Thirteen oil ministers and officials, many in face masks, gathered on Zoom, which has proved to be a surprisingly effective way to conduct diplomacy.
Most of the groundwork had already been done. Saturday’s revised Opec+ agreement is less ambitious than some suggestions, but that is good in a situation where the group has to avoid getting carried away by initial success.
The latest agreement extends existing cuts of a nominal 9.6 million barrels per day, due to end in June, into July.
This is apart from 100,000 bpd of reductions from Mexico, which dropped out after nearly torpedoing the agreement in April and will hold off 1.9 million bpd that would otherwise have come back on the market next month. It seems 1.18 million bpd of additional voluntary cuts by Saudi Arabia and its Gulf allies will not continue.
Some Opec members have not complied with the reduced output targets. Iraq, Nigeria and Angola have fallen short. From the non-Opec members of the Opec+ pact, Kazakhstan also fell short while Russia, which lagged in previous deals, is this time close to full compliance.
Libya is exempt from a quota, but the latest political developments there could revive its exports.
Members who did not meet their targets are to improve, and even make up for over-production in May and June with deeper cuts from July, although it is hard to see how that will be enforced.
From an economic point of view, Opec+ should for now err on the side of lower prices. It will repeat the mistake of 2017 if it cuts deeply for too long and allows prices to run up sharply.
West Texas Intermediate is at about $40 a barrel and Brent crude well above that, an astonishing recovery from the carnage of April. The priority now should be to regain at least all the market share lost this year, however long that takes, while keeping prices in a range of $30 to $50 a barrel.
If prices are too low, budgets suffer, while political pressure from the US will mount.
The coronavirus situation keeps worsening in Brazil, Russia, India, Egypt and Iraq, as well as in US states such as Texas, and is deteriorating again in Iran.
The threat of overflowing tanks and negative prices has receded, but further lockdowns or continuing global economic deterioration could still push down prices again. Hence, some Opec members are keen to blame any market weakness on Iraq and Nigeria, rather than again face blame from Texan drillers.
But let prices go too high and American, Canadian and other high-cost production will rebound, leaving Opec+ with a large and permanent loss of market share. A surge would also stifle economic revival and push it away from greater oil consumption. Recovery packages such as Germany’s already have a strong green tinge and avoid promoting petrol and diesel vehicles.
Even at $40 for US crude, shale producers are already reopening wells, although they are not yet ready to drill new ones. Demand is close to back to normal in China, recovering in the US and gradually picking up in Europe.
In this hazy and fast-moving situation, where Opec+ has to adjust cuts by millions of barrels per day each month, instead of the usual biannual trimming of a few hundred thousand, adaptability is essential.
Laying out a path for cuts in 2022, as was done in April, may be a useful indication of what the group thinks about the medium term, but no one has any real idea of the supply-demand balance by then.
Opec+ should ideally continue adjusting targets each month. The bad memories of the March breakdown are probably enough to hold off a repeat, for now.
The next scheduled gathering is on November 30, although the joint ministerial monitoring committee will keep assembling every month.
The new Zoom diplomacy gives more flexibility – meetings can be held on short notice, once the main players are assured a deal is possible.
Transparency of exports has greatly improved because of monitoring by satellite and tanker transponders through services such as Kpler, Kayrros, Tanker Trackers and Centinar. This is partly clouded by attempts by US-sanctioned Iran and Venezuela to conceal the destination of their shipments.
Other parts of the oil chain remain more obscure. The Joint Organisations Data Initiative – a collaboration of Opec, the International Energy Agency and statistical agencies – brings monthly reports of oil production and use. But several important countries have not updated their figures for months or even years.
Storage can partly be estimated by satellite observation of tanks, but underground holdings in China remain invisible. Oil movements by pipeline, and the amount oil producers consume in their own refineries, are not always reported accurately or on time. Timely guesses for end-user demand during the pandemic rely on satellite reports of road traffic pollution, and traffic monitoring apps.
Nevertheless, even if they do not have perfect clarity, Opec+ probably has more information than any oil market management body since the early 1970s.
That is fortunate, as shale and the coronavirus together make supply and demand move faster than ever. Working from home gives ministers the chance of managing that tricky balance in real time.
Robin Mills is chief executive of Qamar Energy, and author of The Myth of the Oil Crisis
The 12 Syrian entities delisted by UK
Ministry of Interior
Ministry of Defence
General Intelligence Directorate
Air Force Intelligence Agency
Political Security Directorate
Syrian National Security Bureau
Military Intelligence Directorate
Army Supply Bureau
General Organisation of Radio and TV
Al Watan newspaper
Cham Press TV
Sama TV
Tank warfare
Lt Gen Erik Petersen, deputy chief of programs, US Army, has argued it took a “three decade holiday” on modernising tanks.
“There clearly remains a significant armoured heavy ground manoeuvre threat in this world and maintaining a world class armoured force is absolutely vital,” the general said in London last week.
“We are developing next generation capabilities to compete with and deter adversaries to prevent opportunism or miscalculation, and, if necessary, defeat any foe decisively.”
Our legal consultants
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
RESULTS
5pm: Rated Conditions (PA) Dh85,000 (Turf) 1,600m
Winner: AF Mouthirah, Tadhg O’Shea (jockey), Ernst Oertel (trainer)
5.30pm: Maiden (PA) Dh80,000 (T) 1,400m
Winner: AF Alajaj, Tadhg O’Shea, Ernst Oertel
6pm: Wathba Stallions Cup Handicap (PA) Dh70,000 (T) 1,400m
Winner: Hawafez, Connor Beasley, Abubakar Daud
6.30pm: Maiden (PA) Dh80,000 (T) 2,200m
Winner: Tair, Fabrice Veron, Eric Lemartinel
7pm: Handicap (PA) Dh80,000 (T) 2,200m
Winner: Wakeel W’Rsan, Richard Mullen, Jaci Wickham
7.30pm: Handicap (PA) Dh100,000 (T) 2,400m
Winner: Son Of Normandy, Fernando Jara, Ahmad bin Harmash
David Haye record
Total fights: 32
Wins: 28
Wins by KO: 26
Losses: 4
More coverage from the Future Forum
Other acts on the Jazz Garden bill
Sharrie Williams
The American singer is hugely respected in blues circles due to her passionate vocals and songwriting. Born and raised in Michigan, Williams began recording and touring as a teenage gospel singer. Her career took off with the blues band The Wiseguys. Such was the acclaim of their live shows that they toured throughout Europe and in Africa. As a solo artist, Williams has also collaborated with the likes of the late Dizzy Gillespie, Van Morrison and Mavis Staples.
Lin Rountree
An accomplished smooth jazz artist who blends his chilled approach with R‘n’B. Trained at the Duke Ellington School of the Arts in Washington, DC, Rountree formed his own band in 2004. He has also recorded with the likes of Kem, Dwele and Conya Doss. He comes to Dubai on the back of his new single Pass The Groove, from his forthcoming 2018 album Stronger Still, which may follow his five previous solo albums in cracking the top 10 of the US jazz charts.
Anita Williams
Dubai-based singer Anita Williams will open the night with a set of covers and swing, jazz and blues standards that made her an in-demand singer across the emirate. The Irish singer has been performing in Dubai since 2008 at venues such as MusicHall and Voda Bar. Her Jazz Garden appearance is career highlight as she will use the event to perform the original song Big Blue Eyes, the single from her debut solo album, due for release soon.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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Three trading apps to try
Sharad Nair recommends three investment apps for UAE residents:
- For beginners or people who want to start investing with limited capital, Mr Nair suggests eToro. “The low fees and low minimum balance requirements make the platform more accessible,” he says. “The user interface is straightforward to understand and operate, while its social element may help ease beginners into the idea of investing money by looking to a virtual community.”
- If you’re an experienced investor, and have $10,000 or more to invest, consider Saxo Bank. “Saxo Bank offers a more comprehensive trading platform with advanced features and insight for more experienced users. It offers a more personalised approach to opening and operating an account on their platform,” he says.
- Finally, StashAway could work for those who want a hands-off approach to their investing. “It removes one of the biggest challenges for novice traders: picking the securities in their portfolio,” Mr Nair says. “A goal-based approach or view towards investing can help motivate residents who may usually shy away from investment platforms.”
MATCH INFO
Tottenham 4 (Alli 51', Kane 50', 77'. Aurier 73')
Olympiakos 2 (El-Arabi 06', Semedo')
The smuggler
Eldarir had arrived at JFK in January 2020 with three suitcases, containing goods he valued at $300, when he was directed to a search area.
Officers found 41 gold artefacts among the bags, including amulets from a funerary set which prepared the deceased for the afterlife.
Also found was a cartouche of a Ptolemaic king on a relief that was originally part of a royal building or temple.
The largest single group of items found in Eldarir’s cases were 400 shabtis, or figurines.
Khouli conviction
Khouli smuggled items into the US by making false declarations to customs about the country of origin and value of the items.
According to Immigration and Customs Enforcement, he provided “false provenances which stated that [two] Egyptian antiquities were part of a collection assembled by Khouli's father in Israel in the 1960s” when in fact “Khouli acquired the Egyptian antiquities from other dealers”.
He was sentenced to one year of probation, six months of home confinement and 200 hours of community service in 2012 after admitting buying and smuggling Egyptian antiquities, including coffins, funerary boats and limestone figures.
For sale
A number of other items said to come from the collection of Ezeldeen Taha Eldarir are currently or recently for sale.
Their provenance is described in near identical terms as the British Museum shabti: bought from Salahaddin Sirmali, "authenticated and appraised" by Hossen Rashed, then imported to the US in 1948.
- An Egyptian Mummy mask dating from 700BC-30BC, is on offer for £11,807 ($15,275) online by a seller in Mexico
- A coffin lid dating back to 664BC-332BC was offered for sale by a Colorado-based art dealer, with a starting price of $65,000
- A shabti that was on sale through a Chicago-based coin dealer, dating from 1567BC-1085BC, is up for $1,950
The specs
Engine: 4 liquid-cooled permanent magnet synchronous electric motors placed at each wheel
Battery: Rimac 120kWh Lithium Nickel Manganese Cobalt Oxide (LiNiMnCoO2) chemistry
Power: 1877bhp
Torque: 2300Nm
Price: Dh7,500,00
On sale: Now
What are the influencer academy modules?
- Mastery of audio-visual content creation.
- Cinematography, shots and movement.
- All aspects of post-production.
- Emerging technologies and VFX with AI and CGI.
- Understanding of marketing objectives and audience engagement.
- Tourism industry knowledge.
- Professional ethics.
