OPEC, Russia extend record oil cuts to end of July

Agencies
June 7, 2020

Moscow, Jun 7: OPEC, Russia and allies agreed on Saturday to extend record oil production cuts until the end of July, prolonging a deal that has helped crude prices double in the past two months by withdrawing almost 10% of global supplies from the market.

The group, known as OPEC+, also demanded countries such as Nigeria and Iraq, which exceeded production quotas in May and June, compensate with extra cuts in July to September.

OPEC+ had initially agreed in April that it would cut supply by 9.7 million barrels per day (bpd) during May-June to prop up prices that collapsed due to the coronavirus crisis. Those cuts were due to taper to 7.7 million bpd from July to December.

“Demand is returning as big oil-consuming economies emerge from pandemic lockdown. But we are not out of the woods yet and challenges ahead remain,” Saudi Energy Minister Prince Abdulaziz bin Salman told the video conference of OPEC+ ministers.

Benchmark Brent crude climbed to a three-month high on Friday above $42 a barrel, after diving below $20 in April. Prices still remain a third lower than at the end of 2019.

“Prices can be expected to be strong from Monday, keeping their $40 plus levels,” said Bjornar Tonhaugen from Rystad Energy.

Saudi Arabia, OPEC’s de facto leader, and Russia have to perform a balancing act of pushing up oil prices to meet their budget needs while not driving them much above $50 a barrel to avoid encouraging a resurgence of rival U.S. shale production.

It was not immediately clear whether Saudi Arabia, the United Arab Emirates and Kuwait would extend beyond June their additional, voluntary cuts of 1.18 million bpd, which are not part of the deal.

BULGING INVENTORIES

The April deal was agreed under pressure from U.S. President Donald Trump, who wants to avoid U.S. oil industry bankruptcies.

Trump, who previously threatened to pull U.S. troops out of Saudi Arabia if Riyadh did not act, spoke to the Russian and Saudi leaders before Saturday’s talks, saying he was happy with the price recovery.

While oil prices have partially recovered, they are still well below the costs of most U.S. shale producers. Shutdowns, layoffs and cost cutting continue across the United States.

“I applaud OPEC-plus for reaching an important agreement today which comes at a pivotal time as oil demand continues to recover and economies reopen around the world,” U.S. Energy Secretary Dan Brouillette wrote on Twitter after the extension.

As global lockdowns ease, oil demand is expected to exceed supply sometime in July but OPEC has yet to clear 1 billion barrels of excess oil inventories accumulated since March.

Rystad’s Tonhaugen said Saturday’s decisions would help OPEC reduce inventories at a rate of 3 million to 4 million bpd in July-August. “The quicker stocks fall, the higher prices will get,” he said.

Nigeria’s petroleum ministry said Abuja backed the idea of compensating for its excessive output in May and June.

Iraq, with one of the worst compliance rates in May, agreed to extra cuts although it was not clear how Baghdad would reach agreement with oil majors on curbing Iraqi output.

Iraq produced 520,000 bpd above its quota in May, while overproduction by Nigeria was 120,000 bpd, Angola’s was 130,000 bpd, Kazakhstan’s was 180,000 bpd and Russia’s was 100,000 bpd, OPEC+ data showed.

OPEC+’s joint ministerial monitoring committee, known as the JMMC, will meet monthly until December to review the market, compliance and recommend levels of cuts. JMMC’s next meeting is scheduled for June 18.

OPEC and OPEC+ will hold their next scheduled meetings on Nov. 30-Dec. 1.

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Agencies
June 12,2020

Kabul, Jun 12: A blast in a mosque during Friday prayers in the western part of capital Kabul has killed at least four people and wounded many more, Afghanistan's interior ministry said.

"Explosives placed inside the Sher Shah Suri Mosque exploded during Friday prayers," said a statement issued by the ministry, which added that the mosque's prayer leader Mofleh Frotan was among those killed.

Interior ministry spokesman Tariq Arian said police have cordoned off the area and helped move the wounded to ambulances and nearby hospitals.

No group immediately claimed responsibility for the attack but a mosque attack earlier this month was claimed by an ISIL (or ISIS) group affiliate, headquartered in eastern Afghanistan's Nangarhar province.

"Interestingly, every time you have the peace process gaining some momentum and pace, you have these kinds of attacks in the country," Habib Wardak, a national security analyst based in Kabul, told Al Jazeera.

"The Islamic State group claimed responsibility for the attack that happened last week on a mosque in Kabul, so despite the fact that you have these news and press conference from the government that they have eliminated ISIL, how can they conduct such sophisticated operations?"

Friday's blast had parallels to one earlier this month, when an explosion tore apart a famous Kabul mosque and led to the death of renowned Afghan cleric Maulvi Ayaz Niazi.

"In this attack, the imam seems to be the target, not the rest of the crowd. These are the imams who have supported the peace process with the Taliban movement," Wardak said.

"The other political aspect for these kinds of attacks is that there are peace spoilers trying to convey a message that peace with the Taliban will not eradicate violence in the country because you have ISIL."

Violence has spiked in recent weeks in Afghanistan with most of the attacks claimed by the ISIL affiliate.

The United States blamed the armed group for a horrific attack last month on a maternity hospital in the capital that killed 24 people, including two infants and several new mothers.

The ISIL affiliate also took responsibility for an attack on a bus carrying journalists in Kabul on May 30, killing two.

It also claimed credit for an attack on the funeral of a strongman loyal to the government last month that killed 35 people.

Meanwhile, the US is attempting to broker peace talks between the Afghan government and the Taliban to end 18 years of war.

Washington's peace envoy Zalmay Khalilzad was in the region earlier this week trying to resuscitate a US peace deal with the Taliban.

The peace deal signed in February calls for the withdrawal of the US and NATO troops from Afghanistan in return for a commitment by the Taliban to not launch attacks on the US or its allies.

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Agencies
May 31,2020

Washington, May 31: US President Donald Trump said Saturday he will delay the G7 summit scheduled to take place in June and invite other countries -- including India and Russia -- to join the meeting.

"I don't feel that as a G7 it properly represents what's going on in the world. It's a very outdated group of countries," Trump told reporters on Air Force One.

He said he would like to invite Russia, South Korea, Australia and India to join an expanded summit in the fall.

It could happen in September, either before or after the UN General Assembly, Trump said, adding that "maybe I'll do it after the election."

Americans head to the polls in early November to choose a new president, with Trump keen for a return to normalcy after the coronavirus pandemic and a healthy economy as voters cast their ballots.

Describing the event as a "G-10 or G-11", Trump said he had "roughly" broached the topic with leaders of the four other countries.

Leaders from the Group of Seven, which the United States heads this year, had been scheduled to meet by videoconference in late June after COVID-19 scuttled plans to gather in-person at Camp David, the US presidential retreat outside Washington.

Trump created suspense last week, however, when he announced that he might hold the huge gathering in-person after all, "primarily at the White House" but also potentially parts of it at Camp David.

German Chancellor Angela Merkel became the first leader to decline the in-person invitation outright.

"Considering the overall pandemic situation, she cannot agree to her personal participation, to a journey to Washington," her spokesman said Saturday.

Her response followed ambivalent to positive reactions to the invitation from Britain, Canada and France.

The 65-year-old chancellor is the oldest G7 leader after Trump, who is 73. Japan's Shinzo Abe, also 65, is several months younger than Merkel. Their age puts them at higher risk from the coronavirus.

The G7 major advanced countries -- Britain, Canada, France, Germany, Italy, Japan and the United States -- hold annual meetings to discuss international economic coordination.

Russia was thrown out of what was the G8 in 2014 after it seized Ukraine's Black Sea peninsula of Crimea, an annexation never recognized by the international community.

The work of the G7 is now more important than ever as countries struggle to repair coronavirus-inflicted damage.

The White House had previously said the huge diplomatic gathering would be a "show of strength" when world economies are gradually reemerging from shutdowns.

The United States is the worst-hit country for COVID-19 infections, recording more than 1.7 million cases and over 103,680 deaths.

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News Network
February 17,2020

Feb 17: Chinese authorities on Monday reported a slight upturn in new virus cases and 105 more deaths for a total of 1,770 since the outbreak began two months ago.

The 2,048 new cases followed three days of declines but was up by just 39 cases from the previous day’s figure. Another 10,844 people have recovered from COVID-19, a disease caused by the new coronavirus, and have been discharged from hospitals, according to Monday’s figures.

The update followed the publication late Saturday in China’s official media of a recent speech by President Xi Jinping in which he indicated for the first time that he had led the response to the outbreak from early in the crisis. While the reports were an apparent attempt to demonstrate the Communist Party leadership acted decisively from the start, it also opened Xi up to criticism over why the public was not alerted sooner.

In his speech, Xi said he gave instructions on fighting the virus on Jan. 7 and ordered the shutdown of the most-affected cities that began on Jan. 23.

The disclosure of his speech indicates top leaders knew about the outbreak’s potential severity at least two weeks before such dangers were made known to the public. It was not until late January that officials said the virus can spread between humans and public alarm began to rise.

New cases in other countries are raising growing concerns about containment of the virus.

Taiwan on Sunday reported its first death from COVID-19, the fifth fatality outside of mainland China. Taiwan’s Central News Agency, citing health minister Chen Shih-chung, said the man who died was in his 60s and had not traveled overseas recently and had no known contact with virus patients.

Japanese Prime Minister Shinzo Abe convened an experts meeting to discuss containment measures in his country, where more than a dozen cases have emerged in the past few days without any obvious link to China.

“The situation surrounding this virus is changing by the minute,” Abe said.

Japanese Health Minister Katsunobu Kato said the country is “entering into a phase that is different from before,” requiring new steps to stop the spread of the virus.

Japan now has 413 confirmed cases, including 355 from a quarantined cruise ship, and one death from the virus. Its total is the highest number of cases among about two dozen countries outside of China where the illness has spread.

Hundreds of Americans from the cruise ship took charter flights home, as Japan announced another 70 infections had been confirmed on the Diamond Princess. Canada, Hong Kong and Italy were planning similar flights.

The 300 or so Americans flying on U.S.-government chartered aircraft back to the U.S. will face another 14-day quarantine at Travis Air Force Base in California and Lackland Air Force Base in Texas. The U.S. Embassy said the departure was offered because people on the ship were at a high risk of exposure to the virus. People with symptoms were banned from the flights.

About 255 Canadians and 330 Hong Kong residents are on board the ship or undergoing treatment in Japanese hospitals. There are also 35 Italians, of which 25 are crew members, including the captain.

In China’s Hubei province, where the outbreak began in December, all vehicle traffic will be banned in another containment measure. It expands a vehicle ban in the provincial capital, Wuhan, where public transportation, trains and planes have been halted for weeks.

Exceptions were being made for vehicles involved in epidemic prevention and transporting daily necessities.

Hubei has built new hospitals with thousands of patient beds and China has sent thousands of military medical personnel to staff the new facilities and help the overburdened health care system.

Last Thursday, Hubei changed how it recognized COVID-19 cases, accepting a doctor’s diagnosis rather than waiting for confirmed laboratory test results, in order to treat patients faster. The tally spiked by more than 15,000 cases under the new method.

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