles.
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4c11683745ab83ec7273220509d82332 | https://www.reuters.com/article/us-global-oil/oil-prices-fall-on-dip-in-china-demand-surging-u-s-output-idUSKCN1J403W?rpc=401 | Oil falls on concerns over rising supply, weaker demand | Oil falls on concerns over rising supply, weaker demand
By Jessica Resnick-Ault4 Min Read
NEW YORK (Reuters) - Oil prices fell on Friday as concerns about surging U.S. output and falling demand in China weighed on the contract and JP Morgan cut its price forecast.
FILE PHOTO: Oil pumpjacks are seen in Lagunillas, Venezuela May 24, 2018. REUTERS/Isaac Urrutia
Brent crude futures LCOc1 settled down 86 cents, or 1.1 percent, at $76.46 a barrel. U.S. West Texas Intermediate (WTI) crude futures CLc1 ended 21 cents lower at $65.74 a barrel. For the week, Brent fell 0.5 percent, while U.S. crude slipped 0.3 percent.
In the past three weeks, prices have declined from three-year highs as the market has contended with supply concerns. On Friday, oil prices came under pressure after data suggested Chinese demand was waning and concerns lingered about growing U.S. output.
Hedge funds and other money managers cut their bullish bets on U.S. crude futures in the week ended June 5, the U.S. Commodity Futures Trading Commission (CFTC) said.
JP Morgan cut its 2018 crude forecast for WTI by $3 to $62.20 a barrel. The bank said geopolitical tensions and lingering risks of supply disruptions may push prices higher during the second half 2018, it expects prices will head lower late in the year, and remain capped in 2019.
The futures contracts dipped after the forecast was issued, and then pared losses.
China’s May crude oil imports eased away from a record high hit the previous month, customs data showed, with state-run refineries entering planned maintenance.
May shipments were 39.05 million tonnes, or 9.2 million barrels per day (bpd). That compared with 9.6 million bpd in April.
Further weighing on prices has been rising U.S. output C-OUT-T-EIA, which hit another record last week at 10.8 million bpd.
U.S. drillers added one oil rig in the week to June 8, bringing the total count to 862, the highest level since March 2015, General Electric Co's Baker Hughes energy services firm said in its closely followed report. RIG-OL-USA-BHI [RIG/U]
The surge in U.S. production has pulled down WTI into a discount versus Brent CL-LCO1=R of more than $11 a barrel, its steepest since 2015.
MARKET STILL TIGHT
Despite Friday’s decline, Brent remains more than 15 percent above its level at the start of the year.
U.S. investment bank Jefferies said the crude market is tight and spare capacity could dwindle to 2 percent of demand in the second half of 2018, its lowest level since at least 1984.
Markets have been tightened by supply trouble in Venezuela, where state-owned oil company PDVSA is struggling to clear a backlog of about 24 million barrels of crude waiting to be shipped to customers.
More generally, Brent has been pushed up by the voluntary production cuts put in place last year, led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia.
OPEC and Russia meet on June 22/23 to discuss production policy.
On Friday, OPEC’s third-largest producer Iran criticized a U.S. request that Saudi Arabia pump more oil to cover a drop in Iranian exports and predicted that OPEC would not heed the appeal.
Headlines on OPEC members’ plans for the meeting later this month will lead to volatile market swings, said Tariq Zahir, managing member of Tyche Capital Advisors in New York.
“I think it is going to be very choppy,” he said.
Additional reporting by Shadia Nasralla and Dmitry Zhdannikov in London, Henning Gloystein in Singapore; Editing by Marguerita Choy and Phil BerlowitzOur Standards: The Thomson Reuters Trust Principles.
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cadaff9c0bcd534ea46be6f138d000ef | https://www.reuters.com/article/us-global-oil/oil-prices-jump-4-on-opec-output-talks-iran-tension-idUSKBN29A091 | Oil prices jump 5% on OPEC+ output talks, Iran tension | Oil prices jump 5% on OPEC+ output talks, Iran tension
By Stephanie Kelly2 Min Read
Slideshow ( 2 images )
NEW YORK (Reuters) -Oil prices climbed nearly 5% on Tuesday after news that Saudi Arabia will make voluntary cuts to its oil output, while international political tension simmered over Iran’s seizure of a South Korean vessel.
Brent crude futures rose $2.51, or 4.9%, to settle at $53.60 a barrel. U.S. West Texas Intermediate crude ended $2.31, or 4.9%, higher at $49.93 a barrel.
Saudi Arabia will make additional, voluntary oil output cuts of 1 million barrels per day (bpd) in February and March. The cuts are part of a deal to persuade most producers from the group consisting of the Organization of the Petroleum Exporting Countries and allies to hold output steady amid concerns that new coronavirus lockdowns will hit demand.
“Saudi Arabia put the cherry on the cake and if there is one way to describe what its voluntary cut means for the market, ‘happy hour’ is a pretty fitting term,” said Bjornar Tonhaugen, Rystad Energy’s head of oil markets.
OPEC+ resumed talks on Tuesday after reaching a deadlock over February oil output levels this week.
An internal OPEC+ document dated Monday and seen by Reuters highlighted bearish risks and stressed that “the reimplementation of COVID-19 containment measures across continents, including full lockdowns, are dampening the oil demand rebound in 2021”.
Tensions continued around OPEC member Iran’s seizure of a South Korean vessel. Iran denied on Tuesday it was using the ship and its crew as hostages, a day after it seized the tanker in the Gulf while pressing a demand for Seoul to release $7 billion in funds frozen under U.S. sanctions.
In the United States, U.S. crude inventories fell by 1.7 million barrels in the week to Jan. 1 to about 491.3 million barrels, while both gasoline and distillate inventories rose, data from industry group the American Petroleum Institute showed on Tuesday. [EIA/S] [API/S]
Coronavirus lockdowns, which have weighed on fuel demand since early last year, loom. Britain began its third COVID-19 lockdown on Tuesday.
Reporting by Stephanie Kelly; Additional reporting by Noah Browning, Shadia Nasralla and Florence Tan; Editing by Marguerita Choy, David Gregorio and Peter CooneyOur Standards: The Thomson Reuters Trust Principles.
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3fa282cee890f5084ce38be370f6c859 | https://www.reuters.com/article/us-global-oil/oil-prices-jump-after-saudi-arabia-announces-december-supply-cut-idINKCN1NH02I?edition-redirect=in | U.S. crude ends lower for record 11th consecutive session | U.S. crude ends lower for record 11th consecutive session
By Jessica Resnick-Ault4 Min Read
NEW YORK (Reuters) - U.S. crude prices fell for the 11th consecutive session, the most on record since the contract began trading, retreating from a rally early in the session as U.S. President Donald Trump said he hoped there would be no oil output reductions.
Saudi Energy Minister Khalid al-Falih addresses the gathering during India Energy Forum in New Delhi, October 15, 2018. REUTERS/Adnan Abidi/Files
Trump’s comment followed remarks from Saudi Arabia’s energy minister saying OPEC was considering cutting supply next year, citing softening demand. Saudi Arabia has expressed concerns that U.S. sanctions have removed less oil from the market than expected.
U.S. benchmark West Texas Intermediate crude CLc1 fell 26 cents a barrel to settle at $59.93. The fall marked the 11th consecutive daily decline, the most since the contract began trading, according to data from CME Group. The contract continued to drop in post-settlement trading, falling $1.48 to $58.71 a barrel by 3:34 p.m. EST (1834 GMT).
Brent crude futures LCOc1 reversed course late in the session, settling down 6 cents at $70.12 a barrel. Brent also traded lower in post-settlement activity, dropping $1.13 to $69.05 a barrel.
“Hopefully, Saudi Arabia and OPEC will not be cutting oil production,” Trump wrote on Twitter. “Oil prices should be much lower based on supply!” U.S. crude turned negative and extended losses after the tweet.
Oil prices had strengthened early in the session, after Saudi Arabia said the Organisation of the Petroleum Exporting Countries and its partners believed demand was softening enough to warrant an output cut of 1 million barrels per day next year.
Saudi Energy Minister Khalid al-Falih said OPEC and its allies agree that technical analysis shows a need to cut oil supply next year by around 1 million bpd from October levels.
Saudi Arabia, the world’s largest oil exporter, said on Sunday it would cut its shipments by half a million bpd in December due to seasonal lower demand.
“We’re kind of back to square one: It must feel like November 2016 to them, a lot,” said John Kilduff, a partner at Again Capital Management in New York, referring to the time period when OPEC and its allies agreed to initiate production cuts. “The Saudis and Russians, especially, rushed production to market to offset losses that aren’t materializing.”
The market had anticipated that exports from OPEC member Iran would fall precipitously following the institution of U.S. sanctions in November. However, the U.S. has granted waivers to certain major importers of Iranian crude, diminishing the expected cuts.
OPEC and the International Energy Agency release their respective monthly reports on the outlook for oil supply and demand later this week. [OPEC/M] [IEA/M]
Oil prices have fallen around 20 percent in the last month, hit by an increase in global supply and the threat of a slowdown in demand, especially from customers whose currencies have weakened against the dollar and eroded their purchasing power.
Output from the world's top oil producers Russia, the United States and Saudi Arabia has risen by 1.05 million bpd in the last three months, based on official output figures. PRODN-SAC-RU-OUTC-OUT-T-EIA
This has left OPEC scrambling to adjust its own output, which, at around 33.3 million bpd, accounts for roughly a third of global supply.
An official from group member Kuwait said on Monday major oil exporters had over the weekend “discussed a proposal for some kind of cut in (crude) supply next year”, although the official did not provide any detail.
One of OPEC’s biggest problems is the surge in U.S. output.
“One thing that is abundantly clear, OPEC is in for a shale shocker as U.S. crude production increased to a record 11.6 million barrels per day and will cross the 12 million threshold next year,” said Stephen Innes, head of trading for Asia-Pacific at futures brokerage Oanda in Singapore.
Graphic: U.S. oil output, storage & drilling (tmsnrt.rs/2DhQOCB)
Additional reporting by Henning Gloystein in SINGAPORE and Amanda Cooper in London; Editing by Marguerita Choy and Chizu NomiyamaOur Standards: The Thomson Reuters Trust Principles.
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d476c9c7d57065318634ec8ac89738bb | https://www.reuters.com/article/us-global-oil/oil-prices-jump-as-u-s-seen-ending-iran-sanction-waivers-idUSKCN1RY00J | Oil hits 2019 high on U.S. plan to tighten squeeze on Iran | Oil hits 2019 high on U.S. plan to tighten squeeze on Iran
By Stephanie Kelly3 Min Read
NEW YORK (Reuters) - Oil prices jumped more than 2 percent on Monday to a near six-month high, on growing concern about tight global supplies after the United States announced a further clampdown on Iranian oil exports.
Washington said it will eliminate in May all waivers allowing eight economies to buy Iranian oil without facing U.S. sanctions.
“The geopolitical risk premium is back in the oil market, in a big way,” said John Kilduff, a partner at Again Capital LLC in New York. “Most, if not all, legitimate commercial interests will avoid Iran oil purchases. Iran’s flow will be reduced to a trickle.”
Brent crude futures rose $2.07, or 2.88 percent, to settle at $74.04 a barrel. The session high of $74.52 a barrel for the international benchmark was the highest since Nov. 1.
U.S. West Texas Intermediate crude futures climbed $1.70, or 2.66 percent, to settle at $65.70 a barrel. The contract hit $65.92 a barrel, the highest since Oct. 31.
In November the United States reimposed sanctions on exports of Iranian oil but granted waivers to Iran’s eight main buyers: China, India, Japan, South Korea, Taiwan, Turkey, Italy and Greece. They were allowed to keep making limited purchases for six months.
U.S. Secretary of State Mike Pompeo reiterated that Washington’s goal was to bring down exports of Iranian oil to zero and said there were no plans for a grace period beyond May 1.
U.S. officials are seeking ways to prevent Iran from circumventing oil sanctions, a senior administration official said.
Iran said the decision not to renew the waivers has “no value” but Tehran was in touch with European partners and neighbors and would “act accordingly,” Iranian news agencies reported, citing the Foreign Ministry.
Another drop in Iranian exports would further squeeze supply in a tight market. The United States has also sanctioned OPEC member Venezuela, and the Organization of the Petroleum Exporting Countries and allied producers including Russia have voluntarily cut output, which has helped raise oil prices more than 35 percent this year.
Iran’s biggest oil customers are China and India. India hopes Washington will allow allies to keep buying some Iranian oil instead of halting the purchases altogether from May, a source familiar with U.S.-India talks said.
Trump said Saudi Arabia and other OPEC nations could “more than make up” for any drop in Iranian oil supplies.
Saudi Arabia said it would coordinate with other producers to ensure an adequate crude supply and a balanced market.
“By and large, we expect the Saudis to up output in likely capping Brent price advances to around the $75-76 area followed by some leveling through much of the spring period,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.
(GRAPHIC: Iran crude oil & condensate shipping departures link: tmsnrt.rs/2IBQF06).
Additional reporting by Alex Lawler in London and Henning Gloystein in Singapore; Editing by David Gregorio and Susan ThomasOur Standards: The Thomson Reuters Trust Principles.
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ca1dea993594ca35b383b3dab9b48249 | https://www.reuters.com/article/us-global-oil/oil-prices-near-1-year-highs-after-stocks-draw-supply-deficit-forecast-idUSKBN2A306T?il=0 | U.S. crude hits one-year highs after U.S. stock drawdown | U.S. crude hits one-year highs after U.S. stock drawdown
By Stephanie Kelly3 Min Read
NEW YORK (Reuters) - Oil prices rose almost 2% on Wednesday, with U.S. crude reaching its highest settlement level in a year after stockpiles fell to their lowest levels since March.
FILE PHOTO: Crude oil storage tanks are seen in an aerial photograph at the Cushing oil hub in Cushing, Oklahoma, U.S. April 21, 2020. REUTERS/Drone Base
U.S. West Texas Intermediate (WTI) crude futures rose 93 cents, or 1.7%, to settle at $55.69 a barrel, the highest since Jan. 22, 2020, after touching a high of $56.33 earlier in the session.
Brent crude futures rose $1, or 1.7%, to settle at $58.46 a barrel, the highest since Feb. 21, 2020.
Both benchmarks are also currently at their steepest ‘backwardation’ level in a year. That’s where contracts for near-term delivery are more expensive than later supplies, a signal of current demand and expectations of tighter supply. The current U.S. contract trades at $2.30 more than the contract expiring six months later.
U.S. crude oil stockpiles fell last week to 475.7 million barrels, the Energy Information Administration said on Wednesday, their lowest since March. Refinery utilization rates rose by 0.6 percentage points.
“Refineries are back in business, which is supportive for crude,” said Phil Flynn, senior analyst at The Price Futures Group in Chicago.
The market has been bolstered by deep supply cuts from the Organization of the Petroleum Exporting Countries and allies, which on Wednesday maintained ongoing supply cuts.
A document seen by Reuters on Tuesday showed that OPEC+ expects the oil market to be in deficit throughout 2021, peaking at 2 million barrels per day in May.
“The oil market continues to look for better days ahead with an increasing rollout of the vaccine, encouraging demand, while OPEC+ continues to restrain production,” said Andrew Lipow, president of Lipow Oil Associates in Houston.
The market was also bolstered by news that Democrats in the U.S. Congress took the first steps toward advancing President Joe Biden’s proposed $1.9 trillion coronavirus aid plan.
The United States has filed a lawsuit to seize a cargo of oil it says came from Iran rather than Iraq, as stated on the bill of lading, and contravenes U.S. terrorism regulations.
Reporting by Stephanie Kelly in New York; additional reporting by Shadia Nasralla, Shu Zhang and Sonali Paul. Editing by Marguerita Choy, Paul Simao and Sonya HepinstallOur Standards: The Thomson Reuters Trust Principles.
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9e8cd1a12dda40a9e155c791facb3f67 | https://www.reuters.com/article/us-global-oil/oil-prices-near-two-year-highs-as-supply-cuts-bite-idUSKBN1D0026 | Oil up near two-year highs, analysts see more U.S. crude exports | Oil up near two-year highs, analysts see more U.S. crude exports
By Julia Simon3 Min Read
NEW YORK (Reuters) - Oil prices settled higher again on Tuesday, notching a monthly gain of more than 5 percent, but analysts said bullish sentiment that has driven Brent crude to its highest in more than two years could encourage U.S. producers to export more oil.
Slideshow ( 2 images )
Brent LCOc1 settled up 47 cents or 0.7 percent to $61.37, close to its July 2015 highs reached earlier this week, and up around 37 percent from its 2017 lows hit in June.
U.S. West Texas Intermediate crude (WTI) CLc1 settled up 23 cents or 0.4 percent to $54.38, still near its highest since February and close to its highest in more than two years.
Traders and brokers said investors were adjusting positions after price rises of around 5 percent in October.
For the month, Brent was up 6.7 percent, while WTI rose 5.2 percent. WTI's discount to Brent CL-LCO1=R has widened to nearly $7, making it attractive to exporters.
“The large differential has opened the door on regional arbitrage, driving a spike in U.S. crude exports over recent weeks,” BMI Research said in a note.
U.S. crude exports have jumped to close to 2 million barrels per day (bpd) and production C-OUT-T-EIA has risen almost 13 percent since mid-2016 to 9.5 million bpd.
“The problem is as soon as prices move up it’s too easy for U.S. producers to add another rig or another completion crew,” said Stewart Glickman, energy equity analyst at CFRA Research in New York, “Then they increase production and you’re back where you started.”
U.S. crude and gasoline futures RBc1 extended gains in post-settlement trade after industry group the American Petroleum Institute said that U.S. oil inventories fell far more than expected.
Crude inventories fell 5.1 million barrels in the week to Oct. 27 to 456.8 million, compared with analysts’ expectations for a decrease of 1.8 million barrels. Gasoline stocks plunged 7.7 million barrels, versus forecasts of a 1.5 million-barrel draw, the API said.
U.S. government oil inventory data will be released at 10:30 a.m. (1430 GMT) on Wednesday.
Bullish sentiment has been fueled by a pledge by the Organization of the Petroleum Exporting Countries, Russia and other exporters to hold back about 1.8 million bpd in oil production to tighten markets.
OPEC’s adherence to its pledged supply curbs rose to 92 percent from September’s 86 percent, a Reuters survey showed, as top exporter Saudi Arabia continued to pump below its OPEC target and output in Venezuela, in economic depression, declined further.
OPEC is scheduled to next meet at its headquarters in Vienna on Nov. 30.
Additional reporting by Christopher Johnson in London, Henning Gloystein in Singapore; Editing by Marguerita Choy and Chris ReeseOur Standards: The Thomson Reuters Trust Principles.
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eba6196df23ae6bf9682ea44a2253a01 | https://www.reuters.com/article/us-global-oil/oil-prices-rise-as-u-s-crude-stocks-build-less-than-expected-idUSKBN20E07N | Oil prices rise as U.S. crude stocks build less than expected | Oil prices rise as U.S. crude stocks build less than expected
By Arathy S Nair3 Min Read
(Reuters) - Oil prices were up slightly on Thursday after the U.S. government reported a much smaller-than-anticipated rise in crude stocks, but gains were capped by worries about the spread of Coronavirus outside China.
FILE PHOTO: Pump jacks operate at sunset in Midland, Texas, U.S., February 11, 2019. REUTERS/Nick Oxford
U.S. Energy Information Administration (EIA) data showed crude inventories rose only 414,000 barrels last week, much less than the 2.5 million barrel build predicted by analysts in a Reuters poll.
However, scores of new coronavirus cases and a first death in South Korea fanned fears of global pandemic as research suggested it could be more contagious than previously thought.
Brent crude futures LCOc1 settled up 19 cents, or 0.32%, at $59.31 a barrel.
The front-month U.S. West Texas Intermediate (WTI) crude CLc1 futures contract, which expired Thursday, gained 49 cents, or 0.9%, to settle at $53.78 a barrel. The more-active second-month WTI benchmark CLc2 was up 45 cents, or 0.8%, at $53.94 a barrel.
Immediately after the EIA data, Brent front month, front month WTI and second month WTI touched their highest in February.
“Today’s fresh fundamental input mainly cantered on the weekly EIA release that was widely perceived as supportive,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.
However, “negative vibes from the coronavirus are unlikely to dissipate quickly” and China’s efforts to prop up their economy via Central bank rate adjustments is a limited solution in reviving economic activity, Ritterbusch said.
China’s move to cut its benchmark lending rate eased some worries about slowing demand in the world’s second-biggest oil consumer and largest crude oil importer.
U.S. gasoline stockpiles fell by about 2 million barrels in the week to Feb. 14, while analysts had estimated an increase of 435,000 barrels, according to the EIA data.
The data also showed that U.S. East Coast refinery utilization rates fell last week to 59.2%, the lowest since November 2012. However, overall U.S. refinery utilization rates rose 1.4%, primarily as the refiners came out of maintenance.
Also supporting oil prices were U.S. sanctions this week on a trading unit of Russian oil giant Rosneft for its ties with Venezuela’s state-run PDVSA and conflict in Libya that has led to a blockade of its ports and oilfields.
Brent could extend gains to $60.22 a barrel, as suggested by its wave pattern and a projection analysis, said Reuters technical analyst Wang Tao.
Brent crude futures for nearby delivery were also trading at a premium to future months, a structure called backwardation, signalling a potential tightening in supplies.
Coronavirus interactive graphic: here
Reporting by Arathy S Nair in Bangalore; Additional reporting by Ahmad Ghaddar in London and Koustav Samanta in Singapore; Editing by Chris Reese and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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f7651408c06427da64f8edc0f6d2fd86 | https://www.reuters.com/article/us-global-oil/oil-prices-rise-but-still-set-for-weekly-fall-amid-equities-rout-idUSKCN1MM02K | Oil turns lower as weaker demand outlook weighs | Oil turns lower as weaker demand outlook weighs
By Jessica Resnick-Ault3 Min Read
NEW YORK (Reuters) - Oil prices gave back early gains and turned lower on Friday after the International Energy Agency (IEA) deemed supply adequate and the outlook for demand weakening, sinking even as equities rebounded from a slump Thursday.
FILE PHOTO: Pump jacks operate at sunset in an oilfield in Midland, Texas U.S. August 22, 2018. REUTERS/Nick Oxford/File Photo
The West’s energy watchdog said in its monthly report that the market looked “adequately supplied for now” and trimmed its forecasts for world oil demand growth this year and next.
“This is due to a weaker economic outlook, trade concerns, higher oil prices and a revision to Chinese data,” said the IEA, which advises industrialised countries on energy policy.
Brent crude fell 56 cents a barrel to $79.70 by 12:16 p.m. EDT (1616 GMT), after dropping 3.4 percent on Thursday. U.S. crude futures fell 2 cents to $70.95.
“The weaker outlook has gotten a raised profile in the market, but there’s potential for a real supply crunch toward the end of this year,” said John Kilduff, a partner at Again Capital Management in New York. “The demand outlook is hurt right now because of the situation with the U.S. and China in particular.”
Both benchmarks were headed for their first weekly drop in five weeks, pressured by a big rise in U.S. inventories and fading concerns about shrinking global supplies due to looming U.S. sanctions on Iran’s oil exports.
The IEA report is the latest official forecaster to predict weaker demand ahead and conclude that supply is adequate. The Organization of the Petroleum Exporting Countries (OPEC) made a similar move on Thursday.
“The bearish alarm bells are ringing for next year’s oil balance as market players brace for the return of a supply surplus,” said Stephen Brennock of oil broker PVM.
Early in the session, crude rose as global equities were set for their biggest daily gain in nearly a month. Declining equities amid wider risk-off investor sentiment had pressured oil on Thursday.
A drop in U.S. oil production this week supported prices. In the U.S. Gulf of Mexico, companies cut output by 40 percent on Thursday because of Hurricane Michael, even as some began returning crews to offshore platforms.
Michael made landfall in Florida on Wednesday as the third most powerful hurricane to strike the U.S. mainland, though it has since weakened to a tropical storm.
Oil traders will watch for the weekly U.S. drilling rig count, an indicator of upcoming production, which is due at about 1 p.m. from Baker Hughes.
Additional reporting by Aaron Sheldrick and Alex Lawler; Editing by Marguerita Choy and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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8c9c5940b0b29563fa0b2e44df25a1f2 | https://www.reuters.com/article/us-global-oil/oil-prices-rise-on-declining-u-s-crude-stockpiles-looming-iran-sanctions-idUSKCN1LS02Y | Brent reaches $80 a barrel after fall in U.S. crude stocks | Brent reaches $80 a barrel after fall in U.S. crude stocks
By Stephanie Kelly3 Min Read
NEW YORK (Reuters) - Oil futures rose on Wednesday, with Brent reaching $80 a barrel, after a larger-than-expected drop in U.S. crude inventories and as U.S. sanctions on Iran added to concerns over global oil supply.
FILE PHOTO: Crude oil storage tanks are seen from above at the oil hub in Cushing, Oklahoma, March 24, 2016. REUTERS/Nick Oxford/File Photo
Benchmark Brent crude LCOc1 futures rose 68 cents to settle at $79.74 a barrel. The global benchmark earlier reached $80.13 a barrel, its highest level since May 22.
U.S. West Texas Intermediate (WTI) crude CLc1 futures rose $1.12 to settle at $70.37 a barrel, a one-week high.
U.S. crude inventories USOILC=ECI fell by 5.3 million barrels in the last week, the U.S. Energy Information Administration said on Wednesday. Analysts had expected a decrease of 805,000 barrels.
“Today’s crude stock draw of 5.3 million barrels fell far short of the (American Petroleum Institute’s) decline but was significantly larger than the normal draw of around 1 million barrels for this particular week,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.
Also supporting prices were supply concerns surrounding U.S. sanctions on Iran. Since the spring, when the Trump Administration said it would impose the sanctions, traders have been focusing on the potential impact on global supply. The sanctions will target Iran’s oil exports from November.
“Iran is increasingly becoming the preoccupation of the crude market. The last couple of weeks have seen the expected squeeze on Iranian crude flows taking shape, with overall outflows down markedly,” consultancy JBC Energy said.
(Graphic: Iran oil exports to Asia: tmsnrt.rs/2CEzade)
Russian Energy Minister Alexander Novak on Wednesday warned of the impact of the U.S. sanctions against Iran.
“This is a huge uncertainty on the market – how countries, which buy almost 2 million barrels per day (bpd) of Iranian oil, will act. The situation should be closely watched, the right decisions should be taken,” he said.
Novak said global oil markets were “fragile” due to geopolitical risks and supply disruptions, but added his country could raise output if needed.
The Organization of the Petroleum Exporting Countries cut its forecast for oil demand growth in 2019 in its monthly report and said rising challenges in some emerging and developing countries could negatively impact global economic growth. [OPEC/M]
OPEC said it expected demand growth of 1.41 million bpd in 2019, a 20,000-bpd downgrade from its previous forecast.
Oil traders were also watching the progress of category 4 Hurricane Florence, which is expected to make landfall on the U.S. East Coast by Friday.
Crude output will not be affected by the massive storm, but the evacuation of more than a million residents, as well as businesses, has prompted a near-term spike in fuel demand.
Additional reporting by Amanda Cooper in London and Henning Gloystein in Singapore; Editing by Susan Thomas, Phil Berlowitz and Paul SimaoOur Standards: The Thomson Reuters Trust Principles.
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2f1f078201f16f88a6f2a970c9a72593 | https://www.reuters.com/article/us-global-oil/oil-prices-rise-on-early-signs-of-pick-up-in-fuel-demand-idUSKBN22C088?il=0 | Oil prices surge on last day of roller-coaster month | Oil prices surge on last day of roller-coaster month
By Scott DiSavino4 Min Read
NEW YORK (Reuters) - Oil prices jumped on Thursday, after several producers said they would cut output and as signs the U.S. crude glut was not growing as quickly as many had feared brought an upbeat close to one of the most volatile months for oil trading in history.
FILE PHOTO: The sun is seen behind a crude oil pump jack in the Permian Basin in Loving County, Texas, U.S., November 22, 2019. REUTERS/Angus Mordant
Fuel demand worldwide slumped about 30% in April. Even after major oil producers led by Saudi Arabia agreed to slash production by nearly 10 million barrels per day (bpd), U.S. crude futures closed on April 20 at a record low in negative territory.
That collapse in U.S. West Texas Intermediate (WTI) futures made traders frantic to avoid taking delivery as the May front-month contract expired, forcing traders to pay $37.63 a barrel at settlement to get rid of their contracts.
Prices have recovered somewhat but remain down over 60% since the start of the year.
On its last day as the front-month, Brent futures for June delivery rose $2.73, or 12%, to settle at $25.27 a barrel, while U.S. West Texas Intermediate (WTI) crude for June rose $3.78, or 25%, to settle at $18.84.
That was the highest close for Brent since April 20 and WTI since April 16.
Brent, the international benchmark, gained about 11% in April after falling more than 65% over the prior three months. WTI, meanwhile, fell for a fourth month in a row, dropping over 70% during that time, including an 8% loss in April.
The more actively traded Brent futures for July, which will soon be the front-month, gained about 9% to settle at $26.48 a barrel.
Volume in WTI futures on the New York Mercantile Exchange hit around 36 million contracts in April, which Refinitiv data puts as second only to the previous month’s 40.9 million record.
“Oil prices are looking very constructive because over the next month or two, supply will meet demand,” said Edward Moya, senior market analyst at OANDA in New York, noting oversupply worries are slowly easing with a steady stream of headlines of crude production cuts.
Western Europe’s largest oil producer, Norway, said it would lower output from June to December, cutting production for the first time in 18 years as it joined other major producers’ efforts to support prices and curb oversupply.
Royal Dutch Shell Plc RDSa.L, meanwhile, announced its first dividend cut since World War Two.
U.S. oil and gas company ConocoPhillips COP.N said it would sharply reduce oil production in coming weeks, aiming to shut in 35% of its total output by June.
Russian gas producer Novatek PAO NVTK.MM said it plans to cut capital expenditure by a fifth this year, mainly for developing its oil projects, a company manager said on Thursday.
U.S. crude inventories grew by 9 million barrels last week to 527.6 million barrels, Energy Information Administration data showed, below the 10.6 million-barrel rise analysts had expected in a Reuters poll. [EIA/S]
Storage concerns, however, continue to weigh with the International Energy Agency saying global capacity could peak by mid-June.
U.S. President Donald Trump said his administration would soon release a plan to help U.S. oil companies.
Nine companies including Chevron Corp CVX.N and Exxon Mobil Corp XOM.N have agreed to rent space to store 23 million barrels of crude in the U.S. emergency oil reserve.
Additional by Noah Browning in London, Sonali Paul in Melbourne and Koustav Samanta in Singapore; Editing by Marguerita Choy and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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d2f9e19fb782ca25e683f3c91448c7cf | https://www.reuters.com/article/us-global-oil/oil-prices-rise-on-fears-suez-blockage-may-last-weeks-idUKKBN2BI03O | Oil jumps 4% on fears Suez Canal blockage may last weeks | Oil jumps 4% on fears Suez Canal blockage may last weeks
By Stephanie Kelly4 Min Read
NEW YORK (Reuters) - Oil prices rose more than 4% on Friday on worries global supplies of crude and refined products could be disrupted for weeks as workers try to dislodge a giant container ship blocking the Suez Canal.
Slideshow ( 2 images )
It was a rebound from a sharp decline the previous session on concerns that fresh coronavirus lockdowns in Europe would hurt demand.
Brent crude rose $2.62, or 4.2%, to settle at $64.57 a barrel, after dropping 3.8% on Thursday. U.S. West Texas Intermediate (WTI) crude gained $2.41, or 4.1%, to settle at $60.97 a barrel, having tumbled 4.3% a day earlier.
Brent rose 0.1% over the last week, while WTI dropped 0.7%, its third weekly loss.
Oil trade was volatile this week, as traders weighed the potential impact of the Suez Canal blockage which happened on Tuesday against the effect of new coronavirus lockdowns.
“Today the market is up again as traders in a change of heart decided that the Suez Canal blockade is actually becoming more significant for oil flows and supply deliveries than they previously concluded,” said Paola Rodriguez Masiu, Rystad Energy’s vice president of oil markets.
The Suez Canal stepped up efforts on Friday to free the stuck mega vessel, after an earlier attempt failed. Efforts to free it may take weeks, with possible complications from unstable weather.
Of the 39.2 million barrels per day (bpd) of total seaborne crude in 2020, 1.74 million bpd went through the Suez Canal, according to data intelligence firm Kpler. Additionally, 1.54 million bpd of refined oil products flow through the canal, about 9% of global seaborne oil product trade, Kpler said.
On Friday, there were 10 vessels waiting at the entry points of the Canal carrying around 10 million barrels of oil, Kpler said.
Reeling from the blockage in the Suez Canal, shipping rates for oil product tankers have nearly doubled this week, and several vessels were diverted.
The oil markets were also lifted by worries over escalating geopolitical risk in the Middle East. Yemen’s Houthi forces on Friday said they launched attacks on facilities owned by Saudi Aramco.
Prices also drew support from expectations that the Organization of the Petroleum Exporting Countries and its allies will maintain lower production.
Goldman Sachs said it expects OPEC+ to keep production unchanged for May when the group meets next week, “with a still large ramp-up of 3.4 million barrels per day expected by September.”
Acting a week ahead of the OPEC+ meeting, Abu Dhabi National Oil Company (ADNOC) has deepened crude oil supply cuts to Asian customers in June to 10%-15% from 5%-15% in May, several sources said.
In the United States, the number of rigs drilling for oil rose by six this week to 324, data from oil services firm Baker Hughes showed.
Still, the potential negative effect on demand from the coronavirus pandemic loomed. Germany’s third wave of the coronavirus could turn into the worst one so far and 100,000 new daily infections is not out of the question, the head of the German Robert Koch Institute (RKI) said.
Reporting by Stephanie Kelly in New York; Additional reporting by Shadia Nasralla in London Yuka Obayashi in Tokyo. Editing by Marguerita Choy, Mark Potter and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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6148722b7ba467b0e3e149afa8dce29d | https://www.reuters.com/article/us-global-oil/oil-prices-rise-on-opec-output-cuts-as-u-s-sanctions-bite-idUSKCN1Q103A | Oil gains 1 percent after Saudi Arabia pledges more output cuts | Oil gains 1 percent after Saudi Arabia pledges more output cuts
By Laila Kearney3 Min Read
NEW YORK (Reuters) - Oil prices rose more than 1 percent on Tuesday after OPEC figures showed it cut production sharply in January, and as lead member Saudi Arabia said it would reduce its output in March by an additional 500,000 barrels.
FILE PHOTO: An oil pumpjack is seen in Velma, Oklahoma U.S. April 7, 2016. REUTERS/Luc Cohen
Growing investor optimism for a breakthrough in the latest round of U.S.-China trade discussions also boosted futures as members of both sides met in Beijing.
Brent crude futures gained 91 cents, or 1.5 percent, to settle at $62.42 a barrel. U.S. West Texas Intermediate (WTI) crude oil futures rose 69 cents, or 1.3 percent, to settle at $53.10 a barrel.
Oil prices edged up slightly post-settlement after data from the American Petroleum Institute (API), an industry group, showed U.S. crude oil stockpiles had unexpectedly fallen.
Crude inventories fell by 998,000 barrels in the week ended Feb. 8 to 447.2 million, compared with analysts’ expectations for an increase of 2.7 million barrels. Crude stocks at the Cushing, Oklahoma, delivery hub fell by 502,000 barrels, API said.
Production cuts effective to the end of June by the Organization of the Petroleum Exporting Countries and allies led by Russia have tightened markets despite rising output in non-member countries, primarily the United States.
OPEC said on Tuesday it had reduced oil production almost 800,000 bpd in January to 30.81 million bpd under its voluntary global supply pact.
Saudi Arabia Energy Minister Khalid al-Falih told the Financial Times that the country would cut production to about 9.8 million bpd in March to bolster prices. As part of the OPEC deal, that nation pledged to cut output to about 10.3 million bpd.
“The market was bid on the OPEC report, the OPEC numbers themselves, and Saudi Arabia bringing the production numbers down pretty good,” said Bob Yawger, director of energy futures at Mizuho.
Investors were also hopeful that a new round of U.S.-China talks this week would bring the two sides close to resolving their ongoing trade war ahead of a March 1 deadline, Yawger said.
U.S. President Donald Trump said he could push off the deadline to hike tariffs on Chinese imports if the two sides get close enough to striking a deal.
The Energy Information Administration said on Tuesday it expected U.S. crude production to hit a new record of 13.2 million bpd through 2020, which took some steam out of the rally, traders said.
OPEC also cut its forecast for 2019 world oil demand, citing slowing economies and expectations of faster supply growth from rivals, underlining the challenge it faces in preventing an oil glut.
GRAPHIC: U.S. oil production & drilling levels - tmsnrt.rs/2Tm4u4I
Reporting by Laila Kearney; Additional reporting by Noah Browning and Henning Gloystein; Editing by Marguerita Choy, Lisa Shumaker and Tom BrownOur Standards: The Thomson Reuters Trust Principles.
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44ad7fcf7ba656a681a66efd870c155e | https://www.reuters.com/article/us-global-oil/oil-prices-rise-on-stronger-economic-outlook-u-s-stockpile-draw-idUSKBN2BU05P/ | Oil up on global economic recovery, but hefty U.S. fuel stocks weigh | Oil up on global economic recovery, but hefty U.S. fuel stocks weigh
By Laila Kearney3 Min Read
NEW YORK (Reuters) -Oil futures inched higher on Wednesday on an improving global economic outlook, but gains were capped by rising gasoline inventories and fears that new coronavirus outbreaks will weaken a global recovery in fuel demand.
FILE PHOTO: A worker holds a nozzle to pump petrol into a vehicle at a fuel station in Mumbai, India, May 21, 2018. REUTERS/Francis Mascarenhas/File Photo
Brent crude futures settled at $63.16 a barrel, up 42 cents, or 0.7%. U.S. West Texas Intermediate crude settled at $59.77 a barrel, gaining 44 cents, or 0.7%.
U.S. crude stocks fell 3.5 million barrels last week, but gasoline inventories jumped 4 million barrels, the Energy Information Administration (EIA) said, compared with expectations in a Reuters poll for a 221,000-barrel gasoline drop. [EIA/S]
“If you don’t need to make gasoline, then you don’t need to use more crude oil,” said Bob Yawger, director of energy futures at Mizuho Securities.
Prices drew support when the Federal Reserve released minutes from last month’s meeting that reinforced the U.S. central bank’s position that it will refrain from raising rates anytime soon, boosting the fuel demand outlook.
The International Monetary Fund on Tuesday said unprecedented public spending to fight COVID-19 would push global growth to 6% this year, a rate not achieved since the 1970s, which also helped the fuel demand outlook and supported prices.
However, rising COVID-19 cases in the Americas, which accounted for more than half of all coronavirus-related deaths last week, capped gains.
“There’s concern globally with the rise in COVID-19 cases again and now Canada staring down a third wave, the market continues to be haunted by these demand issues from the outbreaks,” said John Kilduff, partner at Again Capital in New York.
Also, global crude supplies could increase as Iran and major world powers took steps toward reviving an agreement that froze Iran’s nuclear weapons development. The parties agreed to form working groups to discuss the possibility of reviving the 2015 deal that could lead to Washington lifting sanctions on Iran’s energy sector.
“Iran is the single largest upside supply risk for the oil market,” said Stephen Brennock of oil brokerage PVM.
Oil prices dropped earlier this week after the Organization of the Petroleum Exporting Countries (OPEC) and allies, a group known as OPEC+, agreed to gradually ease oil output cuts from May.
Additional reporting by Ahmad Ghaddar in London, Jessica Jaganathan in Singapore and Stephanie Kelly in New YorkEditing by David Gregorio, Marguerita Choy and David GoodmanOur Standards: The Thomson Reuters Trust Principles.
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69563eb9c3e63d63e87aafac3ddb3eba | https://www.reuters.com/article/us-global-oil/oil-prices-set-for-biggest-first-quarter-gain-since-2009-on-u-s-sanctions-opec-cuts-idUSKCN1RA04L | Oil posts biggest quarterly rise since 2009 on OPEC cuts, sanctions | Oil posts biggest quarterly rise since 2009 on OPEC cuts, sanctions
By Stephanie Kelly4 Min Read
NEW YORK (Reuters) - Oil prices rose about 1 percent on Friday, posting their biggest quarterly rise in a decade, as U.S. sanctions against Iran and Venezuela as well as OPEC-led supply cuts overshadowed concerns over a slowing global economy.
The May Brent crude oil futures contract, which expired Friday, gained 57 cents, or 0.8 percent, to settle at $68.39 a barrel, marking a first-quarter gain of 27 percent. The more-active June contract settled up 48 cents at $67.58 a barrel.
U.S. West Texas Intermediate (WTI) futures rose 84 cents, or 1.42 percent, to $60.14 a barrel, and posted a rise of 32 percent in the January-March period.
For the two benchmarks, the quarterly rise was the biggest since the second quarter of 2009, when both gained about 40 percent. GRAPHIC: Crude futures quarterly performance - tmsnrt.rs/2HSqli7
U.S. sanctions on Iran and Venezuela have boosted prices this year. Washington is keen to see that Malaysia, Singapore and others are fully aware of illicit Iranian oil shipments and the tactics Iran uses to evade sanctions, a U.S. sanctions official said on Friday.
Sigal Mandelker, under-secretary of the Treasury for Terrorism and Financial Intelligence, told reporters in Singapore that the United States had placed additional “intense pressure” on Iran this week.
Meanwhile, the United States has instructed oil trading houses and refiners to further cut dealings with Venezuela or face sanctions themselves, even if the trades are not prohibited by published U.S. sanctions, three sources familiar with the matter said.
“With U.S. sanctions taking Iranian and Venezuelan oil off the market, at the same time OPEC and non-OPEC producers want to see higher prices and are currently reluctant to make up for any lost volume,” said Andrew Lipow, president of Lipow Oil Associates in Houston.
Also lifting prices this year has been a deal between the Organization of the Petroleum Exporting Countries and allies such as Russia to cut output by around 1.2 million barrels per day, which officially started in January.
FILE PHOTO: Pumpjacks are seen against the setting sun at the Daqing oil field in Heilongjiang province, China December 7, 2018. REUTERS/Stringer
The producer countries are to meet in June, but some cracks are emerging. OPEC leader Saudi Arabia is struggling to convince Russia to stay much longer in the pact, and Moscow may agree only to a three-month extension, three sources familiar with the matter said.
The market has also been supported by slower output growth in the United States, where production has steadied since mid-February. The U.S. government reported on Friday that domestic output in the world’s top crude producer edged lower in January to 11.9 million bpd.
U.S. energy firms this week reduced the number of oil rigs operating to their lowest in nearly a year, cutting the most rigs in a quarter in three years, General Electric Co’s Baker Hughes energy services firm said. [RIG/U]
Futures have been pressured by concerns that a slowing global economy could hit energy demand.
U.S. consumer spending rebounded less than expected in January and incomes rose modestly in February.
Elsewhere, three of China’s top state-controlled bank posted their weakest quarterly profit growth in more than two years.
Still, Barclays bank forecast oil prices “are likely to move still higher in Q2 and average $73 per barrel ($65 WTI), and $70 for the year.”
A monthly Reuters survey of economists and analysts forecast Brent would average $67.12 a barrel in 2019, about 1 percent higher than the previous poll’s $66.44.
Hedge funds and other money managers raised their net long U.S. crude futures and options positions to 243,209 in the week to March 26, the U.S. Commodity Futures Trading Commission (CFTC) said.
GRAPHIC: Russia, Saudi & rest of OPEC crude oil production - tmsnrt.rs/2CHr9lJ
Reporting by Stephanie Kelly; additional reporting by Ahmad Ghaddar in London and Henning Gloystein in Singapore; Editing by Marguerita Choy and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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3054414780ded6bddffa498b96994fba | https://www.reuters.com/article/us-global-oil/oil-prices-stumble-on-weak-china-exports-hangover-idUSKBN1YD034 | Oil slips as weak China exports highlight trade war impact | Oil slips as weak China exports highlight trade war impact
By Jessica Resnick-Ault3 Min Read
NEW YORK (Reuters) - Oil prices fell on Monday after data showed Chinese exports declined for a fourth straight month, sending jitters through a market already concerned about damage to global demand by the trade war between Washington and Beijing.
FILE PHOTO: An oil pump is seen just after sunset outside Saint-Fiacre, near Paris, France September 17, 2019. REUTERS/Christian Hartmann/File Photo
Brent futures LCOc1 settled down 14 cents, or 0.22%, at $64.25 per barrel, after gaining about 3% last week on news that OPEC and its allies would deepen output cuts.
West Texas Intermediate oil futures CLc1 were down 17 cents, or 0.24%, at $59.02 a barrel, having risen about 7% last week on the prospects for lower production from OPEC+, which is made up of the Organization of the Petroleum Exporting Countries and associated producers including Russia.
Monday’s sudden chill came after customs data released on Sunday showed exports from China in November fell 1.1% from a year earlier, confounding expectations for a 1% rise in a Reuters poll.
“That China trade data is a factor, certainly,” said John Kilduff, a partner at Again Capital.
Washington and Beijing have been trying to agree on a trade deal that will end tit-for-tat tariffs, but talks have dragged on for months.
“We’re coming up to a bit of a precipice, with the potential for new tariffs to be slapped on Sunday, so this is going to be an intense week,” Kilduff said. Additional tariffs could weigh on the demand outlook for crude, he added.
Beijing hopes an agreement with the United States can be reached as soon as possible, China’s assistant commerce minister, Ren Hongbin, said on Monday.Monday’s declines also went against signs on Friday that China was easing its stance on resolving the trade dispute with the United States, confirming it was waiving import tariffs for some soybean and pork shipments.
The price drop also put an end to a strong run in previous sessions fuelled by hopes for the OPEC+ production curb deal.
On Friday, OPEC+ agreed to deepen its output cuts from 1.2 million barrels per day (bpd) to 1.7 million bpd, representing about 1.7% of global production.
“This decision crystallises an important shift in strategy to managing short-term physical imbalances rather than trying to correct perceived long-term imbalances through open-ended commitments,” Goldman Sachs said in a note.
The bank revised its Brent spot price forecast to $63 per barrel for 2020, up from a previous estimate of $60.
BofA Merrill Lynch said in a note that strong compliance with the OPEC+ along with positive economic developments such as a U.S.-China trade deal could push Brent to $70 a barrel before the second quarter of 2020.
Reporting by Jessica Resnick-Ault in New York; Additional reporting by Aaron Sheldrick in Tokyo and Noah Browning in London; Editing by Lisa Shumaker and Matthew LewisOur Standards: The Thomson Reuters Trust Principles.
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00d03a4f4006adfdde60c986ed37e3ae | https://www.reuters.com/article/us-global-oil/oil-rallies-on-faster-output-cuts-to-offset-virus-induced-falloff-in-demand-idUSKCN22509H | Oil rallies on faster output cuts to offset virus-induced falloff in demand | Oil rallies on faster output cuts to offset virus-induced falloff in demand
By Scott DiSavino3 Min Read
NEW YORK (Reuters) - Oil soared on Thursday, extending its rebound after major oil-producing nations said they would accelerate planned production cuts to combat the dramatic slump in demand due to the COVID-19 pandemic.
FILE PHOTO: A pumpjack is shown outside the Midland-Odessa area in the Permian basin in Texas, U.S., July 17, 2018. REUTERS/Liz Hampton/File Photo
Crude prices have had one of their most tumultuous weeks ever. U.S. West Texas Intermediate crude futures (WTI) CLc1 closed at negative $37.63 a barrel on Monday, in the worst sell-off for that contract in history. Global benchmark Brent crude LCOc1 was slammed on Tuesday, hitting a two-decade low before rebounding.
Since the start of the year both benchmarks have lost more than two-thirds of their value. Fuel demand is down about 30% worldwide in April and supply will outstrip demand for months to come due to the pandemic.
Brent rose 96 cents, or 4.7%, to settle at $21.33 a barrel, while WTI jumped $2.72, or 19.7%, to settle at $16.50.
“We are seeing a real reaction within the U.S. industry to these super low prices and that is creating some green shoots that is allowing prices to rebound a bit,” said John Kilduff, partner at hedge fund Again Capital LLC in New York. “But it is still hard to get excited about prices just above $15 a barrel.”
He was referring to the decline in U.S. oil rigs to their lowest since 2016 and a 100,000 barrel per day (bpd) drop in U.S. crude output last week to 12.2 million bpd.
The Organization of the Petroleum Exporting Countries and other oil producing nations, a grouping known as OPEC+, agreed this month to cut output by a record 9.7 million bpd, around 10% of global supply, to support oil prices, but prices continued to decline.
Kuwait said on Thursday it had begun cutting oil supply to the international market, ahead of the May 1 date when the deal was supposed to take effect.
Whether that will be sufficient to offset weak demand is unclear. Rystad Energy cut its forecast for oil demand in 2020 to 89.2 million bpd, a 10% decline from 2019. Last week, the energy consultant projected demand would fall to 90.3 million bpd in 2020.
Russia is looking for options to cut its production and may go as far as burning its own oil, sources said. Its production has not changed much from March until now.
(GRAPHIC: Cushing crude stockpiles surge - )
The market was also higher after U.S. President Donald Trump said he had instructed the U.S. Navy to fire on any Iranian ships that harass it in the Gulf, although he added later he was not changing the military’s rules of engagement.
The head of Iran’s Revolutionary Guards said Tehran will destroy U.S. warships if its security is threatened in the Gulf.
“This ratchets up tensions once again between the U.S. and Iran. However, given the glut we have in the oil market, it is difficult to see this offering lasting support to the market, unless the situation does escalate further,” ING’s head of commodities strategy Warren Patterson said.
(GRAPHIC: OPEC's share of India's crude oil imports falls to record low - )
Additional reporting by Bozorgmehr Sharafedin in London and Aaron Sheldrick in Tokyo; Editing by Marguerita Choy, Barbara Lewis and Tom BrownOur Standards: The Thomson Reuters Trust Principles.
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52e7a0d8390d38afac7b0cc7098a0045 | https://www.reuters.com/article/us-global-oil/oil-rises-1-4-on-hopes-opec-will-extend-supply-cuts-weaker-u-s-dollar-idUSKBN1WV035 | Oil rises on hopes OPEC will extend supply cuts, weaker U.S. dollar | Oil rises on hopes OPEC will extend supply cuts, weaker U.S. dollar
By Collin Eaton4 Min Read
HOUSTON (Reuters) - Oil rose on Wednesday, gaining support due to signs that OPEC and allied producers will continue to curb supplies in December, a weaker U.S. dollar and as traders covered short positions ahead of an industry report on U.S. crude inventories.
FILE PHOTO: The sun sets behind an oil pump outside Saint-Fiacre, near Paris, France September 17, 2019. REUTERS/Christian Hartmann/File Photo
Brent crude LCOc1, the global benchmark, rose 68 cents, or 1.16%, to settle at $59.42 a barrel. U.S. crude CLc1 gained 55 cents, or 1.04%, to settle at $53.36.
But oil prices pared gains in post-settlement trade after industry data showed a larger-than-expected increase in U.S. oil stocks. Brent edged lower to $59.15, and WTI to $53.07.
U.S. crude inventories in the week to Oct. 11 rose to 432.5 million barrels, according to the American Petroleum Institute’s weekly report ahead of government stocks data due on Thursday. Crude stocks at the Cushing, Oklahoma, delivery hub rose by 1.6 million barrels, API said. [EIA/S]
Analysts had estimated U.S. crude inventories rose around 2.8 million barrels last week.
The Organization of the Petroleum Exporting Countries and its allies meet on Dec. 5-6 in Vienna to review output policy.
Market participants believe the group known as OPEC+ could decide to extend production cuts “and wait until world demand catches up with the supply situation,” said Andy Lipow, president of Lipow Oil Associates in Houston.
OPEC Secretary-General Mohammad Barkindo has said deeper output cuts are an option. On Tuesday, he said OPEC would do what it could with allied producers to sustain oil market stability beyond 2020.
OPEC, Russia and other producers have agreed to cut oil output by 1.2 million barrels per day until March 2020.
“You did see the OPEC secretary general say OPEC could act to keep the market stable, and if we come back under pressure again we might see that again,” said Gene McGillian, vice president of market research at Tradition Energy in Stamford, Connecticut.
In early trading, prices had slipped because of concerns about weaker demand for fuel due to slower economic growth and forecasts of a further rise in U.S. crude inventories.
The dollar weakened after U.S. retail sales data disappointed investors. Oil is traded in U.S. dollars, so oil typically rises when the dollar falls.
“The dollar is getting whacked right now. It is pushing into territory we haven’t seen since a month ago,” said Joshua Graves, senior market strategist at RJO Futures. “If that continues to sell off, that will continue to boost oil prices.”
On Tuesday, the International Monetary Fund fed worries about crude demand when it said the U.S.-China trade war would cut 2019 global growth to its slowest since the 2008-2009 financial crisis.
“The market oversold yesterday on talk of a big build in inventory,” said Phil Flynn, senior energy analyst at Price Futures Group in Chicago. “We’re seeing some short covering ahead of the (API) report tonight.”
Optimism about an imminent Brexit deal had supported prices, although this faded after EU sources said talks hit a standstill. Analysts have said any agreement that avoids a no-deal Brexit should boost economic growth and oil demand.
Additional reporting by Alex Lawler and Jessica Jaganathan; Editing by Cynthia Osterman and Tom BrownOur Standards: The Thomson Reuters Trust Principles.
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8832e7f59fd3fc210c645a27c4341e54 | https://www.reuters.com/article/us-global-oil/oil-rises-1-on-u-s-stimulus-hopes-supply-concerns-idUSKBN29U06J?il=0 | Oil rises 1% on U.S. stimulus hopes, supply concerns | Oil rises 1% on U.S. stimulus hopes, supply concerns
By Stephanie Kelly2 Min Read
FILE PHOTO: A crude oil tanker is seen at Qingdao Port, Shandong province, China, April 21, 2019. REUTERS/Jason Lee
NEW YORK (Reuters) - Oil prices rose about 1% on Monday as optimism around U.S. stimulus plans and some supply concerns boosted futures, but demand worries prompted by coronavirus lockdowns limited gains.
Brent crude futures rose 47 cents, 0.9%, to settle at $55.88 a barrel. U.S. West Texas Intermediate crude ended 50 cents, or 1%, higher at $52.77 a barrel.
Officials in U.S. President Joe Biden’s administration on a Sunday call with Republican and Democratic lawmakers tried to head off Republican concerns that his $1.9 trillion pandemic relief proposal was too expensive.
“Newly inaugurated President Biden seems to be pushing for a quick approval of his proposed $1.9 trillion pandemic relief package, a development interpreted by the market as a clear indication that the new U.S. administration aims to kick-start an economic recovery, which will naturally benefit fuel consumption,” said Bjornar Tonhaugen, Rystad Energy’s head of oil markets.
On the supply side, the Organization of the Petroleum Exporting Countries and its allies’ compliance with pledged oil output curbs is averaging 85% so far in January, tanker tracker Petro-Logistics said on Monday. The data suggest the group had improved its adherence to pledged supply curbs.
In Indonesia, the country said its coast guard seized an Iranian-flagged tanker over suspected illegal fuel transfers, raising the prospect of more tensions in the oil-exporting Gulf.
Output from Kazakhstan’s giant Tengiz field was disrupted by a power outage on Jan. 17.
Meanwhile, European nations have imposed tough restrictions to halt the spread of the virus, while China reported a rise in new COVID-19 cases, casting a pall over demand prospects in the world’s largest energy consumer.
Barclays raised its 2021 oil price forecasts, but said rising cases in China could contribute to near-term pullbacks.
Reporting by Stephanie Kelly in New York; additional reporting by Noah Browning in London; Editing by Marguerita Choy and David EvansOur Standards: The Thomson Reuters Trust Principles.
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dbddf7d4ccc0e79874d695167bd753b1 | https://www.reuters.com/article/us-global-oil/oil-rises-2-to-more-than-one-year-high-on-supply-cuts-stimulus-hopes-idUSKBN2A802Y?il=0 | Oil rises 2% to more than one-year high on supply cuts, stimulus hopes | Oil rises 2% to more than one-year high on supply cuts, stimulus hopes
By Stephanie Kelly3 Min Read
NEW YORK (Reuters) - Oil prices rose 2% on Monday to their highest in over a year, with Brent nudging past $60 a barrel, boosted by supply cuts among key producers and hopes for further U.S. economic stimulus.
FILE PHOTO: The sun is seen behind a crude oil pump jack in the Permian Basin in Loving County, Texas, U.S., November 22, 2019. REUTERS/Angus Mordant/File Photo
Brent rose $1.22, or 2.1%, to settle at $60.56 a barrel, while U.S. West Texas Intermediate rose $1.12, or 2%, to settle at $57.97 a barrel. Both benchmarks were at the highest since January 2020.
“Managing to breach $60 again feels like the market is finally resurfacing after the long struggle and (taking) a proper breath,” said Rystad Energy’s vice president for oil markets Paola Rodriguez Masiu. “It offers a feeling of normality again.”
Brent and WTI have risen more than 60% since the start of November due to optimism around coronavirus vaccine distributions as well as production cuts from OPEC+ members.
“There seems to be a paradigm shift in the market,” said Phil Flynn, senior analyst at Price Futures Group in Chicago. “There is a sense that the glut of oil supply is disappearing more rapidly than anybody thought possible.”
Saudi Arabia pledged extra supply cuts in February and March following reductions by other members of the Organization of the Petroleum Exporting Countries and its allies.
In a sign that prompt supplies are tightening, the six-month Brent spread hit a high of $2.54 on Monday, its widest since January last year, a signal of demand for current supply.
OCBC economist Howie Lee said the world’s top exporter Saudi Arabia sent a “very bullish signal” last week when it kept monthly crude prices to Asia unchanged despite expectations for small cuts.
“I don’t think anybody dares to short the market when Saudi is like this,” he added.
Investors are keeping watch on a $1.9 trillion COVID-19 aid package for the United States that is expected to be passed as soon as this month.
Hopes that Iranian oil exports would soon return to the market have been dampened, supporting oil prices.
U.S. President Joe Biden said the United States would not lift sanctions on Iran simply to get it back to the negotiating table, while Iran’s Supreme Leader Ayatollah Ali Khamenei said all sanctions should be lifted first.
Reporting by Stephanie Kelly in New York; additional reporting by Bozorgmehr Sharafedin in London, Florence Tan in Singapore; Editing by Marguerita Choy and Mark PotterOur Standards: The Thomson Reuters Trust Principles.
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44cd0a6f2932edee625f3c4b1be3daba | https://www.reuters.com/article/us-global-oil/oil-rises-above-56-on-saudi-export-cut-idUSKBN1CF043 | Oil rises 2 percent on signs rebalancing underway | Oil rises 2 percent on signs rebalancing underway
By Devika Krishna Kumar4 Min Read
NEW YORK (Reuters) - Oil prices rose about 2 percent on Tuesday, supported by Saudi Arabian export cuts in November and comments from OPEC and trading companies that the market is rebalancing after years of oversupply.
A oil pump is seen at sunset outside Scheibenhard, near Strasbourg, France, October 6, 2017 . REUTERS/Christian Hartmann
Saudi Arabia has cut November allocations by 560,000 barrels per day (bpd), in line with its commitment to an OPEC-led supply reduction pact.
The Organization of the Petroleum Exporting Countries is seeking to hold a second meeting with U.S. independent oil firms as well as hedge funds, OPEC’s Secretary General told Reuters, adding that no oil producer could afford to live in isolation.
Brent crude LCOc1 settled up 82 cents, or 1.5 percent, at $56.61 a barrel while U.S. crude rose $1.34, or 2.7 percent, to settle at $50.92.
From a technical standpoint, U.S. crude has staged an impressive rebound from the $49.08 level and a decisive breakout above $51 should encourage a further incline towards $52.40 a barrel, said Lukman Otunuga, research analyst at FXTM.
“In an alternative scenario, sustained weakness below $49, which is also under the 50 (day) daily simple moving average, may open a path towards $47.80.”
OPEC, Russia and other non-member producers are cutting output by about 1.8 million barrels per day (bpd) until next March to get rid of a price-sapping supply glut.
The group is increasingly confident that the market is rebalancing fast, helped by the cutback as well as by stronger-than-expected growth in global demand.
The deal is working, keeping oil prices within “a reasonable range”, the RIA news agency cited Russian Prime Minister Dmitry Medvedev as saying.
The chief executive of trading firm Gunvor, Torbjorn Tornqvist, also said the market was rebalancing, citing falling product stocks and crude held in floating storage clearing up.
“We don’t see this market being out of balance one way or another,” he told the Reuters Global Commodities Summit taking place this week. Overall crude stocks “are still high,” he added, and OPEC needed to stick to its output curbs.
Short-term price support was coming from the United States, where 85 percent of U.S. Gulf of Mexico oil production, or 1.49 million bpd, was offline following Hurricane Nate, according to official figures. However, many facilities have begun resuming operations.
Long term, U.S. oil output could be set for a last spike in 2018 before growth flattens for a number of years as rising costs make a big chunk of production uneconomic, the head of top oil trader Vitol, Ian Taylor, told Reuters.
A federal holiday on Monday has delayed the release of the weekly U.S. inventory data by a day. The American Petroleum Institute (API) is scheduled to release its data for last week at 4:30 p.m. EDT (2030 GMT) on Wednesday and the U.S. Department of Energy’s report is due at 11 a.m. EDT on Thursday.
U.S. crude inventories probably fell for a third straight week, while refined product stockpiles also likely declined, a preliminary Reuters poll showed on Tuesday.
OPEC has managed record-high adherence to its supply cutting deal this year and is considering extending the deal beyond its March 2018 expiry. Some analysts have been concerned that a price recovery could tempt producers to open the taps again.
But analysts at JPMorgan said this was less of an issue, saying “concerns that OPEC compliance would fade into the fourth quarter now appear unfounded.”
“Stronger-than-assumed economic growth offers the potential for tight market conditions to continue if OPEC extends the current deal for another nine months,” the bank said.
Additional reporting by Alex Lawler in London and Henning Gloystein; Editing by Louise Heavens and Lisa ShumakerOur Standards: The Thomson Reuters Trust Principles.
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22f9a37b9e82f89aebe8bea227f8d190 | https://www.reuters.com/article/us-global-oil/oil-rises-after-data-shows-slump-in-u-s-output-amid-texas-freeze-idUSKBN2AO05G?il=0 | Oil rises after data shows slump in U.S. output amid Texas freeze | Oil rises after data shows slump in U.S. output amid Texas freeze
By Stephanie Kelly3 Min Read
NEW YORK (Reuters) - Oil prices climbed on Wednesday to fresh 13-month highs after U.S. government data showed a drop in crude output after a deep freeze disrupted production last week.
FILE PHOTO: An employee holds a sample of crude oil at the Yarakta oilfield, owned by Irkutsk Oil Co, in the Irkutsk region, Russia on March 11, 2019. REUTERS/Vasily Fedosenko/File Photo
U.S. crude oil production dropped last week by more than 10%, or 1 million barrels per day, during the rare winter storm in Texas, equaling the largest weekly fall ever, the Energy Information Administration said. Refinery crude inputs dropped to the lowest since September 2008 as the freeze knocked out power to millions. [EIA/S]
“If you’re getting that kind of drop in one week of EIA production, you’re likely to get more after that,” said Phil Flynn, senior analyst at Price Futures in Chicago.
“There is some concern that this will be a long-term permanent production drop.”
Traffic at the Houston ship channel was slowly coming back to normal but terminals were still facing several issues. After nearly a quarter of national refining capacity was idled by the freeze, refineries have also started to come back online this week.
Brent crude futures rose $1.67, or 2.6%, to settle at $67.04 a barrel. The global benchmark hit a session high of $67.30 a barrel, its loftiest since Jan. 8, 2020.
U.S. West Texas Intermediate (WTI) crude futures ended $1.55, or 2.5%, higher at $63.22 a barrel, after touching $63.37, also their highest since Jan. 8, 2020.
The rally continued oil’s steady march to levels not seen since prior to the coronavirus pandemic as vaccine distribution increases and on forecasts for renewed demand.
Oil prices have rallied about 30% since the start of the year, boosted as well by ongoing supply cuts by the Organization of the Petroleum Exporting Countries and its allies.
Some investors have piled into $100 U.S. oil options contracts as appetite for commodities as a hedge against inflationary pressure is rising, industry sources said.
Volumes in bullish call options and call option spreads for U.S. crude for delivery in December 2021 and December 2022 have surged over the past week, dealers said. About 50,000 options traded in December 2022 on the call spread between oil at $99 and $100 a barrel as well as those between $98-$100 and $90-$100 oil, dealers said.
OPEC+ oil producers will discuss a modest easing of oil supply curbs from April given a recovery in prices, OPEC+ sources said, although some suggest holding steady for now given the risk of new setbacks in the battle against the pandemic.
Reporting by Stephanie Kelly and Devika Krishna Kumar in New York; additional reporting by Ahmad Ghaddar in London, Roslan Khasawneh and Koustav Samanta in Singapore, and Sonali Paul in Melbourne; Editing by Marguerita Choy, Steve Orlofsky and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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4cb3e9376f73eab646ae33ed3d1c82dd | https://www.reuters.com/article/us-global-oil/oil-rises-as-broader-markets-gain-on-hopes-for-more-stimulus-idUSKBN21E06Z | Oil plunges posting fifth straight weekly loss despite stimulus efforts | Oil plunges posting fifth straight weekly loss despite stimulus efforts
By Jessica Resnick-Ault4 Min Read
NEW YORK (Reuters) - Oil prices plunged 5% on Friday and posted a fifth straight weekly loss as demand destruction caused by the coronavirus outweighed stimulus efforts by policymakers around the world.
FILE PHOTO: A pump jack operates in front of a drilling rig at sunset in an oil field in Midland, Texas U.S. August 22, 2018. REUTERS/Nick Oxford
Both contracts are down nearly two thirds this year and the coronavirus-related slump in economic activity and fuel demand has forced massive retrenchment in investment by oil and other energy companies.
Brent crude settled down $1.41, or 5.35% at $24.93 a barrel. The contract fell about 8% on the week. U.S. crude settled down $1.09, or 4.82% at $21.51 a barrel. During the week, U.S. crude fell more than 3%.
“We ran out of ammunition to support the market,” said Bob Yawger, director of energy futures at Mizuho in New York. “The government used up all their bullets this week - next week the market is on its own.”
Physical crude oil traders said they expect Permian basin prices to slide by as much as another $10 a barrel by May, when tanks in the region as well as across the country are seen hitting maximum capacity. That would leave the price of a barrel of oil pumped from the Permian - where nearly 5 million barrels are extracted every day - in the single digits.
With 3 billion people in lockdown, global oil demand could be cut by a fifth, International Energy Agency head Fatih Birol said as he called on major producers such as Saudi Arabia to help to stabilise oil markets.
The calls may not be enough to bring the market back into balance.
“We have our doubts about whether Saudi Arabia will allow itself to be persuaded so easily to return from the path of revenge that it only recently embarked upon,” said Commerzbank analyst Eugen Weinberg, referring to the price war being waged between Russia and Saudi Arabia.
The Group of 20 major economies on Thursday pledged to inject more than $5 trillion into the global economy to limit job and income losses from the coronavirus and “do whatever it takes to overcome the pandemic”.
Related CoverageFactbox: Global oil, gas producers cut spending after crude price crash
Leaders of the U.S. House of Representatives are determined to pass a $2.2 trillion coronavirus relief bill by Saturday at the latest, hoping to provide quick help as deaths mount and the economy reels.
Mainland China reported its first locally transmitted coronavirus case in three days and 54 new imported cases as Beijing ordered airlines to implement sharp reductions in international flights, for fear travellers could reignite the outbreak.
As global oil demand plummets, Saudi Arabia is struggling to find customers for its extra oil, undermining its bid to seize market share by expanding production.
The Organization of the Petroleum Exporting Countries (OPEC) and its de facto leader Saudi Arabia this month failed to reach agreement with other producers, including Russia, to curb oil production to support prices.
But the head of Russia’s sovereign wealth fund, Kirill Dmitriev, told Reuters a new supply pact between OPEC and its allies, a group known as OPEC+, might be possible if other countries join.
“It does not seem as though there is anything the Saudis or the broader OPEC+ group can do to push the market significantly higher,” said ING analyst Warren Patterson.
“The demand destruction we are seeing does mean the level of (production) cuts that would be needed by the group would be just too much to stomach,” he said.
Russian Deputy Energy Minister Pavel Sorokin said the coronavirus outbreak has dented global oil demand by 15 million to 20 million barrels per day (bpd).
Oil and gas research group JBC Energy said it had “drastically” reduced its oil demand forecast for 2020, expecting a decline of more than 7.4 million bpd on average.
Global oil demand stood at about 100 million barrels per day last year, according to the U.S. Energy Information Administration.
Additional Reporting by Bozorgmehr Sharafedin in London and Aaron Sheldrick and Sonali Paul in Tokyo; Editing by Jane Merriman, David Goodman, David Gregorio and Daniel WallisOur Standards: The Thomson Reuters Trust Principles.
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86e8ba4b6969c2c25339e8dc7535adc0 | https://www.reuters.com/article/us-global-oil/oil-rises-as-markets-eye-opec-russia-meeting-on-output-cuts-idUSKBN21Q03S | Oil futures rise on hopes of production cuts | Oil futures rise on hopes of production cuts
By Jessica Resnick-Ault3 Min Read
NEW YORK (Reuters) - Oil futures strengthened late in the session on Wednesday, buoyed by hopes that OPEC and its allies will strike a production cut agreement on Thursday.
Crude has collapsed in 2020 because of a slide in demand due to the coronavirus pandemic and excess supply. Brent dropped to $21.65, its lowest since 2002, on March 30.
Thursday’s video conference meeting between the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia - a group known as OPEC+ - was expected to be more successful than their gathering in March, which ended in a failure to extend supply cuts and a price war between Saudi Arabia and Russia.
“The pressure is enormous on these countries to cut,” said Phil Flynn, an analyst at Price Futures group.
Market sentiment rose on expectations a deal could be reached after media reports suggested Russia would cut its output and Algeria’s energy minister said he expected a “fruitful” meeting.
Related CoverageU.S. oil firms likely to 'organically' cut four million barrels per day: regulator
Russia is ready to cut its oil output by 1.6 million barrels per day, TASS news agency reported, citing an unnamed Energy Ministry official the day before the online conference.
“The meeting will undoubtedly be fruitful in order to rebalance the market through measures we will take tomorrow,” Algerian Energy Minister Mohamed Arkab, also OPEC president, told Algerian state news agency APS.
A group of Republicans in the U.S. House of Representatives told Saudi Crown Prince Mohammed bin Salman on Wednesday that economic and military cooperation between the two countries is in jeopardy unless the kingdom helps stabilize prices by cutting crude output.
While OPEC sources have said a deal to cut production is conditional on participation of the United States, doubts remain as to whether Washington will contribute.
On Tuesday, the U.S. Department of Energy said the country’s output was declining without government action.
Brent crude LCOc1 settled up 97 cents, or 3%, at $32.84 a barrel. U.S. West Texas Intermediate (WTI) crude CLc1 rose $1.46, or 6.2%, to settle at $25.09 a barrel.
The benchmarks pared some gains, with Brent turning negative briefly, after U.S. government data showed crude inventories last week soared by a record 15.2 million barrels, even as production was cut by 600,000 barrels per day to 12.4 million bpd. [EIA/S]
U.S. crude inventories rose as refiners slashed runs and the delivery hub for WTI at Cushing, Oklahoma, posted a record weekly build of 6.4 million barrels, the U.S. Energy Information Administration said. [EIA/S]
Additional reporting by Alex Lawler and Jane Chung; Editing by Marguerita Choy and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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e1689ea4ef21ac24979ddf5ffb9c6919 | https://www.reuters.com/article/us-global-oil/oil-rises-as-u-s-oil-stockpiles-drop-new-chinese-covid-19-cases-decline-idUSKBN29W08E?rpc=401& | Oil prices end mixed, despite big U.S. crude stock drawdown | Oil prices end mixed, despite big U.S. crude stock drawdown
By Laila Kearney2 Min Read
NEW YORK (Reuters) - Oil prices were little changed on Wednesday, despite a massive drawdown in U.S. crude inventories, as ongoing concerns about the coronavirus pandemic tempered buying interest.
Slideshow ( 2 images )
U.S. crude oil stocks dropped by nearly 10 million barrels last week to their lowest levels since March, surprising the market, which was looking for a modest increase in stocks. [EIA/S]
“The market was led up by a significant draw in crude oil as the refining industry continues to turn the crude oil surplus into refined products,” said Andrew Lipow, president Lipow Oil Associates in Houston.
U.S. West Texas Intermediate (WTI) crude futures settled at $52.85 a barrel, rising 24 cents, while global benchmark Brent crude futures fell 10cents to end at $55.81 a barrel.
Also helping oil was the U.S. Federal Reserve’s decision to stick to its dovish tone and leave its key overnight interest rate near zero to maintain monetary support until there is a stronger rebound from the pandemic-triggered recession.
The rising number of global coronavirus cases, which has surpassed 100 million as infections surge in Europe and the Americas, while Asia scrambles to contain fresh outbreaks, weighed on prices.
“Demand concerns should remain with us for some time,” Eugen Weinberg of Commerzbank said.
China, the second-largest oil consumer, has recently seen a coronavirus resurgence. Official Chinese data showed 75 new confirmed cases of COVID-19 on Wednesday, the lowest daily rise since Jan. 11.
Analysts said prices could benefit from lower U.S. oil production as a result of stricter industry regulations by the Biden administration, which on Wednesday paused new oil and gas leases on federal land and cut fossil fuel subsidies as he pursues green policies.
“We’re going to be watching these production numbers to see if U.S. oil producers can overcome a tougher regulatory environment and a tougher funding environment and raise output,” said Phil Flynn, senior analyst at Price Futures Group in Chicago.
Additional reporting by Alex Lawler in London, Roslan Khasawneh in Singapore, Sonali Paul in Melbourne and Scott DiSavino in New York; Editing by Marguerita Choy and Alexander SmithOur Standards: The Thomson Reuters Trust Principles.
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c48d3884faef65988b90126665ac9dc8 | https://www.reuters.com/article/us-global-oil/oil-rises-in-choppy-trade-as-opec-supply-cuts-vie-with-demand-worry-idUSKCN1OX03W | Oil rises in choppy trade as OPEC supply cuts vie with demand worry | Oil rises in choppy trade as OPEC supply cuts vie with demand worry
By Stephanie Kelly4 Min Read
NEW YORK (Reuters) - Oil prices rose more than 1 percent on Thursday in volatile trade, drawing support from signs that Saudi Arabia is cutting crude output but pressured by concerns that slowing global economic growth could dent demand.
Brent crude LCOc1 futures gained $1.04 to settle at $55.95 a barrel, a 1.89 percent gain. U.S. West Texas Intermediate (WTI) crude CLc1 futures rose 55 cents to settle at $47.09 a barrel, a 1.18 percent gain.
(GRAPHIC: Shanghai crude oil futures vs Brent & WTI crude - tmsnrt.rs/2AmwzBl)
Prices traded in a wide range, with Brent hitting a session high of $56.30 a barrel and a low of $53.93 a barrel. WTI posted a session high of $47.49 a barrel and a low of $45.35 a barrel.
Supporting futures were signs of reduced supply from members of the Organization of the Petroleum Exporting Countries. OPEC oil supply fell in December by the largest amount in almost two years, a Reuters survey found, as top exporter Saudi Arabia made an early start to a supply-limiting accord while Iran and Libya posted involuntary declines.
OPEC led by Saudi Arabia, alongside allied producers led by Russia, agreed last year to rein in supplies starting from January after oil prices tumbled from above $86 on worries about surging output.
“The Saudis are still spearheading a significant production cut that became official this week. Thus far, strong adherence to adjusted quotas appears a high probability,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.
A pumpjack is seen at the Sinopec-operated Shengli oil field in Dongying, Shandong province, China January 12, 2017. Picture taken January 12, 2017. REUTERS/Chen Aizhu
But oil price gains were capped by concerns about a faltering global economy.
Tech giant Apple Inc AAPL.O cut its sales forecast, citing a slowdown in China. [.N] The news rattled U.S. equity markets and weighed on oil prices, which at times track Wall Street.
Weaker-than-expected U.S. factory data also added to economic worries.
“Oil is flip-flopping on concerns of supply and demand,” said Phil Flynn, an analyst at Price Futures Group in Chicago. “It’s really a battle between the supply situation, which looks to be tightening, versus the possibility that demand will drop off.”
U.S. oil and gas executives’ outlook turned negative for the first time since the low point of the last oil bust, according to results of a survey released on Thursday by the Federal Reserve Bank of Dallas.
Investors have been concerned about rising supply from top producers, including the United States and Russia.
U.S. crude stocks fell last week, while gasoline and distillate inventories built, data from industry group the American Petroleum Institute showed on Thursday.
Crude inventories fell by 4.5 million barrels in the week ended Dec. 28 to 443.7 million, compared with analysts’ expectations for a decrease of 3.1 million barrels.
Gasoline stocks rose by 8 million barrels, compared with analysts’ expectations in a Reuters poll for a 2 million-barrel gain. Distillate fuels stockpiles rose by 4 million barrels, compared with expectations for a 1.6 million-barrel gain, the API data showed.
Official U.S. government data is due to be released on Friday.
Riyadh was expected to cut February prices for heavier crude grades sold to Asia due to weaker fuel oil margins while reducing prices for light grades to keep Saudi oil competitive against rising U.S. shale oil supplies, a Reuters survey showed on Thursday.
Reporting by Stephanie Kelly; Additional reporting by Noah Browning in London; Editing by Susan Thomas and Lisa ShumakerOur Standards: The Thomson Reuters Trust Principles.
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e35d4ad5a3823fc33f9841ffab90ac95 | https://www.reuters.com/article/us-global-oil/oil-set-for-a-second-weekly-gain-on-demand-hopes-output-shut-ins-idUSKBN22K05R | Oil rises 5% in second weekly gain on output cuts, demand hopes | Oil rises 5% in second weekly gain on output cuts, demand hopes
By Laura Sanicola3 Min Read
NEW YORK (Reuters) - Oil prices settled 5% higher on Friday in their second consecutive week of gains as U.S. producers cut production with the number of drilling rigs falling to a record low, and as more states moved ahead with plans to relax lockdowns intended to halt the coronavirus pandemic.
FILE PHOTO: A pump jack operates at sunset in an oil field in Midland, Texas U.S. August 22, 2018. Picture taken August 22, 2018. REUTERS/Nick Oxford
The number of operating oil and natural gas rigs fell by 34 to an all-time low of 374 this week - reflecting data going back 80 years - as the energy industry slashes output and spending to deal with the coronavirus-led crash in fuel demand.
North American oil companies have shut production faster than analysts expected and are on track to withdraw about 1.7 million barrels per day (bpd) of output by the end of June.
Brent crude settled up $1.51, or 5.1%, at $30.97 a barrel. U.S. West Texas Intermediate crude futures (WTI) gained $1.19, or 5%, to $24.74 a barrel.
Both contracts posted a second week of gains, with Brent advancing over 18% this week and WTI up about 33%.
“This advance of the past couple of weeks has been a bit suspect given the fact that coronavirus cases continue to increase and the U.S. crude surplus is maintaining a steep up trend where a record U.S. stock level is likely to be achieved in next week’s EIA report,” Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois, said in a report.
The U.S. Energy Information Administration’s weekly report on Wednesday showed 15 weeks of consecutive rises in crude stocks although the rate of growth in inventories has slowed since a record build of 19 million barrels in early April.
The market was now watching for more data that shows that Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia - known as OPEC+ - are complying with a record 9.7 million bpd production cuts that began this month, according to Andrew Lipow, president of Lipow Oil Associates in Houston.
“I expect now prices will pull back to $20 a barrel because skepticism will come into the market about the compliance of OPEC+ on the production cuts,” said Lipow.
Iraq has yet to inform its regular oil buyers of cuts to its exports, suggesting it is struggling to fully implement supply cuts.
“All it takes is one or two countries not to comply and it could open the door for others,” Lipow said.
Australia on Friday became the latest country to plan an easing of lockdowns, while France, parts of the United States and countries such as Pakistan are also planning to ease restrictions.
Market participants were also watching how the economic crisis unfolding in the United States affects oil demand in the coming months. The world’s biggest economy lost a staggering 20.5 million jobs in April, the steepest plunge in payrolls since the Great Depression.
Reporting by Laura Sanicola in New York and Ahmad Ghaddar in London, Additional reporting by Aaron Sheldrick in TOKYO; Editing by Marguerita Choy and Kirsten DonovanOur Standards: The Thomson Reuters Trust Principles.
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03a8806dcb15facc4f22f88eae894080 | https://www.reuters.com/article/us-global-oil/oil-set-for-weekly-loss-on-weak-economic-data-idUKKCN1U0033?edition-redirect=uk | Oil prices rise on Iran tensions, OPEC output cuts | Oil prices rise on Iran tensions, OPEC output cuts
By Laila Kearney3 Min Read
NEW YORK (Reuters) - Oil futures rose on Friday as tensions over Iran and an extension to output cuts by OPEC and its allies boosted prices, but mixed economic data limited the rally.
FILE PHOTO: A pumpjack is seen at the Sinopec-operated Shengli oil field in Dongying, Shandong province, China January 12, 2017. REUTERS/Chen Aizhu
Brent crude futures LCOc1 settled at $64.23 a barrel, up 93 cents, or 1.47%. U.S. West Texas Intermediate (WTI) CLc1 settled at $57.51 a barrel, up 17 cents. The U.S. market was closed on Thursday for a national holiday.
Both benchmarks were down for the week as concerns about a slowing global economy outweighed risks to supply. Brent recorded a 3.3% weekly loss and WTI shed roughly 1.8%.
The U.S.-China trade war has dampened prospects of global economic growth and oil demand, but talks resume next week in a bid to resolve the deadlock.
“The complex is maintaining a heavy feel that was set into motion earlier this week by mounting expectations of a global economic slowdown that will be impacting oil demand,” Jim Ritterbusch of Ritterbusch and Associates said in a note.
German industrial orders fell far more than expected in May, and the Economy Ministry said this sector of Europe’s largest economy was likely to remain weak in coming months.
The U.S. Labor Department said nonfarm employers added 224,000 jobs last month, the most in five months. However, new orders for U.S. factory goods fell for a second straight month in May, government data showed, stoking economic concerns.
The U.S. Energy Information Administration reported on Wednesday a weekly decline of 1.1 million barrels in crude stocks, smaller than the 5 million barrel draw reported by the American Petroleum Institute and less than analysts had forecast. USOILC=ECI
The Organization of the Petroleum Exporting Countries and allied producers such as Russia, known as OPEC+, supported prices by extending their deal on supply cuts.
Tension in the Middle East also offered support, particularly to Brent. “Brent is pricing in more of the geopolitical risk than WTI,” said Phil Flynn, an analyst at Price Futures Group in Chicago.
Iran threatened to capture a British ship after British forces seized an Iranian tanker in Gibraltar over accusations the ship was violating EU sanctions on Syria. [nL8N2461KI]
“If Britain does not release the Iranian oil tanker, it is the authorities’ duty to seize a British oil tanker,” a Revolutionary Guards Commander wrote on Twitter.
A Reuters survey found OPEC oil output sank to a new five-year low in June, as a rise in Saudi supply did not offset losses in Iran and Venezuela due to U.S. sanctions and other outages elsewhere in the group.
Additional reporting by Shadia Nasralla and Bozorgmehr Sharafedin in London, Colin Packham in Sydney; Editing by Edmund Blair, Chris Reese and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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f806afb7ea7882ef4e70c280276371fe | https://www.reuters.com/article/us-global-oil/oil-settles-near-13-month-highs-texas-deep-freeze-supports-idUSKBN2AG043?il=0 | Oil settles near 13-month highs; Texas deep freeze supports | Oil settles near 13-month highs; Texas deep freeze supports
By Laura Sanicola2 Min Read
FILE PHOTO: Pump jacks operate at sunset in an oil field in Midland, Texas U.S. August 22, 2018. REUTERS/Nick Oxford/File Photo
NEW YORK (Reuters) - Oil prices settled near 13-month highs on Tuesday, supported by a deep freeze in the U.S. South that shut wells and oil refineries in Texas.
Prices have been buoyant for months, with major oil producing countries restricting supply and vaccines rolling out to combat the coronavirus pandemic.
U.S. West Texas Intermediate (WTI) crude futures settled up 1% to $60.05, after touching their highest since early January 2020. Brent settled up 5 cents, or 0.1%, to $63.35 a barrel, near the 13-month peak reached the previous session.
“Cold temperatures have added supply side support amidst numerous well freeze-offs and several refinery disruptions as some facilities have seen forced shutdowns due to power restriction,” said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois.
Rystad Energy analysts estimated that between 500,000 and 1.2 million barrels of crude oil production in the United States will be shut due to the cold. About 3 million bpd of refining has been closed, with some of the largest U.S. refiners shutting processing, including Motiva Enterprises facilities at Port Arthur, Texas, the country’s largest.
Middle East supply concerns also rose after the Saudi-led coalition fighting the Houthi group in Yemen said on Monday that it had destroyed an explosive-laden drone fired by the Houthis at the kingdom, the world’s biggest oil exporter.
Supply is expected to expand this spring as OPEC+ oil producers said they are likely to ease output curbs after April given a recovery in prices. Still, producers remain cautious about the pandemic. [nL8N2KA5FH]
U.S. oil inventory data from the API industry association and Energy Information Administration (EIA) will be released on Wednesday and Thursday respectively, delayed due to the Monday U.S. holiday.
Additional reporting by Shadia Nasralla in London, Jessica Jaganathan in Singapore; Editing by Edmund Blair, David Goodman and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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01ffeee741ff44dbd88ff58e5fc13c33 | https://www.reuters.com/article/us-global-oil/oil-settles-up-more-than-2-as-u-s-inventories-fall-demand-picks-up-idUSKBN2A114Q?il=0 | Oil settles up more than 2% as U.S. inventories fall, demand picks up | Oil settles up more than 2% as U.S. inventories fall, demand picks up
By Laura Sanicola3 Min Read
NEW YORK (Reuters) - Oil prices settled more than 2% higher on Monday, buoyed by falling U.S. crude inventories and rising winter fuel demand due to one of the worst snowstorms to hit the U.S. Northeast in years.
Slideshow ( 2 images )
Brent crude settled up $1.31 cents, or 2.4%, at $56.35 a barrel. U.S. crude gained $1.35 cents, or 2.6%, to settle at $53.55. Both benchmarks gained nearly 8% in January.
U.S. government data last week showed a drawdown of 2.3 million barrels in stocks at the Cushing, Oklahoma, delivery hub for crude futures. Another 2.3 million-barrel weekly decline is expected, analysts and traders said citing a Wood Mackenzie report.
“Crude is being supported by many small factors this week - expected drawdowns in Cushing, a sudden rise in winter fuel demand amid colder weather, and further talks on Capitol Hill about stimulus checks,” said John Kilduff, partner at Again Capital LLC in New York.
The U.S. Northeast has been hit by a powerful winter snow storm, pummeling a vast swath stretching from Pennsylvania through New England and causing widespread disruption in New York City and other major urban centers in the region.
Goldman Sachs said oil prices could rise to $65 by July, forecasting an oil market deficit of 900,000 barrels per day (bpd) in the first half of 2021, a higher level than its previous prediction of 500,000 bpd.
OPEC oil output rose for a seventh month in January, a Reuters survey found, after the group and its allies agreed to ease supply curbs further, although the production growth was smaller than expected.
“It looks like OPEC compliance is really pushing the complex higher, as well as the expectation that we will see U.S. inventories tighten over the next few weeks,” said Phil Flynn, an analyst at Price Futures Group in Chicago.
Russian oil and gas condensate production also increased in January, two sources told Reuters on Monday, but the increase was in line with expectations, following Moscow’s deal with OPEC on output cuts.
U.S. oil and gas drillers are gearing up for a pick-up in demand. As higher prices make new wells profitable again, they added rigs for a sixth month in a row in January. [RIG/U]
U.S. production data from the Energy Information Administration showed output rose above 11 million bpd in November, the first time it has exceeded that figure since April.
(Graphic: OPEC and U.S. oil production: )
Additional reporting by Bozorgmehr Sharafedin in London, additional reporting by Aaron Sheldrick in Tokyo, Editing by Marguerita Choy, Emelia Sithole-Matarise and Paul SimaoOur Standards: The Thomson Reuters Trust Principles.
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693eef117390f215f73cadc735da460c | https://www.reuters.com/article/us-global-oil/oil-sinks-4-on-demand-concerns-as-coronavirus-spreads-idUSKCN20H0UU | Oil sinks 4% on demand concerns as coronavirus spreads | Oil sinks 4% on demand concerns as coronavirus spreads
By Stephanie Kelly3 Min Read
NEW YORK (Reuters) - Oil prices slumped by nearly 4% on Monday as the rapid spread of the coronavirus in countries outside China added to investor concerns over the effect on demand for crude.
Global equities also extended losses as worries about the impact of the virus grew, with the number of cases jumping in Iran, Italy and South Korea.
Brent crude LCOc1 futures fell $2.20, or 3.8%, to settle at $56.30 a barrel. U.S. West Texas Intermediate (WTI) crude CLc1 futures fell $1.95, or 3.7%, to settle at $51.43 a barrel.
“The reports of the coronavirus spreading is raising more fears of demand destruction,” said Phil Flynn, an analyst at Price Futures Group in Chicago. “When we saw the big move down in the stock market, oil traders were selling first and asking questions later.”
The coronavirus has infected nearly 77,000 people and killed more than 2,500 in China, most of them in Hubei.
South Korea’s fourth-largest city, Daegu, was increasingly isolated as the number of infections there rose rapidly.
Europe’s biggest outbreak is in Italy, which reported a seventh death from the flu-like virus and 220 infections.
People wear protective masks at Venice Carnival, which the last two days of, as well as Sunday night's festivities, have been cancelled because of an outbreak of coronavirus, in Venice, Italy February 23, 2020. REUTERS/Ohad Zwigenberg
Kuwait, Bahrain, Oman and Iraq on Monday recorded their first new coronavirus cases, all involving people who had been in Iran, which raised its toll from the disease to 12 dead and 61 infected.
Afghanistan, Iraq, Kuwait, Saudi Arabia and Turkey imposed travel and immigration curbs on Iran.
Still, World Health Organization chief Tedros Adhanom Ghebreyesus said that using the word “pandemic” did not fit the facts.
“We must focus on containment while preparing for a potential pandemic,” he told reporters in Geneva, adding that the world was not witnessing an uncontained spread or large-scale deaths.
Saudi Aramco expects the coronavirus impact on oil demand to be short-lived and for consumption to rise in the second half of the year, Chief Executive Amin Nasser told Reuters.
On Monday, local health officials in China said that four provinces had lowered their virus emergency response measures.
Goldman Sachs said commodity prices could fall sharply before any rebound on the back of Chinese stimulus efforts.
“The promise of stimulus has made commodity markets act like equity markets, building up risks of a sharp correction,” the bank said in a note.
Bank of America Global Research kept its 2020 forecast for the price of Brent crude steady at $62 a barrel, citing voluntary and involuntary declines in OPEC supply and the resilience of markets to geopolitical shocks.
Meanwhile, U.S. President Donald Trump has decided to step up a sanctions campaign on Venezuela’s oil sector and will be more aggressive in punishing people and companies that violate them, the top U.S. envoy to the Latin American country said.
Additional reporting by Noah Browning in London and Jessica Jaganathan in Singapore; Editing by Marguerita Choy and Jason NeelyOur Standards: The Thomson Reuters Trust Principles.
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e04e8471f915d6173d0a741ae028153d | https://www.reuters.com/article/us-global-oil/oil-slides-as-irma-heads-for-florida-threatening-demand-idUSKCN1BJ06S | Oil slides as Irma heads for Florida, threatening demand | Oil slides as Irma heads for Florida, threatening demand
By Julia Simon3 Min Read
NEW YORK (Reuters) - Oil prices slid on Friday, with U.S. crude down more than 3 percent on worries that commerce and energy demand in Florida and the Southeast would be hit hard as Hurricane Irma, one of the most powerful storms in a century, drove toward the region.
A view shows al-Shuaiba oil refinery in southwest Basra, Iraq April 20, 2017. REUTERS/Essam Al-Sudani
Irma, the second major hurricane to approach the United States in two weeks, has already killed 14 and destroyed islands in the Caribbean. Its predecessor, Harvey, shut a quarter of U.S. refineries and 8 percent of U.S. oil production, with crude prices slumping as widespread refinery outages sharply reduced demand for crude.
It will take weeks for the U.S. petroleum industry to return to full capacity, analysts said. In the case of Irma, analysts are more worried that devastation wrought by the storm could sharply reduce demand for energy.
U.S. light crude oil CLc1 was down $1.53 or 3.12 percent at $47.56 a barrel by 1:47 p.m. EDT (1747 GMT). Brent crude LCOc1 was down 67 cents or 1.2 percent to $53.82 a barrel after reaching its highest level since April at $54.80.
Both benchmarks remained on track for slight weekly gains.
“Hurricanes can have a lasting effect on refinery and industry demand,” said Eugen Weinberg, head of commodities research at Commerzbank in Frankfurt.
U.S. oil output fell almost 8 percent because of Harvey, from 9.5 million barrels per day (bpd) to 8.8 million bpd, according to the Energy Information Administration (EIA). C-OUT-T-EIA
But Irma is headed away from the heart of U.S. oil production.
“Irma looks like it will miss the key Gulf areas, and we’re more worried about shale,” said Mark Watkins, regional investment manager at U.S. Bank.
Port and refinery closures along the Gulf coast and harsh sea conditions in the Caribbean have hit shipping.
“Imports (of oil) to the U.S. Gulf Coast fell to levels not seen since the 1990s,” ANZ bank said.
Hurricane Irma hit the Dominican Republic and Haiti on Friday, heading for Cuba and the Bahamas. It was predicted to reach Florida by Sunday.
The U.S. National Hurricane Center (NHC) said Irma was a Category 5 hurricane, with wind speeds of 160-185 miles per hours.
Hurricane Jose is heading for the Caribbean Leeward islands, which have just been devastated by Irma.
U.S. energy firms cut oil rigs for a third time in the past four weeks as a 14-month drilling recovery stalled, with energy firms reducing spending plans in response to falling crude prices.
Drillers cut three oil rigs in the week to Sept. 8, bringing the total count down to 756 energy services firm Baker Hughes energy services firm said in its Friday report.
Reporting by Julia Simon in New York, Additional reporting by Dmitry Zhdannikov and Christopher Johnson in London, and Henning Gloystein in Singapore; Editing by Greg Mahlich and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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513f1cd1d396dfc60f59cafc05d501e9 | https://www.reuters.com/article/us-global-oil/oil-slips-as-demand-worries-erase-early-bounce-from-saudi-price-increase-idUSKBN22J04V | Oil slips as demand worries erase early bounce from Saudi price increase | Oil slips as demand worries erase early bounce from Saudi price increase
By Scott DiSavino3 Min Read
NEW YORK (Reuters) - Oil prices slipped on Thursday as global supply and demand worries erased earlier gains seen from an increase in Saudi Arabia’s official crude selling price and a surprise rise in Chinese exports last month.
FILE PHOTO: A pump jack is seen at sunset near Midland, Texas, U.S., on May 3, 2017. Picture taken May 3, 2017. REUTERS/Ernest Scheyder
Brent LCOc1 futures fell 26 cents, or 0.9%, to settle at $29.46 a barrel, while U.S. West Texas Intermediate (WTI) crude CLc1 lost 44 cents, or 1.8%, to settle at $23.55.
Earlier in the day, Brent was up over 5% and WTI up over 10%. For the week, Brent was still up about 11% and WTI up about 18%.
Both benchmarks have rallied sharply this week as countries have eased coronavirus-related lockdowns and fuel demand has rebounded modestly. Oil production worldwide is also declining to reduce a growing supply glut.
“We continue to be in a volatile market and this price pull back does not surprise me. I think there was some profit taking,” said John Kilduff, partner at Again Capital LLC in New York.
“The Saudi (price news) was supportive early in the day, but we still have significant headwinds in terms of the economy, demand and storage,” Kilduff said.
U.S. crude inventories at the Cushing storage hub in Oklahoma rose by about 407,000 barrels in the week through May 5, traders said citing Genscape data.
U.S. jobless claims, meanwhile, continued to rise, although at a slower pace with 3.2 million more people seeking unemployment benefits for the week ended May 2. The latest numbers lifted the total to about 33 million claims since March 21.
Analysts at Rystad Energy projected global oil demand would decrease 10.9% in 2020 to 88.7 million barrels per day (bpd) from around 99.5 million bpd in 2019. Last week, the energy consultant forecast demand next year would average 88.8 million bpd.
Oil prices were much higher earlier in the day following reports from Saudi Arabia on crude prices and imports and exports in China.
Saudi Arabia increased its official selling prices (OSP) for June after cutting May exports to almost the lowest in a decade following a deal by global producers to reduce output to prop up prices.
“It is ... likely seen as a strong indication that the Kingdom will follow through on its pledged supply cuts agreed at the 12 April OPEC+ emergency meeting,” Harry Tchilinguirian, head of commodity research at BNP Paribas, said.
The Organization of the Petroleum Exporting Countries (OPEC) and allied producers - a grouping known as OPEC+ - agreed to cut production from May 1 by around 10 million bpd to help support prices.
In China, meanwhile, oil imports climbed to 10.42 million bpd in April from 9.68 million bpd in March, according to Reuters calculations based on customs data for the first four months of 2020.
However, the country’s imports for all goods fell, suggesting any recovery is some way off as economies around the world fall into recession.
Additional reporting by Devika Krishna Kumar in New York, Julia Payne in London and Aaron Sheldrick in Tokyo; Editing by Marguerita Choy and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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124a37fce79e2d849e68e11ad0f35fe7 | https://www.reuters.com/article/us-global-oil/oil-slips-but-holds-most-recent-gains-on-expected-opec-cuts-idUSKBN1CO02X?il=0 | Oil drops more than one percent on profit taking after four days of gains | Oil drops more than one percent on profit taking after four days of gains
By Bryan Sims3 Min Read
HOUSTON (Reuters) - Oil prices fell more than 1 percent on Thursday, breaking four days of gains, pressured by larger-than-expected product inventories in the United States and profit-taking after a recent run-up in markets.
FILE PHOTO: The Philadelphia Energy Solutions oil refinery owned by The Carlyle Group is seen at sunset in front of the Philadelphia skyline March 24, 2014. Picture taken March 24, 2014. REUTERS/David M. Parrott/File Photo
Brent crude LCOc1 settled down 92 cents, or 1.6 percent, at $57.23 a barrel. The global benchmark is still about 30 percent above its mid-year levels.
U.S. light crude CLc1 settled down 75 cents, or 1.4 percent, to $51.29, but is still nearly 25 percent higher than June's lows.
Ongoing tension in the Middle East has boosted prices, but analysts say those concerns may now be priced into the market.
“The geopolitical risk that came rushing into the market is starting to come out,” said John Kilduff, a partner at hedge fund Again Capital LLC.
Kurdish officials said thousands had fled the Kirkuk region fearing persecution since Iraqi armed forces retook it following a referendum on Kurdish independence that was rejected by Baghdad.
Iraq said it expects to restore Kirkuk’s oil production to last week’s levels by Sunday.
Royal Dutch Shell's RDSa.L subsidiary in Nigeria, SPDC, lifted force majeure Thursday on Bonny Light crude oil exports.
Meanwhile, Chevron Corp CVX.N said it temporarily suspended oil and gas drilling activity in Iraqi Kurdistan.
Analysts said they have seen some profit-taking after two weeks of gains. Energy equities XLE were also weaker, falling to 3-1/2-week lows.
U.S. President Donald Trump last week refused to certify Iran’s compliance with a nuclear deal, leaving Congress 60 days to decide further action against Tehran. That could imply the resumption of sanctions against Iran, which reduced supply by about 1 million bpd during the previous round.
However, it is unlikely the United States will get the same level of cooperation from other countries as it did when it previously sanctioned Iran.
Analysts said crude supply should keep tightening if the Organization of the Petroleum Exporting Countries and partners, including Russia, agree an expected extension to their deal to curb production.
The market turned bearish on Wednesday after the U.S. Energy Information Administration reported a surprise drop in U.S. refining rates and an unexpected build in fuel stocks last week that signaled slower demand in the world’s top oil consumer. [EIA/S]
The fuel build overshadowed a 5.7 million-barrel slump in U.S. crude inventories C-STK-T-EIA and an 11-percent tumble in crude output last week to 8.4 million barrels per day (bpd) as production was shut in by Hurricane Nate.
Additional reporting by Christopher Johnson in London and Henning Gloystein in Singapore; Editing by Marguerita Choy and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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fbde92c156f9345d381179c29b0c4195 | https://www.reuters.com/article/us-global-oil/oil-slips-from-highs-but-still-strong-on-opec-led-cuts-idUSKBN1D2036?il=0 | Oil edges up to near two-year highs as market tightens | Oil edges up to near two-year highs as market tightens
By Julia Simon3 Min Read
NEW YORK (Reuters) - Oil prices edged up on Thursday, steadying near two-year highs as the outlook remained upbeat as OPEC-led supply cuts have tightened the market and drained inventories.
An oil rig drilling a well at sunrise, owned by Parsley Energy Inc. near Midland, Texas, U.S., May 3, 2017. Picture taken May 3, 2017. REUTERS/Ernest Scheyder
Brent crude LCOc1 settled up 13 cents, or 0.2 percent, at $60.62 per barrel. The benchmark hit $61.70 on Wednesday, its highest intraday level since July 2015. The contract is up by more than a third from its 2017-lows in June.
U.S. crude CLc1 ended 24 cents, or 0.4 percent, higher at $54.54, almost 30 percent above its 2017-lows in June.
Confidence has been fueled by an effort this year lead by the Organization of the Petroleum Exporting Countries and Russia to hold back about 1.8 million barrels per day (bpd) in oil production to tighten markets.
Saudi Arabian Energy Minister Khalid al-Falih said supply and demand balances were tightening and oil inventories falling, while compliance with the OPEC-led pact to curb supplies had been “excellent”.
“Compliance as a whole for OPEC [ended] up being rather strong,” said Mark Watkins, regional investment manager at U.S. Bank. “Now that we’ve flipped the calendar to November we have the OPEC meeting at the end of the month. There’s expectation that there will be positive comments about extending the cuts past March.”
The pact to withhold supplies runs to March 2018, but there is growing consensus to extend the deal to cover all of next year.
Iraq’s oil minister said that OPEC’s second-largest producer supports keeping curbs on global oil supply to bolster prices, adding $60 per barrel would be an acceptable target price for his country.
The energy ministers of Russia and Saudi Arabia, the world’s top oil producers, were expected to travel to Tashkent, Uzbekistan, on Thursday night, two sources told Reuters. Both said the ministers were expected to give a briefing.
Oil was also supported by falling U.S. commercial crude inventories despite rising output.
U.S. crude oil inventories fell 2.4 million barrels last week despite a 46,000 bpd increase in production to 9.55 million bpd.
Goldman Sachs said it expected year-on-year U.S. oil production growth of 0.8 million to 0.9 million bpd at year-end 2017. That would put end-2017 output at 9.6-9.7 million bpd, close to its highest for at least three decades.
Traders said this was due to U.S. crude trading at a wide discount to Brent, making exports attractive. CL-LCO1=R
U.S. independent oil producer Pioneer Natural Resources said it expected to export 2.3 million barrels of oil in the fourth quarter.
Additional reporting by Christopher Johnson in London, Henning Gloystein in Singapore; Editing by Jason Neely and Andrew HayOur Standards: The Thomson Reuters Trust Principles.
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501a2519fbadfab4ff2815200a8ed623 | https://www.reuters.com/article/us-global-oil/oil-slips-further-below-80-a-barrel-as-focus-on-opec-intensifies-idUSKCN1IP04N | Oil slips further below $80/bbl on talk OPEC may lift output | Oil slips further below $80/bbl on talk OPEC may lift output
By Stephanie Kelly3 Min Read
NEW YORK (Reuters) - Oil prices fell about $1 on Thursday, with expectations building that reduced supplies from Venezuela and Iran could prompt OPEC to wind down output cuts in place since the start of 2017.
Brent crude LCOc1 futures fell $1.01 to settle at $78.79 a barrel, a 1.27 percent loss. U.S. West Texas Intermediate (WTI) crude CLc1 futures fell $1.13 to settle at $70.71 a barrel, a 1.57 percent loss.
The Organization of the Petroleum Exporting Countries may decide in June to lift output to make up for reduced supply from crisis-hit Venezuela and Iran, which was stung by the U.S. decision to withdraw from the nuclear arms control deal, OPEC and oil industry sources told Reuters.
Russian Energy Minister Alexander Novak said production cuts could be eased “softly” if OPEC and non-OPEC countries see the oil market balancing in June, the Interfax news agency reported. [nL5N1SV35N]
Russia and Saudi Arabia have a common position on the future of the oil output cut deal, Novak told Interfax news agency, though he said the deal would stay in place for now. Russia's Lukoil LKOH.MM said the deal should remain in place but needs to be altered.
“We still believe that a production increase will still be forthcoming that will become official at next month’s OPEC meeting,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note. “In the meantime, even the slightest suggestion of such a decision, especially from the Saudis, could force a 1-2 percent price selloff as seen this morning.”
Venezuela’s output has fallen to about 1.4 million barrels per day, according to OPEC secondary sources, as its economic crisis grows and state-run PDVSA struggles to pay debts and fund operations.
Supply concerns have pushed crude to multi-year highs, with Brent last week breaking above $80 a barrel for the first time since November 2014.
OPEC and some other major oil producers, scheduled to meet in Vienna next month, previously agreed to curb combined output by about 1.8 million bpd to boost prices and clear a supply glut.
Global inventories have been broadly falling, even as U.S. crude production has risen. The United States in February produced 10.3 million bpd, a record.
Oil futures also fell as market participants took profits ahead of the U.S. Memorial Day holiday weekend.
“It just feels like reducing exposure in front of a long weekend,” said Walter Zimmerman, chief technical analyst at ICAP-TA in Jersey City, New Jersey.
On Thursday, U.S. President Donald Trump called off a planned summit with North Korean leader Kim Jong Un over that nation’s nuclear aims. The news should have pressured oil prices, but the comments weakened the U.S. dollar, which supported crude, Commerzbank strategist Carsten Fritsch said.
A weaker dollar makes greenback-denominated commodities less expensive for holders of other currencies. The dollar .DXY fell more than 0.2 percent against a basket of currencies.[USD/]
Additional reporting by Amanda Cooper and Ahmad Ghaddar in London, Jane Chung in Seoul and Jessica Jaganathan in Singapore; Editing by Marguerita Choy and Chris ReeseOur Standards: The Thomson Reuters Trust Principles.
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127d94207d6c073010e549138b50e96b | https://www.reuters.com/article/us-global-oil/oil-slips-to-68-as-rally-fizzles-out-before-u-s-supply-report-idUSKBN2B105M?il=0 | Oil slips below $68 as rally fizzles before U.S. supply report | Oil slips below $68 as rally fizzles before U.S. supply report
By Jessica Resnick-Ault3 Min Read
NEW YORK (Reuters) - Oil fell to around $68 a barrel on Tuesday in a choppy session, pressured as concerns faded of a supply disruption in Saudi Arabia, which countered a pause in the dollar’s rally and prospects for tighter supply due to OPEC+ output curbs.
FILE PHOTO: Pump jacks are silhouetted against the rising sun at an oilfield in Baku, January 24, 2013. REUTERS/David Mdzinarishvili
On Monday, crude hit its highest level since the start of the coronavirus pandemic, a day after Yemen’s Houthi forces fired drones and missiles at Saudi oil sites. Saudi Arabia said it thwarted the strike, however, and prices slipped as supply fears eased.
Brent crude settled down 72 cents, or 1.06%, at $67.52 a barrel. The contract pulled back after trading as high as $69.33. It reached $71.38 on Monday, the highest since Jan. 8, 2020.
U.S. West Texas Intermediate (WTI) fell $1.04, or 1.6% to settle at $64.01 a barrel. The contract hit its highest on Monday since October 2018.
In post-settlement trade, U.S. crude extended losses. U.S. crude oil stockpiles rose sharply in the most recent week, according to trading sources, citing data from industry group the American Petroleum Institute released after settlement.
Crude inventories rose by 12.8 million barrels in the week
to March 5, compared with analysts’ expectations in a Reuters poll for a build of 816,000 barrels, sources said. [L1N2L72S5]
“This is more of the same as refineries remain shut down,” said Phil Flynn, senior analyst at Price Futures group, speaking after the API data was released.
Last week’s record decline in U.S. inventories came after the shutdown of Gulf Coast refineries due to the recent winter storm in Texas.
“The market seems to be softening on those concerns. It’s had an incredible run, and it’s due for a correction,” Flynn said.
Official figures from the EIA are expected Wednesday at 10:30 a.m. ET.
In a monthly report, the EIA said it now expects U.S. crude oil production to decline by 160,000 barrels per day (bpd) in 2021 to 11.15 million bpd, a smaller decline than its previous forecast of a 290,000-bpd drop. [L1N2L71PL]
The Organization of the Petroleum Exporting Countries (OPEC) plus Russia and allies, a group known as OPEC+, decided on Thursday to broadly stick to output cuts, fueling a rally.
“Caution is advised as prices are, of course, not going to rise forever,” said Bjornar Tonhaugen of Rystad Energy. “A more definite price direction is expected soon, when the U.S. weekly oil inventory reports” are released.
“Dips have been lately viewed as buying opportunities,” said Tamas Varga of broker PVM. “Last week’s OPEC+ meeting will ensure that the global oil balance will get tighter in the foreseeable future.”
A stronger U.S. dollar, which tends to crimp investor demand for commodities, has weighed on oil, analysts said. The dollar eased from a 3-1/2-month high reached earlier.
Prices gained support from expectations of a U.S. economic recovery after the U.S. Senate approved a $1.9 trillion stimulus package. The U.S. House of Representatives must approve it before it goes to President Joe Biden for his signature.
Additional reporting by Alex Lawler and Jessica Jaganathan; Editing by Edmund Blair, Jonathan Oatis, Jan Harvey, Paul Simao and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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ae2bfa67b40a516b464b8a5e86169bef | https://www.reuters.com/article/us-global-oil/oil-slumps-on-worries-that-supply-cuts-are-playing-catch-up-to-falling-demand-idUKKCN21W02C?edition-redirect=uk | Oil slumps on worries that supply cuts are playing catch-up to falling demand | Oil slumps on worries that supply cuts are playing catch-up to falling demand
By Stephanie Kelly4 Min Read
NEW YORK (Reuters) - Oil prices dropped sharply on Tuesday, with U.S. prices sliding back toward $20 a barrel, as investors bet that fuel demand destruction caused by the coronavirus pandemic would be too much for producers embarking on record global output cuts to offset.
FILE PHOTO: Oil pump jacks work at sunset near Midland, Texas, U.S., August 21, 2019. REUTERS/Jessica Lutz
Global oil-producing nations are expected to reduce production by as much as 19.5 million barrels per day, but those cuts are being implemented slowly and in some cases will not start for weeks. By contrast, demand plunged by roughly 30% worldwide several weeks ago, causing refiners and producers suddenly stuck with oil to stick it into rapidly filling storage.
U.S. West Texas Intermediate (WTI) crude CLc1 settled at $20.11 a barrel, down $2.30 or 10.3%, as one prominent pipeline executive told Texas regulators that storage would be filled by mid-May.
WTI is not far from where markets traded prior to a rally founded on hopes for the OPEC+ production deal inked over the weekend.
Brent crude futures LCOc1 fell $2.14, or 6.7%, to settle at $29.60 a barrel.
Both benchmarks are down more than 50% down this year.
Analysts have praised Saudi Arabia and other major producers for cutting output, but those producers are playing catch-up to the free-fall in demand.
Plains All American Pipeline PAA.N President Harry Pefanis underscored that point at a hearing in Texas on Tuesday, saying that U.S. storage would be filled by mid-May.
“We can’t act as a storage facility for everybody that doesn’t have a market,” Pefanis said at a Texas Railroad Commission hearing, where regulators are considering a cut in state production.
The bulk of the mandated reductions come from the Organization of the Petroleum Exporting Countries and its allies, a group known as OPEC+. That group agreed this weekend to cut output by 9.7 million bpd in May and June. The rest from the United States, Canada and others, will come as a result of weak pricing and happen over time.
“With demand destruction forecasts ranging from 15 million to 22 million bpd in April 2020 and these measures not even coming into place until May, we are likely to see a substantial overhang in the short-term,” said Nitesh Shah, director of research at New York-based WisdomTree Investments.
As a result, physical markets where crude is traded, such as in Houston or London, suggest prices will not recover for a while as storage fills.
U.S. crude inventories rose 13.1 million barrels in the week to April 10 to 486.9 million barrels, data from industry group the American Petroleum Institute showed on Tuesday. Analysts had expected a build of 11.7 million barrels, after stocks climbed by a record 15.2 million barrels the previous week.
Official data is due on Wednesday.
“If U.S. storage continued to increase at last week’s all-time record of 15 million, it would take eight weeks for storage in the U.S. to reach maximum capacity,” said Bob Yawger, director of energy at Mizuho Securities.
Enterprise Products Partners EPD.N said it was making an existing line available to ship more oil to the Cushing, Oklahoma storage hub, which is rapidly filling due to lack of fuel demand.
U.S. production is starting to drop, the Energy Department said on Monday, with estimated shale output expected to fall by 200,000 bpd in April, a record.
There are signs that the coronavirus outbreak may have peaked in some areas of the world.
In China, where the virus outbreak started and is now largely under control, demand appears to be returning, with data showing crude oil imports rose 12% in March from a year earlier.
Reporting by Stephanie Kelly in New York, Noah Browning in London and Aaron Sheldrick in Tokyo; Editing by Marguerita Choy and Richard ChangOur Standards: The Thomson Reuters Trust Principles.
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6e1e55ab47fb56c59b83d9ff1e22a0e3 | https://www.reuters.com/article/us-global-oil/oil-steady-as-fate-of-output-pact-unclear-u-s-china-trade-war-lingers-idUSKCN1TB01E?il=0 | Oil falls 1% amid U.S.-China trade dispute, uncertainty on supply cuts | Oil falls 1% amid U.S.-China trade dispute, uncertainty on supply cuts
By Stephanie Kelly4 Min Read
NEW YORK (Reuters) - Oil prices fell more than 1% on Monday as U.S.-China trade tensions continued to threaten demand for crude and as major producers Saudi Arabia and Russia had yet to agree on extending an output-cutting deal.
FILE PHOTO: A view shows a well head and a drilling rig in the Yarakta Oil Field, owned by Irkutsk Oil Company (INK), in Irkutsk Region, Russia March 11, 2019. REUTERS/Vasily Fedosenko/File Photo
Brent crude futures fell $1, or 1.6%, to settle at $62.29 a barrel. U.S. West Texas Intermediate (WTI) crude lost 73 cents, or 1.4%, to end at $53.26 a barrel.
U.S. President Donald Trump said he was ready to impose another round of punitive tariffs on Chinese imports if he does not reach a trade deal with China’s president at a Group of 20 summit later this month.
China’s foreign ministry said that China is open for more trade talks with Washington but has nothing to announce about a possible meeting.
China’s crude oil imports slipped to around 40.23 million tonnes in May, from an all-time high of 43.73 million tonnes in April, customs data showed, due to a drop in Iranian imports caused by U.S. sanctions and refinery maintenance.
“As U.S.-China tariff concerns heighten, we see more downward adjustments to world oil demand both across this year and next in providing a limiter on occasional price advances,” Jim Ritterbusch of Ritterbusch and Associates said in a note.
Barclays bank, in a note, said its economists had revised down their GDP growth outlook for the United States, China, India and Brazil - countries that account for more than three-quarters of their oil demand growth assumptions for this year.
“The revisions imply a 300,000 barrel per day reduction in our current global oil demand outlook of 1.3 million barrels per day year-on-year for this year,” the British bank said.
On the supply side, Saudi Energy Minister Khalid al-Falih said Russia was the only oil exporter still undecided on the need to extend the output deal agreed by top producers.
The Organization of the Petroleum Exporting Countries and some non-members, including Russia, have withheld supplies since the start of the year to prop up prices. The deal is due to expire this month.
Yet, Russian energy minister Alexander Novak said there is a still a risk that oil producers pump out too much crude and prices fall sharply. Novak said he could not rule out a drop in oil prices to $30 per barrel if the global deal was not extended.
Many oil exporting countries have confirmed they are prepared to hold a policy meeting with OPEC in Vienna over July 2-4, instead of the scheduled date later this month, Novak said.
In the United States, crude production has surged, rising to a weekly record at 12.4 million barrels per day, while crude stockpiles have climbed close to two-year highs, according to the Energy Information Administration’s data last week.
“The market has seen pressure over the last couple of weeks due to the significant rise in crude and product inventories here in the U.S. that has pressured prices as the market now awaits the outcome of the upcoming OPEC and non-OPEC producers’ meeting,” said Andrew Lipow of Lipow Oil Associates in Houston.
(GRAPHIC: Singapore naphtha profits link: tmsnrt.rs/2QZePTG).
Additional reporting by Noah Browning in London and Henning Gloystein in Singapore; Editing by Marguerita Choy and Kirsten DonovanOur Standards: The Thomson Reuters Trust Principles.
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76f172cfb53094d88d4d718c8e4ff185 | https://www.reuters.com/article/us-global-oil/oil-steady-on-signs-of-output-cuts-but-demand-concerns-weigh-idUSKBN22V04K | U.S. crude strengthens as certain stimulus measures to continue | U.S. crude strengthens as certain stimulus measures to continue
By Jessica Resnick-Ault, OPEC+, exports, down, sharply2 Min Read
FILE PHOTO: The sun sets behind a crude oil pump jack on a drill pad in the Permian Basin in Loving County, Texas, U.S. November 24, 2019. REUTERS/Angus Mordant/File Photo
NEW YORK (Reuters) - U.S. crude ended slightly higher on Tuesday, as U.S. Treasury Secretary Steven Mnuchin said he supported extending certain measures intended to bolster the economy, while Brent ended lower on concerns that output cuts might not be sufficient.
Oil has rallied for several days following numerous output cuts from major producers to curb supplies, and as demand picks up with governments worldwide easing restrictions on movement put in place to stop the spread of the coronavirus pandemic.
The front-month contract for U.S. West Texas Intermediate crude, which expires on Tuesday, settled up 68 cents a barrel, or 2.1%, at $32.50 a barrel. The July contract, trading at vastly higher volumes, settled up 31 cents at $31.96 a barrel.
One month ago, the June contract pushed into negative territory ahead of expiry. “It has been a best possible scenario race away from negative prices,” said Bob Yawger, director of Energy Futures at Mizuho in New York.
Benchmark Brent crude was settled at $34.65 a barrel, down 16 cents or 0.5%.
The market weakened early after Mnuchin and Federal Reserve Chair Jerome Powell faced sharp questions at a Senate hearing, but got another boost after Mnuchin said he was willing to consider extending and modifying a payroll loan program for small businesses.
Oil prices have risen in the past three weeks as states have rolled back lockdown provisions and global output has decreased.
Another drawdown in U.S. crude stockpiles in official weekly data to be released on Wednesday could support prices more, said John Kilduff, a partner at Again Capital Management in New York.
The American Petroleum Institute Industry group reported a draw of 4.8 million barrels, along with a drop in gasoline inventories as well. Distillate stocks still rose, reflecting weaker demand for diesel.
Reporting by Jessica Resnick-Ault; Additional reporting by Yuka Obayashi and Noah Browning; Editing by Kevin Liffey, Aurora Ellis and Peter CooneyOur Standards: The Thomson Reuters Trust Principles.
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3e3cf41efffe3e89d8c53df1d292e955 | https://www.reuters.com/article/us-global-oil/oil-surges-on-u-s-china-trade-war-ceasefire-expected-supply-cuts-idUSKBN1O201K?rpc=401& | Oil surges almost 4 percent on trade truce, expected supply cuts | Oil surges almost 4 percent on trade truce, expected supply cuts
By Stephanie Kelly4 Min Read
NEW YORK (Reuters) - Oil prices jumped nearly four percent on Monday after the United States and China agreed to a 90-day truce in a trade dispute and Canada’s Alberta province ordered a production cut, while exporter group OPEC looked set to reduce supply.
FILE PHOTO: A female employee fills the tank of a car at a petrol station in Cairo, Egypt, February 24, 2016. REUTERS/Mohamed Abd El Ghany/File Photo
Brent crude futures rose $2.23 to settle at $61.69 a barrel, a 3.75 percent gain. U.S. West Texas Intermediate (WTI) crude futures gained $2.02 to settle at $52.95 a barrel, a 3.97 percent increase.
Both benchmarks surged more than 5 percent earlier in the session.
China and the United States agreed during a weekend meeting in Argentina of the Group of 20 leading economies not to impose additional trade tariffs for at least 90 days while they hold talks to resolve existing disputes.
The trade war between the world’s two biggest economies has weighed heavily on global trade and sparked concerns of an economic slowdown.
Crude oil has not been included in the list of products facing import tariffs, but traders said the positive sentiment was supporting crude markets.
“Initial signs of the U.S.-China trade relation on the mend have provided a boost to oil prices in today’s trading session. Nevertheless, whether the momentum will sustain hinges on tangible outcomes from the negotiations,” said Abhishek Kumar, senior energy analyst at Interfax Energy in London.
Oil also received support from an announcement by Alberta that the Western Canadian province will force producers to cut output by 8.7 percent, or 325,000 barrels per day (bpd), to deal with a pipeline bottleneck that has led to crude building up in storage.
The Organization of the Petroleum Exporting Countries meets on Thursday to decide output. The group, along with non-OPEC member Russia, is expected to announce cuts aimed at reining in a glut that has pulled down crude prices by around a third since October.
“We feel that a decline of about 1.1-1.2 million barrels per day will be required if fresh price lows are to be precluded,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.
Within OPEC, Qatar said it will leave the producer club in January. Qatar’s oil production is only around 600,000 bpd, but it is the world’s biggest exporter of liquefied natural gas (LNG).
Qatar’s decision to quit OPEC shows the frustration of small producers at the dominant role of a Saudi and Russia-led panel, Iran’s OPEC governor Hossein Kazempour Ardebili told Reuters, adding that any supply cuts should come only from countries that had increased output.
Outside OPEC, Russian oil output stood at 11.37 million bpd in November, down from a post-Soviet record of 11.41 million bpd it reached in October, Energy Ministry data showed on Sunday.
Russian President Vladimir Putin said on Saturday he had no concrete figures on possible oil output cuts, though his country would continue its contribution to reducing global production.
Meanwhile, oil producers in the United States continue to churn out record amounts of oil, with crude output at about 11.5 million bpd.
(Graphic: Top-3 oil producers - tmsnrt.rs/2QqtsxJ)
Reporting by Stephanie Kelly in New York, Christopher Johnson in London and Henning Gloystein in Singapore; Editing by Marguerita Choy and David GregorioOur Standards: The Thomson Reuters Trust Principles.
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0cd0e0ad888bffe012b356785b1c5c80 | https://www.reuters.com/article/us-global-oil/oil-up-on-opec-output-cuts-worries-about-iran-sanctions-idUSKBN1I400J | Oil up on OPEC output cuts, worries about Iran sanctions | Oil up on OPEC output cuts, worries about Iran sanctions
By Stephanie Kelly3 Min Read
NEW YORK (Reuters) - Oil prices rose on Thursday, boosted by OPEC production cuts and the potential for new U.S. sanctions against Iran, but gains were limited by growing U.S. crude inventories.
Oil pumps are seen at sunset outside Vaudoy-en-Brie, near Paris, France April 23, 2018. REUTERS/Christian Hartmann
Brent crude futures LCOc1 rose 26 cents to settle at $73.62 a barrel, a 0.35 percent gain. U.S. West Texas Intermediate (WTI) crude CLc1 rose 50 cents to settle at $68.43 a barrel, a 0.74 percent increase.
“The price move today is probably based off Iran and the tight oil supply market that we already have,” said Rob Thummel, portfolio manager at energy investment manager Tortoise Capital in Leawood, Kansas. “The margin for error right now is just so low in the oil market that you can’t just take supply off the market.”
Iran’s foreign minister said U.S. demands to change its 2015 nuclear agreement with world powers were unacceptable as a deadline set by President Donald Trump for Europeans to “fix” the deal loomed.
Trump has all but decided to withdraw from the accord by May 12, sources said on Wednesday, though exactly how he will do so remained unclear.
Iran re-emerged as a major oil exporter in January 2016 when international sanctions against Tehran were suspended in return for curbs on Iran’s nuclear program.
Also supporting prices, North Sea oilfields connected to the Brent oil pipeline have stopped production due to a shutdown at the UK’s Sullom Voe oil terminal, the Brent pipeline operator said, reducing output of the crude.
Global oil supply has tightened with production cuts led by the Organization of the Petroleum Exporting Countries and its allies. The latest Reuters survey showed OPEC pumped around 32 million barrels per day (bpd) in April, slightly below its target of 32.5 million bpd, due largely to plunging output in Venezuela.
Russia on Thursday said its own compliance with a global deal with OPEC and other producers to curb output stood at 95.2 percent in April, with its output unchanged at 10.97 million bpd.
However, rising U.S. oil supply tempered oil futures gains.
On Wednesday, U.S. government data showed a 6.2-million-barrel jump in crude inventories last week. U.S. production also hit a new weekly record of 10.62 million bpd, ahead of top OPEC producer Saudi Arabia and just below No. 1 producer Russia.
Inventories at the Cushing, Oklahoma storage hub climbed by about 152,000 barrels in the week to May 1, according to market intelligence firm Genscape, traders who saw the data said.
Reporting by Stephanie Kelly; Additional reporting by Libby George in London and Henning Gloystein in Singapore; Editing by David Gregorio and Lisa ShumakerOur Standards: The Thomson Reuters Trust Principles.
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c51a4a56b118c804465e99cd45eba939 | https://www.reuters.com/article/us-global-oil/oil-volatile-ends-up-2-percent-but-demand-concerns-still-weigh-idUSKCN1OW013 | Oil volatile, ends up 2 percent but demand concerns still weigh | Oil volatile, ends up 2 percent but demand concerns still weigh
By Stephanie Kelly3 Min Read
NEW YORK (Reuters) - Oil prices rose about 2 percent in choppy trading on Wednesday, supported by a slight recovery on Wall Street, even as concerns remained about weakening global economic growth which could hurt demand for oil.
FILE PHOTO: A gas torch is seen at the Filanovskogo oil platform operated by Lukoil company in Caspian Sea, Russia October 16, 2018. REUTERS/Maxim Shemetov
Brent crude LCOc1 futures gained $1.11, or 2.1 percent, to settle at $54.91 a barrel, after trading between $52.51 and $56.56.
U.S. West Texas Intermediate (WTI) crude CLc1 ended $1.13, or 2.5 percent, higher at $46.54 a barrel, after hitting a session low at $44.35 and high at $47.78.
Oil futures were buoyed by U.S. equity markets as major stock indices pared earlier losses. [.N] Crude futures have recently tracked stocks on Wall Street, which in 2018 recorded its worst year in a decade.
However, manufacturing data from China earlier added to ongoing concerns about a slowing global economy and increased output out of countries like Russia.
China’s factory activity contracted for the first time in more than two years in December, highlighting the challenges facing Beijing as it seeks to end a bruising trade war with Washington.
“We still view some slippage in the Chinese economy as a significant bearish consideration given the fact that they had become the largest crude importer in the world,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note
Euro zone manufacturing data also proved disappointing, as activity barely expanded at the end of 2018, according to a survey.
Worries about an economic slowdown and excess supply dragged down oil prices from multi-year highs reached in October 2018. Crude futures ended 2018 down for the first year since 2015, with WTI slumping 25 percent and Brent tumbling 21 percent.
Russian production hit a post-Soviet record in 2018, figures showed on Wednesday. Other data showed U.S. output reached a record in October and Iraq boosted oil exports in December.
Surging shale output has helped make the United States the world’s biggest oil producer, ahead of Saudi Arabia and Russia. Oil production has been at or near record highs in all three countries.
Signs of rising production illustrate the challenge facing the Organization of the Petroleum Exporting Countries and its allies, including Russia, which are seeking to prop up the market with a supply cut of 1.2 million barrels per day.
However, the energy minister for the United Arab Emirates, an OPEC member, said on Tuesday he remained optimistic about achieving a market balance in the first quarter.
Additional reporting by Alex Lawler and Noah Browning in London and Henning Gloystein in Singapore; Editing by Marguerita Choy and Paul SimaoOur Standards: The Thomson Reuters Trust Principles.
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8f42db9cf8e9f7217d878b515d71c287 | https://www.reuters.com/article/us-global-oil/u-s-crude-jumps-on-stock-draw-brent-slips-ahead-of-opec-meet-idUSKBN1JG01I | U.S. crude jumps on stock draw; Brent slips ahead of OPEC meet | U.S. crude jumps on stock draw; Brent slips ahead of OPEC meet
By Stephanie Kelly4 Min Read
NEW YORK (Reuters) - U.S. crude futures rose nearly 2 percent on Wednesday, supported by a drop in domestic inventories, while Brent edged down ahead of an OPEC meeting later this week that may result in increased global production.
FILE PHOTO: A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma, U.S., September 15, 2015. REUTERS/Nick Oxford/File Photo
U.S. crude inventories USOILC=ECI fell 5.9 million barrels last week, the largest one-week decline since January, the Energy Information Administration said on Wednesday.
Refinery crude runs rose to 17.7 million barrels per day, the highest on record for this time of year, the EIA data showed.
“Today’s EIA report appeared unequivocally bullish to WTI given a much larger than expected crude stock draw of almost six million barrels that was more than double our anticipated increase,” Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois, said in a note.
“However, the big decline in crude was almost exactly offset by a combined gasoline (and) distillate build of roughly six million barrels.”
U.S. West Texas Intermediate (WTI) crude futures for July delivery CLc1, which expires on Wednesday, rose $1.15 to settle at $66.22 a barrel, a 1.8 percent gain. WTI futures for August CLc2 closed 81 cents higher at $65.71.
Brent crude futures for August delivery LCOc1 fell 34 cents, or 0.5 percent, to end at $74.74 a barrel.
Traders said a drop in Libyan supplies, including the loss of a 400,000-barrel storage tank, also helped support prices.
Libya’s oil output has been slashed to between 600,000 and 700,000 bpd from more than 1 million bpd following clashes at its Ras Lanuf and Es Sider oil terminals, a Libyan oil source said.
An attack by armed factions opposed to Khalifa Haftar’s Libyan National Army (LNA) has forced the closure of the two ports since June 14 and the declaration of force majeure on exports.
Looming large over markets, however, were meetings scheduled on June 22-23 in Vienna for the Organization of the Petroleum Exporting Countries and other big producers, including Russia.
Brent futures fell after Saudi Energy Minister Khalid al-Falih said that the market demands more oil in the second half of this year and that OPEC was converging on a good decision on production policy this week.
“Any developments on OPEC can move us,” said Phil Flynn, analyst at Price Futures Group in Chicago.
Saudi Arabia is trying to convince fellow OPEC members of the need to raise oil output, sources familiar with the talks said on Wednesday.
Russia, which is not a part of OPEC but is the world’s biggest oil producer, is also pushing to loosen supply controls introduced to prop up prices in 2017.
Other OPEC members, including Iran, oppose such a move, fearing a price slump.
Iran signaled it might allow a small increase in OPEC oil output, letting some OPEC members that had overdelivered on cuts return to compliance with quotas.
That would effectively mean a modest boost from producers such as Saudi Arabia that have been cutting more deeply than planned despite production outages in Venezuela and Libya.
Scott Sheffield, executive chairman of Pioneer Natural Resource Co PXD.N said OPEC should boost output by roughly 1 million bpd over time to keep global crude supply and demand in balance as production dips elsewhere.
Additional reporting by Christopher Johnson in London and Henning Gloystein in Singapore; Editing by Marguerita Choy and Edmund BlairOur Standards: The Thomson Reuters Trust Principles.
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3326c67361fd11552005edebd9686c7f | https://www.reuters.com/article/us-global-oil/u-s-crude-set-to-close-at-18-year-low-after-opec-cuts-demand-forecast-idUSKCN21Y042?rpc=401 | Oil little changed, U.S. ties 18-year low after OPEC cuts demand forecast | Oil little changed, U.S. ties 18-year low after OPEC cuts demand forecast
By Scott DiSavino3 Min Read
NEW YORK (Reuters) - Oil prices ended little changed on Thursday after OPEC’s lowering of its global demand forecast for 2020 was offset by some European countries saying they would relax coronavirus restrictions, pointing to a potential rebound in consumption.
FILE PHOTO: A maze of crude oil pipes and valves is pictured during a tour by the Department of Energy at the Strategic Petroleum Reserve in Freeport, Texas, U.S. June 9, 2016. REUTERS/Richard Carson/File Photo
Brent futures LCOc1 gained 13 cents, or 0.5%, to settle at $27.82 a barrel. U.S. West Texas Intermediate (WTI) crude CLc1 ended the day unchanged at $19.87, marking a second straight day of closing at its lowest since February 2002.
The crude market has not been able to rally even after the Organization of the Petroleum Exporting Countries and its Russia-led allies, a group known as OPEC+, came to a deal at the weekend to drastically cut world supply.
Traders said that because some countries in Europe are easing lockdowns, however, fuel demand could rebound sooner than anticipated. Officials at the World Health Organization warned countries to move with extreme caution before relaxing restrictions.
“Some of Europe is starting to open up. That’s supportive for Brent,” said John Kilduff, partner at hedge fund Again Capital LLC in New York.
In its latest monthly report, OPEC forecast that global oil demand would contract by 6.9 million barrels per day (bpd), or 6.9%, in 2020. [OPEC/M]
That forecast, along with Wednesday’s report that U.S. crude stockpiles rose by a record 19.2 million barrels last week, tempered the optimism that grew out of the OPEC+ supply deal to reduce output by 9.7 million bpd for May and June. [EIA/S].
Hoped-for cuts of another 10 million bpd from other countries, including the United States, could lower production by around 20 million bpd, although those cuts are expected to take months to come to fruition.
Following the end of trading, Saudi Arabia and Russia, in a joint statement, said they would continue to monitor oil markets and were ready to take joint measures with the rest of OPEC+ if needed.
“Oil prices must remain depressed to force shut-ins among non-cartelised producers,” said Norbert Ruecker, head of economics at Swiss bank Julius Baer, referring to producers such as the United States, where a lot of production is unprofitable at current prices.
ConocoPhillips COP.N said it would cut U.S. and Canadian oil production by around 225,000 bpd due to the collapse in crude prices. U.S. and Canadian companies have so far announced roughly 730,000 bpd in production cuts.
In Russia, energy firms have already significantly reduced oil export plans for May following the OPEC+ deal, three company sources and two traders told Reuters.
Reporting by Scott DiSavino; Additional reporting by Shadia Nasralla in London, Roslan Khasawneh in Singapore and Aaron Sheldrick in Tokyo; Editing by Marguerita Choy, Elaine Hardcastle and Tom HogueOur Standards: The Thomson Reuters Trust Principles.
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c78d739085042130c20989c50d8438d2 | https://www.reuters.com/article/us-global-oil/u-s-oil-plunges-25-brent-falls-below-20-a-barrel-idUSKCN2280TP | U.S. oil plunges 25%, Brent falls below $20 a barrel | U.S. oil plunges 25%, Brent falls below $20 a barrel
By Stephanie Kelly4 Min Read
NEW YORK (Reuters) - Brent crude fell below $20 a barrel and U.S. crude plunged 25% on Monday, driven lower by skittish investors fleeing the U.S. benchmark due to lack of available storage to deal with a coronavirus-induced collapse in demand.
FILE PHOTO: An oil pump jack pumps oil in a field near Calgary, Alberta, Canada on July 21, 2014. REUTERS/Todd Korol
Even as governments worldwide are taking tentative steps towards reducing restriction on movement to help economies rebound, fuel demand remains weak.
Fuel demand is down 30% globally, and storage is becoming precious, with roughly 85% of worldwide onshore storage full as of last week, according to Kpler data.
Economic concerns continue to plague the market. Global economic output is expected to contract by 2% this year - worse than the financial crisis - while demand has collapsed by 30% because of the pandemic.
U.S. West Texas Intermediate crude futures (WTI) fell $4.16, or 24.6%, to settle at $12.78 a barrel. Brent crude slid $1.45, or 6.8%, to settle at $19.99 a barrel.
Traders also said the crude contract is down in part because retail investment vehicles like exchange-traded funds are shifting their investments away from front month June contracts to avoid getting trapped as many did a week ago, when the oil contract dropped to minus $37.63 a barrel.
Oil futures ended their third straight week of losses last week with a 24% drop for Brent and a 7% slide for WTI. The markets have fallen for eight of the past nine weeks.
(Graphic: Cushing crude stockpiles surge link: )
After last week's losses, the United States Oil Fund LP USO.P, the largest oil exchange product, said it would further shift its holdings into later-dated contracts, selling all of its holdings in the June contract.
That fund was hit hard last week after the May contract lapsed into negative territory just before its expiry. USO at the time did not hold any May contracts.
As of Friday, the fund held nearly 14,000 NYMEX June contracts, roughly 4% of the current open interest in the June contract. In the last several days the fund has sold a sizeable part of its June position; in Monday’s announcement, it said it will sell the rest of its June holdings by Thursday.
“The USO filing undermines confidence in the oil market for June, and it has sunk prices today,” said Cailin Birch, global economist at The Economist Intelligence Unit. “However, it doesn’t change the economic outlook for June, which was always going to be difficult.
The Industrial and Commercial Bank of China (ICBC) <601398.SS 1398.HK> said it will suspend all open positions for retail investor products linked to commodities futures, including crude oil, natural gas, copper and soybeans, from Tuesday.
Crude oil stockpiles at the Cushing, Oklahoma delivery hub for WTI rose over 6% in the week to April 24 to around 65 million barrels, market participants said, citing a Monday report from Genscape. However, inventories only increased 0.5% from Tuesday through Friday.
“Inputs in Cushing have slowed a bit, which either signals they’re finding alternative places to put the oil or a major drop in production,” said Phil Flynn, senior market analyst at Price Futures Group.
Additional reporting by Noah Browning in London and Florence Tan in Singapore and Scott DiSavino and David Gaffen in New York; Editing by Marguerita Choy and Mark PotterOur Standards: The Thomson Reuters Trust Principles.
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28bebb605e360a2687f8d0851fb22d17 | https://www.reuters.com/article/us-global-oilmajors-m-a-analysis/big-oils-patchy-deals-record-casts-shadow-over-green-makeover-idUSKBN25S3RS?il=0 | Big Oil's patchy deals record casts shadow over green makeover | Big Oil's patchy deals record casts shadow over green makeover
By Ron Bousso8 Min Read
LONDON (Reuters) - As major oil companies prepare to spend billions on renewable energy assets to stay relevant in a low-carbon future, the industry’s patchy track record on takeovers is a red flag for some investors.
FILE PHOTO: The sun sets behind a crude oil pump jack on a drill pad in the Permian Basin in Loving County, Texas, U.S. November 24, 2019. Picture taken November 24, 2019. REUTERS/Angus Mordant/File Photo
Ten years ago, the world’s top energy companies were spending billions of dollars on major oil and gas assets and costly drilling programmes in remote parts of the world in a relentless drive to produce more.
Fast forward through an oil price crash in 2014 followed by the fallout from the coronavirus pandemic this year and some big oil companies are counting the cost of the spending spree - as are their shareholders.
When Shell RDSa.L bought BG Group for $54 billion in 2016 in the midst of the price crash, Chief Executive Ben van Beurden made a compelling case to investors: The deal would support Shell's dividend under almost any imaginable oil price scenario.
Four years later, with the world gripped by an unexpected global pandemic, the Anglo-Dutch company has slashed its dividend for the first time since the Second World War and suspended what was the world’s biggest share buyback programme.
For investors, the deal crowned a decade of disappointing takeovers, from Exxon Mobil's XOM.N $30 billion acquisition of North American natural gas producer XTO in 2009 to Repsol's REP.MC $8.3 billion takeover of Canada's Talisman Energy just months before the 2014 crash to Occidental Petroleum's OXY.N ill-timed $38 billion bet on shale producer Anadarko last year.
Now, with European policymakers cracking down on greenhouse gas emissions, the region’s major oil companies have promised to reinvent themselves as low-carbon power suppliers that would thrive in a world of clean energy.
To hit their goals in time, though, they will almost inevitably have to chase a relatively small pool of renewable energy assets in competition with big utility companies at a time valuations are going through the roof.
And some investors worry that history will repeat itself.
“The majors have been poor capital allocators for the better part of the past 20 years,” said Chris Duncan, an analyst at Brandes Investment Partners which has shares in several European oil firms. “I’m nervous ... usually when companies transition to a different market the transition is not a profitable process.”
BP BP.L and Total TOTF.PA will present details about their new strategies to investors this month. Repsol will hold its strategy day in November and Shell's will be in February.
Graphic: Big Oil's recent writedowns -
‘THE SAME MISTAKES’
The collapse in oil prices since COVID-19 struck has also forced the big companies to wipe billions of dollars off the value of their assets and it has also hit revenue to the point they’ve taken on more debt to keep up payments to shareholders.
Shell, for example, cut $16.8 billion off the value of its assets, which included a big chunk of the flagship QCLNG liquefied natural gas (LNG) plant in Australia it acquired through the BG deal.
All told, the world’s top energy companies have booked asset writedowns totalling $60 billion this year following the slide in oil prices and demand during the coronavirus pandemic.
Energy companies listed in the S&P 500 index accounted for 60% of $329 billion in write-offs over the past decade, according to Evercore ISI analyst Doug Terreson.
“CEOs overestimated capital allocation skills and underestimated competitive threats,” Terreson said.
And since 2005, the combined debt of the top five global oil majors, which include Shell, BP and Total, has risen five fold to $370 billion. That means much of the cash they will generate in the coming years will probably go towards cutting debt.
Graphic: Big Oil's soaring debt -
So as oil companies chase renewable assets such as wind, solar and hydro, which generally have lower returns than oil and gas - or invest in green projects from scratch - they’ll be starting from an already highly leveraged position.
Some analysts said that with record debts, an uncertain outlook for oil prices and a weak deal-making record, the big oil companies face a tough task getting investors on board.
“The European majors in particular will have to earn the right to invest more in renewables, and convince investors they will not make the same mistakes again, and again,” said RBC Capital Markets analyst Biraj Borkhataria.
“When Shell acquired BG Group, a key quote from Shell’s CEO stuck with us: ‘Bold, strategic moves shape our industry’. Unfortunately, many of the ‘bold’ moves from management teams in recent years have proven to destroy value over the long term for shareholders,” he said.
Speaking in July, Shell’s CEO stood by the deal.
“The company did get stronger, but indeed the company was not able to withstand the onslaught of COVID if we wanted to adopt a prudent stance ... I remain convinced it was the right move,” van Beurden told reporters.
Three current and former BG and Shell executives interviewed by Reuters, however, believe the deal was overvalued even at the time due to bullish oil and gas price forecasts.
LOWER RETURNS
Big oil companies have historically attracted investors with a promise of large and steady dividends. But the sector has had a poor track record from shareholders’ perspective of late.
Over the past five years, Shell’s total shareholder returns stood at minus 2.9%, according to Refinitiv data.
The picture is similar for others including BP, Exxon Mobil and Total. In addition to Shell, BP and Norway's Equinor EQNR.OL, have also cut dividends and suspended share buybacks.
BP’s total shareholder return, which assumes dividends are reinvested in its shares, is just 1.4% since 2015, while for Exxon it was minus 7.3%, the weakest in the sector, according to Refinitiv data.
Chevron CVX.N had the strongest total returns at 5.9%.
By comparison, returns from Apple AAPL.O shares over the past five years are above 40% while Google's Alphabet GOOGL.O shares have returned more than 15%.
Graphic: Big Oil's total returns -
Graphic: European renewable power companies vs oil majors -
The steady drop in the value of oil companies - BP’s market capitalisation has halved over the past two years to about $75 billion, for example – might also make it harder for them to land large acquisitions of renewable assets or power companies which have seen they shares surge in recent years.
Shares in Danish renewables power firm Orsted ORSTED.CO, for example, have more than doubled over the past two years, giving it a market capitalisation of about $45 billion.
Shares in Spanish utility Iberdrola IBE.MC, one of the world's biggest renewable power companies have jumped 180% in two years to give it a market value above $80 billion.
Valuations of companies such as Orsted could also rise further as many of Europe’s top oil and gas companies compete amongst themselves to expand their low-carbon businesses fast.
Still, some investors said that as the European oil companies evolve into becoming low-carbon businesses, they might attract a different kind of investor more interested in long-term stability than bumper shareholder payouts year after year.
“Traditional oil and gas investors are fond of the high returns and, until recently, the outsized dividends associated with the sector.” said Alasdair McKinnon, portfolio manager at The Scottish Investment Trust.
“However, this shift may attract a different set of investors who look at the prospectively lower returns on offer from renewables with a less jaundiced eye.”
Reporting by Ron Bousso; editing by David ClarkeOur Standards: The Thomson Reuters Trust Principles.
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4784113d75872e83a87f91828549eeb9 | https://www.reuters.com/article/us-global-pandemic-insurance-idUSKBN19J2JJ?feedType=RSS&feedName=healthNews | World Bank launches 'pandemic bond' to tackle major outbreaks | World Bank launches 'pandemic bond' to tackle major outbreaks
By Reuters Staff4 Min Read
LONDON (Reuters) - The World Bank has launched a “pandemic bond” to support an emergency financing facility intended to release money quickly to fight a major health crisis like the 2014 Ebola outbreak.
World Bank Group President Jim Yong Kim delivers his speech during the Belt and Road Forum for International Cooperation in Beijing, China May 14, 2017. REUTERS/Lintao Zhang/Pool
The catastrophe bond, which will pay out depending on the size of the outbreak, its growth rate and the number of countries affected, is the first of its kind for epidemics. It should mean money is disbursed much faster than during West Africa’s Ebola crisis.
Ebola spread across the region in the early months of 2014. Michael Bennett, head of derivatives and structured finance at the World Bank’s capital markets department, said that if the pandemic emergency financing facility (PEF) had existed in 2014, some $100 million could have been mobilised as early as July.
In reality, money did not begin to flow on this scale until three months later, by which time the number of deaths from Ebola had increased tenfold.
“In the end about 11,000 people died in that pandemic and it’s estimated that the cost to the countries most affected – Guinea, Liberia and Sierre Leone - was about $2.8 billion,” Bennett said.
The PEF will offer coverage to all countries eligible for financing from the International Development Agency (IDA), the arm of the World Bank dedicated to the world’s poorest countries.
It covers outbreaks of infectious diseases most likely to cause major epidemics, including pandemic influenza strains; coronaviruses, including SARS; filoviruses, which include Ebola and Marburg; plus others such as Crimean Congo fever, Rift Valley fever and Lassa fever.
Bennett said the PEF as a whole would provide more than $500 million of coverage against pandemics over the next five years. This includes today’s $425 million transaction, comprising $320 million raised through the bond market and $105 million through swaps transactions.
The transaction was oversubscribed by 200 percent, attracting interest from dedicated cat bond investors, asset managers, pension funds and endowments, the World Bank said.
For the pandemic bond, the World Bank will pay bondholders a coupon that replicates an insurance premium plus a funding spread, in return for a payout if the bond is triggered.
“If a trigger event occurs, instead of repaying the bond in full, some or all of the principal is transferred to the PEF trust fund,” Bennett said. “So essentially the investors are acting like insurance companies.”
Under the swaps transactions, the swaps counterparty pays out if a trigger event occurs.
“The objective of offering the risk in both forms is that the bonds and swaps appeal to different types of investors, and therefore … we are creating the broadest possible investor pool for this risk,” said Bennett. That helped drive down prices.
A replenishable cash window available from 2018 will provide funding for diseases that may not meet the activation criteria for the bond, whilst future donor commitments may be used to purchase additional coverage from the market.
Munich Re, which helped develop the insurance component of the PEF in conjunction with Swiss Re and catastrophe risk modeller AIR Worldwide, said pandemics were among the most likely uninsured risks to occur.
The annual global cost of moderately severe to severe pandemics is estimated at roughly $570 billion, or 0.7 percent of global income, the World Bank said.
Reporting by Claire Milhench; editing by Andrew RocheOur Standards: The Thomson Reuters Trust Principles.
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b018e461104ebf83bf909f1f12911cce | https://www.reuters.com/article/us-global-pollution-health/air-pollution-killing-more-people-than-smoking-say-scientists-idUSKBN1QT185 | Air pollution killing more people than smoking, say scientists | Air pollution killing more people than smoking, say scientists
By Amber Milne3 Min Read
LONDON (Thomson Reuters Foundation) - Air pollution is killing more people every year than smoking, according to research published on Tuesday that called for urgent action to stop burning fossil fuels.
FILE PHOTO: A small-particle haze hangs above the skyline in Paris, France, December 9, 2016 as the City of Light experienced the worst air pollution in a decade. REUTERS/Gonzalo Fuentes
Researchers in Germany and Cyprus estimated that air pollution caused 8.8 million extra deaths in 2015 - almost double the previously estimated 4.5 million.
The World Health Organization (WHO) estimates smoking kills about 7 million people a year globally.
The researchers found that in Europe - the key focus of the European Society of Cardiology research - air pollution caused an estimated 790,000 deaths, between 40 and 80 percent of them from cardiovascular diseases such as heart attacks and stroke.
“Since most of the particulate matter and other air pollutants in Europe come from the burning of fossil fuels, we need to switch to other sources for generating energy urgently,” said co-author Prof. Jos Lelieveld, of the Max-Plank Institute for Chemistry in Mainz and the Cyprus Institute Nicosia, Cyprus.
“When we use clean, renewable energy, we are not just fulfilling the Paris Agreement to mitigate the effects of climate change, we could also reduce air pollution-related death rates in Europe by up to 55 percent.”
The study, published in the European Heart Journal, focused on ozone and the smallest pollution particles, known as PM2.5, that are particularly harmful to health as they can penetrate into the lungs and may even be able to cross into the blood.
The researchers said new data indicated the hazardous health impact of PM2.5 - the main cause of respiratory and cardiovascular disease - was much worse than previously thought.
They urged a reduction in the upper limit for PM2.5 in the European Union, which is currently set at 25 micrograms per cubic meter, 2.5 times higher than the WHO guideline.
“In Europe the maximum permissible value ... is much too high,” said Lelieveld and co-author Prof. Thomas Munzel, of the Department of Cardiology of the University Medical Center Mainz in Germany, in a joint statement.
“In the USA, Australia and Canada the WHO guideline is taken as a basis for legislation, which is also needed in the EU.”
Worldwide, air pollution caused 120 extra deaths in every 100,000 people per year, with deaths in parts of Europe at an even higher rate of up to 200 in 100,000.
“To put this into perspective, this means that air pollution causes more extra deaths a year than tobacco smoking,” said Munzel.
“Smoking is avoidable but air pollution is not.”
Reporting by Amber Milne, Editing by Claire Cozens. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers that covers humanitarian news, women's and LGBT+ rights, human trafficking, property rights, and climate change. Visit news.trust.orgOur Standards: The Thomson Reuters Trust Principles.
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19e9133953d215f543d63f999381e3f9 | https://www.reuters.com/article/us-global-precious-idUSKBN20W040 | Gold jumps past $1,700 level for first time in seven years on virus fears | Gold jumps past $1,700 level for first time in seven years on virus fears
By Reuters Staff3 Min Read
(Reuters) - Gold prices jumped past the $1,700 per ounce level for the first time since late 2012 on Monday, as a widening coronavirus outbreak and a plunge in crude oil hammered equities and sent investors scurrying for safe havens.
FILE PHOTO: Gold bullions are displayed at GoldSilver Central's office in Singapore June 19, 2017. REUTERS/Edgar Su/File Photo
FUNDAMENTALS
* Spot gold XAU= rose 1.5% to $1,699.20 per ounce by 0054 GMT, having touched its highest since December 2012 at $1,702.45 earlier in the session.
* U.S. gold futures GCv1 jumped 1.6% to $1,699.70 per ounce.
* Asian equities sank as investors fled to bonds to hedge the economic shock of the coronavirus, and oil plunged more than 20% after Saudi Arabia slashed its official selling price.
* The price of futures contracts for the S&P 500 index, a Wall Street benchmark, fell more than 4% on Sunday as off-hours trading for U.S. equity markets resumed.
* The Japanese yen JPY= jumped to a more than three-year high against the dollar, while U.S. benchmark 10-year Treasury yields fell to a record low.
* Japan’s economy shrank faster than initially estimated in the fourth quarter on a bigger decline in business spending, data showed, casting a deeper shadow over the outlook as the virus hit production and heightened recession risks.
* Mainland China had 40 new confirmed cases of infections on Sunday, the National Health Commission said, taking the country’s total number of confirmed cases to 80,735.
* China’s exports contracted sharply in the first two months of the year while imports declined, data showed on Saturday, as the health crisis triggered by the outbreak caused massive disruptions to business operations, global supply chains and economic activity.
* The epidemic likely halved China’s economic growth in the current quarter compared with the previous three months, more severe than thought three weeks ago and triggering expectations for earlier interest rate cuts, a Reuters poll found.
* Italy’s markets will open as usual on Monday, but traders are expecting a wild start to the week after the government ordered a lockdown of large parts of the north of the country on Sunday, including the financial capital Milan, to fight the virus.
* Palladium XPD= fell 2.9% to $2,492.38 per ounce, while platinum XPT= was down 1.2% to $890.41
* Silver XAG= gained 0.3% to $17.37 per ounce.
Reporting by K. Sathya Narayanan in Bengaluru; Editing by Subhranshu SahuOur Standards: The Thomson Reuters Trust Principles.
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5b830e100b168a0d758720d66daee938 | https://www.reuters.com/article/us-global-precious-idUSKCN0UX19Q | Gold drops as China stimulus bets lift appetite for risk | Gold drops as China stimulus bets lift appetite for risk
By Clara Denina3 Min Read
LONDON (Reuters) - Gold fell on Tuesday as the dollar and equity markets rose after data showing China’s weakest economic growth in years fanned stimulus hopes and spurred investors towards riskier assets.
A woman holds a one-kilogram gold bar at the headquarters of the Australian Bullion Company (ABC) in Sydney April 19, 2013. REUTERS/Daniel Munoz
Data showed that the world’s second-biggest economy grew 6.8 percent in the fourth quarter, the slowest rate since 2009. For 2015 as a whole China’s growth came in at 6.9 percent, the weakest in 25 years.
Spot gold was down 0.4 percent at $1,084.60 an ounce by 1247 GMT (0747 EDT) after a lethargic session on Monday when U.S. markets shut for the Martin Luther King holiday. U.S. gold for February delivery fell 0.6 percent to $1,084.20.
Bullion had scaled a two-month high of $1,112 on Jan. 8 as investor appetite for risk decreased on renewed concerns about global growth, especially a slowdown in China and whether authorities in Beijing can manage it.
“As long as there is confusion about how China manages exchange rate policy, how they will intervene in the stock market and so on, there will be some safe-haven demand for gold,” Danske Bank senior analyst Jens Pedersen said.
“However, even though we have seen a re-pricing of the Fed’s rate hike this year (the market doesn’t expect a full rate hike before December), we haven’t seen much dollar weakness and that’s because the market is expecting monetary easing from other central banks.”
The dollar was up 0.2 percent against a basket of major currencies, making gold more expensive for foreign holders.
Gold slid 10 percent last year on fears that higher U.S. interest rates would lower demand for the non-interest-paying asset and continued dollar strength caps gold’s upside.
Weak physical demand from top gold consumers China and India has also limited gold’s upside potential, analysts said, with Chinese consumer spending dented by its slowing economy.
“It seems unlikely that any particular group would put a floor under the gold price at this stage,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney.
Spot platinum climbed 1.3 percent to $828.81 an ounce after falling to a seven-year low of $812.95 in the previous session.
Palladium rose 1.5 percent to $498.95 and silver gained 0.5 percent to $14.02.
Additional reporting by Manolo Serapio Jr. in Manila; Editing by David GoodmanOur Standards: The Thomson Reuters Trust Principles.
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b60bc68fe20d60785e310c13ce176364 | https://www.reuters.com/article/us-global-precious-royals/meghan-markle-makes-gold-sales-sparkle-idUSKCN1IQ0FU | Meghan Markle makes gold sales sparkle | Meghan Markle makes gold sales sparkle
By Renita D. Young3 Min Read
NEW YORK (Reuters) - The Meghan Markle effect has spread to yellow gold jewelry, helping boost United States sales in the first quarter of 2018 with further gains expected, jewelers said.
The first three months of the year were the strongest first quarter for gold jewelry demand in the United States since 2009, according to the World Gold Council. Sellers say that is due in no small part to the public’s fascination with American actor Meghan Markle, who was engaged to Britain’s Prince Harry last November and who married him in a dazzling ceremony on Saturday.
Meghan, Duchess of Sussex, favors yellow gold.
“Around that time (of the engagement), we started seeing more sales of yellow gold and the last couple months it’s increased more,” David Borochov, of New York-based R&R Jewelers, said on Thursday. “Yellow gold jewelry sales have risen about 30 percent this year.”
For the last 15 years, white gold, silver and platinum have been the metals of choice for jewelry and couples tying the knot, jewelers said. Over the last few years, rose gold has become a favorite, while yellow gold was considered outdated.
Borochov said he typically sells about 70 to 80 percent in white gold and platinum, and 20 to 30 percent in yellow and rose gold. He expects the latter to increase.
“We saw an increase of about 20 percent (in yellow gold jewelry sales) from the beginning of the year,” said Nerik Shimunov, owner of Crown Jewelers in New York, which specializes in custom jewelry pieces for celebrities.
Meghan and Harry told the BBC in November that yellow gold is her favorite; her engagement ring is set in that metal.
Gold jewelry sales at Chicago-based Daniel Levy Jewelry increased by 10 percent after the engagement, “primarily because of the surplus of white gold,” said Daniel Levy, though he noted a recognizable shift to yellow gold.
Celebrity purchases influence jewelry sales, said Alistair Hewitt, the World Gold Council’s director of market intelligence. Council research from 2016 found that 22 percent of U.S. women buying jewelry or luxury fashion were inspired by magazines and newspapers, with another 11 percent citing influence from celebrities.
“It would not be surprising to see the coverage of the royal wedding – including the choice of engagement ring and wedding band – influence shoppers’ behavior,” he said.
Reporting by Renita D. Young in New York; Editing by David Gaffen and Matthew LewisOur Standards: The Thomson Reuters Trust Principles.
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6df4b26e2bff06c6480a7005a4a2a573 | https://www.reuters.com/article/us-global-precious/palladium-breaks-1500-level-on-supply-woes-weak-dollar-lifts-gold-idUSKCN1Q9024?edition-redirect=uk | Palladium breaks $1,500 level on supply woes; weak dollar lifts gold | Palladium breaks $1,500 level on supply woes; weak dollar lifts gold
By Karthika Suresh Namboothiri3 Min Read
(Reuters) - Palladium prices broke above $1,500 for the first time on Wednesday due to a prolonged supply deficit, while gold rose to a fresh 10-month high as the dollar struggled ahead of the U.S. Federal Reserve’s policy meeting minutes.
FILE PHOTO: Gold bullion is displayed at Hatton Garden Metals precious metal dealers in London, Britain July 21, 2015. REUTERS/Neil Hall/File Photo
Palladium is crucial in the making of catalytic converters used in exhaust systems of vehicles, and an improvement in demand from the auto sector has supported the metal’s surge.
“Demand (for palladium) is increasing year by year because of catalyst demand for gasoline engines. Environmental requirements are getting stronger, which means more palladium is needed in (manufacturing) a car,” said Yuichi Ikemizu, Tokyo branch manager at ICBC Standard Bank.
Furthermore, the supply deficit is likely to widen this year as stricter emissions standards increase demand for catalytic converters, Britain-based autocatalyst manufacturer Johnson Matthey said last week.
Spot palladium rose to an all-time high of $1,500.50 per ounce and was 0.7 percent higher at $1,490 as of 0800 GMT. The autocatalyst metal has gained almost 19 percent so far this year, making it one of the best performing metals.
Gold prices hit their highest since April 19, 2018 as the dollar was capped on falling U.S. Treasury yields and optimism surrounding trade talks between the United States and China.
U.S. President Donald Trump said on Tuesday that trade talks with China were going well and suggested he was open to pushing off the March 1 deadline to complete negotiations.
Most investors expect uncertainties over U.S.-China trade talks to end this week, which will weaken the dollar and support gold, said Hareesh V, head of commodity research at Geojit Financial Services.
Progress in trade discussions between the world’s top two economies has whisked off the safe-haven appeal for the dollar, making gold more attractive to investors.
Spot gold was up 0.1 percent at $1,342.46 per ounce after rising to a high of $1,346.73 earlier in the session.
U.S. gold futures were steady at $1,345.40.
Investors are now looking ahead to the release of U.S. Federal Open Market Committee’s minutes from its Jan. 29-30 policy meeting at 1900 GMT.
“The dovish shift in U.S. Federal Reserve language over the year-to-date has improved the fundamental outlook for gold prices,” Fitch Solutions said in a note.
“A less steep trajectory for U.S. rate hikes bolsters our existing view that U.S. dollar gains are behind us and that this will help put a floor under gold prices.”
Spot gold may peak around a resistance at $1,351 per ounce, as suggested by a projection analysis and a rising trendline, according to Reuters market analyst Wang Tao.
Among other precious metals, platinum was down 0.2 percent at $815.63 per ounce, while spot silver was up 0.2 percent at $16.01.
Reporting by Karthika Suresh Namboothiri in Bengaluru; Editing by Subhranshu Sahu and Rashmi AichOur Standards: The Thomson Reuters Trust Principles.
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3d0a146612c7f255346fad27115d3796 | https://www.reuters.com/article/us-global-privateequity-breakingviews-idUSKCN2AT1U9 | Breakingviews - Private equity growth fetish stores up future pain | Breakingviews - Private equity growth fetish stores up future pain
By Liam Proud3 Min Read
A man speaks on his phone as he walks past The Gherkin and other office buildings in the City of London, Britain November 13, 2018.
LONDON (Reuters Breakingviews) - Buyout barons may no longer be the rapacious cost-cutters of popular imagination. According to consultancy Bain & Co’s annual private equity study, released on Monday, the industry is pinning its hopes on boosting revenue to justify rich valuations. The cuddlier image risks lower returns.
Private equity titans like Blackstone’s Steve Schwarzman and KKR’s Henry Kravis spent $592 billion in 2020, or 7% more than the five-year annual average. Valuations also defied the pandemic. The average deal in the United States was done at a near-record 11.4 times enterprise value to EBITDA multiple, while Europe’s 12.6 times was the highest ever. Since 65% of deals were in sectors that are resilient to lockdowns, like technology, it’s unlikely that the high multiples reflect falling EBITDA from the crisis.
How can Schwarzman and co make money with prices so high? The answer, increasingly, is growth. Bain’s analysis found that private equity returns are now predominantly driven by boosting revenue and selling companies at a richer valuation than when they are bought. Since the latter tactic, known as multiple expansion, is unlikely to work with today’s high purchase prices, the onus is on increasing sales.
The shift away from cost-cutting makes sense. The proportion of secondary buyouts, or those companies which have already been through the private equity wringer, is rising, meaning less fat to cut. And public companies, with the help of activists, keep a tighter leash on expenses.
Yet relying on growth makes it harder to justify high prices. A buyout firm that acquires a company for 12.6 times EBITDA, and sells it five years later at the same multiple without improving profitability, would need revenue to grow by 8% a year to hit the 20% internal rate of return that private equity groups typically target. That’s according to Breakingviews calculations that assume leverage of 7 times EBITDA, with annual interest costs of 5%.
Few companies consistently increase their revenue that fast. The median annual growth forecast over the next three years for firms in the FTSE 100 and S&P 500 indexes is just 5.6%, Refinitiv data shows. Less than one-third of the group will surpass 8%. Meanwhile buyout funds have roughly $1 trillion of cash to spend, Bain reckons, meaning more capital is chasing a dwindling number of targets. Private equity’s growth fetish risks shrinking returns.
BreakingviewsReuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.Sign up for a free trial of our full service at https://www.breakingviews.com/trial and follow us on Twitter @Breakingviews and at www.breakingviews.com. All opinions expressed are those of the authors.
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f8331b4ad936571f5f8e8c33bd34d3b5 | https://www.reuters.com/article/us-global-protests-idUSKBN1X127J | Season of discontent: protests flare around the world | Season of discontent: protests flare around the world
By Reuters Staff6 Min Read
(Reuters) - Another day, another protest.
On Monday it was Bolivia - angry people clashed with police after the political opposition said it had been cheated in an election won by incumbent President Evo Morales.
Last week, the streets of the Chilean capital Santiago descended into chaos, as demonstrators enraged by a hike in public transport fares looted stores, set a bus alight and prompted the president to declare a state of emergency.
Earlier this month, Ecuador’s leader did the same after violent unrest triggered by the decision to end fuel subsidies that had been in place for decades.
And that was just South America.
Hong Kong has been in turmoil for months, Lebanon’s capital Beirut was at a standstill, parts of Barcelona resembled a battlefield last week and tens of thousands of Britons marched through London at the weekend over Brexit.
Protests have flared around the world in the last few months. Each has had its own trigger, but many of the underlying frustrations are similar.
Globalization and technological progress have, in general, exacerbated disparities within countries, said Sergei Guriev, former chief economist of the European Bank for Reconstruction and Development, while noting that not all of the current protests were driven by economic concerns.
Digital media has also made people more acutely aware of global inequalities, said Simon French, chief economist at UK bank Panmure Gordon.
“We know that the economics of happiness is largely driven by a relative assessment of your position versus your benchmark,” he said, a benchmark that now stretched way beyond the local community.
Slideshow ( 6 images )
ECONOMICS
In at least four countries hit by recent violent protests, the main reason for the uprising is economic.
Governments in Chile and Ecuador have incurred their people’s wrath after trying to raise fares and end fuel subsidies.
As clashes engulfed Quito, Ecuadorean President Lenin Moreno reached out to indigenous leaders who had mobilized people to take to the streets.
Within minutes, chief protest organizer Jaime Vargas had rejected that outreach.
“We’re defending the people,” Vargas said in a live Facebook video from the march in Quito.
His response, visible to millions of people, underlines an added challenge authorities have when trying to quell dissent: social media has made communication between protesters easier than ever.
Tens of thousands of people have flooded Beirut in the biggest show of dissent against the establishment there in decades. People of all ages and religions joined to protest about worsening economic conditions and the perception that those in power were corrupt.
Similar factors were behind deadly civil unrest in Iraq in early October.
More than 100 people died in violent protests across a country where many Iraqis, especially young people, felt they had seen few economic benefits since Islamic State militants were defeated in 2017.
Security forces cracked down, with snipers opening fire from rooftops and the internet being shut to stem the flow of information among protesters.
Slideshow ( 6 images )
GIVE US OUR AUTONOMY
Hong Kong has been battered by five months of often violent protests over fears Beijing is tightening its grip on the territory, the worst political crisis since colonial ruler Britain handed it back to China in 1997.
There have been few major rallies in recent weeks, but violence has escalated at those held, with militant activists setting metro stations ablaze and smashing up shops, often targeting Chinese banks and stores with mainland links.
Police have fired thousands of rounds of tear gas, hundreds of rubber bullets and three live rounds at brick- and petrol bomb-throwing activists.
The events in Hong Kong have drawn comparisons to Catalonia in recent days. There, too, people are angry at what they see as attempts to thwart their desire for greater autonomy from the rest of Spain, if not outright independence.
Protesters set cars on fire and threw petrol bombs at police in Barcelona, unrest sparked by the sentencing of Catalan separatist leaders who sought to declare an independent state.
Demonstrators also focused on strategic targets to cause maximum disruption, including the international airport, grounding more than 100 flights.
That came several days after similar action in Hong Kong, suggesting that protest movements are following and even copying each other on social media and the news.
“In Hong Kong they have done it well, but they are crazier,” said Giuseppe Vayreda, a 22-year-old art student at a recent Catalan separatist protest.
On Thursday, Hong Kong protesters plan a rally to show solidarity with those demonstrating in Spain.
LEADER OR NO LEADER
In some cases, individuals rise to the forefront of protest movements, using social media to get their message across.
In Egypt, where demonstrations last month were relatively small yet significant in their rarity, the catalyst of dissent against President Abdel Fattah al-Sisi was an Egyptian posting videos from Spain.
Greta Thunberg, a Swedish teenager, inspired millions of people to march through cities around the world in September to demand that political leaders act to stop climate change.
Tens of thousands gathered in a New York park to listen to her speech.
“If you belong to that small group of people who feel threatened by us, then we have some very bad news for you,” she said. “Because this is only the beginning. Change is coming whether they like it or not.”
Reporting by Reuters correspondents; Additional reporting by Andrea Shalal and Heather Timmons in Washington; Writing by Mike Collett-White; Editing by Nick Tattersall and Sonya HepinstallOur Standards: The Thomson Reuters Trust Principles.
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fca1c2a7c51c94687ed5c29f1e8c2157 | https://www.reuters.com/article/us-global-protests-markets-graphic/global-protests-gaining-attention-in-financial-markets-idUSKBN1X326E | Global protests gaining attention in financial markets | Global protests gaining attention in financial markets
By Marc Jones, Mike Dolan10 Min Read
LONDON (Reuters) - An alarming spread of street protests and civil unrest across the world in recent weeks looms large on the radar of financial markets, with investors wary the resulting pressures on stretched government finances will be one of many consequences.
FILE PHOTO: An anti-government protester hits by a tear gas canister during a protest march in Hong Kong, China October 20, 2019. REUTERS/Tyrone Siu
Money managers and risk analysts seeking a common thread between often unconnected sources of popular anger - in Hong Kong, Beirut, Cairo, Santiago and beyond - reckon the unrest is particularly worrying following years of modest global economic growth and relatively low joblessness.
If, as many fear, the world is slipping back into its first recession in more than a decade, then the root causes of restive streets will only deepen and force embattled governments to loosen purse strings further to fund better employment, education, healthcare and other services to placate them.
Forced fiscal loosening in a world already swamped with debt and heading into another downturn may unnerve creditors and bond holders, especially those holding government debt as an insurance against recession and a haven from volatility.
“Protests per se are unpredictable for investors by definition and fit a pattern of rising political risks that have affected market perceptions in almost all geographies,” said Standard Chartered Bank strategist Philippe Dauba-Pantanacce.
“Investors will get more nervous when they see that a country’s IMF package or investment promises are conditioned on fiscal consolidation and that the first austerity measures are followed by massive protests.”
More broadly popular pushback against debt reduction and austerity raises serious questions about how still-mushrooming debt loads can be sustained, even after the massive central bank intervention to underwrite it in recent years.
Many also fear the feedback loop.
According to the International Monetary Fund this month, a global downturn half as severe as the one spurred by the last financial crisis in 2007-9 would result in $19 trillion of corporate debt being considered “at risk” - defined as debt from firms whose earnings would not cover the cost of their interest payments let alone pay off the original debt.
Rising bankruptcies at so-called “zombie” firms would, in turn, risk spurring rising job losses and yet more unrest.
Marc Ostwald, global strategist at ADM Investor Services, said he saw many of the protests as ‘straws that break the camel’s back’ - tipping points in a broad swathe of long-standing complaints about inequality, corruption and oppression, variations on the broader themes of populism and anti-globalization.
(Graphic: Google searches on the word protest on the increase, )
But Ostwald said there was a worry for financial markets who have surfed rising debt piles for years thanks to central bank money printing and bond buying.
“At some point the smothering impact of QE (quantitative easing) will run its course,” Ostwald said.
“And as many of the zombie companies then go to the wall, so governments will face rising unemployment and desperately need to borrow money to prop up their economies - particularly as social unrest rises, as we are witnessing.”
Of the dozens of protest movements that have emerged in recent years, here are some of the most prominent ones.
HONG KONG
Hong Kong has been battered by five months of often violent protests after the city state tried to bring in legislation that would have allowed extraditions to mainland China. The plan has been formally withdrawn but it is unlikely to end the unrest as it meets only one of five demands pro-democracy protesters have.
On Tuesday, authorities announced HK$2 billion ($255 million) relief measures for the city’s economy, particularly in its transport, tourism and retail industries. It followed a more sizeable HK$19.1 billion ($2.4 billion) package in August to support the underprivileged and businesses. Hong Kong’s Financial Secretary has also said more assistance will be given if needed.
The Hang Seng, one of Asia’s most prominent share markets, is down 12% since the protests started and although it has been recovered some ground over the last two months, it has continued to lag other major markets.
(Graphic: Hong Kong stocks have suffered during protests , )
LEBANON
Hundreds of thousands of people have been flooding the streets for nearly two weeks, furious at a political class they accuse of pushing the economy to the point of collapse.
Prime Minister Saad al-Hariri announced on Monday a symbolic halving of the salaries of ministers and lawmakers, as well as steps toward implementing long-delayed measures vital to fixing the finances of the heavily indebted state.
Markets are increasingly worried it will all end in default. The government’s bonds are now selling at a 40% discount and Credit Default Swaps, which investor use as insurance against those risks, have soared.
(Graphic: Default alarm bells ringing in Lebanon, )
IRAQ
Similar factors were behind deadly civil unrest in Iraq which flared in early October. More than 100 people died in violent protests across a country where many Iraqis, especially young people, felt they had seen few economic benefits since Islamic State militants were defeated in 2017.
The government responded with a 17-point plan to increase subsidized housing for the poor, stipends for the unemployed and training programs and small loans initiatives for unemployed youth.
EXTINCTION REBELLION
This London-bred movement is pushing for political, economic and social changes to avert the worst devastation of climate change. XR protesters began blockading streets and occupying prominent public spaces late last year, and following 11 days of back-to-back protests in April the UK government symbolically declared a climate “emergency”.
The movement is developing alongside the growing FridaysForFuture led by Swedish teenager Greta Thunberg which sees school children boycott lessons on Fridays.
It has been particularly strong in Germany and the government there recently launched the ‘Gruene Null’ or ‘Green Zero’ policy which specifies that any spending that pushes the government’s budget into deficit must be on climate-focused investments.
Incoming European Commission chief, Ursula von der Leyen, has also introduced an ambitious “European Green Deal” which would include the support of 1 trillion euros ($1.11 trillion) in sustainable investments across the bloc.
Amazon AMZN.O Chief Executive Officer Jeff Bezos last month pledged to make the largest U.S. e-commerce company net carbon neutral by 2040.
CHILE
At least 15 people have died in Chile’s protests which started over a hike in public transport costs but have grown to reflect simmering anger over intense economic inequality as well as costly health, education and pension systems seen by many as inadequate.
Chile’s President Sebastian Pinera announced an ambitious raft of measures on Tuesday aimed at quelling the unrest, including with a guaranteed minimum wage, a hike in the state pension offering and the stabilization of electricity costs.
ECUADOR
Violent protests at the start of October forced Ecuadorean President Lenin Moreno to scrap his own law to cut expensive fuel subsidies that have been in place for four decades.
The government had estimated the cuts would have freed up nearly $1.5 billion per year in the government budget, helping to shrink the fiscal deficit as part of a $4.2 billion IMF loan deal Moreno had signed.
BOLIVIA
Mass protests and marches broke out in Bolivia this week after the opposition said counting in the country’s presidential election at the weekend was rigged in favor of current leader Evo Morales.
The unrest - already the severest test of Morales’ rule since he came to power in 2006 - could spread if his declaration of outright victory is confirmed, after monitors, foreign governments and the opposition called for a second-round vote.
EGYPT
Protests against President Abdel Fattah al-Sisi broke out in Cairo and other cities in September following online calls for demonstrations against alleged government corruption, as well as recent austerity-focused measures.
Protests are rare under the former army chief and about 3,400 people have been arrested since the protests began, including about 300 who have since been released, according to the Egyptian Commission for Rights and Freedoms, an independent body.
The country's main stock market .EGX30 dropped 10% over three days as the protests kicked off although it has since recovered over half of that ground.
FRANCE
The Gilets Jaunes movement named after the fluorescent yellow safety vests that all French motorists must carry began a year ago to oppose fuel tax increases, but quickly morphed into a broader backlash against President Emmanuel Macron’s government, rising economic inequality and climate change.
Macron swiftly reversed the tax hikes and announced a swathe of other measures worth more than 10 billion euros ($11.3 billion) to boost the purchasing power of lower-income voters. That was followed up with another 5 billion euro package of tax cuts in April.
(Graphic: France's bond yields rose during peak of yellow vests protests, )
ARAB SPRING
Beginning in late 2010, anti-government protests roiled Tunisia. By early 2011 they had spread into what became known as the Arab Spring wave of protests and uprisings which ended up toppling not only Tunisia’s leader but Egypt, Libya, and Yemen’s too. The Arab Spring uprisings in Syria developed into a civil war that continues to be waged today.
(Graphic: Bond markets have reacted to some degree to protests , )
ETHIOPIA
A total of 16 people have been killed in at least four cities since fierce clashes broke out on Wednesday against the reformist policies of Nobel Prize-winning Prime Minister Abiy Ahmed.
The greater freedoms that those policies bring have unleashed long-repressed tensions between Ethiopia’s many ethnic groups as local politicians claim more resources, power and land for their own regions. Ethiopia is due to hold elections next year.
Reporting by Marc Jones and Mike Dolan, additional reporting by Karin Strohecker in London and Mitra Taj in La Paz; Editing by Sonya HepinstallOur Standards: The Thomson Reuters Trust Principles.
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59401f64c8db96d14ba9c774041d6f4b | https://www.reuters.com/article/us-global-race-portland-idUSKBN25Q0XN | Portland mayor urges restraint, renunciation of violence after fatal shooting | Portland mayor urges restraint, renunciation of violence after fatal shooting
By Steve Gorman, Maria Caspani5 Min Read
(Reuters) - Officials in Portland, Oregon, said on Sunday they were braced for an escalation of protest-related violence that has convulsed the city for three months, citing social media posts vowing revenge for a fatal shooting amid weekend street clashes between supporters of President Donald Trump and counter-demonstrators.
“For those of you saying on Twitter this morning that you plan to come to Portland to seek retribution, I’m calling on you to stay away,” Mayor Ted Wheeler told an afternoon news conference, urging individuals of all political persuasions to join in renouncing violence.
He also lashed out at Trump for political rhetoric that he said “encouraged division and stoked violence,” and brushed aside a flurry of weekend Twitter posts from the president criticizing Wheeler and urging the mayor to request help from the federal government to restore order.
“It’s an aggressive stance. It’s not collaborative,” Wheeler said of Trump’s tweets. “I’d appreciate it if the president would support us or stay the hell out of the way.”
Wheeler and Police Chief Chuck Lovell said investigators were still working to establish the sequence of events leading to the fatal shooting late Saturday in downtown Portland, and they provided few new details about the investigation.
Lovell said it remained to be determined whether the shooting was connected to skirmishes that night between a caravan of protesters driving through the city’s downtown district in pickup trucks waving pro-Trump flags and counter-protesters on the streets.
Video on social media showed individuals in the beds of the pickups firing paint-balls and spraying chemical irritants at opposing demonstrators as they rode by, while those on the street hurled objects at the trucks and tried to block them.
Authorities have not identified the shooting victim. But the New York Times reported the man gunned down was wearing a hat with the insignia of the right-wing group Patriot Prayer. On Sunday, the leader of the group, Joey Gibson, appeared to confirm that the victim was a Patriot Prayer member whom he knew.
“We love Jay, and he had such a huge heart. God bless him and the life he lived,” Gibson wrote on social media. “I’m going to wait to make any public statements until after the family can.”
Slideshow ( 4 images )
Trump later re-tweeted a photo of a man identified as Jay Bishop and described in that post as “a good American that loved his country and Backed the Blue,” an apparent reference to police. “He was murdered in Portland by ANTIFA.”
Trump wrote, “Rest in Peace Jay!” in his retweet.
UNDER FIRE FROM TWO SIDES
The mayor also came under renewed fire from several left-wing Oregon-based civil rights and community organizations that have been at odds with Wheeler and called for his resignation in an open letter on Sunday.
“Amid 94 days and nights of protests against police brutality, Mayor Wheeler has fundamentally failed in his responsibilities to the residents of Portland,” the letter said.
Police warned against individuals taking to Twitter on the basis of misinformation.
“There are many who are sharing information on social media who are jumping to conclusions that are not based on facts,” Lovell said.
He said the shooting was preceded by a “political rally involving a vehicle caravan that traveled through Portland for several hours.” He said those vehicles had departed from a prescribed protest route that was supposed to funnel them along Interstate 5, outside Portland, to the site of the rally in neighboring Clackamas County.
Slideshow ( 4 images )
He said that by the time the shooting took place, the caravan had already cleared that section of downtown, and that there were no police at the spot when it happened.
Protests, which have grown violent at times, have roiled downtown Portland every night for more than three months following the May 25 killing of George Floyd, the Black man who died under the knee of a white police officer in Minneapolis.
The demonstrators, demanding reforms of police practices they view as racist and abusive, have frequently clashed with law enforcement and on occasion with counter-protesters associated with right-wing militia groups.
The Trump administration in July deployed federal forces to Portland to crack down on the protests, drawing widespread criticism that the presence of federal agents in the city only heightened tensions.
On Sunday’s broadcast of ABC’s “This Week” program, acting Homeland Security Secretary Chad Wolf said, “All options continue to be on the table” to resolve Portland’s unrest. (This story has been refiled to fix typographical error in headline and update sequence)
Reporting by Steve Gorman and Maria Caspani; Editing by Daniel WallisOur Standards: The Thomson Reuters Trust Principles.
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46fd306137424a9122a6e9aebf9724d2 | https://www.reuters.com/article/us-global-race-portland-protests-idUSKCN24O14G | U.S. watchdog to probe use of force in Portland; federal agents to Seattle on standby | U.S. watchdog to probe use of force in Portland; federal agents to Seattle on standby
By Deborah Bloom5 Min Read
PORTLAND, Ore. (Reuters) - The U.S. Justice Department announced on Thursday it would investigate the use of force by federal agents against protesters in Portland, Oregon, following another night of unrest in which the city’s mayor was tear-gassed.
The investigations, which follow an uproar over the deployment of federal border patrol officers to Portland against the wishes of local officials, come as the Trump administration said it was sending a similar contingent to Seattle.
Justice Department Inspector General Michael Horowitz said his office will investigate allegations federal agents used excessive force against peaceful protesters in Portland and a separate review of actions taken against protesters in Washington, D.C.’s Lafayette Square near the White House on June 1.
Democratic lawmakers have asked for such an investigation over concerns Attorney General William Barr and acting Homeland Security Secretary Chad Wolf were using federal agents to “suppress First Amendment protected activities.” The First Amendment to the U.S. Constitution protects the right to assemble peacefully.
The White House did not immediately comment on the announcement.
The Federal Protective Service, which is in charge of protecting federal buildings and monuments, said agents from the U.S. Customs and Border Patrol would be on standby in Seattle to protect federal property if needed.
“The CBP team will be on standby in the area, should they be required. FPS requests this kind of assistance multiple times a year at our over 9,000 facilities across the country,” FPS said in a statement.
Related CoverageFederal agents in Portland may not use force against journalists: judge
Seattle police on July 1 dismantled an “autonomous zone” that protesters maintained for weeks around a city police station during protests against racial injustice sparked by the death of George Floyd in police custody in Minneapolis on May 25. President Donald Trump criticized Democratic officials in Seattle and Washington State for failing to clear the area earlier.
More protests are planned this weekend in Seattle’s Capitol Hill neighborhood, where the autonomous zone was.
‘STOP OCCUPYING OUR CITY’
The deployment of federal agents in Portland last week is a flashpoint in what demonstrators and local officials see as a political ploy by Trump to drum up a “law and order” campaign as he faces an uphill re-election battle.
Late Thursday, a federal judge in Oregon issued a temporary restraining order barring the agents from arresting or using force against journalists and legal observers.
Portland Mayor Ted Wheeler was stung by tear gas early on Thursday morning after joining demonstrators protesting against racial injustice and police brutality since Floyd’s death.
Slideshow ( 6 images )
Security forces have frequently tear-gassed and clubbed demonstrators during the unrest and Wheeler, visiting the protest site outside the federal courthouse in downtown Portland, urged that federal agents be withdrawn from the city.
Wheeler, a Democrat, has called the intervention an abuse of federal power and said it was escalating the violence. The past week has seen bigger and bigger crowds of supporters joining the demonstrations.
“They’re not wanted here. They’re not properly trained to be here. And we’re asking them right this minute – we’re demanding that they leave,” he said. “We’re demanding that the federal government stop occupying our city.”
Slideshow ( 6 images )
But Wheeler, also the city’s police commissioner, was jeered by demonstrators, and some threw water bottles at him, calling on him to resign and chanted “Shame on You.” Some said he should have done more to protect Portland’s citizens.
Wheeler, wearing a surgical mask and goggles, then experienced two rounds of heavy tear gas, a Reuters reporter at the scene said. His eyes and nose were running, his face was red and his eyes were bloodshot.
Last week, protesters said uniformed personnel without name tags or agency badges snatched young people off the streets into unmarked vans before eventually releasing them. It remains unclear what that operation was intended to do, but it failed to dent the enthusiasm of the protesters.
Hundreds of women calling themselves a “wall of moms” and wearing bike helmets and yellow T-shirts appeared among the protesters following those reports.
Carrying signs like “Feds stay clear. Moms are here,” and “I’m so disappointed in you - mom,” the women have been shoved and tear-gassed by agents. Some older men have also joined, bringing leaf blowers to blow away tear gas.
Reporting by Deborah Bloom; additional reporting by Sarah Lynch, Mark Hosenball and Sharon Bernstein; Writing by Bill Tarrant; Editing by Dan Grebler and Grant McCoolOur Standards: The Thomson Reuters Trust Principles.
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a991d46eaadd71de230896cea1b0ee20 | https://www.reuters.com/article/us-global-race-portland/police-declare-riot-as-portland-protesters-set-fires-attack-government-building-idUSKCN25F0OH | Police declare riot as Portland protesters set fires, attack government building | Police declare riot as Portland protesters set fires, attack government building
By Kanishka Singh3 Min Read
(Reuters) - Protesters lit fires, threw rocks and smashed windows at county government offices in the U.S. city of Portland on Tuesday, prompting police to declare a riot, after weeks of mostly peaceful anti-racism demonstrations.
The protesters, some wearing gas masks and carrying shields, lit fires in dumpsters and used lighter fuel to start a fire inside the Multnomah Building big enough to set off the sprinkler system, police said.
TV footage bit.ly/34c7Z5L showed debris on the street in flames and people throwing stones at the building. The fire in the building was put out by police, media said.
Black Lives Matter protests have been held across the United States in recent months after the May 25 death of George Floyd, a 46-year-old African-American man, who died after a white police officer knelt on his neck for nearly nine minutes.
Protests, including in Portland, have at times erupted into arson and violence, and federal officers sent into the Northwestern city have repeatedly clashed with crowds targeting the federal courthouse there.
Police said some officers were targeted a night earlier with a “powerful green laser” capable of causing permanent eye damage when some protesters marched on the Portland Police Association building.
“Portland Police has declared the gathering near the Multnomah Building a riot after individuals vandalized, repeatedly smashed first floor windows with rocks and threw burning material into an office,” the Multnomah County Sheriff’s Office said on Twitter.
Police said some crowd control “munitions” were used to disperse the protesters, but no tear gas.
Multnomah County Chair Deborah Kafoury released a statement at midnight, saying a small group of protesters had set fire to the Office of Community Involvement.
“This is the heart of our county, where people in our community come to get married, get their passports, and celebrate their cultural traditions and diversity,” the Oregonian website quoted her as saying, adding the space is dedicated to community members “marginalized by the traditional political process.”
Police said on Wednesday an officer sustained a minor injury and there were two arrests, one on charges of rioting, unlawful use of a weapon and assaulting a public safety officer, and another on charges of criminal mischief and reckless endangering.
A crowd of several hundred people gathered in the city’s Colonel Summers Park late on Tuesday before marching through Southeast Portland streets, eventually arriving at the Multnomah Building, police said.
U.S. Attorney General William Barr came under fire from Democratic lawmakers earlier this month for sending federal officers to disperse protesters in the city.
Republican Senator Lindsey Graham on Tuesday called for the Department of Justice to prosecute a group of people caught on videotape beating and kicking a man who crashed his truck near protests in Portland.
Reporting by Kanishka Singh in Bengaluru; Editing by Nick MacfieOur Standards: The Thomson Reuters Trust Principles.
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2272bad9057c04590367c40d7e07cdfb | https://www.reuters.com/article/us-global-race-protest-washingtondc/washington-d-c-police-union-moves-to-block-release-of-body-cam-footage-idUSKCN2562IW | Washington, D.C., police union moves to block release of body cam footage | Washington, D.C., police union moves to block release of body cam footage
By Reuters Staff3 Min Read
WASHINGTON (Reuters) - The Washington, D.C., police union said on Monday it asked a court to block the mandatory release of body camera footage and names of police officers involved in shootings.
FILE PHOTO: A Washington DC Metropolitan Police officer walks past an umbrella reading: "Defund Police" on the steps of a city government building, during events to mark Juneteenth which commemorates the end of slavery in Texas, two years after the 1863 Emancipation Proclamation freed slaves elsewhere in the United States, amid nationwide protests against racial inequality, near the White House, in Washington, D.C., U.S., June 19, 2020. REUTERS/Tom Brenner/File Photo
The federal district passed a police reform law in July after weeks of protests in the nation’s capital and across the globe against systemic racism and police brutality, sparked by the killing of African-American George Floyd by a police officer in Minneapolis.
Floyd's death, as well as other high-profile incidents of police brutality, led three dozen states to introduce initiatives to change or study policing, according here to the National Conference of State Legislatures.
Washington’s emergency legislation requires the Metropolitan Police Department to release the names of officers and body camera footage within five days of an officer-involved shooting or the use of serious force, among other measures.
Records of previous incidents, dating back to the beginning of the body-camera program in October 2014, were to be released by Aug. 15. The police union argued in its court filing, made on Aug. 7, that releasing those records could harm officers’ reputations.
“The release of the body-camera footage and names of officers will unjustly malign and permanently tarnish the reputation and good name of any officer that is later cleared of misconduct concerning the use of force,” the union said in a statement.
Nationwide data on police discipline is limited. A Reuters investigation here found that many police union contracts call for disciplinary records to be kept private or erased and make it difficult for citizens to file complaints.
Experts have said body-worn cameras or bystander footage can increase the likelihood of attention to or discipline for police misconduct. [L1N2DO0YI]
On July 31, Washington Mayor Muriel Bowser released footage related to killings in three officer-involved deaths.
The mayor’s office did not respond to a request for comment. The district’s attorney general’s office declined to comment.
Arthur Spitzer, senior counsel for the American Civil Liberties Union in Washington, said the organization agreed with the union that there was a right to privacy, but said it did not apply to officer-involved shootings. He noted that some of the issues the union brought up with the law are already addressed with certain checks.
“We don’t think that the identity of a law enforcement officer who’s engaged in official conduct is a matter of sensitive personal information at all,” Spitzer said.
The union’s latest move comes on the heels of a separate lawsuit it filed, which argued that the portion of the reform law that stripped it of the right to negotiate with management over the discipline of members was unconstitutional.
Reporting by Makini Brice; Editing by Heather Timmons and Dan GreblerOur Standards: The Thomson Reuters Trust Principles.
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ff97c0dede810d1ae0581341364b623f | https://www.reuters.com/article/us-global-race-protests-portland-100days/federal-troops-and-street-battles-portland-protests-near-100-days-idUSKBN25V2W3 | Federal troops and street battles: Portland protests near 100 days | Federal troops and street battles: Portland protests near 100 days
By Caitlin Ochs4 Min Read
PORTLAND (Reuters) - The protests that erupted in Portland after George Floyd’s killing nearly 100 days ago have evolved into a seemingly constant battle between progressives and far-right groups while highlighting long-standing racial tensions in Oregon.
FILE PHOTO: Alan Swinney points a gun during clashes between groups like Proud Boys and Patriot Prayer, and protesters against police brutality and racial injustice in Portland, Oregon, U.S., August 22, 2020. REUTERS/Maranie Staab
The protests drag on even as street demonstrations in other U.S. cities have waned, and some civic leaders say they have been spurred rather than quelled by the deployment of federal troops in July.
Marked by clashes between right- and left-wing protesters, caravans of people supporting U.S. President Donald Trump have squared off on the streets against counter-protesters with deadly results.
The tensions have roiled downtown Portland, the Pacific northwestern enclave with a reputation as a liberal city, every night for nearly three months.
“If you have a place that’s perceived as progressive, very liberal, and then you have people who might have a different perspective, this is (seen as) the place where you can ‘battle it out,’” said Shirley Jackson, a professor of Black studies at Portland State University.
Click the image to see more photos of Portland's protests. Pictured: Xavier Warner and Teal Lindseth use megaphones during a protest against racial inequality and police violence in Portland, Oregon, U.S., July 28, 2020. REUTERS/Caitlin Ochs
On Aug. 29, one member of a pro-Trump group was shot and killed. The suspect in the case, who had said he was part of the anti-fascist movement, was killed while being arrested by U.S. marshals on Thursday.
Slideshow ( 4 images )
Although Oregon is known as a progressive, left-leaning state, it has a history of institutional racism that is extreme even for the United States.
Oregon was the only state to join the union that explicitly banned Black people from living there, and it once had the largest Ku Klux Klan organization west of the Mississippi River. The state also failed to fully ratify the 14th Amendment of the U.S. Constitution, which granted citizenship and equal protection under the law to Black people, until 1973.
That history means white supremacy groups and anti-government militias have deep roots in the state, outside of its liberal hubs.
Demonstrations against racism and police brutality swept across the United States after the May killing of Floyd, a 46-year-old Black man who died after a Minneapolis police officer knelt on his neck for nearly nine minutes.
In Portland, however, the protests have taken on a sense of permanency.
Tai Carpenter, president of Don’t Shoot PDX, an anti-gun violence nonprofit, said the state’s racist past - and continued police brutality in the present - are fueling the longevity of the city’s protests.
“Police are still showing that Black lives don’t matter. Because they were never meant to matter in Oregon,” Carpenter said. “The fact that we’re in Portland is why we’re coming up on 100 days of protest. That’s why the movement isn’t blowing down here.”
The violence between rival groups over historic tensions has alienated some activists.
Elizabeth Reitzell, 29, a high school teacher in Portland, has demonstrated with the Portland Buddhist Peace Fellowship by joining in silent meditations every week since July, after initially being put off by the aggression she saw in the street protests.
“I was really eager to be involved but I struggled to find how I could fit in a meaningful way without being wrangled in with the less peaceful protesters,” she said.
“(The violence) is very confusing to us organizers,” said Xavier “Princess” Warner, 19, a co-founder of Black Unity PDX, a civil rights collective. “Because us fighting for equality, us fighting for our lives, us fighting for our rights, is not political.”
Reporting by Moira Warburton in Vancouver and Caitlin Ochs in Portland; Editing by Tom BrownOur Standards: The Thomson Reuters Trust Principles.
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928a2fbd29b426fc5328c915b5d949ad | https://www.reuters.com/article/us-global-race-protests-portland-arrests-idUSKCN24P2DA?taid=5f1b359231fdfb000144a205&utm_campaign=trueAnthem%3A+Trending+Content&utm_medium=trueAnthem&utm_source=twitter | U.S. authorities say 18 Portland protesters face federal charges | U.S. authorities say 18 Portland protesters face federal charges
By Lisa Lambert, Jason Lange, Mark Hosenball2 Min Read
Federal law enforcement officials aim at protesters outside a fence during a demonstration against police violence and racial inequality in Portland, Oregon, U.S., July 24, 2020. REUTERS/Caitlin Ochs
WASHINGTON (Reuters) - The U.S. Justice Department on Friday said it has arrested 18 people and charged them for alleged crimes committed during recent anti-racism protests in Portland.
In a statement, the department said all 18 had made a first appearance in federal court and were released pending jury trials or other court proceedings.
Billy Williams, the Portland United States Attorney, said that five people were charged for allegedly committing crimes including assaulting a federal officer, trespassing and creating a disturbance during protests on the night of July 20-21.
Prosecutors said that seven people have been charged in connection with criminal conduct during a July 21-22 night protest. Another six were charged for their alleged actions in protests during the night of July 22-23.
The federal government has deployed teams of specially equipped agents to the Portland protests, drawing criticism from Democrats and civil liberties groups over excessive force and federal overreach by the Trump administration.
Our Standards: The Thomson Reuters Trust Principles.
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62370dc8c5b092c2fde4b099ce970e39 | https://www.reuters.com/article/us-global-race-protests-portland-idUSKBN25V0G0 | After police kill Portland shooting suspect, sister calls for peace | After police kill Portland shooting suspect, sister calls for peace
By Deborah Bloom, Andrew Hay5 Min Read
PORTLAND, Ore. (Reuters) - Police shot and killed a self-declared anti-fascist activist in Washington state on Thursday night as they moved in to arrest him on suspicion he fatally shot a right-wing counterprotester last weekend in Portland, Oregon, officials said.
Michael Reinoehl, 48, wanted on a murder charge, was armed with a semi-automatic handgun when members of a U.S. Marshals Service fugitive task force shot him dead outside an apartment complex in suburban Olympia, Washington, according to the Marshals Service and the Thurston County Sheriff’s Office.
His sister, who asked not to be named, said her “estranged” brother believed the United States “was going to war.”
“He believed the war was here, and look at where that got him; where it got us,” she told Reuters in a text message.
“Two men are dead. He is one of them. Two families have been thrown into chaos, and everyone seems more up in arms than ever. I believe in something different. I believe the peaceful majority are stronger than that.”
Reinoehl was in a car when police opened fire, leading him to flee on foot as four officers shot at him, Thurston County Sheriff’s Office spokesman Ray Brady told reporters.
Brady could not confirm whether Reinoehl fired on police, but witnesses told reporters a hail of bullets put out car windows and hit nearby homes.
Related CoverageFederal troops and street battles: Portland protests near 100 days
Flowers were placed under the mailbox where Reinoehl fell and where an agent attempted CPR on him before he was pronounced dead at the scene, according to bystander videos.
A Multnomah County, Oregon, court had charged Reinoehl with the murder of Aaron Danielson on Saturday, and Portland police issued a warrant for his arrest, asking U.S. marshals to locate him.
Reinoehl, who provided security for Black Lives Matter in Portland protests, in a video interview with Vice aired hours before his death appeared to admit to shooting Danielson and said the shot “felt like the beginning of a war.”
He said he acted in self-defense.
Danielson, 39, was part of a caravan of supporters of Republican President Donald Trump who rode in pickup trucks into downtown Portland and clashed with protesters demonstrating against racial injustice and police brutality.
A Portland man who ran a specialty moving company in the city for over 20 years, Danielson was a supporter of right-wing Christian group Patriot Prayer.
Slideshow ( 5 images )
Danielson’s friend Michael Hamilton saw no justice in Reinoehl’s death and said he and his family were getting death threats and being called “Nazis” after he started a GoFundMe page for Danielson.
“Now they want me to live in fear? Not likely,” said Hamilton. “I also refuse to kill my brothers and sisters. If they want civil war they will have to murder me like a dog in the streets like they did my friend, a good and decent man.”
Slideshow ( 5 images )
ANTIFA
Danielson and Reinoehl were pitted against one another in escalating confrontations between right- and left-wing groups in Portland.
The city has become a focus of the presidential campaign after its nearly 100 days of protests since George Floyd, a Black man, died in police custody in Minneapolis on May 25.
Trump, who has made law and order the main theme of his reelection bid, singled out Portland as one of several Democrat-run cities he calls “anarchist jurisdictions.”
The U.S. Justice Department on Friday directly linked Reinoehl to the left-wing antifa movement, the first time it had done so for a demonstrator facing federal charges in Portland.
Nationally, antifa is a largely unstructured, far-left movement whose followers broadly aim to confront those they view as authoritarian or racist.
“Antifa groups murdered my friend,” said Patriot Prayer leader Joey Gibson, who on Tuesday called on supporters not to seek revenge.
Facebook Inc FB.O on Friday said it took down the pages of Patriot Prayer and Gibson, saying it was part of their efforts to remove "violent social militias" from the platform.
Gibson said Facebook should ban antifa pages, too.
In social media posts Reinoehl, a father of two, described himself as a professional snowboarder, an Army veteran and “100% ANTIFA.”
“Every Revolution needs people that are willing and ready to fight,” he said in a June 16 Instagram post. “It will be a war and like all wars there will be casualties.”
Reporting by Deborah Bloom; additional reporting by Ann Maria Shibu, Andrew Hay, Gabriella Borter, Mark Hosenball and Sarah N. Lynch; editing by Mike Collett-White, Jonathan Oatis and Sonya HepinstallOur Standards: The Thomson Reuters Trust Principles.
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b914168bfb8b695c4f4abc68c60043e1 | https://www.reuters.com/article/us-global-race-protests-portland-veteran/navy-veteran-says-he-was-beaten-like-a-punching-bag-in-portland-idUSKCN24L2CP | Navy veteran says he was beaten 'like a punching bag' in Portland | Navy veteran says he was beaten 'like a punching bag' in Portland
By Deborah Bloom2 Min Read
PORTLAND (Reuters) - As a U.S. Navy veteran, Chris David said he thought he would be able to talk plainly with federal agents in Portland and ask them why they were using unmarked cars to snatch people off the street during recent protests in the Oregon city.
Demonstrators return to protest against racial inequality in front of federal buildings despite lingering tear gas fired by federal law enforcement officials in Portland, Oregon, U.S., July 19, 2020. Picture taken July 19, 2020. REUTERS/Caitlin Ochs
When he tried to speak with them outside the federal courthouse in Portland on Saturday night, he said a federal officer beat him with a baton, breaking his hand in two places. A second officer sprayed him with chemical irritant, David said.
“I wanted to ask them ‘Why are you guys not following the Constitution?’ But we never got there,” David said in an interview. “They whaled on me like a punching bag.”
A video appearing to show David being beaten by a federal officer and sprayed with a chemical by another while he stood passively went viral this weekend with 10.7 million views.
Afterward David, 53, was praised on social media for allegedly standing up to federal officers accused of excessive force and escalating violence as they protect federal buildings.
Top Homeland Security officials said on Monday they had no intention of pulling back in Portland and defended the federal crackdown on anti-racism protests, including the use of unmarked cars and unidentified officers in camouflage.
Ken Cuccinelli, acting deputy secretary of the U.S. Department of Homeland Security, told CNN the officers involved in the incident were from the U.S. Federal Marshals Service.
Cuccinelli said he had seen the video but had not heard the audio or seen reports from officers involved in the event. He did not comment further.
Portland Police did not immediately respond to a request for comment on the incident.
Demonstrations began in Portland in May against police brutality and racial injustice triggered by the killing of African American George Floyd.
Reporting by Deborah Bloom in Portland; Editing by Dan GreblerOur Standards: The Thomson Reuters Trust Principles.
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8b9e9cae700f4a57265df35b772dbffa | https://www.reuters.com/article/us-global-race-protests-portland/portland-police-make-multiple-arrests-as-us-city-nears-100-days-of-protests-idUSKBN25W0GM | Portland police arrest 27 as U.S. city nears 100 days of protests | Portland police arrest 27 as U.S. city nears 100 days of protests
By Kanishka Singh3 Min Read
(Reuters) - Portland police made multiple arrests overnight on Friday as the Oregon city nears 100 days of demonstrations against U.S. racism and police brutality, which have at times turned violent.
Slideshow ( 5 images )
Police arrested 27 people, mostly on charges of interfering with law enforcement or disorderly conduct after not complying with orders to clear the area where they assembled and throwing items at officers.
“Officers began to make targeted arrests and in some cases moved the crowd back and kept them out of the street,” according to a press released issued on Saturday.
One arrested protester was injured with a “bleeding abrasion” on her head, police said.
Demonstrations against racism and police brutality have swept the United States since the death in May of George Floyd, a 46-year-old Black man who died after a Minneapolis police officer knelt on his neck for nearly nine minutes.
In Rochester, New York on Friday night nearly 1,000 demonstrators marched downtown to protest the March death of black man Daniel Prude in police custody. Police used pepper balls to clear protesters during protests the night before, according to local news reports.
Portland has become the epicenter of demonstrations, with protests taking place nightly over the last three months calling for policing and social justice reforms. These have at times turned into clashes between demonstrators and officers, as well as between right- and left-wing groups.
Police shot and killed a self-declared anti-fascist activist in Washington state on Thursday night as they moved in to arrest him on suspicion he fatally shot a right-wing counterprotester last weekend in Portland.
The administration of President Donald Trump deployed federal forces to Portland in July to crack down on the protests. Trump signed a memo on Wednesday that threatens to cut federal funding to “lawless” cities, including Portland.
His Democratic challenger in the Nov. 3 presidential election, Joe Biden, has accused Trump of stoking violence with his rhetoric.
Reporting by Kanishka Singh in Bengaluru; additional reporting by Valerie Volcovici in Washington; Editing by Frances Kerry and Alistair BellOur Standards: The Thomson Reuters Trust Principles.
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1db2d05476b767e32a5e1e96bc74b51a | https://www.reuters.com/article/us-global-race-protests/federal-agents-pull-out-of-seattle-mayor-says-idUSKCN24U05A | Federal agents pull out of Seattle, mayor says | Federal agents pull out of Seattle, mayor says
By Reuters Staff3 Min Read
(Reuters) - U.S. agents deployed to Seattle to protect federal property have left the city after local officials complained their presence was escalating tensions, Seattle’s mayor said on Tuesday.
U.S. tactical forces arrived in Washington state’s largest city last week and were on standby to protect federal facilities after attacks on a federal courthouse in Portland, Oregon.
Mayor Jenny Durkan rejected the deployment, saying it did not have the consent of local officials and could incite the property damage it was supposed to prevent.
She tweeted on Tuesday that the Department of Homeland Security (DHS) told her that U.S. Border Patrol Tactical Unit agents had left Seattle. DHS did not immediately respond to a request for comment.
Durkan is among Democratic mayors who have called for an end to violence at protests against racism and police brutality after Republican President Donald Trump used images of the destruction for his re-election campaign.
U.S. Attorney General William Barr said on Tuesday that federal agents were in Portland to stop “rioters” destroying the courthouse and rejected Democrats’ suggestions it was to promote Trump’s “law-and-order” campaign theme ahead of the Nov. 3 election.
Anti-racism demonstrations escalated over the weekend, with Seattle seeing its biggest Black Lives Matter protests in weeks. A man was shot and killed at an Austin, Texas, demonstration and two protesters were shot and wounded in Aurora, Colorado.
A man was arrested on Tuesday in connection with the Colorado shooting. Two protest groups sued DHS on Monday for deploying agents to protect the Portland courthouse, saying it was unconstitutional for federal forces to take on roles reserved for state and local law enforcement.
Widespread and mostly peaceful protests against racial bias and police brutality have taken place in the United States since May 25 when George Floyd, a Black man, died under the knee of a white officer in Minneapolis.
Federal agents sent to Portland have used tear gas, pepper balls and stun grenades on protesters outside a federal courthouse, who have tried to tear down a fence erected around it
Barr told a congressional hearing on Tuesday that two federal agents sent to Portland may have been permanently blinded by lasers used by activists and that far more officers had been injured than demonstrators, with industrial-grade fireworks, rocks and firebombs hurled at agents.
Reporting by Gregory Scruggs in Seattle and Andrew Hay in Taos, New Mexico; Additional reporting by Keith Coffman in Colorado; Editing by Bill Tarrant and Peter CooneyOur Standards: The Thomson Reuters Trust Principles.
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0c4dc7956786bdfd35129c078f6665b1 | https://www.reuters.com/article/us-global-race-sierraclub/sierra-club-examines-racist-past-painful-legacy-of-john-muir-idUSKCN24N2ZR | Sierra Club examines racist past, painful legacy of John Muir | Sierra Club examines racist past, painful legacy of John Muir
By Reuters Staff3 Min Read
WASHINGTON (Reuters) - The Sierra Club on Wednesday said it would examine its “substantial role” in perpetuating white supremacy and denounced the racist actions of environmentalist icon John Muir, a prominent figure in the preservation of America’s wilderness.
FILE PHOTO: A rainbow is seen across the Yosemite Valley in front of El Capitan granite rock formation in Yosemite National Park, California, U.S., March 29, 2019. REUTERS/Lucy Nicholson/File Photo
Michael Brune, the executive director of the 128-year-old Sierra Club, said it was committed to becoming an actively anti-racist organization and laid out some changes that would be made as the group works to counter racism and exclusion.
Brune also criticized Muir, the group’s founder in the late 1800s, for maintaining friendships with advocates of white supremacy and eugenics and for having made derogatory comments about Black and indigenous people that drew on racist stereotypes.
The Sierra Club’s announcement comes as millions have demonstrated against police brutality and racial inequality since the May 25 killing of George Floyd, a 46-year-old Black man who died after a white Minneapolis police officer knelt on his neck for nearly nine minutes.
In addition to pushing for police reforms in some cities, some protesters have removed Confederate statues and other symbols of America’s legacy of slavery.
“It’s time to take down some of our own monuments, starting with some truth-telling about the Sierra Club’s early history,” Brune wrote on the group’s website.
“As the most iconic figure in Sierra Club history, Muir’s words and actions carry an especially heavy weight. They continue to hurt and alienate Indigenous people and people of color who come into contact with the Sierra Club,” he said.
Muir, a Scottish immigrant, is best known for his activism to preserve what is today Yosemite National Park in the California Sierras, including by personally lobbying President Theodore Roosevelt.
In an effort to counter racism, the group that bills itself as the largest grassroots environmental organization in the United States said it will increase the number of Black, indigenous and other people of color in its leadership, amplify voices of color and decide which of its monuments need to be renamed or pulled down.
Brune recognized that the Sierra Club in its early years was in effect a mountaineering club for white middle- and upper-class people, who sometimes screened out people of color from joining.
The members of the club sought to protect the wilderness where they hiked, the same wilderness Brune said had needed protection decades earlier when white settlers violently displaced Native Americans.
“The whiteness and privilege of our early membership fed into a very dangerous idea - one that’s still circulating today. It’s the idea that exploring, enjoying, and protecting the outdoors can be separated from human affairs,” Brune said.
Reporting by Daphne Psaledakis; Editing by Mary Milliken and Tom BrownOur Standards: The Thomson Reuters Trust Principles.
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ba882d5ade8f73e6b908008c26392d24 | https://www.reuters.com/article/us-global-race-un-idUSKCN25F2F4?taid=5f3dd5b4159d1f0001e2d2ce&utm_campaign=trueAnthem%3A+Trending+Content&utm_medium=trueAnthem&utm_source=twitter | United Nations removes survey asking staff if they are 'yellow' | United Nations removes survey asking staff if they are 'yellow'
By Michelle Nichols3 Min Read
NEW YORK (Reuters) - The United Nations has been accused by some of its staff of racism after it issued a survey that included a question asking how they identify themselves, and offered ‘yellow’ among the possible responses.
FILE PHOTO: The United Nations Headquarters is pictured in the Manhattan borough of New York City, New York, U.S., March 10, 2020. REUTERS/Carlo Allegri
The ‘U.N. Survey on Racism’ was sent to thousands of staff on Wednesday. An email accompanying the survey said it was being carried out as part of U.N. Secretary-General Antonio Guterres’ “campaign to eradicate racism and promote dignity.”
But the first question, on how staff identify themselves, itself reflected an historic Western racist view of Asians by listing ‘yellow’ as an option, several U.N. staffers told Reuters. Other categories offered were black, brown, white, mixed/multi-racial and any other.
“The first question is insane, deeply offensive and hard to fathom how in an organization as diverse as the United Nations this question was approved for release in a system-wide survey,” said one U.N. staff member, speaking on condition of anonymity.
United Nations spokesman Stephane Dujarric said the survey would be “taken off-line and revised appropriately taking into account the legitimate concerns” that had been expressed.
“We acknowledge the need to formulate these categories with greater sensitivity and will take immediate steps to rectify this,” Dujarric said.
Erica Foldy, an associate professor at the Wagner Graduate School of Public Service at New York University, said the use of the term was not acceptable.
“The term ‘yellow’ to refer to people of Asian descent is a slur. It should not be used, period. At the same time, it is useful to remember that language related to race is complex and always in flux,” she said.
“Recently Brown, which had been considered something of a slur (though perhaps never as problematic as yellow) has come into broad use. But I don’t see that happening with ‘yellow’,” Foldy said.
Organizations and companies have been under increasing pressure to address racism in the wake of global protests sparked by the death of George Floyd, a Black American who died in May after a white police officer knelt on his neck.
Reporting by Michelle Nichols; editing by Mary Milliken, Rosalba O’Brien and Richard PullinOur Standards: The Thomson Reuters Trust Principles.
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c3c2dcb2a134b81953766577b1d540e0 | https://www.reuters.com/article/us-global-race-usa-defense/u-s-military-needs-to-take-hard-look-at-confederacy-symbols-base-names-top-general-says-idUSKBN24A31S | U.S. military needs to take 'hard look' at Confederacy symbols, base names, top general says | U.S. military needs to take 'hard look' at Confederacy symbols, base names, top general says
By Idrees Ali, Phil Stewart3 Min Read
WASHINGTON (Reuters) - The top U.S. general said on Thursday that the military had to take a “hard look” at symbols of the Confederacy, including the names of bases, and said he had recommended a commission to look at the issue even as President Donald Trump has ruled out renaming military bases that are named for Confederate leaders.
Despite Americans more conscious about race issues following the death of African American George Floyd while in Minneapolis police custody, Trump has favored keeping the names of 10 military bases from Virginia to Texas that are named for Confederate military leaders.
Chairman of the Joint Chiefs of Staff General Mark Milley’s comments could put him and the military on a collision course with Trump, who is campaigning for the November presidential election and has dismissed calls to rename bases as an attempt to erase American history.
“I’ve recommended a commission of folks to take a hard look at the bases, the statues, the names, all of this stuff, to see if we can have a rational, mature discussion,” Milley told a congressional hearing.
“There is no place in our armed forces for manifestations or symbols of racism, bias or discrimination,” he said, noting that the American Civil War “was an act of treason at the time.”
Slideshow ( 4 images )
Milley added that the focus for the military, in which 43 percent of its members are minorities, was unity and cohesion.
“For those young soldiers who go onto a base, a Fort Hood or a Fort Bragg or a fort wherever named after a Confederate general, they can be reminded that that general fought for an institution of slavery that may have enslaved one of their ancestors,” Milley said.
Trump’s rejection of renaming bases, via a tweet last month, slapped down Pentagon officials who are open to discussing the issue, which has emerged as a way of achieving racial reconciliation.
U.S. military bases named for Confederate military leaders are all located in former Confederate states. Many of those states helped elect Trump in 2016, and he is counting on them again for the Nov. 3 election.
The Republican-led U.S. Senate Armed Services Committee has voted to require the Pentagon to rename military bases named after Confederate generals.
Reporting by Idrees Ali and Phil Stewart, Editing by Franklin Paul and Dan GreblerOur Standards: The Thomson Reuters Trust Principles.
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617eb70243a60155928a22a13dbae903 | https://www.reuters.com/article/us-global-race-usa-ohio/hundreds-march-in-ohio-capital-over-police-shooting-of-black-man-idUSKBN28L2RR | Hundreds march in Ohio capital over police shooting of Black man | Hundreds march in Ohio capital over police shooting of Black man
By Rich McKay3 Min Read
(Reuters) - Hundreds of protesters rallied on Friday evening in downtown Columbus, Ohio, demanding justice and transparency from investigations into the killing last week of a young Black man shot by a sheriff’s deputy outside his home.
Slideshow ( 5 images )
The crowd, shown in footage broadcast by local news outlets and on social media, marched downtown toward the Ohio statehouse chanting, “No justice, no peace, no racist police.”
Some participants in the march, followed closely by police officers on foot and in patrol cars, spilled into the streets, blocking traffic, but the gathering appeared peaceful and there were no reports of arrests.
The protest unfolded a week to the day after Casey Christopher Goodson, 23, was shot to death by a Franklin County sheriff’s deputy assigned to a group of U.S. marshals searching for a fugitive in the Northland neighborhood where Goodson lived.
According to authorities, the officer said he had seen Goodson carrying a gun and opened fire on him when Goodson ignored the deputy’s order to drop the weapon.
Goodson’s family said he had been returning from a local sandwich shop and was shot in the back as he was about to enter his home. They said he had a permit to carry a concealed weapon.
A coroner’s report said Goodson was shot multiple times in the torso.
“I’m calling for justice and that’s all I’m calling for,” Goodson’s mother, Tamala Payne, said in a news conference Thursday. “My son was a peaceful man and I want his legacy to continue in peace.”
Lawyers for the deputy, identified as Jason Meade, said Goodson had pointed a gun at him before the shooting, CBS News and other media reported.
The shooting is the latest in a spate of killings of African Americans by police in the United States that have triggered a wave of protests over racial injustice and brutality by law enforcement.
The Columbus Division of Police is investigating the shooting, along with the FBI, the U.S. Attorney’s Office for the Southern District of Ohio, and the Civil Rights Division of the U.S. Department of Justice.
Tom Quinlan, chief of police in Columbus, has promised an “independent, meticulous unbiased investigation.”
Another protest was planned for downtown Columbus on Saturday at noon, according to the Columbus Dispatch and other local media.
Reporting by Rich McKay in Atlanta; Editing by Alistair Bell and Daniel WallisOur Standards: The Thomson Reuters Trust Principles.
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e780a1fc069cf811ed39d4e31e021ced | https://www.reuters.com/article/us-global-race-usa-trump-idUSKBN25R2R1 | Trump defends accused Kenosha gunman, declines to condemn violence from his supporters | Trump defends accused Kenosha gunman, declines to condemn violence from his supporters
By Jeff Mason, Andrea Shalal3 Min Read
WASHINGTON (Reuters) - President Donald Trump on Monday sided with a 17-year old charged with killing two people during protests in Kenosha, Wisconsin, saying the accused gunman was trying to get away and would have been killed by demonstrators if he had not opened fire.
Trump on Tuesday will visit Kenosha, the site of protests against police brutality and racism since Jacob Blake, a 29-year-old Black man, was shot seven times by police on Aug. 23 and left paralyzed.
On the third night of protests, Kyle Rittenhouse, 17, shot three protesters, two fatally, with an assault rifle.
“He was trying to get away from them ... And then he fell and then they very violently attacked him,” Trump said at a briefing. “I guess he was in very big trouble ... He probably would have been killed.”
Rittenhouse has been charged as an adult with two counts of first-degree homicide and one count of attempted homicide, and his lawyer has said he plans to argue self-defense.
Related CoverageFederal agencies to investigate 'left-wing civil unrest': Trump
The Republican president, who has made law and order a main theme of his re-election campaign, declined to condemn violent acts by his supporters and railed against what he called rioting and anarchy carried out by “left-wing” protesters.
Former Democratic Vice President Joe Biden, Trump’s opponent in the Nov. 3 election, accused the president of stoking violence with his rhetoric, while insisting that rioters and looters be prosecuted.
“Tonight, the president declined to rebuke violence. He wouldn’t even repudiate one of his supporters who is charged with murder because of his attacks on others. He is too weak, too scared of the hatred he has stirred to put an end to it,” Biden said in a statement.
Trump suggested violence would increase if Biden won and accused the former vice president of surrendering to a left-wing mob. “In America, we will never surrender to mob rule, because if the mob rules, democracy is indeed dead,” Trump said.
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The shooting of Blake, 29, in front of three of his children in Kenosha, a predominantly white city of about 100,000 people on Lake Michigan, has triggered a fresh wave of nationwide protests.
The summer of protests ignited after video footage showed a Minneapolis police officer kneeling on the neck of a Black man, George Floyd, for nearly nine minutes. Floyd later died, and the since-fired officer has been charged with murder.
White House spokeswoman Kayleigh McEnany told reporters that Trump planned to survey the damage in Kenosha and meet with business owners, shrugging off calls by some state and local leaders for him to forgo the visit.
Trump said he would not meet with Blake’s family.
Reporting by Jeff Mason and Andrea Shalal; additional reporting by Susan Heavey and; Tim Ahmann; editing by Cynthia OstermanOur Standards: The Thomson Reuters Trust Principles.
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b7bd09baf04b10e127aafd59effecb0a | https://www.reuters.com/article/us-global-race-usa-wisconsin/police-shoot-black-man-in-the-back-in-wisconsin-city-national-guard-deployed-idUSKBN25K0CN | Wisconsin calls out National Guard after unrest over police shooting of Black man | Wisconsin calls out National Guard after unrest over police shooting of Black man
By Stephen Maturen5 Min Read
KENOSHA, Wis. (Reuters) - Wisconsin’s governor called out the National Guard on Monday, and police in the city of Kenosha skirmished with protesters during a second night of unrest over the wounding of a Black man shot in the back by police as his three children looked on.
Ordering Guard troops deployed to Kenosha, on the shore of Lake Michigan 40 miles (65 km) south of Milwaukee, Governor Tony Evers also decried what he branded excessive force in the shooting of Jacob Blake, and called for a special legislative session to consider police reforms.
About an hour later on Monday afternoon, Kenosha’s mayor faced dozens of angry, jeering protesters demanding the arrest of officers involved in Sunday’s shooting. Some in the group tried to force their way into the municipal public-safety building adjacent to the courthouse when the mayor, John Antaramian, retreated from the heckling crowd.
The door was broken from its hinges, but police in riot gear drove the demonstrators back by dousing some with pepper spray.
Shortly after nightfall, scores of protesters defying a dusk-to-dawn curfew massed outside the courthouse, shouting and tossing water bottles at a line of sheriff’s deputies, who responded with volleys of tear gas and pepper balls.
A short time later, several truckloads of National Guard troops were seen rolling into the center of town about a block away. Local media reported that exit ramps leading into the city from an Interstate-94 had been closed to traffic.
Blake, 29, was listed in stable condition following surgery, his father told news media on Monday. His three young sons witnessed the shooting from just a few feet away while sitting in their car, according to the family attorney, Ben Crump.
Related CoverageBiden calls for officers to be 'held accountable' in Wisconsin shooting
Video of the encounter taken by an onlooker showed Blake walking toward the driver’s side of a gray SUV followed by two officers with their guns drawn at his back. Seven gunshots are then heard as Blake, who appears unarmed, opens the car door and a woman nearby jumps up and down in disbelief.
It was unknown whether the officers saw something inside the vehicle that prompted them to shoot Blake. It was also not clear whether one or both officers opened fire.
Crowds soon gathered at the scene, and some demonstrators set fires and threw bricks and Molotov cocktails at police, leading authorities to close public buildings in the area.
GOVERNOR CALLS FOR TROOPS, EMPATHY
Evers, a Democrat, said he ordered Guard troops to Kenosha at the request of local officials to help maintain order after activists said they were organizing further demonstrations for Monday night.
He also said police had shown a pattern of “excessive use of force and immediate escalation when engaging with Black Wisconsinites.”
Slideshow ( 6 images )
“We must rise to this movement and this moment and meet it with our empathy, our humanity and a fierce commitment to disrupt the cycle of systemic racism and bias that devastates Black families and communities,” Evers said in a public address.
Pete Deates, president of the city’s police union, accused the governor of rushing to judgment, calling Evers’ comments “wholly irresponsible.”
The shooting occurred three months after the May 25 death of a Black man in Minneapolis, George Floyd, who was pinned to the street under the knee of a white police officer, sparking nationwide protests against police brutality and racism within the U.S. criminal justice system.
Slideshow ( 6 images )
Former Vice President Joe Biden, the Democrat challenging Republican President Donald Trump in the Nov. 3 election, called for the officers involved in Kenosha to be held accountable.
“The nation wakes up yet again with grief and outrage that yet another Black American is a victim of excessive force,” Biden said in a statement. “These shots pierce the soul of our nation.”
The American Civil Liberties Union of Wisconsin denounced the National Guard deployment as an unnecessary and “militarized” response to legitimate protests that “only serves to exacerbate tensions.”
Sunday’s shooting occurred as officers were responding to what they termed a “domestic incident.” Police immediately took the victim to a hospital, according to a police statement. Authorities gave no further explanation of what led to the shooting.
Attorney Crump, who also has represented Floyd’s family, said in a statement that Blake had been trying to de-escalate a domestic incident when the officers first shot him with a stun gun.
“As he was walking away to check on his children, police fired their weapons several times into his back at point-blank range,” Crump said.
The officers involved were placed on administrative leave while the investigation is underway, the Wisconsin Department of Justice said on Monday.
Reporting by Stephen Maturen in Kenosha, Wis.; Additional reporting by Nathan Layne, Daniel Trotta and Trevor Hunnicutt. Writing by Nathan Layne and Steve Gorman. Editing by Mark Heinrich, Jonathan Oatis and Raju GopalakrishnanOur Standards: The Thomson Reuters Trust Principles.
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5f971ec90da7435441cfdbfeb5dd970a | https://www.reuters.com/article/us-global-rotation-column/column-beware-of-whiplash-in-normality-trade-idUKKBN27R0NZ?edition-redirect=uk | Column: Beware of whiplash in 'normality trade' | Column: Beware of whiplash in 'normality trade'
By Mike Dolan6 Min Read
(The author is editor-at-large for finance and markets at Reuters News. Any views expressed here are his own.)
FILE PHOTO: Passersby wearing protective face masks are reflected on a stock quotation board outside a brokerage, amid the coronavirus disease (COVID-19) outbreak, in Tokyo, Japan November 10, 2020. REUTERS/Issei Kato
LONDON (Reuters) - For a couple of days at least, there’s been a craving for the ‘old normal’. But the past is never quite what it seemed.
The mere glimpse of economic and political ‘normality’ returning with this week’s U.S. election results and COVID-19 vaccine breakthrough prompted a scramble for burnt-out ‘value’ stocks, bonds and currencies and away from lockdown winners, safe-havens and anti-globalisation plays.
One stand-out stock trade following Monday's Pfizer/BioNTech vaccine surprise would have been to switch from online meeting firm Zoom ZM.O to cinema operator AMC Entertainment AMC.N -- for a tidy relative gain of 70% in just hours.
If more restrained in price terms, that sort of move was rife across markets. Banks and energy stocks -- among the biggest losers from months of lockdown, recession and floored borrowing rates -- have surged for two days now, with airline, travel and leisure shares also helping push MSCI’s all-country index to new highs.
In contrast, New York's NYFANG+TM .NYFANG index -- grouping tech giants Apple, Amazon, Facebook, Alphabet and others -- fell 6% from levels inflated by zero interest rates and locked-down households' reliance on digital services.
With the gap between value stocks and growth stocks in MSCI’s global index at its highest in 20 years, investors have been itching to rotate for a long time.
And this value play, or normality trade, was not confined to sectors and stocks -- it also played out in demand for bonds of Europe’s ‘laggards’, even those hit hard by the pandemic, UK stocks and sterling, and lower-rated corporate debt.
A flight from safe-haven assets like gold and Swiss francs, or long-term bonds supported by economic gloom and central bank purchases, mirrored those moves.
Even before the vaccine news, Joe Biden’s victory over self-styled political and globalisation disrupter Donald Trump had fuelled hopes for ‘trade detente’ that have recently lifted China’s yuan and other emerging market assets.
The U.S. president-elect’s green infrastructure pledge lifted renewable energy stocks, while his scepticism about Brexit is expected to hasten a trade deal between Brussels and London -- another potential tailwind for the long-shunned pound.
But it is the Pfizer news that has really lifted investors.
Consultancy McKinsey reckons vaccine-aided immunity among developed world populations is possible by the second half of 2021, shifting those economies away from their crisis-footing as early as the first quarter.
Deutsche Bank said the vaccine’s efficacy was “significantly better than the market’s base case and risky assets should therefore reprice materially”. It favoured the pound as a stand-out play.
Combining some of the value themes amplifies them. UK banks priced in dollars .FTNMX8350 have jumped almost 14% in their biggest two-day gain in more than a decade.
But things can quickly get more complicated.
Graphic - Where in the world?
Graphic - Return to 'normalcy'?
BEWARE CROSS-CURRENTS
Some mega-trends that were already developing have been catalysed by the pandemic and its passing may simply usher in what McKinsey calls the “next normal”, of further digital transformation, with all the winners and losers that brings.
As Amundi’s chief investment officer Pascal Blanque opined just hours before the Pfizer news: “The idea that the vaccine is the alpha and omega of everything is wrong.”
So reversing investment course either sectorally or geographically may not make sense for long.
More normality will mean a rethink of the monetary and fiscal policies that have kept economies and markets afloat for nine months -- not least those long-duration assets highly sensitive to interest rates, from long-dated government bonds to digital stocks with near-zero future earnings discounts.
Any challenge to the assumption that central banks will keep borrowing costs suppressed for years to keep government debts affordable could destabilise record equity valuations. Rotation may make sense but seismic shifts create risks of their own.
On the other hand, interest rates had been ossifying for years due to low inflation and growth -- themselves in part due to the digital revolution and demographic change. While reflation trades may now seem obvious, it’s difficult to make a case for accelerating price growth.
Biden’s election brings promises of higher spending but those could founder if Senate races leave Congress gridlocked in January.
Higher U.S. yields compared to Europe and elsewhere, seen as likely post-election and post-pandemic, could meanwhile fuel a steep dollar recovery that would challenge China and emerging markets even if global trade fears ebb.
And a new vaccine horizon itself could cut across the sort of “blue sky” fiscal and monetary policy thinking that many had hoped would lift the world out of the low-growth, low-wage funk it has suffered for much of the past decade.
“A return to normality is not the same as a move to continued fiscal stimulus that could put growth on a higher future path,” said Oliver Blackbourn, Multi-Asset portfolio manager at Janus Henderson Investors.
By Mike Dolan, Twitter: @reutersMikeD; Editing by Catherine EvansOur Standards: The Thomson Reuters Trust Principles.
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596d4ab9f4ccc1e4dcc845d817df3773 | https://www.reuters.com/article/us-global-savings-idUSKCN2AV0YW | Column: 'Excess' savings - accelerant or mirage? | Column: 'Excess' savings - accelerant or mirage?
By Mike Dolan6 Min Read
LONDON (Reuters) - With the second wave of the pandemic came the second lockdowns - and now evidence of the second household savings stash, too.
Euro, Hong Kong dollar, U.S. dollar, Japanese yen, pound and Chinese 100 yuan banknotes are seen in this picture illustration, January 21, 2016. REUTERS/Jason Lee/Illustration/File Photo
But even as expected spending of trillions of dollars of these “excess” savings stokes economic recovery forecasts, inflation fears and financial markets, some economists suspect large chunks of what look like precautionary buffers may outlive the pandemic itself - or least not find their way to the shops.
Despite the financial distress experienced by many families during the pandemic lockdowns of the past year, most in developed economies worked from home, received furlough payments or direct government cheques. With few services, travel or leisure activities open to spend incomes on, many debts were paid down and aggregate savings and bank deposits ballooned.
As the first lockdowns eased last summer, some - though not all - of that additional buffer was spent - but spurring a dramatic bounce in activity late last year.
Now, U.S. data for January shows the second wave had a similar effect, with household savings as a share of disposable income surging 7 percentage points in the first month of the year - and back above 20% for the first time since May. While shy of the 33% hit last April, January’s rate was still higher than in any month in the 60 years prior to the COVID shock.
Boosted by fresh lockdowns and December’s “mini” $900 billion government package of supports and direct household handouts, that savings rate translates into almost $4 trillion in total - or more than $2 trillion than the average month of the two years prior to the pandemic and almost 10% of gross domestic product.
If these “excess” savings are fully spent again as the pandemic ends, alongside $1.9 trillion of new government spending and $120 billion per month Federal Reserve bond buying, it risks a sharp rise in inflation, according to economists such as former Treasury chief Larry Summers and ex International Monetary Fund chief economist Olivier Blanchard.
Last week’s sudden bond market turbulence showed just how much of a difference that means to investors.
And it’s not a phenomenon peculiar to the United States. Although European data lags, estimates show a similar pattern in through last year and into 2021.
A Reuters analysis of the top four UK banks’ results shows domestic customers deposited 221 billion pounds of extra cash last year.
Germany’s savings rate, which hit records over 20% in the second quarter of 2020, was already climbing back toward that level again in the final quarter and savings for the full year were 111 billion euros higher than in the prior two years.
Deutsche Bank economist Marc Schattenberg estimates that if Q1 is similar to Q2 last year, those ‘involuntary savings’ will rise to 160 billion euros - at least 30% of which will be spent on conservative estimates.
And if the ‘precautionary motive’ around job insecurity is overstated, as much as 40%, or 65 billion euros, could be then spent over the remainder of the year - lifting consumption growth to 2% and adding an additional half percentage point to Deutsche’s existing 4% GDP growth forecast.
RICARDIAN TWIST
If that estimate seems underwhelming against the U.S. angst, it’s partly because Deutsche and others feel the forced savings - whether in the United States or Europe - won’t return to pre-pandemic square as quickly as some assume.
Deutsche’s central scenario reckons 70% of the ‘excess’ would remain in household deposits or assets for the time being.
Its rationale is the bulk of ‘excess’ is skewed to high-income households with a high propensity to save anyhow and the cash will more likely find its way to financial investments.
Shweta Singh, TSLombard’s Managing Director, Global Macro reckons this is also true in the United States, where data shows a clear skew in accumulation of liquid assets to the higher earners who mostly kept working and who typically spend more of their incomes on shuttered services.
What’s more, she said 2020’s durable goods spree is unlikely to be repeated with the same gusto two years in a row.
“Those expecting households to aggressively run down their stock of savings will be disappointed,” she wrote. “There could be a burst of inflation in the immediate term, especially in the services sector, but it will be short-lived until there is a meaningful improvement in the labour market.”
And then there’s the thorny issue of so-called “Ricardian equivalence”, a theory posited by 19th century economist David Ricardo suggesting government debt is largely just what citizens owe to themselves - and people save more when governments spend alot to prepare for future tax rises to fix public finances.
In a paper this week dismissing the idea of this savings build as “excessive”, professors Florin Bilbiie, Gauti Eggertsson and Giorgio Primiceri said the saving build was the accounting flipside of the trillions of extra government spend.
They said the theory doesn’t work in lockstep in practise and surveys show those who received cheques last year spent between 25-40%. But if the bulk of ‘forced savings’ are with high earners, they are also the ones likely to be targeted with higher taxes and more likely to behave in a ‘Ricardian’ way.
The author is editor-at-large for finance and markets at Reuters News. Any views expressed here are his own.
by Mike Dolan, Twitter: @reutersMikeDOur Standards: The Thomson Reuters Trust Principles.
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ae8ad03ed031e6c029543cd0402d5a6a | https://www.reuters.com/article/us-global-socialmedia-rights-trfn-idUSKBN23Q2TO | 'Lost memories': War crimes evidence threatened by AI moderation | 'Lost memories': War crimes evidence threatened by AI moderation
By Avi Asher-Schapiro, Ban Barkawi8 Min Read
NEW YORK/AMMAN (Thomson Reuters Foundation) - From bombings and protests to the opening of a new health center, student journalist Baraa Razzouk has been documenting daily life in Idlib, Syria, for years, and posting the videos to his YouTube account.
But this month, the 21-year-old started getting automated emails from YouTube <Youtube Inc> alerting him that his videos violated its policy, and that they would be deleted. As of this month, more than a dozen of his videos had been removed, he said.
“Documenting the (Syrian) protests in videos is really important. Also, documenting attacks by regime forces,” he told the Thomson Reuters Foundation in a phone interview. “This is something I had documented for the world and now it’s deleted.”
YouTube, Facebook, and Twitter warned in March that videos and other content may be erroneously removed for policy violations, as the coronavirus pandemic forced them to empty offices and rely on automated takedown software.
But those AI-enabled tools risk confusing human rights and historical documentation like Razzouk’s videos with problematic material like terrorist content - particularly in war-torn countries like Syria and Yemen, digital rights activists warned.
“AI is notoriously context-blind,” said Jeff Deutch, a researcher for Syrian Archive, a nonprofit which archives video from conflict zones in the Middle East.
“It is often unable to gauge the historical, political or linguistic settings of posts ... human rights documentation and violent extremist proposals are too often indistinguishable,” he said in a phone interview.
Erroneous takedowns threaten content like videos that are used as formal evidence of rights violations by international bodies such as the International Criminal Court and the United Nations, said Dia Kayyali of digital rights group Witness.
“It’s a perfect storm,” the tech and advocacy coordinator said.
After the Thomson Reuters Foundation flagged Razzouk’s account to YouTube, a spokesman said the company had deleted the videos in error, although the removal was not appealed through their internal process. They have now restored 17 of Razzouk’s videos.
“With the massive volume of videos on our site, sometimes we make the wrong call,” the spokesman said in emailed comments. “When it’s brought to our attention that a video has been removed mistakenly, we act quickly to reinstate it.”
TAKEDOWN
In recent years social media platforms have come under increased pressure from governments to quickly remove violent content and disinformation from their platforms - increasing their reliance on AI systems.
With the help of automated software, YouTube removes millions of videos a year, and Facebook deleted more than 1 billion accounts last year for violating rules like posting terrorist content.
Last year social media companies pledged to block extremist content following a livestreamed terror attack on Facebook of a gunman killing 51 people at two mosques in Christchurch, New Zealand.
Governments have followed suit, with French President Emmanuel Macron vowing to make France a leader in containing the spread of illicit content and false information on social media platforms.
But the country’s top court this week rejected most of a draft law that would have compelled social media giants to remove any hateful content within 24 hours.
Companies like Facebook have also pledged to remove misinformation about the coronavirus outbreak that could contribute to imminent physical harm.
These pressures, combined with an increased reliance on AI during the pandemic, puts human rights content in particular jeopardy, said Kayyali.
TRACKING CONTENT
Social media firms typically do not disclose how frequently their AI tools mistakenly take down content.
So, the Syrian Archive group has been using its own data to approximate change over time in the rate of deletions of human rights documentation on crimes committed in Syria, which has been battered by nearly a decade of war.
The group flags accounts posting human rights content on social media platforms, and archives the posts on its servers. To approximate the rate of deletions they run a script pinging the original post each month to see if it has been removed.
“Our research suggests that since the beginning of the year, the rate of content takedowns of Syrian human rights documentations on YouTube roughly doubled (from 13% to 20%)” said Deutch, calling the increase “unprecendented”.
In May, Syrian Archive detected more than 350,000 videos on YouTube had disappeared - up from 200,000 in May 2019, including videos of aerial attacks, protests, and destruction of civilians homes in Syria.
Deutch said he had seen content takedowns in other war-torn countries in the region, including Yemen and Sudan. “Users in conflict zones are more vulnerable,” he said.
Other groups, including Amnesty International and Witness, have warned of the trend elsewhere, including in sub-Saharan Africa.
Syrian Archive was not able to test for takedowns at Facebook, because outside researchers are restricted from the platform’s application programing interface (API).
But earlier this month Syrians began using the hashtag “Facebook is fighting the Syran revolution” to flag similar content takedowns on the platform.
Last month Yahya Daoud, a Syrian humanitarian worker with the White Helmets emergency response group, shared a post and a photo showing a woman who died in a 2012 massacre by the forces of Syrian President Bashar al-Assad in the Houla region.
By the end of the month Daoud said his account - which he had used since 2011 to document his life in Syria - was automatically deleted without explanation. “I was depending on Facebook to be an archive for me,” he said.
“So many memories have been lost: the death of my friends, the day I became displaced, the death of my mother,” he said, adding that he had unsuccessfully tried to appeal the decision through Facebook’s automated complaints system.
Facebook did not respond to requests for comment.
‘WE AREN’T HEARING THEM’
Researchers say they are only able to detect a small slice of erroneous content takedowns.
“We don’t know how many people are trying to speak and we aren’t hearing them,” said Alexa Koenig, director of the University of California Berkeley’s Human Rights Center.
“These algorithms are grabbing the content before we even see it,” said Koenig, whose center uses images and videos posted from conflict zones like Syria to document human rights abuses and build cases.
YouTube said that 80% of videos flagged by its AI were deleted before anyone had seen them in the second quarter of 2019.
That concerns Koenig, who worries that the erasure of these videos could jeopardize ongoing investigations around the world.
In 2017 the International Criminal Court issued its first arrest warrant that rested primarily on social media evidence, after video emerged on Facebook of Libya commander Mahmoud al-Werfalli.
The video purportedly showed him shooting dead 10 blindfolded prisoners at the site of a car bombing in Benghazi. He is still at large.
Koenig worries this kind of documentation is now under threat: “The danger is much higher than it was just a few months ago,” she said.
“It’s a sickening feeling, to know we aren’t close to where we need to be in preserving this content.”
Reporting by Avi Asher-Schapiro @AASchapiro in New York and Ban Barkawi @banbarkawi in Amman, Editing by Zoe Tabary. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit news.trust.orgOur Standards: The Thomson Reuters Trust Principles.
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99c039826835ef831b313e4d2225fbec | https://www.reuters.com/article/us-global-stocks-poll-idUSKCN0ZS1N1 | Global stocks outlook dims with risk aversion on the rise again: Reuters poll | Global stocks outlook dims with risk aversion on the rise again: Reuters poll
By Ross Finley, Rahul Karunakar6 Min Read
LONDON/BENGALURU (Reuters) - Optimism about stock market performance this year has wilted, with investors fretting about the global economy and unexpected shocks likely to condemn most key indices to a weaker performance than thought just a few months ago.
A man passes by the New York Stock Exchange (NYSE) in New York City, U.S., July 11, 2016. REUTERS/Brendan McDermid
The latest Reuters poll of over 250 analysts, fund managers and brokers worldwide taken June 27-July 11 also showed an intensifying pull between stretched share prices - with Wall Street at a record high - and bond markets, with most government bond yields at record lows and vast swathes of them negative.
Strategists at Citi have noted that the gap between the global government bond benchmark yield, just 0.5 percent, and the dividend yield on global equities of about 2.7 percent, is the widest in 60 years, and on that basis, stocks look attractive.
Ten of the indexes polled are expected to be lower by the end of the year when just three months ago the consensus view among forecasters was that they would be up, in some cases significantly. [Graphic: tmsnrt.rs/29t4c95]
But the poll results do not provide a definitive picture on where forecasters are recommending investors put their money, although hopes remain high once again that next year will be better, particularly for struggling emerging markets.
The Bank of England is set to reverse course in response to Britain’s shock vote on June 23 to leave the European Union, with rate cuts and renewed government bond purchases nearly certain in an attempt to limit the damage. [BOE/INT]
The trouble is, even though the vast majority polled don’t expect any financial crisis from Brexit, that shock has increased risk aversion, as well as the risk a likely British recession may have ripple effects well beyond its borders.
Expectations for an interest rate rise in the United States have also faded despite a surprisingly strong jobs report last week, triggering a rally in stocks and U.S. Treasuries.
So while in past years the prospect of more central bank cash might have lit a fire under the stock market, there is a clear sense now of pessimism in the latest results about the outlook for European shares, as well as Britain’s FTSE 100. [EPOLL/FRDE] [EPOLL/GB]
Related CoverageWall Street may have already had its 2016 bounce: Reuters pollLittle upside for Latam stocks by end-year after Brazil rally: Reuters poll
“The Brexit vote has damaged the outlook for the global economy and EPS (earnings per share). This is clearly unhelpful for global equities. It also drove global bond yields down to unprecedented levels, which has increased the relative income attractions of equities,” wrote Citi strategists in a note.
“These two opposing forces are likely to keep share prices trapped in the current trading range. While Citi strategists collectively forecast a 7 percent rise in global equities by mid-2017, investors could probably generate a better return if they wait for the next dip.”
Even on Wall Street, where stocks had their worst start to the year ever only to rally back to a record high, in large part on optimism about the economy, many are now cautious, especially ahead of a presidential election in November. [EPOLL/US]
“It’s Brexit one day, election issues the next. We’ve been telling clients to sort of buckle up,” said Jeff Mortimer, director of investment strategy for BNY Mellon Wealth Management.
However, with increasing central bank ownership of a government bond market limited in size by fiscal restraint, stock and bond prices are likely to continue rising, simply because the money that’s been created has to go somewhere.
The European Central Bank also has both feet on the accelerator, having launched its latest aggressive expansion to its stimulus well before the Brexit vote. Now many are speculating it may have to consider doing even more to make sure the euro zone economy doesn’t veer off track as a result.
Perhaps unexpectedly, the most optimistic outlook appears to be for Japan, where stocks have been beaten down by a soaring yen and a moribund economy. [EPOLL/JP]
In addition to a much lengthier and more aggressive central bank stimulus program than in Europe, more fiscal stimulus is in the pipeline there after elections at the weekend where Prime Minister Shinzo Abe was victorious.
Indian shares are also expected to perform well on relative stability compared with other Asian economies, although forecasts are markedly less optimistic for the remainder of the year than those taken three months ago. [EPOLL/IN]
For Asia more widely, as well as Latin America, forecasters were less upbeat, looking past the U.S. presidential election and potential near-term trouble as a result of Brexit to peg 2017 for a rebound. [EPOLL/ASIA] [EPOLL/BR]
“There are likely to be more periodic sell-offs in risky assets in the months ahead, but we do not expect these to prevent EM (emerging market) stocks from performing reasonably well,” wrote David Rees, senior markets economist at Capital Economics.
“If anything, the vote for ‘Brexit’ appears likely to ensure that global monetary conditions remain looser for longer,” he wrote. “This, along with relatively low valuations, will support EM equities in the next 18 months.”
(Poll data: EQUITYPOLL1)
(Other stories from the Reuters global stock markets poll:)
Additional reporting and polling from reporters in Seoul, Shanghai, Sydney, Tokyo, London, Frankfurt, Milan, Moscow, Johannesburg, New York, Brasilia, Sao Paulo, Toronto and Bengaluru; Editing by Adrian CroftOur Standards: The Thomson Reuters Trust Principles.
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9efecfa44a75ca4e1f5039a69d8978a6 | https://www.reuters.com/article/us-global-swf-environment/sovereign-investors-tweak-portfolios-for-environmental-risk-idUKKBN19A0HP?edition-redirect=uk | Sovereign investors tweak portfolios for environmental risk | Sovereign investors tweak portfolios for environmental risk
By Claire Milhench6 Min Read
LONDON (Reuters) - Some sovereign investors are reducing their exposure to fossil fuels or seeking clean alternatives to protect their portfolios from rising environmental risk.
Norway’s $900 billion sovereign wealth fund (SWF) -- itself financed by oil sales -- and the New Zealand Super Fund (NZSF) are among those adjusting investments in anticipation of tougher environmental rules or damage from the impact of global warming.
Rising temperatures could lead to more violent storms and flooding, posing a threat to infrastructure and prime real estate, both favored by sovereign investors.
U.N. scientists say greenhouse gases are the main cause of warming and while the U.S. administration has questioned the science, many countries are introducing rules to cut emissions.
Norway’s SWF, the world’s largest, is divesting from companies that derive more than 30 percent of their turnover or activity from coal, a major source of greenhouse gases. It is also investing in alternative fuel companies such as NextEra Energy, a U.S. wind farm developer.
By July the fund’s ethics watchdog is likely to recommend the fund excludes or puts on a watch list the first of several firms in the oil, cement and steel industries. The fund is also pushing companies to disclose carbon emissions and plans to handle climate change risk.
“In terms of greenhouse gas emissions, we are actually expecting companies to increase reporting on it,” the fund’s chief executive Yngve Slyngstad told Reuters.
“We want to have more transparency on investment plans and how they are affected.”
The NZSF said last year it would set a target by the end of June to reduce its carbon footprint.
“We should be able to increase our returns for the same risk, or get the same returns with less risk,” Adrian Orr, chief executive of NZSF, said in November.
In an update, an NZSF spokeswoman said the fund was looking at its passive portfolio rules and this would lead to a reduction in fossil fuel holdings. More details would be given when the changes have been made, she said.
It has already invested in energy efficient glass manufacturer View and waste gas-to-fuel firm LanzaTech.
France’s SWF Caisse des Depots (CDC) is also aiming to reduce the carbon footprint of its equity portfolio by 20 percent by 2020, and is exiting companies that derive more than 20 percent of revenue from coal.
“Coal is a 19th century energy, it is not the energy of the future,” said Joel Prohin, head of portfolio management at CDC.
COUNTING THE COST
Investors have committed to divesting some $5 trillion from fossil fuel companies, according to Arabella Advisors, with pension funds leading the way.
In June, Swedish pension fund, AP7 sold its investments in six energy-related companies it says violate the 2015 Paris Agreement, which aims to limit global warming to below 2 degrees Celsius and has pushed environmental risk up the agenda.
That is despite U.S. President Donald Trump’s decision last month to take the United States out of the agreement, which attracted international condemnation.
A 2016 study by the London School of Economics and others put value at risk at $2.5 trillion in a ‘business as usual’ emissions scenario of 2.5 degrees Celsius of warming by 2100.
“If you believe climate change is happening and there’s going to be a cost to that, do you pay that cost upfront as a preventative measure, or wait for the impacts to happen and then pay the bills?” said Alex Millar, head of EMEA sovereigns at Invesco.
One SWF official, speaking on condition of anonymity, said it was steering clear of Miami real estate given the risk of rising sea levels in the low lying area.
“It’s very likely that in 10 years’ time the parking is going to be flooded,” he said.
A 2017 Invesco study of sovereign investors found climate change was the most important environmental, social and governance (ESG) issue for those that had already incorporated ESG factors into their investment process. Seventy percent of ESG adopters perceived an increase in long-term returns.
But it also noted adoption of ESG practices was patchy, with some investors in the United States and emerging markets reluctant to commit without harder data on risks and returns.
ENERGY FOR FREE
The International Forum of Sovereign Wealth Funds (IFSWF) is exploring the investment implications of the global commitment to curb greenhouse gas emissions and will report back to its members in September.
“Funds that are primarily funded through fossil fuel production will feel an accelerated demand to diversify as quickly as possible,” said NZSF’s Orr, who also chairs the IFSWF.
Even where fossil fuel divestment is not a priority, more investors want to capture the upside in the green economy.
The Abu Dhabi Investment Authority has invested in renewable energy firms Greenko and ReNew Power while Singapore’s GIC has targeted investments in electric vehicles.
Ithmar Capital, Morocco’s strategic investment fund, wants to raise $1-2 billion from infrastructure specialists and other SWFs for its Africa-focused green infrastructure fund.
“Africa is contributing the least to climate change, but it is suffering the most so it needs a specific action plan,” Tarik Senhaji, chief executive of Ithmar Capital, said.
Mahmood Alkooheji, chief executive of Bahrain’s SWF Mumtalakat, also described renewables as “the way forward”.
“We can’t not be thinking of the environment,” he told Reuters. “For Bahrain it’s a very promising area, we have sunshine 366 days in a year ... so that’s a lot of energy being wasted. It’s energy for free so why not invest in it?”
Additional reporting by Gwladys Fouche and Sujata Rao; editing by Anna WillardOur Standards: The Thomson Reuters Trust Principles.
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9872efadcfe3c4ccbf707cb2bcfbfe9e | https://www.reuters.com/article/us-global-swf-startups/sovereign-investors-hunt-for-unicorns-in-silicon-valley-idUSKBN1871XI | Sovereign investors hunt for 'unicorns' in Silicon Valley | Sovereign investors hunt for 'unicorns' in Silicon Valley
By Claire Milhench6 Min Read
LONDON (Reuters) - Sovereign investors are sinking more money into tech start-ups and opening offices in Silicon Valley in the hope of bagging a “unicorn” - the rare private firm that grows in value to over $1 billion.
Sovereign wealth funds (SWFs), which run over $6.59 trillion in assets, hope that investing at an early stage will yield outsize returns if the firms enjoy dizzying growth.
But such start-ups can also offer a useful hedge in case SWF holdings in mature sectors come under threat from digital disrupters, just as global hotel chains have been undercut by online room rentals business Airbnb - itself a unicorn.
SWFs made 12 investments last year in U.S. start-ups, worth $12.4 billion, up from four investments in 2012 worth $202 million, according to data compiled by research firm PitchBook.
Globally, there were 42 deals involving SWFs and start-ups last year valued at some $16.2 billion, according to the Sovereign Wealth Lab research center at Madrid’s IE Business School.
The creation of the $100 billion technology-focused Vision Fund suggests these numbers will grow. The fund is a venture between Japan’s SoftBank and Saudi’s PIF, the latter’s appetite whetted by its $3.5 billion investment in ride-hailing app Uber.
Last year’s deals with SWF participation included multi-billion dollar funding rounds for companies such as China Internet Plus and Ant Financial Services, an affiliate of China’s Alibaba.
SCOUTING FOR UNICORNS
How the funds scout out these opportunities varies.
Some SWFs have dedicated venture capital units such as Temasek’s Vertex Ventures, Kuwait’s Impulse and Canada’s OMERS Ventures.
But more are opening offices in San Francisco’s Silicon Valley - a hub for tech start-ups - with Qatar Investment Authority (QIA) the latest to announce plans.
“There are a lot of these unicorns growing at a clip here faster than anywhere else,” said Babak Nikravesh, an SF-based partner at law firm Hogan Lovells, who represents sovereign investors. “The returns are outsized returns – and that’s what’s driving a number of sovereigns to open here.”
According to Fortune, the United States accounted for 101 unicorns in 2016, with China hosting 36, the United Kingdom eight, and India seven.
GIC and Malaysia’s Khazanah already have offices in San Francisco, while Temasek opened an office in late 2016, and in January made an $800 million investment in healthcare tech firm Verily Life Sciences..
“We’ve been stepping up investments in tech, life sciences and healthcare, and having a presence in San Francisco helps us get closer to the companies in these sectors,” Paul Ewing-Chow, an associate director at Temasek, told Reuters by e-mail.
London is also attracting some funds. Khazanah set up in London last May to target European tech ventures. GIC, a shareholder in UK-based tech and healthcare incubator Allied Minds ALM.L, also has an office in London.
FINDING WINNERS
With fierce competition for the best opportunities, some SWFs work closely with third-party venture capitalists who spotlight promising companies.
Recently, Australia’s $130 billion Future Fund co-invested with venture capital firm NEA in Fugue, a start-up working in cloud computing, and California-based Radiology Partners.
The Australian fund was also among those canny enough to gain early exposure to unicorns such as Uber, Pinterest, Airbnb and Snapchat, earning annual returns of well over 20 percent net of fees from its venture program.
“Venture is very important to us as it gives us access to the current innovation and disruption trend,” the fund’s chief investment officer Raphael Arndt told a conference in Melbourne last September.
With digital disruptors continuing to erode the market share of less innovative old sector companies, from taxi firms to car-makers, start-ups are an ideal portfolio hedge.
“In banking, (SWFs) invest a lot in fintech, in transport they invest in driverless cars. They need to balance their portfolios with the old and the new players,” said Javier Capape, a director at the Sovereign Wealth Lab.
SWFs might spread the risk by seeding several firms in the same sector. “You can’t invest in just one start-up as the risk is huge – normally they fail eight out of 10 times,” he added.
A typical commitment might be only about $5 million-$20 million, but the number of deals is growing as SWFs try to ensure they pick a winner. GIC has backed several firms in the electric vehicle sector.
“Valuations can ramp up very quickly,” said Nikhil Salvi, a manager at Aranca, an investment research and analytics firm. “SWFs are willing to put small stakes in a lot of companies with the expectation that one or two might become outsize successes - that can change the portfolio return quite dramatically.”
Khazanah earned over $1 billion on its $400 million investment in China’s Alibaba in less than two years ahead of its New York listing. And GIC participated in a 2015 $400 million funding round for India’s Uber rival Ola, which is now valued at $5 billion.
PATIENCE
But SWFs are not always seeking a quick pay out.
The Ireland Strategic Investment Fund (ISIF) says early stage investments are a way to support economic activity at home, while generating commercial returns. It recently backed U.S. tech unicorns InsideSales.com, and Kabbage, which have committed to open offices in Ireland.
“Tech investments are particularly appealing to us given Ireland’s strong reputation as a tech hub,” ISIF director Eugene O’Callaghan said, predicting ISIF’s tech exposure would grow.
But with 193 unicorns globally worth $681 billion according to venture capital database CB Insights, some industry participants worry that a risk bubble is forming. Another fear is that the Vision Fund will inflate valuations, heightening the risk that initial public offerings (IPOs) disappoint.
U.S. software company Cloudera CLDR.N, which made its stock market debut in April, priced well below than the $4.1 billion it was once valued at.
Additional reporting by Marius Zaharia in Singapore and Alasdair Pal in London; Editing by Tom HeneghanOur Standards: The Thomson Reuters Trust Principles.
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2b317c09f0e042cbb83dbca83e4d69cb | https://www.reuters.com/article/us-global-tax-breakingviews/breakingviews-review-taxs-weird-past-exposes-present-oddities-idUSKBN2BW1GR | Breakingviews - Review: Tax’s weird past exposes present oddities | Breakingviews - Review: Tax’s weird past exposes present oddities
By Liam Proud5 Min Read
U.S. currency is seen in this picture illustration taken March 6, 2020.
LONDON (Reuters Breakingviews) - The authors of “Rebellion, Rascals, and Revenue: Tax Follies and Wisdom through the Ages” set themselves a daunting task: make tax history interesting. Michael Keen and Joel Slemrod mostly succeed, even managing to serve readers a surprisingly palatable dollop of economic theory in the process. The main effect of this enjoyable gallop through state levies of the past is to expose the continuing oddities of how governments raise revenue today.
One lesson is that there’s no such thing as a perfect tax. Finance ministers, monarchs, emperors and pharaohs have all faced the competing demands of efficiency, practicality and perceived fairness when trying to extract money from their subjects.
Perhaps that’s why they keep repeating the same mistakes. The English poll tax of 1381, introduced under the “boy king” Richard II, contributed to a mass peasant revolt during which rebels briefly controlled London. Over 600 years later, Margaret Thatcher’s decision to impose a similar flat-rate levy on every British adult helped end her decade-long tenure as prime minister.
Keen, a tax bod at the International Monetary Fund, and Slemrod, a University of Michigan economics professor, proffer neat yarns by the bucketload. So much so that parts of the book read like a jumbled collection of anecdotes. But at their best, the tales of historic folly and wisdom breathe life into dry principles of tax theory.
Take Britain’s 17th century levy on hearths, the floor area of a fireplace. Many citizens responded by blocking up their chimneys. King Charles II raised much less cash than he needed, while some of his subjects suffered in the cold. It’s a classic example of what economists call “excess burden” – the deadweight loss to society from distortive taxation.
The authors give a similarly lively treatment to the question of incidence, or who really ends up paying a tax. It’s rarely the same person who hands over the money. A 1990 U.S. levy on boats costing over $100,000, for example, was supposed to hit the super-rich without jacking up income-tax rates. But pricier yachts led to fewer sales, costing thousands of relatively poor boat builders in South Florida their jobs. Keen and Slemrod cite studies finding that workers indirectly shoulder between 16% and 40% of the corporate tax burden, either through lower wages or employment.
State levies are also seldom far from history’s key turning points. Sometimes they’re a cause: the Boston Tea Party, an early milestone in the American Revolution, was a response to the British crown’s cunning fiscal shenanigans designed to prop up the failing East India Company. The barons who collared King John into signing Magna Carta in 1215 were similarly exercised by arbitrary levies. At other times, seismic events in history have served as cover for fiscal revolutions: France and Russia introduced income tax shortly after the outbreak of the World War One. America massively expanded its income tax base, with the help of propaganda videos featuring Donald Duck, during the World War Two.
Now the coronavirus pandemic has prompted governments to consider new ways to raise revenue. One increasingly popular candidate is the wealth tax. The appeal of imposing a one-off, backward-looking levy is that it would be relatively free from the economically distortive effects that undermined King Charles II’s hearth tax. Windfall charges on companies which benefitted from the pandemic, as floated recently by the IMF, would have a similar logic. Meanwhile the idea of hiking taxes on capital gains, which is under consideration in both Britain and the United States, would remedy a modern anomaly. Keen and Slemrod note that many countries historically taxed such “unearned income” at a higher rate than wages. Soaring asset prices and sluggish labour markets only add weight to the case for reverting to past practice.
Other contemporary policies look like fodder for future historians of tax oddities. The so-called arm’s length principle of multinational corporate tax is one contender. It allows companies to juggle liability between their subsidiaries through internal payments, provided those dealings mimic the terms of two imaginary and unrelated trading partners. The principle has kept many tax lawyers in expensive suits but arguably made tax avoidance much easier. The enduring lesson from “Rebellion, Rascals, and Revenue” is that, when it comes to taxes, the present is no less peculiar than the past.
BreakingviewsReuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.Sign up for a free trial of our full service at https://www.breakingviews.com/trial and follow us on Twitter @Breakingviews and at www.breakingviews.com. All opinions expressed are those of the authors.
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8dc3308099a871c556290b0c903a129c | https://www.reuters.com/article/us-global-taxavoidance-britain-idUSKCN0Y3183 | Countries pledge to fight graft by revealing who owns companies | Countries pledge to fight graft by revealing who owns companies
By David Brunnstrom, Estelle Shirbon5 Min Read
LONDON (Reuters) - Countries from Britain to Afghanistan pledged on Thursday to set up public registers of company ownership in a collective effort to make it harder to launder the proceeds of corruption around the globe.
Boyko Borissov, the Prime Minister of Bulgaria (L) is met by Britain's Foreign Office minister Hugo Swire as he arrives at a summit on corruption at Lancaster House in central London, Britain, May 12, 2016. REUTERS/Paul Hackett
Prime Minister David Cameron announced the steps at a global anti-corruption summit he was hosting; but critics said the registers might have no meaningful impact unless tax havens, many ultimately controlled by Britain, also ended secrecy.
The build-up to the London event was marred by Cameron being caught on camera describing Nigeria and Afghanistan, which are both taking part, as “fantastically corrupt”; but he later said that the leaders of both countries were tackling the problem.
U.S. Secretary of State John Kerry, addressing a plenary session at the summit, said he had been shocked by the degree to which he found corruption “pandemic” around the world.
“It is a contributor to terrorism in many different ways and the extremism that we see in the world today comes to no small degree from the utter exasperation that people have with the sense that the system is rigged,” Kerry said.
“We see this anger manifesting itself in different forms in elections around the world, including ours,” he said, alluding to the unexpected success of Republican Donald Trump and Democrat Bernie Sanders in the U.S. presidential primaries.
Britain, France, the Netherlands, Nigeria and Afghanistan pledged to launch public registers of true company ownership while Australia, New Zealand, Jordan, Indonesia, Ireland and Georgia announced initial steps toward similar arrangements.
Kerry said the United States had already announced measures to improve transparency on business ownership.
The countries taking part in the summit issued a 34-point communique outlining pledges to tackle issues ranging from doping and match-fixing in sports to tax evasion and bribery.
Slideshow ( 6 images )
The summit organizers also published separate statements from 40 countries, each one setting out commitments for which, Cameron said, civil society, media and others should hold governments to account.
PENALTIES
Under the new rules announced by Cameron, foreign companies that own a property in Britain or want to buy one or to bid for a central government contract will have to join the register.
The aim is to expose those who hide behind obscure shell companies to own properties, a particularly acute problem in London which has been hit by repeated scandals involving luxury homes owned by corrupt foreign politicians and business people.
“We await to see the detailed requirements, how it will be policed and the penalties for non-compliance in order to judge whether the proposed legislation will actually have any teeth,” said Chris Burdett, a partner at law firm Clyde&Co.
Critics said real progress on money-laundering and tax evasion would only come if tax havens were also compelled to open up about who owns offshore-registered companies.
“Tax dodgers can still sleep easily tonight,” said Susanna Ruiz, tax expert at charity Oxfam.
The release of the “Panama Papers”, leaked documents from law firm Mossack Fonseca, put tax avoidance at the top of the global agenda by showing the extent to which tax havens were used by politicians and business people from around the world.
Anti-corruption protesters who gathered close to the summit venue, some dressed as bankers with bowler hats reclining on deck chairs as they fanned themselves with banknotes, said what was needed was an outright abolition of tax havens.
The British Virgin Islands, a British overseas territory that the Panama Papers suggested was home to more than half of the 200,000 companies set up by Mossack Fonseca, was not represented at the London summit.
Britain also seized the opportunity of the summit to bring forward plans to introduce a criminal offense for companies that fail to stop employees facilitating tax evasion, pledging to introduce legislation to that effect this year.
John Milner, head of business crime and fraud at law firm IBB Solicitors, said this was a step in the right direction in tackling what he called Britain’s “unenviable and growing reputation as a soft touch for laundering dirty money”.
However, he expressed doubts as to whether the already stretched white collar crime investigating body would be able to enforce the new rule.
Additional reporting by Georgina Cooper and Elizabeth Piper; editing by Ralph BoultonOur Standards: The Thomson Reuters Trust Principles.
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d7949559b2d8e6a9ea640ba8df5dd50b | https://www.reuters.com/article/us-global-taxavoidance-cameron-idUSKCN0Y11NW | Cameron says leaders of 'fantastically corrupt' countries to attend UK anti-graft summit | Cameron says leaders of 'fantastically corrupt' countries to attend UK anti-graft summit
By Guy Faulconbridge4 Min Read
LONDON (Reuters) - British Prime Minister David Cameron was caught on camera telling Queen Elizabeth on Tuesday that leaders of some “fantastically corrupt” countries, including Nigeria and Afghanistan, were due to attend his anti-corruption summit.
Cameron will host an international anti-corruption summit on Thursday aimed at stepping up global action to combat corruption in all walks of life.
In a pooled video feed made available to the ITN broadcaster, Cameron was shown talking with the queen at Buckingham Palace about the summit.
“We had a very successful cabinet meeting this morning, talking about our anti-corruption summit,” Cameron said when the queen approached. “We have got the Nigerians - actually we have got some leaders of some fantastically corrupt countries coming to Britain.”
Cameron went on: “Nigeria and Afghanistan - possibly two of the most corrupt countries in the world.”
The queen, who steers clear of political comment, did not respond to Cameron’s comment. But the Archbishop of Canterbury, Justin Welby, said: “But this particular president is actually not corrupt.”
Nigeria’s President Muhammadu Buhari and Afghan President Ashraf Ghani, both of whom are due to attend the summit, acknowledge corruption in their countries and have pledged to clean it up.
Slideshow ( 3 images )
“OLD SNAPSHOT OF NIGERIA”
Buhari’s spokesman Garba Shehu said Cameron’s remarks were not “reflective of the good work that the president is doing”.
“The Prime Minister must be looking at an old snapshot of Nigeria,” Shehu said, adding: “Thank you to the Archbishop.”
Afghanistan is at number 166, second-from-bottom, in campaign group Transparency International’s latest Corruption Perceptions Index, an annual ranking of countries.
Only North Korea and Somalia, jointly ranked at number 167, are perceived to be more corrupt. Nigeria is at number 136 in the index.
“There is no doubt that historically, Nigeria and Afghanistan have had very high levels of corruption, and that continues to this day,” said Cobus de Swardt, Managing Director of Transparency International.
Slideshow ( 3 images )
“But the leaders of those countries have sent strong signals that they want things to change.”
It was not clear whether Cameron realized he was being filmed and recorded at the event, held to mark the queen’s 90th birthday last month.
After Cameron’s remarks about Nigeria and Afghanistan, John Bercow, the speaker of parliament’s House of Commons, joked: “They are coming at their own expense, one assumes?”
“Everything has to be open,” Cameron said of the summit.
“There are no sort of closed-door sessions. Everything has to be in front of the press ... It could be quite interesting.”
Cameron’s Downing Street office said both Buhari and Ghani acknowledged they faced a challenge to tackle corruption and they had been invited to the summit because they were leading the fight against graft.
“In a collection of essays on the fight against corruption to be published on the day of the summit, President Ghani writes that Afghanistan is ‘one of the most corrupt countries on earth’,” a spokeswoman for Cameron said.
“President Buhari writes that corruption became a ‘way of life’ in his country under ‘supposedly accountable democratic governments’.”
Additional reporting by Michael Holden and Estelle Shirbon in London and Felix Onuah in Abuja; Editing by Angus MacSwanOur Standards: The Thomson Reuters Trust Principles.
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162133d8c6deba560b73fc3963be32a3 | https://www.reuters.com/article/us-global-taxavoidance-nigeria-idUSKCN0Y21HA | After British corruption slip, Nigeria demands stolen assets back | After British corruption slip, Nigeria demands stolen assets back
By Georgina Cooper, Estelle Shirbon4 Min Read
LONDON (Reuters) - Nigerian President Muhammadu Buhari demanded on Wednesday that Britain return assets held there by corrupt Nigerians, pointing the finger back at London after Britain’s prime minister suggested Nigeria was “fantastically corrupt”.
David Cameron’s remarks during a conversation with Queen Elizabeth, caught on camera on Tuesday, have so far dominated the build-up to a global anti-corruption summit he is hosting on Thursday which Buhari will attend.
During a pre-summit event in London, Buhari was asked to respond to Cameron’s comment that Nigeria and Afghanistan were “possibly two of the most corrupt countries in the world”.
He has since noted that the leaders of both countries are working hard to combat corruption.
“I am not going to demand any apology from anybody. What I am demanding is the return of assets,” Buhari said at an event, to applause from Nigerians in the audience.
“What would I do with an apology? I need something tangible,” he said, rubbing his fingers together in a gesture commonly used to refer to money. The audience laughed.
Buhari has a reputation for personal probity and has pledged to crack down on corruption in Nigeria, Africa’s top oil producer and most populous nation where generations of politicians have looted public coffers for their personal gain.
Nigeria's President Muhammadu Buhari (L) and Britain's Prime Minister David Cameron (R) look on during a breakfast dialogue with Youth Leaders at the Commonwealth Heads of Government Meeting (CHOGM) in Valletta, Malta November 28, 2015. REUTERS/Andrew Winning
Buhari did not specify which assets he was talking about.
British police have conducted several investigations in recent years into assets held in Britain by Nigerian politicians, including two former state governors and a former oil minister. One of the ex-governors is serving a prison sentence in Britain after pleading guilty to money-laundering.
Nigeria is listed at number 136 out of 167 in campaign group Transparency International’s latest Corruption Perceptions Index, an annual ranking of countries in which a higher number indicates a higher level of perceived corruption.
RUNAWAY GOVERNOR
Britain lies equal 10th with Germany and Luxembourg.
But British opposition politicians and anti-corruption campaigners have said Cameron was ill-placed to criticize Nigeria when Britain’s own record on combating corruption was less than glorious.
They have said that corrupt politicians and business people from Nigeria and many other countries have laundered their ill-gotten gains in Britain’s property market, while London also has ties to numerous tax havens routinely used to hide stolen money.
In his remarks on Wednesday, Buhari alluded to the case of Diepreye Alamieyeseigha, former governor of the oil-producing state of Bayelsa in the Niger Delta, who was arrested in London in 2005 on suspicion of money-laundering.
Alamieyeseigha skipped bail and fled back to Nigeria dressed as a woman. He was later impeached, tried and convicted in Nigeria of stealing millions of dollars of public money.
“He (Alamieyeseigha) had to dress like a woman to leave Britain and leave behind his bank account and fixed assets which Britain was prepared to hand over to us. This is what we are asking for,” Buhari said.
Britain’s Department for International Development (DFID) could not immediately provide details of any assets returned to Nigeria.
Writing by Estelle Shirbon Editing by Jeremy Gaunt.Our Standards: The Thomson Reuters Trust Principles.
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4d71bedee1b2778160d5986a898c66ea | https://www.reuters.com/article/us-global-tech-development-idUSKBN1AO005 | Developing countries urged to act now to prevent technology exacerbating poverty | Developing countries urged to act now to prevent technology exacerbating poverty
By Inna Lazareva, Thomson Reuters Foundation3 Min Read
YAOUNDE (Thomson Reuters Foundation) - Governments and businesses in developing countries must act now to ensure rapid technological advances boost rather than hinder development, a think-tank said on Tuesday, warning that growing automation posed a particular threat to women’s jobs.
Increasing automation in industries risks leaving large numbers unemployed and widening inequality gaps, especially in the global South, the London-based International Institute for Environment and Development (IIED) said in a report.
“What we’re seeing now is the emergence of technologies which are likely to mean that there will be less market for simple industrial manufacturers in poor countries because of automation,” the institute’s director Andrew Norton told the Thomson Reuters Foundation by phone.
The report, which examines the impact of automation on work in the global South, warned that it could have “a sharply negative impact on gender equality”.
Norton, the report’s author, said sectors “in the frontline of the next wave of automation” included call centers which have provided a large number of jobs for women in some countries.
But the institute said problems could be avoided if governments refocused their economic and social policies to make them more sustainable.
The report said it was vital for governments to invest in developing education systems that ensure people have the skills to thrive in a rapidly evolving labor market.
Support to smallholder farmers was also important so that they could benefit from changing technology.
Countries with natural resources should invest in sustainable development, it said, citing the example of Costa Rica which has promoted forest regeneration and reaped rewards from investing in sustainable tourism and hydropower.
The increasing “global gig economy” also offers opportunities, enabling workers anywhere in the world with good internet access to bid for work on digital platforms in areas such as translation, graphic design and accountancy.
Such global digital labor platforms are growing in volume of business at 2.5 percent per year, the report found.
“Clearly, millions of people in developing countries can be expected to turn to outsourced work as internet access (covering more than 40 per cent of the world’s population in 2017) continues to grow,” it said.
Technology can also play a vital role in strengthening infrastructure, Norton said, pointing to Kenya’s cellphone-based money transfer service M-PESA - now used by more than two-thirds of the country’s adult population.
“Automation and other technological developments are both a warning and present opportunities. Now is the time for governments and businesses to act,” he said in a statement.
“They need to make sure that the men and women whose livelihoods are threatened by this change have the means to adjust and adapt.”
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25365e3be1ac877d65106518cf9ffe64 | https://www.reuters.com/article/us-global-tech-education-analysis-trfn/global-exam-grading-algorithm-under-fire-for-suspected-bias-idUSKCN24M29L | Global exam grading algorithm under fire for suspected bias | Global exam grading algorithm under fire for suspected bias
By Avi Asher-Schapiro7 Min Read
NEW YORK (Thomson Reuters Foundation) - When Colorado high school student Isabel Castaneda checked her final grades for the International Baccalaureate program in July, she was shocked.
Despite being one of the top-ranking students in her public school, she failed a number of courses — including high-level Spanish, her native language.
The International Baccalaureate (IB) program - a global standard of educational testing that also allows U.S. high-school students to obtain college credit - cancelled its exams in May, due to the coronavirus pandemic.
Instead of sitting final exams, which usually account for the majority of students’ scores, students were assigned their marks based on a mathematical “awarding model”, as described by the IB program.
“I come from a low-income family - and my entire last two years were driven by the goal of getting as many college credits as I could to save money on school,” Castaneda said in a phone interview. “When I saw those scores, my heart sank.”
The COVID-19 pandemic has disrupted exams all over the world, and educational institutions have adapted in a range of ways, from moving tests online to asking students to wear protective gear during testing.
Relying on an algorithm to help determine results comes with its own specific risks, researchers warn.
Depending on the kinds of data the model considers, and how it makes predictions, it has the potential to reproduce - or even exacerbate - existing patterns of inequality for low-income and minority students, they say.
About 160,000 students take IB courses every year, including nearly 90,000 in the United States - and almost 60% of public schools that offer IB in the U.S. are “Title I” schools, with significant low-income student populations, according to the program.
“The choice to use a statistical model in place of a traditional examination warrants several concerns,” said Esther Rolf, a PhD candidate at the University of California-Berkeley, who studies algorithmic fairness.
“Using historical records ... often leads to bias against individuals from historical underprivileged groups.”
IB spokesman Dan Rene shared with the Thomson Reuters Foundation an explanation of the model which relied on three main components.
They were coursework, predictions teachers made about how students would perform on the exam, and the “school context”, which included historical data on predicted results, and performance on past coursework for each subject.
“This process was subjected to rigorous testing by educational statistic specialists,” the spokesman said in an emailed statement.
IB also released a statistical May bulletin showing that average scores in 2020 were in line with previous years, and said it had a process to “review extraordinary cases”.
LOST COLLEGE OFFERS
In previous years, students’ grades have been generated by combining final exams graded by IB and coursework marked by their teachers - which the IB spot-checked, according to its website.
Teachers also make predictions about their students’ final grades, which students can use to secure provisional college admissions before taking their final exams.
“[A] school’s own record was built into the model” by using “historical data to model predicted grade accuracy, as well as the record of the school to do better or worse on examinations compared with coursework,” the IB’s statement noted.
Although the IB insists its model is not an algorithm, experts say it is.
Joe Lumsden, secondary principal at Stonehill International School in Bangalore, India, worried that an entire school’s record might not be an accurate indicator for an individual student’s performance or potential.
“If there are bright students at a struggling school that’s never performed well before, the algorithm could have pulled their scores down - we just don’t know,” said Lumsden.
Several students, as well as parents and teachers, have told the Thomson Reuters Foundation that they have had university offers contingent on certain scores rescinded since the final exam results were published.
TESTING IN A CRISIS
Many testing services have been forced to change their procedures as a result of the coronavirus pandemic.
The College Board, the U.S. non-profit that runs the Advanced Placement (AP) exams - which allow high-school students to earn credit for some U.S. college courses - moved the process online.
The ACT, another exam used in U.S. college admissions, has postponed its testing. Other tests - including a number of state bar exams - have also been moved online.
Iris Palmer, a senior advisor with the Education Policy program at New America, a Washington-based think tank, said she had never heard of a statistical model being used to assign grades.
“The way we use algorithms in education can be especially problematic if there is bias,” she said. “The results can determine the course of the rest of your life.”
She was particularly worried about how the algorithm may have weighed the historical performance of a school when assigning this year’s students’ grades.
“In schools with a lot of turnover, or without a lot of resources, this could really not work well,” she said.
“Students ... who are black or low-income are probably at a disadvantage from the algorithm,” Palmer added.
Nicol Turner Lee, director of the Center for Technology Innovation at the Brookings Institution think tank, agreed it can be hard to build a fair model out of past educational data, given the inequality already baked into the educational system.
“You have to start with the assumption that the algorithm is flawed,” she said.
“By default, it has a problem because the data is generated by the discriminatory outcomes our educational system already produces.”
More than 20,000 students have signed a petition to the IB, protesting the algorithm.
“I think this is discrimination,” said one IB teacher at a U.S. public school, who asked not to be named because they were not authorized to speak to the press.
“They are applying what other teachers and other groups of students did and projecting it on to these kids.”
Grace Abuhamad, a public policy advisor at the Canadian artificial intelligence firm Element AI who has studied bias in credit score algorithms, said the IB’s decision to try to build a school’s past performance into the model makes some sense.
“School context could help balance out fraud,” she said, explaining that certain schools could inflate their students’ coursework scores or predict grades that were unrealistic, and that the model needed to take that into account.
For Castaneda, her final IB results mean she will not receive the college credits she was expecting when she attends Colorado State University in the fall, which would have allowed her to skip some lower-level university classes and graduate faster.
“It’s going to cost me thousands of dollars,” she said.
Reporting by Avi-Asher Schapiro @AASchapiro; Editing by Jumana Farouky and Zoe Tabary. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit news.trust.orgOur Standards: The Thomson Reuters Trust Principles.
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986ee7cade0bd0236f35c742a198de75 | https://www.reuters.com/article/us-global-tech-privacy-trfn-idUSKBN21Z0NF | Data of the dead: Virtual immortality exposes holes in privacy laws | Data of the dead: Virtual immortality exposes holes in privacy laws
By Umberto Bacchi8 Min Read
TBILISI (Thomson Reuters Foundation) - Have you ever wanted to talk to a loved one after they died? It used to be that only necromancers and mediums could claim to contact the dead, but soon digital versions of the deceased could be living just a few clicks away.
From South Korea to the United States, tech startups are looking at ways to keep the dead alive in a digital afterlife that data experts say poses myriad legal and ethical questions the world is yet to properly address.
“Technically, we can recreate anyone online given enough data,” said Faheem Hussain, a clinical assistant professor at Arizona State University’s School for the Future of Innovation in Society.
“That opens up a Pandora’s box of ethical implications.”
Most services only allow people to sign up to their own digital afterlife while they are still alive.
But the lack of regulation on the issue leaves the door open for others with access to the data of the deceased to bring them back to life in virtual form - raising concerns about privacy and consent, data experts say.
“In most countries in the world, the data of the deceased are not protected,” said Edina Harbinja, a senior lecturer in media and privacy law at Birmingham’s Aston University.
“So, nothing in law would prevent the creation of an avatar or android that would resemble the dead”.
That could happen without the consent of the deceased, and the data used could infringe on other people’s privacy if it includes for example conversations the person had with friends and others, she noted.
VIRTUAL ALTER EGOS
From virtual reality (VR) to artificial intelligence (AI), advances in technology have spurred a series of initiatives offering different shades of virtual immortality in recent years.
In February, a South Korean broadcaster aired a tearful reunion between a mother and her deceased 7-year-old daughter who was recreated through VR as a digital avatar modelled upon a child actor using photos and memories from her mother.
Other companies have been looking at social media as a source of information to create chatbots that could impersonate us after we are gone.
ETER9, a social network set up by Portuguese developer Henrique Jorge, pairs each user with an AI “counterpart” that learns to copy their online behaviour and can post comments and content on their behalf - even after they are dead.
“When a user decides to keep his counterpart active for eternity, he will have the extension of himself alive forever,” Jorge told the Thomson Reuters Foundation in emailed comments.
“Some years from now, your great-grandchildren will be able to talk with you even if they didn’t have the chance to know you in person.”
U.S.-based Eternime offers a similar service, while Replika, a company in California, creates digital alter egos that users can talk to when in need of a confidant or companion.
Other startups like SafeBeyond and GoneNotGone allow people to record videos and messages that will be dispatched to their loved ones after death, like letters from the grave marking birthdays or other life events.
MANY QUESTIONS, FEW ANSWERS
While some people might find comfort in the idea of living on digitally after they die, data experts warn that holes in data protection laws make it possible to virtually resurrect someone without their permission.
Wills can provide some guidelines if they contain directions on how to dispose of the deceased’s digital assets, but in some countries there is no guarantee these will be honoured, said Harbinja at Aston University.
In Britain, for example, decisions around what to do with data are seen as personal wishes - akin to preferring cremation rather than burial - that can be overridden by executors and heirs and are not enforceable in court, Harbinja noted.
A few European countries allow heirs to exercise data protections granted to the living, such as the right to access or erase personal data or move it from one social media platform to another.
ETER9 founder Jorge said his social network deals with some of those issues by allowing users to set up their account to stop generating posts on their behalf once they have died.
Users can also nominate a person to be responsible for their account after death.
But even those safeguards bring about some ethical conundrums, such as whether it would be right to pull the plug on a digital avatar that someone had set up as a perpetual testament to their life, Harbinja said.
“Should the data protection and other laws cater for the rights of the family or of the deceased?” she asked. “And where do we draw the line between life and death, or between remembering someone and recreating someone?”
REIGN OF THE DEAD?
With the number of Facebook profiles belonging to dead people expected to outnumber those of the platform’s living users within a few decades, data privacy questions are becoming more pressing, said Carl Ohman at the Oxford Internet Institute.
Besides helping bereaved people grieve, the data left behind by the deceased can provide future generations with an unprecedented insight into our society, according to Ohman, a digital afterlife expert.
“This (Facebook) is the biggest archive of human behaviour ever assembled in the history of our species,” he said by phone.
And leaving companies who stand to make money from that archive to decide what to do with it could be problematic, he added.
Some might decide to delete profiles that are not profitable, destroying valuable historical data, while others could create avatars that do things their living versions would have not approved of in a bid to increase returns, he said.
One solution would be for the industry to come together and self-regulate around ethical standards similar to those adopted by archaeological museums - treating the data of the deceased as if they were “digital human remains”, Ohman suggested.
Companies could make aggregated and anonymised data of deceased people public for researchers to study, releasing more detailed information - particularly about relevant historic figures - as the years pass, he said.
At the same time, full digital resurrections should be limited to people who consented to it in life, and they should be made fully aware of how their data is going to be displayed post mortem, leaving no room for later modifications, he added.
Guessing how the digital afterlife world will develop - and how popular virtual avatars could become - may take longer still.
The ETER9 website, which has been under maintenance for weeks, has about 70,000 users, Jorge said, compared with Facebook’s 2.5 billion.
The Eternime project counts on almost 47,000 subscribers but is currently on hold due to lack of funding, its founder said.
Hussain of Arizona State University said it is important to start a global conversation to address some of the issues the industry poses before they come to the fore.
This is particularly true at a time where online interactions are ballooning as the new coronavirus pandemic forces many to stay home, he added.
“Human society as a whole is creating more digital footprints than ever before,” he said.
“One of the certainties in life is that we are going to be dead, so where’s the design for that?”
Reporting by Umberto Bacchi @UmbertoBacchi; Editing by Jumana Farouky and Zoe Tabary. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit news.trust.orgOur Standards: The Thomson Reuters Trust Principles.
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33e92e438c6c410ae20b8fe93fdbc4c2 | https://www.reuters.com/article/us-global-technology-disasters-idUSKBN18Z057 | Facebook launches disaster maps to help aid workers save lives | Facebook launches disaster maps to help aid workers save lives
By Magdalena Mis, Thomson Reuters Foundation2 Min Read
LONDON (Thomson Reuters Foundation) - Facebook on Wednesday launched disaster maps - an initiative aimed at helping humanitarian organizations save lives in emergencies.
FILE PHOTO: A man poses with a magnifier in front of a Facebook logo on display December 16, 2015. REUTERS/Dado Ruvic/Illustration/File Photo
“When there’s a flood, earthquake, fire or other natural disaster, response organizations need accurate information quickly about where people are in order to save lives,” founder and chief executive Mark Zuckerberg said on Facebook.
“When traditional communication channels like phone lines are down, it can take too much time to figure out where people need help.”
The maps will reflect the movements and location of people before, during and after disasters to help aid agencies work out where they should deliver food, water and medical supplies.
Zuckerberg said the new maps would help build “safe communities, and we will keep doing more initiatives like this”.
The company worked with the U.N. children’s agency UNICEF, the International Federation of the Red Cross and Red Crescent Societies, the World Food Programme, among others, to identify what data would be most useful. They would all have immediate access to the new maps, with other agencies to follow.
Facebook said it would provide three types of maps:
- Location density maps will show people’s location before, during and after a disaster.
- Movement maps will illustrate flight between neighborhoods or cities over several hours.
- Safety check maps will show when users let their family and friends know they are out of harm’s way.
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630181ae4347c60fc8a9b7d53efeb9ab | https://www.reuters.com/article/us-global-trafficking-idUSKBN14J01D?il=0 | From DNA to laws to data, five key tools to combat trafficking in 2017 | From DNA to laws to data, five key tools to combat trafficking in 2017
By Ed Upright, Thomson Reuters Foundation5 Min Read
LONDON (Thomson Reuters Foundation) - With the power of technology and legal clout, many experts agree that 2017 could be the tipping point in the global battle against human trafficking and modern slavery.
An estimated 45.8 million people live in some form of slavery across the world, according to the 2016 Global Slavery Index by human rights group Walk Free Foundation.
Yet pressure and awareness are now building, big business is starting to lead the way, new laws are being put in place and potentially game-changing technology is available.
We asked experts what they see as the five most important tools in the year ahead to tackle the illegal trade in humans that is worth an estimated $150 billion a year:
1. Technology
Technological innovation and scientific advances are more important than ever in monitoring, detecting and prosecuting cases of trafficking.
Highly specialized and complex tools are trying to accomplish more straightforward aims, whether arming garment workers with “voice and choice” or verifying where source materials, such as cotton, really originate.
U.S.-based software group LaborVoices provides a mobile phone based service allowing factory employees to anonymously report abuse, late wages, safety conditions and child labor.
CEO Kohl Gill told the Thomson Reuters Foundation that the data logged by his company from 20,000 people in over 300 factories in Bangladesh and Turkey provides a chance for workers to “fact check” potential employers.
Big companies can also use the information to use best-in-class factories and problems can be identified early, said Gill.
DNA forensic technology can already be used to tag cotton and detect substitute fibers from countries using state-sponsored slavery to produce cotton, said James A. Hayward, president, chairman and CEO of Applied DNA Sciences.
In a second use of DNA technology, Hayward said his company will soon be able to track cotton to exactly where it is picked.
2. Supply chain visibility
Due to government, consumer and ethical pressures, companies and supply chains will be increasingly in the spotlight in 2017, said Geraint John, senior vice president of research at SCM World, a global community of supply chain professionals.
The focus on slavery has moved from sex trafficking to eliminating abuse, dangerous conditions and child labor.
John told the Thomson Reuters Foundation it is increasingly incumbent on businesses to validate their own supply chains with more companies talking publicly about improving procurement processes and admitting being totally slave-free is challenging.
Technology again plays a part here.
Kosten Metreweli, CMO at UK software company Segura Systems, said many supply chains remain surprisingly primitive so improved visibility and transparency are key.
Segura provides a cloud-based software which aims to allow businesses to see further down the chain, then act on it.
3. Legislation
New laws can lead to physical change and many hope that will happen with the signing of an anti-trafficking bill in India, the country with the highest number of slaves that is home to an estimated 18 million, according to the Global Slavery Index
The country’s first comprehensive anti-trafficking law, awaiting approval in 2017, would unify existing laws and aim to treat survivors as victims needing help rather than criminals.
In December 2016, President Pranab Mukherjee launched a campaign to end child slavery and publicly called for the world to recognize minors must have freedom - the first time India’s highest authority has recognized child slavery.
4. Education and awareness
While public, corporate and government action over slavery is picking up pace, this must go hand-in-hand with training and education on the ground, said John.
He said the best companies are going beyond policy to offer internal education in their own procurement systems, educating their own staff on culture and expectations.
He added that to beat trafficking, key players need to tackle specific objectives, offering training and explanation rather than punishment and other sanctions.
5. Mass collection of data
Matt Friedman, CEO of The Mekong Club, compared the current battle against modern slavery to the fight against HIV/AIDS in the 1980s, in terms of the changing perceptions of the issue.
“To me, the modern slavery issue is like a slowly unfolding disaster,” said Friedman, who undertook a 70-day, 27-city, trafficking-awareness trip in the United States last summer.
He sees the mass collection of data, the creation of an anti-trafficking “master plan” and much-improved basic collaboration and training as the ways to tackle modern slavery.
“We all need to step up our game, we need to solve many of these long-standing systemic challenges, we need to have more of a sense of urgency, and we need to do it now,” Friedman said.
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b7d1c04284b45e319bff58a8cf14b0af | https://www.reuters.com/article/us-global-trafficking/corporations-are-tackling-forced-labor-but-progress-needed-index-idUSKCN1BN1MH | Corporations are tackling forced labor but progress needed: index | Corporations are tackling forced labor but progress needed: index
By Adela Suliman, Thomson Reuters Foundation3 Min Read
LONDON (Thomson Reuters Foundation) - Human trafficking is pervasive in global industries particularly in manufacturing sectors such as textiles, but efforts by corporations to be socially responsible are starting to have an impact, a report found on Tuesday.
The EcoVadis Global CSR Risk and Performance Index evaluates the corporate social responsibility (CSR) of more than 20,400 companies in 2016.
The annual index found human trafficking and forced labor were common in lower value manufacturing sectors where few skills were required, such as farming and transportation.
Companies were making more robust efforts to ensure their supply chains were clean of trafficking and forced labor - but with room for improvement, said EcoVadis.
“We’re observing many companies, across all markets, making crucial year-over-year improvements to CSR performance,” said Pierre-Francois Thaler, co-founder of EcoVadis.
“The criticality of supply chain CSR remains extremely high, and there’s a lot of room for all businesses to grow and improve.”
The report found that European companies scored better for CSR compared to the Americas and Africa, Middle East and Asia.
Among the top performing industries were the small and medium food and beverage companies and construction companies. Finance, legal, consulting and advertising industries also fared well.
“The problem (forced labor) exists in every country and in every industry so its vital that business is part of the fight to eradicate it,” Marilyn Croser, Director of CORE Coalition, a British civil society network on corporate accountability, told the Thomson Reuters Foundation.
“Transparency is central,” added Croser, who said too many companies were providing inadequate statements or failing to report incidents of modern slavery.
The report found better performance on tackling forced labor and trafficking among companies based in countries with strong anti-slavery laws.
Modern slavery has become a catch-all term to describe human trafficking, forced labor, debt bondage, sex trafficking, forced marriage and other slave-like exploitation with nearly 46 million people enslaved around the world, according to the 2016 Global Slavery Index.
“Modern slavery is embedded into almost every area of our society, a hideous crime that robs millions of lives from their basic right to freedom,” said a spokesman at charity Hope for Justice, which works to end modern slavery.
“We believe the corporate world has an opportunity to be a leading vehicle for change in this worldwide issue, as they tackle slavery in supply chains, provide work for survivors and raise awareness within their workforce and to their consumers.”
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0efffa360eba3c74007be4c6e4e1856d | https://www.reuters.com/article/us-global-un-childlabour-trfn/u-n-hails-historic-milestone-in-global-drive-to-end-child-labour-idUSKCN250294 | U.N. hails 'historic' milestone in global drive to end child labour | U.N. hails 'historic' milestone in global drive to end child labour
By Reuters Staff3 Min Read
LONDON (Thomson Reuters Foundation) - The United Nations’ labour agency hailed a “historic” milestone on Tuesday in the drive to end child labour after a global treaty to protect children from sexual exploitation, forced labour and armed conflict was signed by all member states.
The International Labour Organization (ILO)’s convention against the worst forms of child labour was backed this week by the Pacific island nation of Tonga, making it the first U.N. labour treaty to be ratified by all 187 of its members.
The convention, which is legally binding on governments, was adopted in 1999 and has been ratified amid rising concerns that economic fallout from the coronavirus pandemic could reverse two decades of gains in combating child labour. [L1N2DO1N3]
“Universal ratification ... is an historic first that means that all children now have legal protection against the worst forms of child labour,” ILO director-general Guy Ryder said.
“It reflects a global commitment that the worst forms of child labour, such as slavery, sexual exploitation, the use of children in armed conflict or other illicit or hazardous work ... have no place in our society,” he said in a statement.
The number of child labourers worldwide has dropped to 152 million from 246 million in 2000, according to the ILO. About 70% of these children work in agriculture and nearly half are in hazardous jobs, it said.
Yet global progress in tackling child labour has slowed in recent years - particularly among children aged between five and 11, and the COVID-19 pandemic could lead to the first rise in the practice since 2000, several U.N. agencies warned in June.
As the pandemic pummels the global economy, pushing millions of people into poverty, families may be under pressure to put their children to work for survival, campaigners say.
“The business community is both aware of and acting on the need to do business with respect for children’s rights,” said Roberto Suarez Santos, head of the International Organisation of Employers (IOE) - the world’s largest private sector network.
“This is even more urgent in the times of the COVID-19 pandemic,” he said in a statement. “We cannot allow the fight against the worst forms of child labour to backslide.”
The United Nations has a target of ending all forms of child labour by 2025 - one of the 17 Sustainable Development Goals (SDGs) agreed upon in 2015 to address a range of global ills.
Writing by Kieran Guilbert, Editing by Helen Popper. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit news.trust.orgOur Standards: The Thomson Reuters Trust Principles.
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a253d651f65489b223c3bd826a3f66e1 | https://www.reuters.com/article/us-global-war-children/more-than-350-million-children-living-in-conflict-zones-says-charity-idUSKCN1FZ00M | More than 350 million children living in conflict zones, says charity | More than 350 million children living in conflict zones, says charity
By Lee Mannion, Thomson Reuters Foundation3 Min Read
LONDON (Thomson Reuters Foundation) - More children than ever before are living in conflict areas and are at risk of death and violence, the charity Save the Children said on Thursday, with Syria, Afghanistan and Somalia the worst countries for young people.
In a report, the global charity said at least 357 million children - or one in six worldwide - were living in conflict zones, an increase of 75 percent since the early 1990s.
Increased urbanisation, longer-running conflicts and a rise in the number of schools and hospitals being targeted heightened the danger for children, according to Save the Children.
Other threats include abduction and sexual violence.
“We are seeing a shocking increase in the number of children growing up in areas affected by conflict, and being exposed to the most serious forms of violence imaginable,” Helle Thorning-Schmidt, chief executive of the charity, said in a statement.
“Children are suffering things no child ever should; from sexual violence to being used as suicide bombers. Their homes, schools and playgrounds have become battlefields,” added Thorning-Schmidt, the former prime minister of Denmark.
United Nations figures show more than 73,000 children have been killed or maimed in 25 conflicts since 2005, the year it started collating such statistics, according to the report.
Since 2010, the number of U.N.-verified cases of children being killed and maimed has gone up by almost 300 per cent.
Aid agencies say the true figure is likely to be far higher given the difficulties of verifying accounts in conflict zones.
Save the Children said the worsening situation for children in conflict zones was due to increased fighting in towns and cities, and the growing use of bombs in densely populated areas.
Children are being targeted with more brutal tactics, such as the deployment of youth as suicide bombers and the widespread use of weapons such as barrel bombs, according to the charity.
Those in the Middle East are most likely to be living in a conflict zone - two-fifths of children in the region - followed by Africa, with 20 percent living in war-torn areas, it said.
“Children in conflict zones around the world are coming under attack at a shocking scale, with parties to conflicts blatantly disregarding international laws,” said Manuel Fontaine, head of emergency programmes at UNICEF, the U.N. children’s agency.
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e06d1b2943b07877acd90d90e794f652 | https://www.reuters.com/article/us-global-water-agreements/more-deals-less-conflict-cross-border-water-planning-key-report-warns-idUSKCN1VC00F | More deals, less conflict? Cross-border water planning key, report warns | More deals, less conflict? Cross-border water planning key, report warns
By Laurie Goering4 Min Read
LONDON (Thomson Reuters Foundation) - Efforts to share rivers, lakes and aquifers that cross national boundaries are falling short, raising a growing risk of conflict as global water supplies run low, researchers warned on Thursday.
Fewer than one in three of the world’s transboundary rivers and lake basins and just nine of the 350 aquifers that straddle more than one country have cross-border management systems in place, according to a new index by the Economist Intelligence Unit.
With more than half the world’s population likely to live in water-scarce areas by 2050 and 40 percent dependent on transboundary water, that is a growing threat, said Matus Samel, a public policy consultant with the Economist Intelligence Unit.
“Most transboundary basins are peaceful, but the trend is that we are seeing more and more tensions and conflict arising,” he told the Thomson Reuters Foundation.
When work began on the index, which looks at five key river basins around the world from the Mekong to the Amazon, researchers thought they would see hints of future problems rather than current ones, Samel said.
Instead, they found water scarcity was becoming a “very urgent” issue, he said. “It surprised me personally the urgency of some of the situation some of these basins are facing.”
Population growth, climate change, economic and agricultural expansion and deforestation are all placing greater pressures on the world’s limited supplies of water, scientists say.
As competition grows, some regions have put in place relatively effective bodies to try to share water fairly, the Economist Intelligence Unit report said.
Despite worsening drought, the Senegal River basin, shared by West African nations including Senegal, Mali and Mauritania, has held together a regional water-governance body that has attracted investment and support, Samel said.
Efforts to jointly govern the Sava River basin, which crosses many of the once warring nations of the former Yugoslavia in southeast Europe, have also been largely successful, he said.
But replicating that is likely to be “a huge challenge” in conflict-hit basins, such as along the Tigris and Euphrates rivers in Iraq and Syria, Samel said.
Still, even in tough political situations, “there are ways ... countries and local governments and others can work together to make sure conflicts do not emerge and do not escalate,” he said.
“The benefits of cooperation go way beyond direct access to drinking water,” he said. “It’s about creating trust and channels for communication that might not otherwise exist.”
‘NO EASY SOLUTIONS’
The report suggests national leaders make water security a priority now, link water policy to other national policies, from agriculture to trade, and put in place water-sharing institutions early.
“There are no easy solutions or universal solutions,” Samel warned. “But there are lessons regions and basins can learn and share.”
The index has yet to examine many hotspots, from the Nile River and Lake Chad in Africa to the Indus river system in India and Pakistan, but Samel said it would be expanded in coming years.
Working toward better shared water management is particularly crucial as climate change brings more drought, floods and other water extremes, said Alan Nicol, who is based in Ethiopia for the International Water Management Institute.
“Knowing how a system works effectively helps you know what to do in the face of a massive drought or flood event - and we should expect more extreme weather,” he said.
While efforts to coordinate water policy with other national and regional policies and priorities are crucial, the key missing element in shoring up water security is political will, he said.
“We’ve been talking about this kind of integrated water management for 30 years,” he said. “The problem is practising it. And that’s essentially a political problem.”
Reporting by Laurie Goering @lauriegoering; Editing by Claire Cozens. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, climate change, resilience, women's rights, trafficking and property rights. Visit news.trust.org/climateOur Standards: The Thomson Reuters Trust Principles.
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33f819d8098c037c181676895b9d47dd | https://www.reuters.com/article/us-global-weather-climate-change-trfn-idUSKBN2153DB | As climate heats up, planners urged to look beyond history to judge risks | As climate heats up, planners urged to look beyond history to judge risks
By Megan Rowling5 Min Read
BARCELONA (Thomson Reuters Foundation) - Climate predictions based only on what has happened in the past underestimate the likelihood of extreme weather, which could leave people and infrastructure like homes and roads unprotected from global warming, a study warned on Wednesday.
New techniques combining historical observations of weather extremes with computer-based climate models could help policymakers and engineers more accurately integrate the effects of climate change into their planning decisions, it said.
The study, published in the journal Science Advances, found predictions based only on events in the preceding 45 years foresaw far fewer extremely hot and wet days than actually occurred in the northern hemisphere from 2006 to 2017 - because they did not reflect the continued influence of global warming.
The number of record-setting heat events across Europe and East Asia in 2006-2017 was more than double the median prediction based on historical observations.
The same was true for extreme wet days in the United States and Europe, while for East Asia the actual number was almost double compared with predictions from past data.
The problem is that, for decades, engineers and planners have calculated the risks of threats such as floods without working out how they might change as the planet heats up and makes extreme events more likely, said study author Noah Diffenbaugh.
“Global warming has had a really strong effect over the last decade,” said Diffenbaugh, a professor in the Department of Earth System Science at Stanford University.
“One of the main challenges in becoming more resilient to these extremes is accurately predicting how the global warming that’s already happened has changed the odds of events that fall outside of our historical experience.”
Maarten van Aalst, director of the Red Cross Red Crescent Climate Centre, who was not involved in the study, said it confirmed the rapid rise in risk already being experienced by disaster responders at the frontlines of climate change.
Work he has been involved in also shows that, in the case of recent heatwaves in Europe and Australia, heat extremes are increasing much faster in reality than climate models predict.
“This is an important reminder that we are not only facing a predictable rise in extremes, but also rising uncertainty,” he said in emailed comments.
CLIMATE-SAFE CALIFORNIA?
The Stanford study noted historical climate observations are widely used to make risk management decisions on everything from water resources to supply chain management, disaster relief and insurance - even though the need to factor in climate change has been known for years.
“It has been challenging to move away from the techniques based on historical observations,” Diffenbaugh said.
That is partly because broad climate models tend to work less well when applied to particular locations, he told the Thomson Reuters Foundation.
But at the regional level, combining climate modeling with historical data resulted in relatively accurate predictions of weather extremes, the study showed.
As intensifying wildfires, heatwaves and floods happen more often, and sea levels rise, at least some governments and other bodies are showing interest in incorporating projections of future climate change into infrastructure planning, Diffenbaugh added.
In 2018, for example, California passed a bill setting up a “Climate-Safe Infrastructure Working Group” to develop recommendations for the state on how to build and design more robust infrastructure in the face of growing climate extremes.
It proposed taking a gradual, adaptive approach, allowing flexibility to respond as new information became available.
A waterfront roadway, for instance, could be designed so it could be moved or raised in line with increases in sea level and floods, or nearby green space expanded to absorb more water.
Van Aalst said the rise in extreme weather has led to major disasters partly because other risk factors also are increasing, such as more people and assets becoming exposed to heatwaves and floods in expanding cities, or more elderly people living alone.
“The flipside is that we can do something about it,” he said. “Rising extremes do not have to lead to rising disasters if we tackle these other risk factors.”
Reporting by Megan Rowling @meganrowling; editing by Laurie Goering. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit news.trust.org/climateOur Standards: The Thomson Reuters Trust Principles.
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1102b8095f549e85b0ff5dc820343b6e | https://www.reuters.com/article/us-global-windpower-auctions-factbox-idUSKBN2BU0S1 | Factbox: Global offshore wind tenders and auctions in 2021 | Factbox: Global offshore wind tenders and auctions in 2021
By Reuters Staff4 Min Read
(Reuters) - Offshore wind power is a key renewable energy source for achieving ambitious climate targets, with many countries planning to award contracts to develop wind farms at sea this year.
FILE PHOTO: An Envision wind turbine at the Mozura wind farm in Ulcinj, Montenegro, June 18, 2020. REUTERS/Stevo Vasiljevic/File Photo
Governments have different options for structuring tenders, with the most common models being the award of seabed leases, contracts for difference, or centralised auctions.
Below is a list of planned tenders and explanation of the most common tender types.
DENMARK
The Nordic country is holding a centralised tender to develop the Thor offshore wind farm with up to 1 GW of capacity, with the result expected in December. Six bidders have been pre-qualified.
It is also launching a second centralised tender for the Hesseloe wind farm site of up to 1.2 GW this year.
FRANCE
The country will hold a centralised tender this year for a wind farm with roughly 1 GW capacity off Normandy in northern France.
It has also scheduled a further centralised tender for 0.25 GW of floating wind off the Brittany coast, also in northern France.
GERMANY
Germany is awarding just under 1 GW of capacity to be operational from 2026 in a centralised auction model tender ending on Sept. 1, covering acreage in both the Baltic and North Sea.
IRELAND
The country is expected to hold an auction for an as yet undetermined amount of offshore wind capacity under its Renewable Electricity Support Scheme (RESS), which offers successful participants a fixed price for their generation for around 15 years.
JAPAN
The country is set to award its first offshore wind licences totalling 1.5 GW this year. It is also expected to open a further round for another 1 GW.
NETHERLANDS
The Hague is holding a centralised tender for the Hollandse Kust West area with 1.52 GW of capacity.
POLAND
The country will award 5.9 GW of capacity with contracts for difference at a fixed strike price that is yet to be announced.
UK
The UK awarded 8 GW of new seabed leases in English and Welsh waters in February. Later this year, it will also hold a CfD auction for up to 12 GW of capacity.
Scotland is holding a separate seabed leasing round for some 10 GW of capacity, which closes in July.
U.S.
The state of New York awarded 2.5 GW of capacity in January, which was won by a joint venture of Equinor and BP.
Connecticut will hold an auction for 1 GW of capacity in the second half of the year, with results expected by year end or early 2022.
New Jersey is expected to award contracts for up to 2.4 GW of capacity in June.
Maryland is holding two auctions this year for a total of 0.8 GW.
Massachusetts will hold an auction for 1.6 GW of capacity in the second half of the year, with results expected by year end or early 2022.
Rhode Island is expected to award contracts for 0.6 GW by the end of June.
TAIWAN
The Asian country is expected to commence an auctioning round open to pre-developed projects for a total of 1 GW capacity later this year, but awards may not be made until 2022.
SEABED LEASES
In these auctions firms bid for the rights to develop a specific area offshore. Traditionally, governments award leases with a fixed option fee, payable annually until a project is approved and has taken a final investment decision, after which companies pay annual rent.
However, a British leasing round earlier this year applied a competitive process, achieving unexpectedly high prices for option fees.
Developers with seabed leases enter their projects into auctions for Contracts for Difference (CfD) once they have planning consent.
CONTRACTS FOR DIFFERENCE
Participants bid projects with planning consent into the auction, based on a specific off-take price for their power. If wholesale prices are below the agreed price, they receive the difference, but in return need to relinquish the profits if selling their production above the agreed strike price in the wholesale market.
CENTRALISED AUCTIONS
In this auction model, countries offer pre-determined sites to any bidder with no need to enter a specific, pre-developed project.
Reporting by Nora Buli, Nicola Groom, Yuka Obayashi, Susanna Twidale; Editing by Kirsten DonovanOur Standards: The Thomson Reuters Trust Principles.
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