Oil rises on weak dollar, Saudi commitment to cut output

Traders said that oil drew some support from top crude exporter Saudi Arabia, which said it would adhere strictly to its commitment to cut output under the agreement between OPEC and other producers, such as Russia. (Reuters)
Updated 17 January 2017

Oil rises on weak dollar, Saudi commitment to cut output

LONDON: Oil prices rose on Tuesday, supported by a falling US dollar and Saudi Arabia saying it would adhere to the Organization of the Petroleum Exporting Countries’ (OPEC) commitment to cut output.
Gains were capped by rising US production and skepticism that OPEC as a whole would comply with its commitments to reduce supplies.
Brent crude futures, the international benchmark for oil prices, were up 66 cents at $56.52 a barrel by 1304 GMT. US West Texas Intermediate (WTI) crude futures were up 78 cents at $53.15.
The dollar, along with stocks and bond yields, fell across the board on Tuesday after US President-elect Donald Trump said that the strong greenback was hurting US competitiveness.
Traders said that oil drew some support from top crude exporter Saudi Arabia, which said it would adhere strictly to its commitment to cut output under the agreement between OPEC and other producers, such as Russia.
Under the agreement, OPEC, Russia and other non-OPEC producers have pledged to cut oil output by nearly 1.8 million barrels per day (bpd), initially for six months, to bring supplies back in line with consumption.
“The market genuinely seems quite happy here (with oil around $55) ... but people are watching with caution as the slightest hint of this OPEC/non-OPEC agreement going wrong is going to drive the market down,” said Matt Stanley, a fuel broker at Freight Investor Services (FIS) in Dubai.
Despite this, crude futures have fallen by 5 percent since their early January peaks on doubts over producers’ willingness to comply fully with the cuts.
Traders are also watching rising US output, which could offset supply cuts elsewhere.
“The market is focused on the build in US production, which is nearly up to 9 million bpd — up from 8.5 million bpd last June and close to 2014 production levels,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney.
“With US crude clearly above $50 a barrel, we are getting a supply-side response, which is pushing production higher,” he said.
Further weighing on crude, at least in the short term, have been refinery outages in the Middle East and Asia over the past week, traders said.
Analysts also said that steps to prop up oil prices through a cut in supplies could be self-defeating.
“For each $10 per barrel increase in oil prices, oil demand will decline by 10 basis points. While consensus expects demand-growth of 1.3 million bpd in 2017 (vs. 1.4 million bpd in 2016), we see risks to the downside as demand growth in China and India starts to moderate,” AB Bernstein said.


Dubai launches economic program for post COVID-19 recovery 

Updated 05 August 2020

Dubai launches economic program for post COVID-19 recovery 

  • “The Great Economic Reset Programme” is part of a “COVID Exit initiative” to help the recovery and reshaping of the economy
  • The economic program will feature analyses of current and future policies

DUBAI: Dubai launched an economic program as part of its efforts to reshape the emirate’s economy for a “sustainable” and “resilient” future post the coronavirus pandemic, the government said. 
The Dubai government partnered with the Mohammed bin Rashid School of Government (MBRSG) to launch “The Great Economic Reset Programme” as part of a “COVID Exit initiative” to help the recovery and reshaping of the economy, state news agency WAM reported on Tuesday. 
The economic program will feature analyses of current and future policies, research and extensive stakeholder consultation to set the direction and tone of future economic policies, regulations and initiatives.
The government plans to use local and international experts for economies and societies to create growth strategies for the Dubai economy.
The MBRSG held a “Virtual Policy Council,” with global experts and thought leaders to discuss the impacts of COVID-19 on the economy and potential policy responses and initiatives. 
Chief economists, senior practitioners and researchers from leading global institutions including the World Bank, joined experts from Dubai Economy and the MBRSG at the first roundtable.
“I believe the triple helix collaboration between public, private and academia stakeholders have always produced the best solutions in the past. In the highly uncertain environment now, extensive collaboration and cooperation between all stakeholders are vital to our future prosperity. The Virtual Policy Council will propose the best approaches Dubai and the UAE can adopt to address the risks and opportunities in the next normal economy,” said Mohammed Shael Al-Saadi, CEO of the Corporate Strategic Affairs sector in Dubai Economy.
“This Virtual Policy Council is a key component of the whole process where global experts and thinkers share their views on the future economy. In this new era, the role of governments in enabling the new economic actors is becoming increasingly central, and Dubai is well-positioned to lead the way with innovative models of growth post COVID19,” said Professor Raed Awamleh, Dean of MBRSG.
The roundtable also discussed the impact of the pandemic on international trade, foreign investment and tourism, as well as the rise of digital globalization.