Qatar Airways to grow despite boycott, CEO says

Akbar Al-Baker said his state-owned airline might know by April the size of the loss. (AP)
Updated 13 February 2018

Qatar Airways to grow despite boycott, CEO says

CANBERRA, Australia: Qatar Airways’ chief executive said Tuesday the carrier will post a loss this year because four other Arab countries have severed land, air and sea links with Qatar.
Akbar Al-Baker said his state-owned airline might know by April the size of the loss. He could not give a timeline on when the new routes would make up for markets lost.
“It all depends on how quick we will be able to mature the new destinations that we are operating instead of the destinations that were taken away from us during the boycott,” Al-Baker said.
“The world is very large and we are always looking at new opportunities which we have been doing very successfully. We will grow everywhere, not only by ... new destinations but also grow frequencies,” he added.
Qatar’s four neighbors have effectively cut their air, land and sea links, isolating it, though there is no military boycott.
President Donald Trump last year denounced Qatar for allegedly funding terrorism.
But Al-Baker has ruled out any reputational damage for his airline or his country from that accusation of supporting extremists that led to the severing of Qatar’s links with its neighbors.
“Mr. Trump realizes that he was misinformed, misled by the blockading countries to believe that Qatar was a pariah in the region, which is not the case. We are a big supporter and an ally of the United States,” he said.
Al-Baker rejected reports last month from the UAE, home of the world’s busiest airport in Dubai, that Qatari fighter jets had “intercepted” Emirati commercial airliners. The air forces of Qatar’s boycotting neighbors have never intercepted a Qatar Airways airliner, he said.
“This is false news just to increase the temperature and find ways to expand the conflict,” Al-Baker said.
The US and Qatar last month inked a deal to resolve a years-old quarrel over alleged airline subsidies.
The aviation agreement calls for Qatar Airways to open up its accounting books: US airlines say the company receives billions of dollars in government payments that leave them at a competitive disadvantage. Qatar also made a loose commitment not to launch flights to the US from Europe or other non-Qatari cities that would create yet more competition for US carriers.
Al-Baker denied his airline was subsidized and said he had no interest in using “fifth freedom” rights to stop in other countries en route to the US.
Al-Baker told reporters at a Kuwait air show last month that a US start-up airline had offered Qatar Airways a 25 percent stake.
The offer remains “under wraps,” Al-Baker said Tuesday.
“But Qatar as a country and Qatar Airways are very keen to invest in the United States,” Al-Baker said.


Oil slumps more than 4% on coronavirus fears

Updated 28 February 2020

Oil slumps more than 4% on coronavirus fears

  • Traders fret about impact of spreading virus on crude demand, particularly from China

LONDON: World oil prices tumbled by more than 4 percent on Thursday, as traders fretted about the impact of spreading coronavirus on crude demand, particularly from key consumer China.

Brent oil for April delivery tanked almost 4.2 percent to $51.20 per barrel, while New York’s WTI crude for the same month dived nearly 5 percent to $46.31.

“Concerns that the virus will prompt a global slowdown, weaker consumer confidence and reduced travel has raised concerns about lower demand, weighing on prices,” said CMC Markets analyst Michael Hewson.

Investors are growing increasingly fearful about the economic impact of the new coronavirus or COVID-19 outbreak. 

The virus continues to spread meanwhile, with Brazil reporting Latin America’s first case, and Denmark, Estonia, Greece, Georgia, Norway and Pakistan following suit.

Around 2,800 people have died in China and more than 80,000 have been infected. There have been more than 50 deaths and 3,600 cases in dozens of other countries, raising fears of a pandemic.

The spread of the virus to large economies including South Korea, Japan and Italy has raised concerns that growth in fuel demand will be limited. 

Consultants Facts Global Energy forecast oil demand would grow by 60,000 barrels per day in 2020, a level it called “practically zero,” due to the outbreak.

US President Donald Trump sought to assure Americans on Wednesday evening that the risk from coronavirus remained “very low,” but global equities resumed their plunge, wiping out more than $3 trillion in value this week alone.

“The negative price impact would intensify if the coronavirus were declared pandemic by the World Health Organization, something that looks imminent,” said PVM Oil Associates analyst Tamas Varga.

“The mood is gloomy and the end of the tunnel is not in sight – there is no light ahead just darkness. Not even a refreshingly positive weekly US oil report was able to lend price support.”

Gasoline stockpiles dropped by 2.7 million barrels in the week to Feb. 21 to 256.4 million, the Energy Information Administration (EIA) said on Wednesday, amid a decline in refinery throughput. Distillate inventories fell by 2.1 million barrels to 138.5 million.

US crude oil stockpiles increased by 452,000 barrels to 443.3 million barrels, the EIA said, which was less than the 2-million-barrel rise analysts had expected.

The crude market is watching for possible deeper output cuts by the Organization of the Petroleum Exporting Countries and its allies including Russia, a group known as OPEC+.

“Oil is in freefall as the magnitude of global quarantine efforts will provide severe demand destruction for the next couple of quarters,” said Edward Moya, senior market analyst at OANDA. 

“Expectations are growing for OPEC+ to deliver deeper production cuts next week.”

OPEC+ plans to meet in Vienna on March 5-6.