US not concerned by any new OPEC output cut, says Brouillette

Optimism in oil market is growing that we could see Beijing resume some normalcy in travel and trade outside of the Hubei province, says analyst. (Shutterstock)
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Updated 12 February 2020

US not concerned by any new OPEC output cut, says Brouillette

  • Oil prices rise to $54 a barrel on Tuesday, recovering from a 13-month low

VIENNA: The US is not concerned by moves being considered by OPEC and its allied producers to curb oil production further, US Energy Secretary Dan Brouillette said on Tuesday.

A technical panel that advises the Organization of the Petroleum Exporting Countries and its allies, led by Russia, have proposed an additional output cut of 600,000 barrels per day (bpd), three sources told Reuters last week.

OPEC is meeting next month in Vienna.

The group of producers, known as OPEC+, has already been implementing cuts of 1.2 million bpd since January 2019 to reduce the global supply glut and prop up crude prices.

“We’re not concerned about the decision that OPEC may make and whatever decision they make will be good for them and we appreciate what they’re doing,” Brouillette told reporters on the sidelines of a conference at the UN nuclear watchdog’s headquarters in Vienna.

“They’re going to meet and they’re going to make a determination and a decision that’s best suited for them but I think their ability to impact oil prices in the manner in which they did, you know, three, four, five decades ago is just fundamentally different,” Brouillette said.

Meanwhile, oil rose to $54 a barrel on Tuesday, recovering from a 13-month low as the number of new coronavirus cases slowed in China, easing some concerns about lengthy destruction of oil demand.

Brent crude rose $1.07 to $54.34 a barrel, having dropped on Monday to its lowest since January last year at $53.11. US West Texas Intermediate crude was up 89 cents at $50.46.

“The bottom seems to be in place for oil prices,” said Edward Moya, analyst at brokerage OANDA.

“Optimism is growing that we could see Beijing resume some normalcy in travel and trade outside of the Hubei province.”

Investors remain wary that China’s oil demand could take a further hit if the coronavirus cannot be contained and if OPEC and its allies, known as OPEC+, fail to agree on further steps to support prices.

“Though oil is recovering again today, the lack of any coordinated action by OPEC+ means that oversupply concerns are likely to retain the upper hand,” said Commerzbank analyst Eugen Weinberg.

Oil rose alongside a rally in world equities, which resumed their climb toward record highs on Tuesday on hopes the virus is peaking.


Cheese, car parts and Kobe beef: UK’s trade deal with Japan

EU Chief negotiator Michel Barnier walks to a meeting in London, Friday, Oct. 23, 2020. (AP)
Updated 24 October 2020

Cheese, car parts and Kobe beef: UK’s trade deal with Japan

  • Britain hopes new agreement will provide better access to Japanese markets

TOKYO: Britain says the post-Brexit trade deal signed with Japan on Friday “secures major wins that would be impossible as part of the EU”, though its substance is largely similar to the current EU-Japan accord.

Britain hopes the agreement will boost trade with Japan by around $20 billion when it comes into force in January after being ratified by lawmakers in both countries.
Here are four things to know about the bilateral deal: When the deal was announced last month, Britain said it meant around 99 percent of its exports to Japan would be tariff-free.
Under the current EU-Japan trade agreement, in place since February 2019, the vast majority of custom duties are also absent.
The European Union says that under its deal, the bloc’s meat exports to Japan increased by 12 percent, while electrical machinery exports were boosted by 16.4 percent.
“In terms of market access, we have maintained Japan’s high level access to the UK market as under the Japan-EU deal,” Japan’s Foreign Minister Toshimitsu Motegi said on Friday.
“And for some products such as train cars and autoparts, we have improved access.”
The Japan-UK deal has a particular focus on exports in the food and drink, finance and tech sectors, and aims to reduce red tape for British pork, beef and salmon farmers.
It also includes brand protection for British goods, including English sparkling wine, Yorkshire Wensleydale cheese and Welsh lamb.
In return, the UK government says consumers will be able to buy “cheaper, high-quality Japanese goods — from udon noodles to Bluefin tuna and Kobe beef.”

FASTFACT

There are currently 241 British businesses in the agriculture and food sector who import from Japan, and 693 who export goods to Japan.

There are currently 241 British businesses in the agriculture and food sector who import from Japan, and 693 who export goods to Japan, the UK government says.
But unlike the Japan-EU deal, this agreement lacks quotas for agricultural exports like cheese, according to the Financial Times, and instead allows Britain to use any such quotas left over by the EU.
The deal includes new provisions on digital trade that aim to ease the flow of data, among other changes.
“This deal doesn’t just preserve existing benefits, but it strikes out in services like digital and data, where the UK and Japan both have strengths, and hope to collaborate in future,” said Britain’s International Trade Secretary Liz Truss.
The UK hopes the deal will help its companies that supply services — from financial to telecoms and transport — gain access to the Japanese market.
While some analysts have cast doubt on how much difference the new digital provisions will make, British businesses have welcomed the agreement.
Carolyn Fairbairn, director-general of the Confederation of British Industry, called it a “breakthrough moment”.
Japan accounted for around just two percent of Britain’s trade last year, government statistics show — roughly the same as Norway.
But the deal could act as a bridge for the UK to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, also known as TPP-11 — a free-trade deal between 11 countries including Japan, Canada, Mexico, Vietnam and Australia.
It was previously known as the Trans-Pacific Partnership (TPP) and had been slated to be the world’s largest trade pact before the United States withdrew in 2017, blocking its ratification.
Truss said the deal “paves the way” for Britain to join the partnership — but this is likely to be a complex manoeuvre that will take years.