Saudi Arabia says higher oil output driven by demand

Updated 09 June 2015

Saudi Arabia says higher oil output driven by demand

LONDON: Saudi Arabia's Oil Ministry said on Tuesday the rise in its oil production over the past three months was a result of increased global demand and the needs of its customers, and was not designed to compensate for lower oil prices.

The world's biggest oil exporter has ramped up production to around 10.3 million barrels per day (bpd) — its highest rate on record.
That level was first reached in March, and eclipsed its previous peak of 10.2 million bpd in August 2013, according to records going back to the early 1980s.
The Saudi oil minister said in April the country's output would likely remain at around 10 million bpd.
The Oil Ministry, in a rare statement, said the Kingdom's oil policy did not reflect personal views and was formulated by an integrated team of experts and specialists in oil market economics, based at the ministry's offices in Riyadh.
"It is done in coordination with oil-producing countries, especially OPEC countries, so as to serve the Kingdom's interests in the short and medium terms. It is also reviewed by the country's senior leadership. The integrated team of experts and advisers supports the decision makers," the official said.
The ministry said the statement was issued after the Wall Street Journal published a story last week about the Kingdom's oil policies, which it said it considered to be inaccurate.
A former climate change and environmental issues adviser to the Oil Ministry, Mohammad Al-Sabban, was among the names mentioned in the article, in which he gave his views on Saudi oil policy.
The Oil Ministry statement said Al-Sabban "was not on the specialized economic team assigned to study global oil market conditions and the Kingdom's foreign petroleum policy".
It said his term had ended in mid-2013 and that "the statements he makes to Arab and international media, and his journalistic writings, represent only his personal point of view and do not ... reflect the Kingdom's official position on petroleum issues".
On Friday, oil group OPEC agreed to stick by its policy of unconstrained output for another six months, setting aside warnings of a second lurch lower in prices as some members such as Iran look to ramp up exports.


Economists fear a US recession in 2021

Updated 48 min 28 sec ago

Economists fear a US recession in 2021

  • Trump’s higher budget deficits ‘might dampen the economy’

WASHINGTON: A number of US business economists appear sufficiently concerned about the risks of some of President Donald Trump’s economic policies that they expect a recession in the US by the end of 2021.

Thirty-four percent of economists surveyed by the National Association for Business Economics, in a report being released Monday, said they believe a slowing economy will tip into recession in 2021. 

That’s up from 25 percent in a survey taken in February. Only 2 percent of those polled expect a recession to begin this year, while 38 percent predict that it will occur in 2020.

Trump, however, has dismissed concerns about a recession, offering an optimistic outlook for the economy after last week’s steep drop in the financial markets and saying on Sunday, “I don’t think we’re having a recession.” A strong economy is key to the Republican president’s 2020 reelection prospects.

The economists have previously expressed concern that Trump’s tariffs and higher budget deficits could eventually dampen the economy.

The Trump administration has imposed tariffs on goods from many key US trading partners, from China and Europe to Mexico and Canada. 

Officials maintain that the tariffs, which are taxes on imports, will help the administration gain more favorable terms of trade. But US trading partners have simply retaliated with tariffs of their own.

Trade between the US and China, the two biggest global economies, has plunged. Trump decided last Wednesday to postpone until Dec. 15 tariffs on about 60 percent of an additional $300 billion of Chinese imports, granting a reprieve from a planned move that would have extended duties to nearly everything the US buys from China.

The financial markets last week signaled the possibility of a US recession, adding to concerns over the ongoing trade tensions and word from Britain and Germany that their economies are shrinking.

The economists surveyed by the NABE were skeptical about prospects for success of the latest round of US-China trade negotiations. Only 5 percent predicted that a comprehensive trade deal would result, 64 percent suggested a superficial agreement was possible and nearly 25 percent expected nothing to be agreed upon by the two countries.

The 226 respondents, who work mainly for corporations and trade associations, were surveyed between July 14 and Aug. 1. That was before the White House announced 10 percent tariffs on the additional $300 billion of Chinese imports, the Chinese currency dipped below the seven-yuan-to-$1 level for the first time in 11 years and the Trump administration formally labeled China a currency manipulator.

As a whole, the business economists’ recent responses have represented a rebuke of the Trump administration’s overall approach to the economy.

Still, for now, most economic signs appear solid. Employers are adding jobs at a steady pace, the unemployment rate remains near a 50-year low and consumers are optimistic. US retail sales figures out last Thursday showed that they jumped in July by the most in four months.