Oil prices were hovering at a 10-month high after Saudi Arabia and Russia said they would extend supply cuts of a combined 1.3 million barrels per day to the end of the year.
Brent, the benchmark for two thirds of the world’s oil, was trading 0.21 per cent higher at $90.23 a barrel at 8pm UAE time on Wednesday, while West Texas Intermediate, the gauge that tracks US crude, was 0.44 per cent higher at $87.07 a barrel.
Brent rallied yesterday following the announcement gaining 1.2 per cent at market close and settling at $90.04, while WTI ended the day 1.3 per cent higher at $86.69.
As part of their voluntary cuts, Saudi Arabia is extending its one million bpd output reduction until December, while Russia is rolling over its export cut of 300,000 bpd until the end of the year.
“This is a clear indication that oil prices trump volumes for the kingdom,” said Rystad Energy’s senior vice president Jorge Leon.
“These bullish moves significantly tighten the global oil market and can only result in one thing: higher oil prices worldwide. The decisions surprised oil markets, and prices reacted strongly and suddenly following the announcements.”
Tightening market conditions come amid concerns about a demand slump due to sluggish economic growth in China, the world's second largest economy and top oil importer.
China's economy expanded an annual 6.3 per cent from April to June, after growing 4.5 per cent in the previous three months, according to the latest data from the National Bureau of Statistics. The pace of growth in the second quarter missed the 7.1 per cent estimate of economists polled by Bloomberg and the 7.3 per cent forecast of those surveyed by Reuters.
China's services activity grew at the slowest pace in eight months in August amid weak demand, a private sector report said on Tuesday.
The Caixin/S&P Global services purchasing managers' index slipped to 51.8 last month from 54.1 in July, indicating a softer expansion in the country’s service sector output.
Saudi Arabia began implementing its cut in July, which was later extended to include August and September.
“In effect, the kingdom’s production for the coming months of October, November and December will be approximately nine million barrels per day,” the Saudi Press Agency reported on Tuesday, citing a Ministry of Energy official.
The decision seeks to “reinforce the precautionary efforts made by Opec+ countries with the aim of supporting the stability and balance of oil markets”, and it will be reviewed monthly in the context of market conditions, SPA said.
The latest move by Russia, which had already pledged to reduce its production by 500,000 bpd until the end of 2024, aims to maintain “stability and balance” in oil markets, Deputy Prime Minister Alexander Novak said on Tuesday.
At its August meeting, producers group Opec+ agreed to keep to its current output policy.
The alliance of 23 oil-producing countries has total production cuts in place of 3.66 million bpd, which includes a two million bpd reduction agreed on last year as well as voluntary cuts of 1.66 million bpd announced in April.
“This policy flexibility allows Saudi Arabia to retain control of the oil market,” said UBS strategist Giovanni Staunovo.
“Russia’s participation is also important, as the country is the second largest producer in the Opec+ group and the deal ensures close co-ordination between the two producers.”
UBS expects a market deficit of more than 1.5 million bpd in the fourth quarter of 2023 and with oil inventories set to fall further over the coming months, it is forecasting Brent to rise to $95 a barrel by the end of the year.
MUFG Bank maintained its yearend 2023 and 2024 Brent crude target of $84 a barrel and $87 a barrel, respectively, with a surge back north of $100 a barrel.
"Our reading of this development is that Opec+ is categorically exercising, in today’s underinvested environment, its inelastic pricing power – that is, its ability to raise prices incrementally without significantly hampering its demand," MUFG said.
Extending production cuts "once again highlights the kingdom’s strong message to 'do whatever is necessary to bring stability to this market'", it said.
The Vile
Starring: Bdoor Mohammad, Jasem Alkharraz, Iman Tarik, Sarah Taibah
Director: Majid Al Ansari
Rating: 4/5
UAE currency: the story behind the money in your pockets
How Beautiful this world is!
Silent Hill f
Publisher: Konami
Platforms: PlayStation 5, Xbox Series X/S, PC
Rating: 4.5/5
UAE v Gibraltar
What: International friendly
When: 7pm kick off
Where: Rugby Park, Dubai Sports City
Admission: Free
Online: The match will be broadcast live on Dubai Exiles’ Facebook page
UAE squad: Lucas Waddington (Dubai Exiles), Gio Fourie (Exiles), Craig Nutt (Abu Dhabi Harlequins), Phil Brady (Harlequins), Daniel Perry (Dubai Hurricanes), Esekaia Dranibota (Harlequins), Matt Mills (Exiles), Jaen Botes (Exiles), Kristian Stinson (Exiles), Murray Reason (Abu Dhabi Saracens), Dave Knight (Hurricanes), Ross Samson (Jebel Ali Dragons), DuRandt Gerber (Exiles), Saki Naisau (Dragons), Andrew Powell (Hurricanes), Emosi Vacanau (Harlequins), Niko Volavola (Dragons), Matt Richards (Dragons), Luke Stevenson (Harlequins), Josh Ives (Dubai Sports City Eagles), Sean Stevens (Saracens), Thinus Steyn (Exiles)
Our legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
KILLING OF QASSEM SULEIMANI
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WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
Pakistan T20 series squad
Sarfraz Ahmed (captain), Fakhar Zaman, Ahmed Shahzad, Babar Azam, Shoaib Malik, Mohammed Hafeez, Imad Wasim, Shadab Khan, Mohammed Nawaz, Faheem Ashraf, Hasan Ali, Amir Yamin, Mohammed Amir (subject to fitness clearance), Rumman Raees, Usman Shinwari, Umar Amin
The specs
Engine: 2.0-litre 4-cyl turbo
Power: 201hp at 5,200rpm
Torque: 320Nm at 1,750-4,000rpm
Transmission: 6-speed auto
Fuel consumption: 8.7L/100km
Price: Dh133,900
On sale: now
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More from Neighbourhood Watch:
Electric scooters: some rules to remember
- Riders must be 14-years-old or over
- Wear a protective helmet
- Park the electric scooter in designated parking lots (if any)
- Do not leave electric scooter in locations that obstruct traffic or pedestrians
- Solo riders only, no passengers allowed
- Do not drive outside designated lanes
Schedule:
Sept 15: Bangladesh v Sri Lanka (Dubai)
Sept 16: Pakistan v Qualifier (Dubai)
Sept 17: Sri Lanka v Afghanistan (Abu Dhabi)
Sept 18: India v Qualifier (Dubai)
Sept 19: India v Pakistan (Dubai)
Sept 20: Bangladesh v Afghanistan (Abu Dhabi) Super Four
Sept 21: Group A Winner v Group B Runner-up (Dubai)
Sept 21: Group B Winner v Group A Runner-up (Abu Dhabi)
Sept 23: Group A Winner v Group A Runner-up (Dubai)
Sept 23: Group B Winner v Group B Runner-up (Abu Dhabi)
Sept 25: Group A Winner v Group B Winner (Dubai)
Sept 26: Group A Runner-up v Group B Runner-up (Abu Dhabi)
Sept 28: Final (Dubai)
Who has lived at The Bishops Avenue?
- George Sainsbury of the supermarket dynasty, sugar magnate William Park Lyle and actress Dame Gracie Fields were residents in the 1930s when the street was only known as ‘Millionaires’ Row’.
- Then came the international super rich, including the last king of Greece, Constantine II, the Sultan of Brunei and Indian steel magnate Lakshmi Mittal who was at one point ranked the third richest person in the world.
- Turkish tycoon Halis Torprak sold his mansion for £50m in 2008 after spending just two days there. The House of Saud sold 10 properties on the road in 2013 for almost £80m.
- Other residents have included Iraqi businessman Nemir Kirdar, singer Ariana Grande, holiday camp impresario Sir Billy Butlin, businessman Asil Nadir, Paul McCartney’s former wife Heather Mills.
Hunting park to luxury living
- Land was originally the Bishop of London's hunting park, hence the name
- The road was laid out in the mid 19th Century, meandering through woodland and farmland
- Its earliest houses at the turn of the 20th Century were substantial detached properties with extensive grounds
French business
France has organised a delegation of leading businesses to travel to Syria. The group was led by French shipping giant CMA CGM, which struck a 30-year contract in May with the Syrian government to develop and run Latakia port. Also present were water and waste management company Suez, defence multinational Thales, and Ellipse Group, which is currently looking into rehabilitating Syrian hospitals.
THE BIO
Favourite place to go to in the UAE: The desert sand dunes, just after some rain
Who inspires you: Anybody with new and smart ideas, challenging questions, an open mind and a positive attitude
Where would you like to retire: Most probably in my home country, Hungary, but with frequent returns to the UAE
Favorite book: A book by Transilvanian author, Albert Wass, entitled ‘Sword and Reap’ (Kard es Kasza) - not really known internationally
Favourite subjects in school: Mathematics and science
Abdul Jabar Qahraman was meeting supporters in his campaign office in the southern Afghan province of Helmand when a bomb hidden under a sofa exploded on Wednesday.
The blast in the provincial capital Lashkar Gah killed the Afghan election candidate and at least another three people, Interior Minister Wais Ahmad Barmak told reporters. Another three were wounded, while three suspects were detained, he said.
The Taliban – which controls much of Helmand and has vowed to disrupt the October 20 parliamentary elections – claimed responsibility for the attack.
Mr Qahraman was at least the 10th candidate killed so far during the campaign season, and the second from Lashkar Gah this month. Another candidate, Saleh Mohammad Asikzai, was among eight people killed in a suicide attack last week. Most of the slain candidates were murdered in targeted assassinations, including Avtar Singh Khalsa, the first Afghan Sikh to run for the lower house of the parliament.
The same week the Taliban warned candidates to withdraw from the elections. On Wednesday the group issued fresh warnings, calling on educational workers to stop schools from being used as polling centres.
More from Rashmee Roshan Lall
Moon Music
Artist: Coldplay
Label: Parlophone/Atlantic
Number of tracks: 10
Rating: 3/5
