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IMF cuts forecasts for global economic growth

Christine Lagarde, the IMF managing director, says the outlook is ‘too low, too brittle and too lopsided’ Low oil prices will not provide a sufficient updraught to dispel the clouds hanging over the global economy, the International Monetary Fund said on Tuesday. In a sign of its increasing gloom about the medium-term economic outlook, the IMF cut its global economic growth forecasts by 0.3 percentage points for both 2015 and 2016 despite believing cheaper oil represents a “shot in the arm”. Its 2015 forecast for the UK was unchanged at 2.7 per cent and cut by 0.1 percentage point for next year to 2.4 per cent compared with its previous forecast in its World Economic Outlook last October. Its outlook for the UK is broadly favourable despite uncertainty about the general election, with the faltering eurozone economy likely to prove the biggest brake on growth. Last year the IMF described […]

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IEA’s Van der Hoeven sees no quick recovery for global economy, oil demand

Abu Dhabi (Platts)–20Jan2015/655 am EST/1155 GMT Flat global demand for oil and the wild card of shale oil development continued to cast long shadows over the global oil market, the International Energy Agency’s Executive Director Maria van der Hoeven said Tuesday. "There is no growth in demand, and that has to do with the global economy," she told reporters on the sidelines of the World Future Energy Summit in Abu Dhabi. "We do not see that recovering," she added. Van der Hoeven described the rise of North American shale oil and gas production in recent years as "a game changer" for global energy markets. It was too early to tell whether low oil prices would trigger deflation in advanced economies, but the IEA was monitoring the situation closely, she said. The IEA was also keeping a watch on the impact of falling oil prices on gas markets, she said. […]

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World’s Largest Traders Use Offshore Supertankers to Store Oil

ENLARGE The TI Oceania supertanker which is being used by oil trading house Vitol to store oil until the commodity’s price rises. Overseas Shipholding Group The supertanker TI Oceania was built to ferry vast quantities of oil across oceans, but for the next year it is expected to remain anchored off the coast of Singapore, storing millions of barrels of oil for Vitol SA, a giant trading house. According to shipbrokers and analysts, the 3-million-barrel megaship—one of the largest in the world—is just one example of efforts by traders to turn a profit in the slumping global oil market . The strategy is simple: buy and store oil at cheap prices now , selling futures contracts to lock in the higher oil prices expected later. “It is one of the easy ways to make money and that’s one of the interesting things about it from a trading perspective: It’s […]

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Iraq: Turkey Receives Kirkuk Oil

The Turkish port of Ceyhan has received 450,000 barrels of crude oil from the northern Iraqi province of Kirkuk, Turkish Energy Minister Taner Yildiz said, Shafaq News reported Jan. 18. The oil is being sold under the supervision of Iraq’s state oil marketing company following an agreement between Iraq and the Kurdistan Regional Government on oil exports and revenue-sharing .  

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Iran sees no OPEC shift toward a cut, says oil industry could withstand $25 crude

DUBAI (Reuters) – Iran sees no sign of a shift within OPEC toward action to support oil prices, its oil minister said, adding its oil industry could ride out a further price slump to $25 a barrel. The comments are a further sign that despite lobbying by Iran and Venezuela, there is little chance of collective action by the 12-member OPEC to prop up prices – entrenching the reluctance of individual members to curb their own supplies. In remarks posted on the Iranian oil ministry’s website SHANA, Oil Minister Bijan Zanganeh called for increased cooperation between members of the Organization of the Petroleum Exporting Countries. "Iran has no plan (to hold an emergency OPEC meeting) and is currently in consultations with other OPEC member states in a bid to prevent the sharp fall in the oil price, but these consultations have yet to bear fruit," he said. Oil has […]

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Iran Nuclear Talks to Resume Next Month

ENLARGE U.S. Secretary of State John Kerry and Iranian Foreign Minister Javad Zarif in Geneva last week. Associated Press BRUSSELS—Nuclear talks between Iran and six powers over Tehran’s nuclear program will resume at senior-official level early next month, a spokeswoman for the European Union said Monday. She said talks in Geneva on Sunday between the parties were “serious and useful” and they had decided to meet again in early February. Others, however, said the talks remain very difficult. The EU chairs the six-power group—made up of the U.S., Russia, China, France, the U.K. and Germany—which negotiates on the nuclear dossier. U.S. Secretary of State John Kerry held talks on Wednesday and on Friday with his Iranian counterpart, Javad Zarif, in an effort to accelerate the diplomacy. Senior U.S. diplomats also held several days of meetings in Geneva over the weekend with Iranian negotiators. The two sides have set a […]

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New round of Iran nuclear talks broadened consensus: Chinese official

Wang Qun, Director-General of the Department of Arms Control of Chinese Ministry of Foreign Affairs speaks to media in Geneva, Switzerland, on Jan. 18, 2015. The new round of negotiations over Iran’s long-standing controversial nuclear program broadened the consensus, said the head of Chinese delegation to the talks on Sunday. (Xinhua/Zhang Miao) GENEVA, Jan. 18 (Xinhua) — The new round of negotiations over Iran’s long-standing controversial nuclear program broadened the consensus, said the head of Chinese delegation to the talks on Sunday. Wang Qun, Director-General of the Department of Arms Control of Chinese Ministry of Foreign Affairs, said that this round of talks was intensive, practical and in-depth. Wang said that China hopes all sides to seize the valuable historic opportunity, and show the political will and determination to facilitate a package solution and a win-win comprehensive agreement. Wang added that parties involved agreed to hold the next round […]

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War Zones Are Still Hot But Cheap Oil Is Making Traders Complacent

Back when oil traded at $115 a barrel in June, traders were talking about the fighting in places like Iraq , Ukraine and Libya as part of the reason it was so high. Fast forward seven months and while crude has faded to $50 a barrel amid a supply glut, those geopolitical risks — along with some new ones that emerged — remain largely intact. Islamic State militants haven’t given up the goal of a Middle East caliphate, Libya is mired in chaos, pro-Russian separatists keep skirmishing with Ukrainian forces and North Korea is fighting Hollywood. All of this has some analysts wondering if investors are setting themselves up for a nasty surprise by driving oil down so far. To Michael McCarthy , chief strategist at CMC Markets, current prices indicate investors see “almost zero risk” of a geopolitical event disrupting output. In other words, brace for a big […]

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Former Saudi oil boss says it can cope with low price

Oil well at sunset Saudi Arabia can cope with low oil prices for "at least eight years", Saudi Arabia’s minister of petroleum’s former senior adviser has told the BBC. Mohammed al-Sabban said the country’s policy was to defend its current market share by enduring low prices. "You need to allow prices to go as low as possible in order to see those marginal producers move out of the market," he said. Mr al-Sabban advised the ministry for 27 years, leaving last year. Saudi Arabia, the largest producer within the Opec oil producers’ cartel, has repeatedly said that it will not cut output to try to boost the oil price. Mr al-Sabban said Saudi Arabia’s "huge financial reserves" would enable it to cope with the low oil price. The country is now in the process of cutting government spending. Without these cuts, Mr al-Sabban said, Saudi Arabia could not cope […]

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China seen posting weakest annual growth in 24 years, will spur more stimulus

BEIJING (Reuters) – China is likely to post its weakest growth since the global financial crisis in the fourth quarter as its property market cooled, reinforcing expectations the government will have to roll out more stimulus measures to avoid a sharper slowdown. Data on Tuesday is expected to show the world’s second-largest economy grew 7.2 percent in the October-December quarter from a year earlier, slowing from 7.3 percent in the previous quarter, a Reuters poll showed. That would be its weakest performance since the first quarter of 2009, when the growth rate tumbled to 6.6 percent and a sudden collapse in world trade threw some 20 million Chinese out of work. Full-year economic growth in 2014 is almost certain to undershoot the government’s target of 7.5 percent and mark the weakest expansion in 24 years, adding to concerns about shaky global demand. With the property market likely to remain […]

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