Opec+ meetings have become oddly routine. They probably will not stay like that, but on Thursday, the group swiftly agreed to continue their plan of raising output by 400,000 barrels per day next month. The demands of the US president to cool off prices have been disregarded.
The oil exporters’ decision is easily understood. Brent crude around $82 a barrel is above the historic average but not particularly high, certainly compared to record gas, coal and electricity prices. Oil prices have dropped over the past two weeks.
Although stocks have been sharply drawn down over the past few months, the group is concerned that they are forecast to rise both next year and in 2023. The first quarter is usually the weakest for demand growth. They still have a wary eye on coronavirus cases, particularly given China’s widening outbreak.
It would be easier to hold back on production now and raise it in January, if required, than to boost output now and then have to persuade members to hold back later. That might force Saudi Arabia back into making additional voluntary cuts, which it would be loath to do. Riyadh emphasised the decision by sharply raising its official selling prices to Europe and Asia.
The Biden administration’s concern is also comprehensible. Opec+’s planned production increases are not being met because a growing number of members such as Angola, Algeria and Nigeria are unable to pump to their assigned limit. That situation may worsen as allocations keep growing. As one of the few countries with substantial remaining spare capacity, this supports the UAE’s push in July to raise its baseline.
High prices at the pump are one of the most salient economic indicators to Americans, especially as inflation and supply chain disruptions strike many other goods and commodities. Without much new production on the horizon outside Opec+, more oil is needed to substitute for pricey gas over the Northern Hemisphere winter, meet a continuing robust recovery in consumption and support the gradual resumption of large-scale aviation.
Before electric vehicles seriously chip away at petroleum demand, oil prices are likely to be only cooled off over the next two years by an unlikely breakdown of Opec+ cohesion, a serious Covid resurgence or interest rate rises and an economic slowdown. The oil exporters’ ministers need to watch those risks carefully and not let prices rise into the red zone.
But there is little US President Joe Biden can do practically and desirably. He inherited this problem.
It seems almost forgotten that it was Donald Trump, back in April last year, who pushed vocally for the Opec+ alliance to make deep production cuts in the face of the Covid-induced demand collapse, to save the American oil industry.
US oil output peaked at about 13 million bpd before the pandemic, then slumped and have now revived to about 11.5 million bpd. The Democrats’ message has been strongly pro-climate. However, a slow recovery in production is not because of environmental restrictions but shareholders’ impatience to see cash returned instead of burnt on profligate drilling. Higher prices are now finally encouraging rising output, but not the breakneck growth of the past years.
The Biden administration has focused on tightening regulations on domestic oil production, halting drilling on federal lands and in sensitive areas, and blocking new pipelines. Incentives for electric vehicles and tighter fuel efficiency standards would cut US oil demand in the longer term.
Neither of these policy prongs has yet had any significant impact. In any case, the industry, after numerous chances to clean up its act, needs regulation to prevent methane leaks and flaring of unwanted gas. In that respect, Mr Biden is doing responsible operators a favour.
The short-term tool at the US president’s disposal is the strategic petroleum reserve, from which oil could be released to cool the market – temporarily. But the reserve is meant to be saved for emergencies such as shortages caused by natural disasters or wars. Mr Biden did not mention any release in a speech on Friday, and prices rose more than $2 a barrel in response.
He could also push harder on a revived nuclear deal with Iran, that would bring its exports back on the market. But that also faces major political opposition at home, requires co-operation from Tehran and will be lengthy and complicated.
There could be a package of strictly short-term measures, such as tax breaks for environmentally compliant operators and ending Trump-era steel tariffs that increased costs. Raising oil output at home will affect prices, put some pressure on Opec and could call the US industry’s bluff. But it would still face bitter environmental opposition.
Better than threatening to do something and proving impotent, it is wiser to change the narrative. Calling simultaneously for net zero carbon and for Opec to increase output pleases no-one.
One alternative is to shift course and declare that oil consumption is going to fall, but that while it does, as much of it as possible should be met by the US and its allies, with strong environmental protections. A carbon tax or border tariffs would put surplus oil rents back into American pockets.
The other is to explain directly that the low-carbon transition will be challenging and sometimes painful, but that the future holds less pollution, lower energy costs, better vehicles, greater energy security and, above all, a liveable climate.
US presidents have rarely been good at telling hard truths about energy to their high-consuming society. The current state of political division and misinformation makes that even harder. For now, Opec+ is probably on safe ground in taking little heed of the White House.
Robin M. Mills is chief executive of Qamar Energy and author of The Myth of the Oil Crisis
U19 WORLD CUP, WEST INDIES
UAE group fixtures (all in St Kitts)
Saturday 15 January: v Canada
Thursday 20 January: v England
Saturday 22 January: v Bangladesh
UAE squad
Alishan Sharafu (captain), Shival Bawa, Jash Giyanani, Sailles Jaishankar, Nilansh Keswani, Aayan Khan, Punya Mehra, Ali Naseer, Ronak Panoly, Dhruv Parashar, Vinayak Raghavan, Soorya Sathish, Aryansh Sharma, Adithya Shetty, Kai Smith
COMPANY PROFILE
Name: Kumulus Water
Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
Number of staff: 22
Investment raised: $4 million
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
Power: 819hp
Torque: 678Nm at 7,250rpm
Price: From Dh1,700,000
Available: Now
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
Top New Zealand cop on policing the virtual world
New Zealand police began closer scrutiny of social media and online communities after the attacks on two mosques in March, the country's top officer said.
The killing of 51 people in Christchurch and wounding of more than 40 others shocked the world. Brenton Tarrant, a suspected white supremacist, was accused of the killings. His trial is ongoing and he denies the charges.
Mike Bush, commissioner of New Zealand Police, said officers looked closely at how they monitored social media in the wake of the tragedy to see if lessons could be learned.
“We decided that it was fit for purpose but we need to deepen it in terms of community relationships, extending them not only with the traditional community but the virtual one as well," he told The National.
"We want to get ahead of attacks like we suffered in New Zealand so we have to challenge ourselves to be better."
About Housecall
Date started: July 2020
Founders: Omar and Humaid Alzaabi
Based: Abu Dhabi
Sector: HealthTech
# of staff: 10
Funding to date: Self-funded
Gothia Cup 2025
4,872 matches
1,942 teams
116 pitches
76 nations
26 UAE teams
15 Lebanese teams
2 Kuwaiti teams
Water waste
In the UAE’s arid climate, small shrubs, bushes and flower beds usually require about six litres of water per square metre, daily. That increases to 12 litres per square metre a day for small trees, and 300 litres for palm trees.
Horticulturists suggest the best time for watering is before 8am or after 6pm, when water won't be dried up by the sun.
A global report published by the Water Resources Institute in August, ranked the UAE 10th out of 164 nations where water supplies are most stretched.
The Emirates is the world’s third largest per capita water consumer after the US and Canada.
The Great Derangement: Climate Change and the Unthinkable
Amitav Ghosh, University of Chicago Press
Yuki Means Happiness
Alison Jean Lester
John Murray
MATCH INFO
Day 2 at Mount Maunganui
England 353
Stokes 91, Denly 74, Southee 4-88
New Zealand 144-4
Williamson 51, S Curran 2-28
Hotel Silence
Auður Ava Ólafsdóttir
Pushkin Press
The biog
Name: Younis Al Balooshi
Nationality: Emirati
Education: Doctorate degree in forensic medicine at the University of Bonn
Hobbies: Drawing and reading books about graphic design
At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances
Our legal columnist
Name: Yousef Al Bahar
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
The specs
Engine: Dual 180kW and 300kW front and rear motors
Power: 480kW
Torque: 850Nm
Transmission: Single-speed automatic
Price: From Dh359,900 ($98,000)
On sale: Now
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Five famous companies founded by teens
There are numerous success stories of teen businesses that were created in college dorm rooms and other modest circumstances. Below are some of the most recognisable names in the industry:
- Facebook: Mark Zuckerberg and his friends started Facebook when he was a 19-year-old Harvard undergraduate.
- Dell: When Michael Dell was an undergraduate student at Texas University in 1984, he started upgrading computers for profit. He starting working full-time on his business when he was 19. Eventually, his company became the Dell Computer Corporation and then Dell Inc.
- Subway: Fred DeLuca opened the first Subway restaurant when he was 17. In 1965, Mr DeLuca needed extra money for college, so he decided to open his own business. Peter Buck, a family friend, lent him $1,000 and together, they opened Pete’s Super Submarines. A few years later, the company was rebranded and called Subway.
- Mashable: In 2005, Pete Cashmore created Mashable in Scotland when he was a teenager. The site was then a technology blog. Over the next few decades, Mr Cashmore has turned Mashable into a global media company.
- Oculus VR: Palmer Luckey founded Oculus VR in June 2012, when he was 19. In August that year, Oculus launched its Kickstarter campaign and raised more than $1 million in three days. Facebook bought Oculus for $2 billion two years later.
New schools in Dubai
Should late investors consider cryptocurrencies?
Wealth managers recommend late investors to have a balanced portfolio that typically includes traditional assets such as cash, government and corporate bonds, equities, commodities and commercial property.
They do not usually recommend investing in Bitcoin or other cryptocurrencies due to the risk and volatility associated with them.
“It has produced eye-watering returns for some, whereas others have lost substantially as this has all depended purely on timing and when the buy-in was. If someone still has about 20 to 25 years until retirement, there isn’t any need to take such risks,” Rupert Connor of Abacus Financial Consultant says.
He adds that if a person is interested in owning a business or growing a property portfolio to increase their retirement income, this can be encouraged provided they keep in mind the overall risk profile of these assets.
The Sand Castle
Director: Matty Brown
Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea
Rating: 2.5/5
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
Ballon d’Or shortlists
Men
Sadio Mane (Senegal/Liverpool), Sergio Aguero (Aregentina/Manchester City), Frenkie de Jong (Netherlans/Barcelona), Hugo Lloris (France/Tottenham), Dusan Tadic (Serbia/Ajax), Kylian Mbappe (France/PSG), Trent Alexander-Arnold (England/Liverpool), Donny van de Beek (Netherlands/Ajax), Pierre-Emerick Aubameyang (Gabon/Arsenal), Marc-Andre ter Stegen (Germany/Barcelona), Cristiano Ronaldo (Portugal/Juventus), Alisson (Brazil/Liverpool), Matthijs de Ligt (Netherlands/Juventus), Karim Benzema (France/Real Madrid), Georginio Wijnaldum (Netherlands/Liverpool), Virgil van Dijk (Netherlands/Liverpool), Bernardo Silva (Portugal/Manchester City), Son Heung-min (South Korea/Tottenham), Robert Lewandowski (Poland/Bayern Munich), Roberto Firmino (Brazil/Liverpool), Lionel Messi (Argentina/Barcelona), Riyad Mahrez (Algeria/Manchester City), Kevin De Bruyne (Belgium/Manchester City), Kalidou Koulibaly (Senegal/Napoli), Antoine Griezmann (France/Barcelona), Mohamed Salah (Egypt/Liverpool), Eden Hazard (BEL/Real Madrid), Marquinhos (Brazil/Paris-SG), Raheem Sterling (Eengland/Manchester City), Joao Félix(Portugal/Atletico Madrid)
Women
Sam Kerr (Austria/Chelsea), Ellen White (England/Manchester City), Nilla Fischer (Sweden/Linkopings), Amandine Henry (France/Lyon), Lucy Bronze(England/Lyon), Alex Morgan (USA/Orlando Pride), Vivianne Miedema (Netherlands/Arsenal), Dzsenifer Marozsan (Germany/Lyon), Pernille Harder (Denmark/Wolfsburg), Sarah Bouhaddi (France/Lyon), Megan Rapinoe (USA/Reign FC), Lieke Martens (Netherlands/Barcelona), Sari van Veenendal (Netherlands/Atletico Madrid), Wendie Renard (France/Lyon), Rose Lavelle(USA/Washington Spirit), Marta (Brazil/Orlando Pride), Ada Hegerberg (Norway/Lyon), Kosovare Asllani (Sweden/CD Tacon), Sofia Jakobsson (Sweden/CD Tacon), Tobin Heath (USA/Portland Thorns)
Specs
Engine: Electric motor generating 54.2kWh (Cooper SE and Aceman SE), 64.6kW (Countryman All4 SE)
Power: 218hp (Cooper and Aceman), 313hp (Countryman)
Torque: 330Nm (Cooper and Aceman), 494Nm (Countryman)
On sale: Now
Price: From Dh158,000 (Cooper), Dh168,000 (Aceman), Dh190,000 (Countryman)
Squid Game season two
Director: Hwang Dong-hyuk
Stars: Lee Jung-jae, Wi Ha-joon and Lee Byung-hun
Rating: 4.5/5
