Oil traded near the highest level since November on optimism the U.S. and China can reach a trade deal and as an outage at the world’s largest offshore field in Saudi Arabia signaled tightening supply.
Futures in New York rose as much as 1 percent after advancing 5.4 percent last week. President Donald Trump said talks with China were “very productive” as his team returned from Beijing and readied for another round of discussions in Washington this week, raising hopes that a trade war between the world’s largest economies will ease. The Saudis, meanwhile, were said to be repairing a damaged power cable that’s curbed output at the Safaniyah field.
Crude’s surged about 24 percent this year as Saudi Arabia and Russia pledged to expand their output cuts, easing concerns that record U.S. production would result in a global glut. More supply is being threatened because of American sanctions against Venezuela and Iran. Reports that the U.S. and China had reached consensus in principle on the main topics in their negotiations further helped boost investors’ risk appetite.
“Markets are astonished by the amount of production cuts and the further reductions Saudi plans to make,” said Howie Lee, a Singapore-based economist at Oversea-Chinese Banking Corp. “Even though there was no conclusive trade deal from Beijing, the already bullish oil market took no news as good news.”
West Texas Intermediate for March delivery rose as much as 54 cents to $56.13 a barrel on the New York Mercantile Exchange and traded 49 cents higher at $56.08 at 7:34 a.m. in London. Transactions will be booked Tuesday for settlement because of the U.S. President’s Day holiday. Prices last week posted their biggest gain in more than a month.
Brent for April settlement was at $66.65 a barrel, up 40 cents, on the London-based ICE Futures Europe exchange. It gained 6.7 percent last week. The global benchmark crude’s premium over WTI for the same month narrowed to $10.19, after widening to the biggest spread in more than three months on Friday.
Also Read: Trump, Xi Hail Progress in Trade Talks as Tariff Deadline Nears
Conciliatory signals from the world’s two biggest economies are calming fears Washington will ratchet up tariffs before a March 1 deadline. “Big progress being made on soooo many different fronts!,” Trump said on Twitter Sunday.
Worries about the trade war worsening a global slowdown are receding at a time when OPEC and its allies are accelerating their implementation of the oil-production cuts agreed in December. The Organization of Petroleum Exporting Countries reported a strong start to the latest round of supply reductions, with the Saudis pledging to cut beyond agreed levels.
The impact of the outage at Safaniyah, which has the capacity to pump 1.2 million to 1.5 million barrels of mostly heavy-sour crude a day, could be damped as seasonal refinery maintenance works across Asia and the U.S. typically peak around now. Saudi Arabian Oil Co. said in statement that all its facilities were “safe and normal,” without elaborating on the situation at Safaniyah.
Saudi Arabia’s crown prince is not seeking to buy English Premier League (EPL) clubside Manchester United, the kingdom’s media minister said on Monday, News reports.
While denying reports to that effect, the minister, Turki al-Shabanah, added that there had only been a meeting with the Saudi wealth fund regarding sponsorship.
Reports that Mohammed Bin Salman intends to buy the club are “completely false”, Shabanah, wrote on social network Twitter.
He was reacting to reports that the crown prince had sought to tempt the Glazer family to cede control of the club.
“Manchester United held a meeting with PIF Saudi to discuss (a) sponsorship opportunity,” Shabanah said, adding that no deal materialised.
On Sunday, the British newspaper, the Sun, said the crown prince was in a £3.8-billion ($4.9-billion) take-over bid for one of football’s most popular clubs.
The paper said a bid was first submitted in October.
It added that the fallout from the murder of Saudi journalist Jamal Khashoggi at the kingdom’s embassy in Istanbul however put the “skids” on a potential offer.
Source: The Routers
The son of Mozambique's former President Armando Guebuza has been arrested in a legal crackdown on suspects linked to a $2-billion government debt scandal, AFP reports.
AFP is quoting local media and judiciary sources as saying that Ndabi Guebuza, the oldest of Guebuza's four children, was picked up from his home in the capital Maputo. Local media reports that he was arrested in connection with a government debt which plunged the country into its worst financial crisis.
Zimbabwe's government has shelved plans to fully join the Africa Continental Free Trade Area (ACFTA) so that it could find space to stabilise local industry which is struggling to produce enough quality goods to compete outside.
This was revealed by Industry and Commerce Ministry's director of International Trade, Beatrice Mutetwa while addressing parliamentarians last week.
"We have requested for time out of the ACFTA because our local industry is not producing enough to be able to compete with other countries.
"We have requested for between 13 to 15 years and thereafter, we will be able to compete with our continental counterparts," she said.
Mutetwa said Zimbabwe was in a peculiar position and needed to work towards achieving an even landscape. This, she said, was unlike the current situation which only makes the country a market place because it lacked locally manufactured products.
"We need to focus on the industry pillar and infrastructure because we cannot just open up our markets without looking at the supply side. Otherwise we may end up becoming a market for others," Mutetwa said.
Member countries are requested to open up 90 percent of their markets but Zimbabwe had only offered up 85 percent as considerations are still being made on how the key sectors like tourism and mining will be protected.
ACFTA is the brainchild of the African Union and was initiated in 2012 with the objective of establishing a single trading bloc which enjoys lowered trade barriers across the continent.
The organ will take advantage of the existing regional blocs like SADC which will eventually be unified in the creation of the free trade area.
It is set to bring together the continent's 55 nations, creating a total 1 billion customers for Africa's goods and services through a lucrative $3.4 trillion Gross Domestic Product.
The initiative also seeks to accelerate trade between African nations as opposed to the current scenario where intra-continental trade is at its lowest.
- New Zimbabwe