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Around the World
OPEC may soon crack, as Oil price sets for biggest quarterly rise
OPEC and its allies are scheduled to meet in June to set policy, but progress is clouded with uncertainties as cracks are reportedly emerging in the union.
The Organisation of Petroleum Exporting Countries (OPEC) has once again shrugged off President Donald Trump’s continued Twitter rants against the organisation’s crude output cuts.
Last Thursday, Trump called out OPEC on Twitter as part of his constant criticisms, demanding that the oil cartel stops driving prices higher.
Very important that OPEC increase the flow of Oil. World Markets are fragile, price of Oil getting too high. Thank you!
— Donald J. Trump (@realDonaldTrump) March 28, 2019
Oil Price fell after Trump’s Twitter tirade
After Trump’s call on OPEC to increase the flow of oil, global prices of the commodity reportedly fell. West Texas Intermediate (WTI) trading down by $0.46 (-0.77%), while Brent dipped by $0.52 (-0.77%).
Recall that Trump has always been critical of OPEC and its non-affiliated allies (OPEC+). He has been demanding that they increase oil production by 1.2 million barrels per day (bpd).
Oil Price rebounds the biggest quarter in 10 years
Earlier, the U.S West Texas Intermediate crude fell to $58.20 per barrel. However, Oil price futures rebounded and settled 11 cents lower at $59.30 a barrel.
Similarly, the International Brent crude oil futures fell 1 cent to $67.82 per barrel on Thursday, after earlier sinking to $66.54 per barrel in the wake of Trump’s tweet.
Away from the rebounding of oil prices after Trump’s tweet, data reportedly shows that U.S. West Texas Intermediate (WTI) futures rose 63 cents to $59.93 a barrel, and were on track for a rise of 32 percent over the January-March period. For the two benchmarks, the first quarter was the best-performing quarter since 2009, when both gained about 40%
Factors to consider
Away from the U.S sanctions, the power blackouts witnessed by Venezuela has crippled its oil industry. According to Industry sources, the country’s main oil export ports required to convert the country’s heavy oil into exportable grades were halted this week.
Forecasts
However, analysts have expressed optimism for oil prices reaching $75 dollars per barrel as inventories fall.
According to Tamas Varg of PVM Oil Associates:
“If the unplanned supply cuts remain in place, oil prices could hit $75 dollars a barrel as inventories fall.”
Similarly, a monthly survey forecast shows Brent would average $67.12 a barrel in 2019, about 1 percent higher than the previous poll’s $66.44.
Meanwhile, the rebound in oil price has been attributed to production cuts in OPEC+ group of producers, and that has been the main reason for the dramatic recovery since the 38% price slump witnessed during the final quarter of 2018.
Oil Price rebounded 4 months high in 17 years, but for how long?
Bloomberg reported that oil rose to a four month high because news of Russian production cuts helped crude continue toward its best first quarter in 17 years.
It is instructive to note that the U.S sanctions on Iran and Venezuela boosted oil prices this year because the sanctions have restricted crude exports out of the countries.
However, the U.S sanctions are at the detriments of Saudi Arabia and Russia whose oil exports have so far been restricted.
Despite oil price rebounding, it has been reported that there is some skepticism that Saudi Arabia, a member of the allied OPEC+, may heed to President Trump’s call for more output.
According to John Kilduff, a partner at Again Capital in New York:
“There is some skepticism that Saudi Arabia and other oil producers will heed President Trump’s call for more output, which was the initial reaction.”
Warning for Nigeria, as OPEC’s unholy alliance may soon crack up
OPEC and its allies are scheduled to meet in June to set policy, but some cracks are reportedly emerging in the union. The OPEC-led pact may appear to be working, driving prices up. But there are some uncertainties surrounding it.
For instance, Russia has reportedly deepened its output cuts. The country’s Energy Minister, Alexander Novak, stressed that the country will review the possibility of extension or otherwise. The minister stated this just a day after it was reported Russia had been considering letting the cut lapse in September.
The issue is this: Saudi Arabia has been having a hard time convincing Russia to stay longer in the deal to cut production.
Hence, Russia, which only reluctantly agreed to cut down production, may not hold back supply beyond September 2019. If this happens, it most likely may drag down global oil price. By implication, Nigeria may be adversely affected by this, seeing as the country’s economy depends largely on crude exportation.
Around the World
Joe Biden sworn-in as the 46th President of the United States
The whole world watched in awe as Joe Biden was sworn in as the new President of the United States.
Joe Biden has been sworn in as the 46th President of the United States.
The 78-year-old Democrat and former Vice president to Barack Obama is being sworn in after emerging the winner of last year’s Presidential elections.
Biden’s running mate, Kamala Devi Harris was sworn in as vice president by Justice Sonia Sotomayor, becoming the first woman and the first black and Asian-American person elevated to serve in a role a heartbeat from the presidency.
The inauguration took place at the US Capitol, the same building that was stormed on January 6, by Donald Trump’s violent supporters.
Trump who for months refused to conceded to Biden’s victory at the polls left the White House for the final time hours earlier and flew to Florida after making it clear weeks ago that he will not be attending the inauguration.
Trump’s Vice, Mike Pence attended the ceremony, as he skipped Trump’s farewell military salute event at Andrews base.
The ceremony includes musical performances by Lady Gaga – who sang the national anthem – as well as Jennifer Lopez and Garth Brooks.
Former Presidents; Barack Obama, George W. Bush and Bill Clinton were all present at the inuaguration
What you should know
- At 78, Biden is the oldest president ever to take the oath of office.
- In his speech, Biden swore to defend the constitution and the country “against all enemies, foreign and domestic”.
- History was made as Kamala Harris became America’s first female, first Black and first Asian American vice-president.
- Donald Trump skipped the ceremony, becoming the first president not to attend his successor’s inauguration since 1869.
Around the World
Joe Biden to return United States to WHO on first day as President
In-coming US President, Joe Biden has resolved to immediately return the country back to the WHO after his inauguration.
The US President-elect Joe Biden plans to immediately return back the country to the World Health Organization (WHO) on the first day after his inauguration as he intends to make a sweeping review of the policies of outgoing President, Donald Trump.
This is as he intends to send top US medical expert Anthony Fauci to speak to the group in a strong rejection of Donald Trump’s snubs and criticisms during the coronavirus pandemic.
This disclosure is contained in a fact sheet released by President-elect Joe Biden’s transition team.
READ: Joe Biden gains additional 4.6 million Twitter followers in less than 12 hours
According to a report by Bloomberg, the incoming administration plans to take part in the WHO executive board meeting this week, with Fauci, the top U.S. infectious disease expert, heading the delegation and speaking.
The statement says that as soon as the United States resumes its engagement with the WHO, the new administration will work with the body to strengthen and reform the UN health agency.
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What this means
- With these announced plans, the Joe Biden administration is showing that it intends to set a new science-based tone in seeking to reverse Donald Trump’s dismissal of strategies to mitigate the virus as well as seek international cooperation in addressing the pandemic.
- It also further reinforces the incoming President’s earlier criticism of Trump’s handling of the pandemic especially in the early days rather than laying blames.
READ: U.S dollar stays firm, Joe Biden to unveil COVID-19 support programs
What you should know
- It can be recalled that President Donald Trump in May 2020, announced that the US would exit the WHO because of what he said was its undue deference to China and failure to provide accurate information about the coronavirus.
- He often referred to the UN health agency as being controlled by China and criticized their handling of the coronavirus pandemic.
- The US had been the WHO’s largest contributor, providing $400 million to $500 million in mandatory and voluntary contributions annually, with Trump’s last year decision drawing sharp criticism in Congress, as well as from allies in Europe.
Around the World
Donald Trump and Joe Biden clash over plans to lift travel ban on UK, EU, Brazil
Joe Biden’s incoming administration has dismissed plans by President Donald Trump to lift the coronavirus-related travel bans for non-American citizens.
The incoming administration of President-elect Joe Biden has dismissed plans by the outgoing President, Donald Trump to lift the coronavirus-related travel bans for non-American citizens arriving from the European Union, the U.K. and Brazil, which means the curbs will stay in effect.
This follows the announcement from Trump in the White House on Monday that the bans could be lifted because of the administration’s last week’s decision to require international travellers to present either the results of a negative recent coronavirus test or evidence that they had already recovered from the disease. The change would go into effect starting Jan. 26, six days after Biden takes office.
However, the announcement by Donald Trump was rejected as Joe Biden’s Spokeswoman, Jen Psaki, in a tweet post, disclosed that the incoming administration plans to block the outgoing US President’s move according to a report from Bloomberg.
READ: Twitter drops 8.5% in early trading over President Trump ban
What Joe Biden’s spokeswoman is saying
- Psaki in her statement, tweeted, “On the advice of our medical team, the Administration does not intend to lift these restrictions on 1/26. In fact, we plan to strengthen public health measures around international travel in order to further mitigate the spread of COVID-19.’’
She said that with the worsening pandemic and more contagious variant emerging globally, this is not the time to be lifting restrictions on international travel.
READ: Suspending Trump was the right decision but sets dangerous precedent – Twitter CEO
What President Donald Trump has said
Trump, in a White House announcement, had pointed out that the international travel restrictions could be eased safely.
- Trump in a proclamation said, “This action is the best way to continue protecting Americans from Covid-19 while enabling travel to resume safely. Under his plan, travel bans would remain in place for China and Iran, the White House said, citing their “lack of cooperation” with the U.S. in fighting the virus.’’
The recent decision by the Centers for Disease Control and Prevention to require a negative Covid-19 test for people arriving in the U.S. from other countries was not directly linked to the travel ban but was seen as a way to impose safety restrictions that would allow for a resumption of travel.
Despite the surge in Covid-19 infections, experts conclude that allowing people into this country from other nations wouldn’t pose a significant risk, especially with new testing requirements.
READ: US Capitol complex temporarily shut down
What you should know
- It can be recalled that President Donald Trump had initially announced the restrictions on March 11 in the early days of the pandemic on nearly all non-US citizens who had travelled to 28 EU countries, China and Iran, as part of the bid to curb the spread of the virus.
- Brazil was later included in the travel ban on May 25 and applies to any foreign nationals who had been in any of those nations within the previous 14 days.
