New York oil sinks under $50 on OPEC doubts

New York crude dipped below $50 on Thursday. (Shutterstock)
Updated 29 November 2018
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New York oil sinks under $50 on OPEC doubts

  • West Texas crude hits 14-month low
  • All eyes on G20 and OPEC meets

LONDON: New York oil sank Thursday under $50 on doubts over an OPEC output cut, while most stocks rose as the Federal Reserve hinted at a softer pace of interest rate hikes.
Investors meanwhile remain wary about the weekend’s crunch trade talks between US President Donald Trump and China counterpart Xi Jinping at the G20 summit in Buenos Aires.
The pound fell versus the dollar and euro one day after the UK government and Bank of England painted a bleak picture of the country’s economic future following Brexit.
Milan’s stocks index was one of the few falling into negative territory on lingering concerns over Rome’s budget deficit.
New York’s West Texas Intermediate crude, one of the world’s major oil contracts, slumped in morning deals to strike a near 14-month low at $49.41 per barrel.
European benchmark London Brent North Sea oil dived to $57.50, a level last seen in early October 2017.
Traders remain uncertain about whether OPEC and non-OPEC producers like Russia will agree to curb output at their Vienna gatherings next week.
“The oil market is clearly not 100 percent convinced that the OPEC+ will cut supplies next week, but the pressure is certainly building as prices continue to fall amid ongoing concerns over excessive supply and lower demand growth,” Forex.com analyst Fawad Razaqzada told AFP.
“With WTI hovering around the $50 mark, it has given up more than 50 percent of its gains made since hitting a low in 2016.
“This represents a significant drop for a healthy market, which makes intervention from the OPEC+ group even more likely,” Razaqzada added.
However on Thursday, Saudi Arabia’s energy minister Khalid Al-Falih and Russian leader Vladimir Putin both appeared to dent hopes of a deal.
“Comments by... Al-Falih and Russian President Putin gave rise to doubts that the OPEC+ group will be able to agree on a sufficiently comprehensive production cut when it meets in Vienna,” said Commerzbank analysts in a note to clients.
“Al-Falih made it clear that Saudi Arabia would not reduce production alone. Saudi Arabia in particular had recently stepped up its production hugely and was therefore chiefly responsible for the oversupply.”
Commerzbank analysts also noted that Putin indicated that key oil producer Russia is “absolutely fine” with an oil price at $60.
Oil had spiked to four-year peaks in October after OPEC and other global producers had snubbed pressure from Trump to lift output and dampen the market.
Prices have since tumbled however on rising production, Chinese growth fears, and easing concerns about the impact of sanctions on Iran.


Former Nissan chairman Ghosn appears in Tokyo court

Updated 2 min 10 sec ago
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Former Nissan chairman Ghosn appears in Tokyo court

  • It is the first of a series of hearings to iron out logistics for Carlos Ghosn’s actual trial
  • Nissan’s former chairman has hired a strong legal team as he fights to clear his name

TOKYO: Nissan’s former chairman, Carlos Ghosn, appeared in a Japanese courtroom Thursday for a hearing ahead of his trial on accusations of financial misconduct.
It was the first of a series of hearings to iron out logistics for Ghosn’s actual trial. The trial date has not been set, and experts say it could be months away.
Ghosn, who led the Japanese automaker for two decades, was arrested in November and charged with underreporting his income and breach of trust. He was released on bail in March, rearrested in April on fresh accusations and then released again on bail on April 25.
Ghosn insists he is innocent and says he was targeted in a “conspiracy” by others at Nissan Motor Co.
Nissan, which is allied with Renault of France, has seen profits nose-dive amid the fallout from Ghosn’s arrest.
Ghosn has hired a strong legal team as he fights to clear his name. One of his top lawyers, Junichiro Hironaka, was seen walking into the courtroom Thursday with Ghosn.
One of the conditions of Ghosn’s release on bail is that he is forbidden to contact his wife. Prosecutors say that’s to prevent evidence tampering.
Ghosn’s lawyers challenged that restriction, saying it is a violation of human rights, but the Supreme Court rejected their appeal Tuesday.
The lawyers can appeal again to have the restriction removed.
In a briefing Thursday, Deputy Chief Prosecutor Shin Kukimoto welcomed the Supreme Court’s decision.
“For married people to be together is important, but I feel there was enough reason for the Supreme Court to support us in this restriction,” he said.
Kukimoto declined comment on the hearing, which was closed to reporters and the public.
Kukimoto also said the maximum penalty upon conviction of all 15 counts of the charges Ghosn is facing is 15 years in prison and a fine of ¥150 million ($1.4 million).