Business

Oil prices fall after OPEC+ postpones meeting

Published

6 months ago

November 23, 2023

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Oil prices fall after OPEC+ postpones meeting

International oil prices fell Wednesday after a key ministerial meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies was pushed back from Sunday to November 30.

The Vienna-based organisation announced the postponement of the OPEC+ alliance gathering in a brief statement, without providing any explanation.

The 13 OPEC members headed by Saudi Arabia and ten partners led by Russia are due to decide on their output policy amid slumping crude prices and recent rumours of discord among alliance members.

Global crude prices shed more than five percent following the surprise announcement but stablised a little. At 1630 GMT, Brent North Sea crude was down 3.9% at $79.27 a barrel, while West Texas Intermediate was 4.1% lower at $74.61.

Diverging views

“Uncertainty is never good for financial markets, which now have to wait longer to get clarity what OPEC+ will do next year,” UBS analyst Giovanni Staunovo told AFP.

The postponement also signalled the existence of “different views among the group’s participants”, he added, confirming what two OPEC+ sources had told AFP on condition of anonymity.

The alliance has postponed ministerial meetings in the past, “but never for four days” indicating difficulties to reach agreement, said Jorge Leon of Rystad Energy. With oil prices plummeting below $80 per barrel since peaking in September, analysts expect further production cuts by the alliance.

But the great unknown is how the cuts would be implemented next year and potentially shared among members. In recent months, nine OPEC+ members including Riyadh, Moscow, Baghdad and Dubai have reduced their output.

Saudi Arabia bore the brunt, voluntarily slashing production by a further million barrels a day since July.

Voicing discontent over the slump in prices, Saudi energy minister Prince Abdulaziz bin Salman recently “blamed speculators for the oil price slide” rather than weak demand, said analyst Carsten Fritsch of Commerzbank.

End of Saudi cuts?

Russian Deputy Prime Minister Alexander Novak on Wednesday sounded a different note, saying that “current oil prices objectively reflect the current situation”.

“They are at a sufficient level, so the market is balanced. But we will discuss these issues in detail at the next meeting”, he added, quoted by Russian news agencies. Oil prices are far from the levels near $140 a barrel reached after the Russian invasion of Ukraine.

But they remain above the average of the last five years, despite concerns about demand, particularly in China — the world’s biggest importer of crude.

For the Saudis, however, the $80 mark is critical as the break-even price is slightly above it, according to IMF estimates. In the absence of an agreement, investors fear that Riyadh might put an end to their additional cuts, Fawad Razaqzada of City Index told AFP.

“It’s clear that they’re dissatisfied with some of the other OPEC+ members who are not complying with the cuts” previously announced, he added. Russia is reportedly reluctant to implement its commitments because it needs the oil revenue to finance its war in Ukraine.

The two sources close to the discussions contacted by AFP, also mentioned “disagreements between Riyadh and African countries over quotas”. Some members have said they would like to increase their production.

At the last meeting in June, the United Arab Emirates obtained an increase in their volume for 2024, to the detriment of other countries such as Angola, Congo and Nigeria.

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Business

Chinese firm aims to expand investments in Pakistan, shows interest in mining sector

Published

1 day ago

May 17, 2024

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Chinese firm aims to expand investments in Pakistan, shows interest in mining sector

A notable Chinese company has expressed keen interest in expanding its investment in Pakistan, in yet another sign of investor confidence boost in the leadership of Prime Minister Shehbaz Sharif.

A delegation from Chinese firm MCC Tongsin Resources led by its Chairman Wang Jaichen called on PM Shehbaz here on Friday.

The premier invited the Chinese company to invest in Pakistan’s mining sector and manufacturing of export goods.

Shehbaz assured the delegation that his government would extend all-out facilitation to the company from minerals exploration and processing to the export of goods.

The PM instructed the relevant federal ministers and officers to continue consultation with the Chinese firm, taking the Balochistan chief minister, provincial departments and stakeholders on board.

The delegates reposed trust in PM Shehbaz’s leadership, and expressed keen interest in enhancing their investment in Pakistan’s mining and minerals sectors.

The delegation briefed Prime Minister Shehbaz about the construction of a mineral park in Pakistan and their future investment plans.

The premier welcomed the Chinese firm and highlighted the priority steps by his government to promote foreign investment in Pakistan.

He said that being a time-tested friend, China supported Pakistan in every difficult hour for which the Pakistani nation was grateful to the leadership and people of China.

Federal ministers Ahad Khan Cheema, Dr Musaddik Malik, Rana Tanveer Hussain, Jam Kamal Khan and relevant senior officers attended the meeting.

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Business

Govt jacks up power price by Rs1.47 per unit

Published

1 day ago

May 17, 2024

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Govt jacks up power price by Rs1.47 per unit

The government on Friday increased the electricity tariff by Rs1.47 per unit.

According to Nepra sources, the collection from consumers will take place in August, September, and October.

The electricity companies had requested the funds as part of the third quarter adjustment for 2023-2024, seeking Rs 31.34 billion under capacity charges.

Sources said that Rs5.57 billion were requested for operation and maintenance costs, and Rs12.38 billion were requested for the transmission and distribution impact under monthly fuel cost adjustment.

Previously, Nepra had completed the hearing on the electricity companies’ request under the quarterly adjustment.

Nepra approved the Power Division’s request, allowing an increase of Rs 1.45 per unit in electricity prices.

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Business

Hong Kong allows China’s digital yuan to be used in local shops

Published

1 day ago

May 17, 2024

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Hong Kong allows China's digital yuan to be used in local shops

Hong Kong will allow mainland China’s pilot digital currency to be used in shops in the city, the head of its de facto central bank said on Friday, marking a step forward for Beijing’s efforts to internationalise the yuan amid rising geopolitical tensions.

The programme, backed by Beijing, will allow mainland Chinese and Hong Kong residents to open digital yuan wallets via a mobile app developed by China’s central bank and will permit them to make payments in retail shops and some online stores in Hong Kong and in mainland China.

Transactions using e-CNY, predominantly for domestic retail payments in China, hit 1.8 trillion yuan ($249.27 billion) as of end of June 2023, with 120 million digital wallets opened, according to the latest disclosure from China’s central bank.

Using the wallet, users can make payments at over 10 million merchants in 17 provinces and cities in the mainland.

Each wallet used in the city will be subject to a balance limit of 10,000 yuan, with single transactions and daily payments capped at 2,000 yuan and 5,000 yuan, respectively, officials from the Hong Kong Monetary Authority said.

Peer-to-peer transfers will not be allowed at the moment, according to the HKMA.

“By expanding the e-CNY pilot in Hong Kong .. users may now top up their wallets anytime, anywhere without having to open a mainland bank account, thereby facilitating merchant payments in the mainland by Hong Kong residents,” HKMA Chief Eddie Yue said.

Currently, users of other digital yuan wallets such as those operated by Ant Group and Tencent can make payments in the city.

Industrial and Commercial Bank of China, Bank of China Ltd, China Construction Bank Corp and Bank of Communications Co have been selected as e-CNY wallet operators.

The yuan’s use in global finance remains low, though it has shown steady increases.

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