Amazon becomes the most scrutinized company

Protesters stand on their car and block traffic during a demonstration at the Amazon Spheres in Seattle. (AFP)
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Updated 18 May 2020

Amazon becomes the most scrutinized company

  • Company’s market value has hovered near record levels around $1.2 trillion

SAN FRANCISCO: As Amazon becomes an increasingly important lifeline in the pandemic crisis, it is being hit with a wave of criticism from activists, politicians and others who question the tech giant’s growing influence.

Amazon has become the most scrutinized company during the health emergency.

It has boosted its global workforce to nearly 1 million and dealt with protests over warehouse safety and reported deaths of several employees.

But Amazon has also pledged to spend at least $4 billion in the current quarter — its entire expected operating profit — on coronavirus mitigation efforts, including relief contributions and funding research.

Amazon’s AWS cloud computing unit, which powers big portions of the internet, is also a key element during the crisis with more people and companies working online.

Amazon’s market value has hovered near record levels around $1.2 trillion as it reported rising revenues and lower profits in the past quarter.

“Its sheer size justifies the scrutiny,” said Dania Rajendra of the activist group Athena, a coalition which is focused specifically on Amazon’s corporate activity and treatment of workers.

Athena activists fret that Amazon, which also controls one of the major streaming television services, infiltrates so many aspects of people’s lives.

Rankling many activists, the rise in Amazon’s shares has boosted the wealth of founder and CEO Jeff Bezos to over $140 billion even as the global economy has been battered by the virus outbreak.

Amazon has faced employee walkouts at several facilities over safety and hazard pay and has been accused of firing people for speaking out against the company.

“It’s a minority going on strike but the sentiment represents thousand if not hundreds of thousands,” said Steve Smith of the California Labor Federation.

While Amazon has boosted base pay to $15 an hour, above the minimum wage required, and added bonuses during the pandemic, activists say it’s insufficient, especially in high-cost states like California.

“This company can afford to make these jobs middle class jobs, good jobs,” Smith said.

The tensions have spilled over into the US capital Washington and elsewhere. US lawmakers leading antitrust investigations asked Bezos to respond to reports that the company improperly used data from third-party sellers to launch its own products, which the company has denied.

New York state Attorney General Letitia James called Amazon “disgraceful” for firing a warehouse employee who led a worker protest over safety. 

Amazon said the employee refused to quarantine after testing positive for COVID-19.

In a statement to AFP, Amazon defended its actions on workplace safety, social distancing and noted that it is implementing its own employee testing program. The company also disputed claims it was stifling employee speech.

Spokeswoman Lisa Levandowski said the employees in question were dismissed “not for talking publicly about working conditions or safety, but rather, for repeatedly violating internal policies.”

Levandowski added that Amazon already provides what many unions have been seeking, including a high base wage, health benefits and career opportunities.

“She said the company seeks “a great employment experience” along with offering “a world-class customer experience (while) respecting rights to choose a union.”

Analyst Patrick Moorhead of Moor Insights & Strategy said Amazon is getting heightened scrutiny because of its growing global influence and because of the wast wealth of Bezos.

Moorhead said Amazon also brought on some of its woes with its highly public search for a second headquarters which highlighted tax breaks for the tech giant.

But Moorhead said Amazon is “not profiting” from the coronavirus crisis, and should be credited for some 150 measures taken including the pooling of high-performance computing for researchers.

“If you think about the alternative of shutting down Amazon, so many people wouldn’t get the supplies that they need. You’d have a tremendous number of people unemployed,” he said.


Oil surges on hopes of new deal on output cuts

Updated 02 June 2020

Oil surges on hopes of new deal on output cuts

  • Brent price has doubled in five weeks
  • OPEC talks may be brought forward

DUBAI: Oil prices surged toward $40 a barrel on Monday as hopes rose for an early agreement to extend the big production cuts agreed by Saudi Arabia and Russia under the OPEC+ alliance.

Brent, the global benchmark, jumped by more 9 percent to nearly $39, continuing the surge that has doubled the price in five weeks — the best performance in its history. It recovered after record supply cuts agreed between the 23 countries of the OPEC+ partnership, and enforced cuts in US shale oil.

DME Oman crude, the regional benchmark in which a lot of Saudi Aramco exports are priced, rose above $40 a barrel for the first time since early March.

Market sentiment was buoyed by the possibility that the Organization of Petroleum Exporting Countries would agree with non-OPEC members to extend the cuts for a longer period than was agreed in April.

Oil analysts expect OPEC to fast track a “virtual” meeting to formally agree to maintaining cuts at the record 9.7 million barrels a day level. The meeting was scheduled for June 9, but bringing it forward would allow producers more time to set pricing levels.

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An official with one OPEC delegation told Arab News there was consensus among the 23 OPEC+ members for the new date, which could be as early as June 4. The meeting will also consider how long the current level of cuts would be maintained. Some OPEC members want it to run to the end of the year, other producers would prefer a two-month extension.

Omar Najia, global head of derivatives with trader BB Energy, told a forum run by Gulf Intelligence consultancy: “I’d be amazed if OPEC did not extend the higher level of cuts. As long as Saudi Arabia and Russia continue saying nice things to each other I’d expect the rally to continue.”

A Moscow source close to the oil industry said energy officials there had come to the conclusion that “the deal is working” and it was important to keep prices at an “acceptable” level.

Sentiment was also affected by a comparatively high level of compliance with the new cuts, running at about 75 percent among OPEC+ members, with only Iraq and Nigeria noticeable under-compliers.

Robin Mills, chief executive of Qamar Energy, said: “That’s where I’d expect it to be after two months in such a fluid situation. It will be even better in June.”