2023-11-22 19:51

OPEC+ had been scheduled to meet on Sunday Delay comes as countries struggle to agree output levels Dispute linked to African countries Oil loses nearly 1%, rebounds from 4% drop earlier Delay shows there are some different views in group - analyst DUBAI/LONDON, Nov 22 (Reuters) - OPEC+ has delayed a ministerial meeting expected to discuss oil output cuts to Nov. 30 from Nov. 26 as producers struggled to agree on production levels and hence possible reductions, OPEC+ sources said, a surprise delay that sent oil prices sliding. Three OPEC+ sources said this was linked to African countries. OPEC+ said after its last meeting in June that the 2024 output quotas of Angola, Nigeria and Congo were conditional on reviews by outside analysts. Sunday's meeting of the Organization of the Petroleum Exporting Countries and allies such as Russia, known as OPEC+, had been expected to consider further changes to a deal that already limits supply into 2024, according to analysts and OPEC+ sources. "Uncertainty is never good for financial markets, with markets now having to wait longer to get clarity what OPEC+ does next year," said UBS analyst Giovanni Staunovo. "The postponement of the meeting also shows there are some different views among the group participants." Brent crude settled down 49 cents a barrel at $81.96, recovering from steep losses earlier of nearly 5% after news that the dispute was linked to African producers, among the smaller exporters in OPEC. That led some investors and analysts to downplay the importance of the issue that caused the delay. Brent has fallen from near $98 in late September, pressured by rising supplies and concern about demand and a potential economic slowdown. Russian Deputy Prime Minister Alexander Novak and Saudi Energy Minister Prince Abdulaziz bin Salman agreed to delay the meeting, another OPEC+ source said, citing issues around other producers. The Sunday meeting had been expected to convene in OPEC's Vienna headquarters. OPEC announced the delay in a statement which didn't mention if the group would convene online or in person on Nov. 30, although three delegates said it was expected to be in person in Vienna. EXTRA CUTS? Several analysts have predicted OPEC+ is likely to extend or even deepen oil supply cuts into next year and some, including Helima Croft at RBC Capital, have said Saudi Arabia might ask other members to share the task. "We see some scope for the group to do a deeper reduction," Croft said this week. Before the OPEC statement, Bloomberg News reported that the meeting could be delayed for an unspecified period of time, citing delegates who said Saudi Arabia had expressed its dissatisfaction with other members about their output numbers. Saudi Arabia, Russia and other OPEC+ members have already pledged oil output cuts of about 5 million barrels per day (bpd), or about 5% of daily global demand, in a series of steps that started in late 2022. This figure includes a 1 million bpd voluntary reduction by Saudi Arabia and a 300,000 bpd cut in Russian oil exports, both of which last until the end of 2023. https://www.reuters.com/business/energy/opec-postpones-policy-meeting-nov-30-oil-falls-2023-11-22/

2023-11-22 18:55

CARACAS, Nov 22 (Reuters) - Venezuela is currently producing some 850,000 barrels per day (bpd) of oil and hopes to soon reach 1 million bpd, the country's deputy oil minister, Erick Perez, said on Wednesday, following the temporary lifting of U.S. sanctions on the nation. Washington in October issued a license allowing Venezuela to export oil, gas and fuel to its chosen markets through mid-April as a way to encourage negotiations for a fair presidential election next year. The measures could be reverted. "We have set a plan with several phases: recovery, stabilization and growth. Of course, six months in the oil industry is a short time, (but) will allow us to progress. In the medium term, we will see the results," he said on the sidelines of an energy conference in Caracas. The nation has about 5,000 active wells for crude and gas output and its natural gas production currently averages some 4 billion cubic feet per day, according to official data. Venezuela's oil output in October was 786,000 bpd. It will continue growing if diluents to produce exportable heavy crude grades are imported, Perez said. The country is hopeful it will be able to progressively recover market share in what it was the main destination of its oil, the U.S., while pushing deals for starting exports of natural gas, including to Trinidad and Tobago, Perez said. "The recovery of our markets, the recovery of those customers will improve over the time," he added. Ali Moshiri, former Chevron executive and current chief executive officer of Houston-based Amos Global Energy, said state company PDVSA had done "an excellent job maintaining production despite sanctions," but added that Venezuela needs to encourage private participation and restructure debt to attract capital and reach up to 2.5 million bpd of output. "The Venezuelan energy sector eventually should be privatized with participation of the government as equity holder," Moshiri said during the conference. Venezuela also is progressing in talks with Trinidad's government for the Dragon field, a U.S.-authorized offshore project in negotiation with Trinidad's National Gas Company (NGC) and Shell (SHEL.L) that would provide Venezuelan gas for producing liquefied natural gas and petrochemicals, Perez said. Trinidad's Energy Minister Stuart Young traveled to Caracas this week to negotiate the terms of Dragon's exploration and production license. https://www.reuters.com/markets/commodities/venezuela-producing-850000-bpd-oil-hopes-recover-market-share-us-2023-11-22/

2023-11-22 18:21

LONDON, Nov 22 (Reuters) - Britain needs a "digital alternative" to relying on Visa and Mastercard for card payments regardless of steps being taken by regulators, a report commissioned by the government said on Wednesday. The conclusions of the Future of Payments Review echo longstanding complaints across Europe about heavy reliance on the American duo for card payments, though calls and attempts to create a 'home grown' alternative have made little progress. "While cards make a tremendous contribution to the payments landscape, we heard notable dissatisfaction with the cost of card schemes on the part of shops, services, and other merchants – which may be in part due to a lack of choice or digital alternatives to the existing card schemes," the review said. Britain's Payment Systems Regulator (PSR) is reviewing the fees card schemes charge, a longstanding battle ground pitching Visa and Mastercard against 'merchants' charged for accepting their cards from customers making payments. "Regardless of the outcome of the PSR’s work, we believe the market would be further improved if there was a viable digital alternative to the card schemes," the review said. So-called open banking, or third party fintechs using data from a customer's bank, with permission, to offer payments services, could create a lower cost alternative to card schemes for retailers, it added. "If choice can be created, we believe that merchant dissatisfaction will decrease." Open banking could also improve the currently "clunky" experience of direct consumer-to-consumer transfers, it said. Visa welcomed the review's conclusion saying that the UK payments landscape was in a good position. "We are keen to work with Government to ensure the UK continues to be at the forefront of payments innovation", it said. Mastercard said it welcomed the review's recognition of the contribution cards make, adding that the company continuously invests in the latest and most innovative payment technologies, including open banking. https://www.reuters.com/technology/uk-payments-report-calls-alternatives-mastercard-visa-2023-11-22/

2023-11-22 18:13

BUENOS AIRES, Nov 22 (Reuters) - Argentina's libertarian President-elect Javier Milei is sticking by his plans for economic "shock" therapy to fix the country's myriad crises from triple-digit inflation to rising poverty and a dearth of foreign currency reserves. In an interview late on Tuesday, Milei said that his government, which will take office on Dec. 10, would have to make deep spending cuts, something he pledged in the campaign as part of a "chainsaw" plan to trim state spending. "There's no money. There's no money," Milei told local outlet Neura Media. "If we don't make a fiscal adjustment, we're headed for hyperinflation. We'll have hyperinflation and we are going to have 95% poverty and 70% or 80% homeless." Argentina, South America's second largest economy, is battling against inflation at 143% and net central bank reserves estimated at negative $10 billion. Over two-fifths of the population is in poverty and a recession in looming. Milei beat Peronist Economy Minister Sergio Massa in a run-off election on Sunday, a rebuke from voters to the center-left government that many blame for stoking the crisis with high spending, which supports millions but has proved unsustainable. Self-described anarcho-capitalist Milei, who has sharply divided opinion in Argentina and beyond with plans to dollarize the economy and shut the central bank, said he would limit the size of the state and have a fiscal balance by the end of 2024. "I will make a shock adjustment and I will put the economy in a fiscal balance. As I pledged not to raise taxes, this means I will do so by cutting spending," he said. He added that this could mean very tough months ahead for the country. "A fiscal balance is non-negotiable. The fiscal balance is not under debate. I will sack the minister who spends too much." https://www.reuters.com/world/americas/theres-no-money-argentinas-milei-doubles-down-economic-shock-therapy-2023-11-22/

2023-11-22 17:31

Weekly jobless claims drop 24,000 to 209,000 Continuing claims decline 22,000 to 1.840 million Core capital goods orders dip 0.1%; shipments unchanged WASHINGTON, Nov 22 (Reuters) - The number of Americans filing new claims for unemployment benefits fell more than expected last week, but that likely does not change the view that the labor market is gradually slowing as higher interest rates cool demand in the economy. Though the weekly jobless claims report from the Labor Department on Wednesday also showed unemployment rolls declining for the first-time since mid-September, they remained near the highs for this year. The drop in both initial and continuing claims likely reflected ongoing challenges ironing out seasonal fluctuations from the data. Slowing demand for labor and subsiding inflation have led economists and financial markets to conclude the Federal Reserve was done hiking interest rates in the current cycle. "Looking past seasonal noise, we think the claims data are consistent with a job market that is cooling enough to keep rate hikes off the table, but too strong to make rate cuts a consideration any time soon," said Nancy Vanden Houten, lead U.S. economist at Oxford Economics in New York. Initial claims for state unemployment benefits dropped 24,000 to a seasonally adjusted 209,000 for the week ended Nov. 18. The decline more than reversed the jump in the prior week, which had lifted claims to a three-month high. Economists polled by Reuters had forecast 226,000 claims for the latest week. The data was released a day early because of the Thanksgiving holiday on Thursday. Unadjusted claims rose 21,239 to 238,677 last week. Claims in California surged 7,911. There were also significant increases in filings in Kentucky, Oregon, Kentucky and Illinois. Only Texas reported a decrease in claims in excess of 1,000. Minutes of the Fed's Oct. 31-Nov. 1 meeting published on Tuesday showed that while policymakers viewed labor market conditions as having "remained tight," they noted that "they had eased since earlier in the year, partly as a result of recent increases in labor supply." Stocks on Wall Street were trading higher. The dollar rose against a basket of currencies. Prices of shorter-dated U.S. Treasuries fell. LABOR MARKET SLOWING Financial markets are anticipating a rate cut in the middle of 2024, according to CME Group's FedWatch Tool. Most economists, however, view a rate cut as premature. Indeed, a survey from the University of Michigan on Wednesday showed consumers this month anticipating higher inflation both in the near and long term. The rise in inflation expectations, especially over the next five years to the highest level since 2011, could worry policymakers. Since March 2022, the U.S. central bank has hiked its policy rate by 525 basis points to the current 5.25%-5.50% range. "This will remind policymakers that it will be some time before the Fed can consider the 2021-22 surge in inflation to have truly been contained and reversed," said Conrad DeQuadros, senior economic advisor at Brean Capital in New York. But other economists were not too concerned, with Daniel Silver, an economist at JPMorgan, arguing that "we should also keep in mind that this increase in inflation expectations has not been evident to the same degree in some other related measures." A survey from the New York Fed this month showed softer inflation expectations in October. The claims data covered the period during which the government surveyed businesses for the nonfarm payrolls component of November's employment report. Claims rose marginally between the October and November survey weeks. The economy created 150,000 jobs in October. Though the labor market is steadily slowing, there are signs the moderation is broadening out. According to the Bank of America Institute, an analysis of internal data showed a rise in "pay disruptions" over 2023, consistent with rising joblessness. It noted that this phenomenon, previously confined to higher-income groups, appeared to be extending to middle- and lower-income cohorts. The institute also said there was a significant slowdown in job-to-job moves, consistent with slower hiring and workers' reluctance to move against an uncertain economic backdrop. Data next week on the number of people receiving benefits after an initial week of aid, a proxy for hiring, will offer more clues on the health of the labor market in November. Continuing claims fell 22,000 to 1.840 million during the week ending Nov. 11, the latest claims report showed. They had increased since mid-September, hitting a two-year high in early November. Most economists expect them to resume their upward trend in the coming weeks. A combination of easing labor market conditions and difficulties adjusting the data for seasonal fluctuations following an unprecedented surge in applications for jobless benefits early in the COVID-19 pandemic have pushed continuing claims higher. Slowing economic demand was evident in a report from the Commerce Department on Wednesday showing business spending on equipment struggling to rebound early in the fourth quarter. Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, dipped 0.1% last month after falling 0.2% in September, the Commerce Department's Census Bureau said. Core capital goods shipments were unchanged for a second straight month. Shipments of non-defense capital goods dropped 0.3% following a 0.2% decline in the prior month. These shipments feed into the calculation of equipment spending in the gross domestic product report. Business spending on equipment contracted in the third quarter. The economy grew at a 4.9% annualized rate in the July-September quarter. Growth estimates for the fourth quarter are mostly below a 2% pace. "It's true that the recent drop-back in bond yields may provide some support for investment, but borrowing costs are likely to remain considerably higher than they were a couple of years ago for the foreseeable future," said Andrew Hunter, deputy chief U.S. economist at Capital Economics. "And with banks continuing to tighten lending standards too, there appears to be little chance of an imminent recovery." https://www.reuters.com/markets/us/us-weekly-jobless-claims-fall-labor-market-still-slowing-2023-11-22/

2023-11-22 17:04

Hunt accepts the recommendations of FDI review Review author: other countries slicker on FDI Current investment office "lacks teeth", review finds LONDON, Nov 22 (Reuters) - The British government will give more powers to its investment office to create a concierge service for large international investors in a recognition that it has become too slow and disjointed when trying to win international capital. Finance minister Jeremy Hunt said on Wednesday he would accept the recommendations of a review into foreign direct investment (FDI) after investors complained that unexpected changes to policies such as corporation tax and net zero plans were also putting them off. Investors had called for help in navigating issues such as different incentive schemes and different government departments, and the labour shortages and planning delays that can complicate the job. Richard Harrington, author of the review into FDI, said that other governments had evolved their approach to attracting investment and "have a much more slick, centralised, organised system for dealing with investors than we do". "The idea of the concierge service, beefed up, is that these investors would have an account manager who would deal with all the different aspects of government for them," he told Reuters. Harrington's review found that while Britain continued to perform well on headline FDI figures, "the UK needs to do more in an increasingly competitive environment for investment." The review called for the Office for Investment to have more powers to deliver a proper concierge service, saying that it currently "lacked teeth" and didn't provide a "substantive offering compared to international competitors." It also called for the investment minister to be given more seniority to be able to operate across government, and said government should set out a business investment strategy by spring 2024, overseen by a cross-government Investment Committee. "I'd like to see the Investment Committee meeting by January of next year, and really get this moving. And I've been assured by the Chancellor (Hunt) that will be the case," added Harrington, who sits in the upper house of parliament. Giving an Autumn Statement budget update which is focused on measures to speed up Britain's slow economy, Hunt said he accepted all of the review's headline recommendations. "In particular, we will put in place a concierge service for large international investors modelled on the best such services offered by our competitors and will increase funding for the Office for Investment to deliver it," Hunt said. https://www.reuters.com/world/uk/britain-set-up-investor-concierge-service-fight-fdi-2023-11-22/