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Oil Industry May Invoke Trade Law to Challenge Export Ban

The U.S. oil industry, riding a domestic energy boom, is preparing to challenge restrictions on crude exports, possibly by arguing that limits designed to keep petroleum in America may violate international trade rules. “Export issues are something we’re going to have to address,” John Felmy, the chief economist for the American Petroleum Institute trade group said in an interview. “It’s a debate we have to have.” He declined to discuss lobbying strategy or trade rules, though a June planning document on API letterhead obtained by Bloomberg News says the group has begun to develop “the necessary legal analysis” to support export approvals. API is planning to “highlight potential violations of the World Trade Organization rules against export restrictions,” according to the draft document, prepared for the group’s executive committee meeting. Industry officials say the push is just starting to lift the 1970s-era restrictions, and they acknowledge it will be […]

Posted On : Published By : Tom Whipple
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Great Expectations, Deferred

Great1.png Page added on November 5, 2013 Still waiting for large, economy-wide job increases from the “shale revolution” From Goldman Sachs, “Is the Economy Gaining “Fracktion?”” (not online): There is little evidence of significant “induced” employment growth in downstream manufacturing industries. Similarly, cap-ex in energy intensive sectors that might be expected to benefit most from the shale boom has not outperformed cap-ex in other sectors during the recovery, although it did decline by less during the recession. On top of fears that the surge in unconventional oil and natural gas will not be enduring [1] [2] [3] , there remains some doubt that the development of fracking will be the game-changer that many have claimed – at least with respect to macroeconomics. (Prominent studies include IHS (2012) , McKinsey (2013) .) Below I turn first to a discussion of employment growth in core oil and gas extraction. Then I […]

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Iran Talks Tread Tricky Line on Sanctions

U.S. officials head to Geneva this week for a pivotal new round of discussions with Iran over its nuclear program. So you can be sure some tricky talks lie just ahead for the Obama administration. Tricky negotiations with the Iranians, of course. But also tricky negotiations with Congress and with Israel over the future of economic sanctions against the Iranian regime. The administration and its partners among big world powers—Britain, France, Russia, China and Germany—believe they are moving toward a two-phase agreement with Iran designed to rein in its nuclear program before it becomes capable of producing nuclear weapons. Under the first phase of that deal, Iran would freeze elements of its nuclear program immediately in return for what officials say would be “modest” relief from some of the broad and crippling sanctions the West put in place. And that’s where the rub comes in. That first phase, the […]

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China plans to prove the sceptics wrong

Ingram Pinn illustration Foreign commentators and local bloggers regularly predict that China is heading for an economic and political crisis. But the country’s leaders are in strikingly confident mood. They believe that China can keep growing at more than 7 per cent a year for at least another decade. That would mean the country’s economy – already the second-largest in the world – would double in size. And, depending on the assumptions you make about US growth and exchange rates, it would probably mean that China becomes the world’s largest economy by 2020. Nobody embodies the leadership’s confidence better than the burly, imposing figure of Xi Jinping, China’s president. Last week, I was part of a group of foreign visitors – brought together by the 21st century Council, a think-tank – who met the Chinese leader in Beijing. Mr Xi’s manner is warmer and less formal than that of […]

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China warns local leaders to cut industry bloat

AP Photo BEIJING (AP) — Chinese leaders have ordered local officials to stop expanding industries such as steel and cement in which supply outstrips demand, a Cabinet statement said Tuesday, in a sign previous orders to cut overcapacity were ignored. Beijing has been trying since 2009 to cut excess production capacity, which has triggered price-cutting wars that threaten the financial health of some industries. But lower-level leaders whose promotions depend on economic development have continued to support local industries. In a video conference on Monday, planning officials warned local leaders to stop ignoring orders to reduce overcapacity in industries including steel, cement, aluminum and glass. “Those who still violate discipline will be heavily punished,” said the deputy director of the Cabinet planning agency, the National Development and Reform Commission, Hu Zucai, according to the government newspaper China Daily. Economists and business groups warn industrial overcapacity could hurt Chinese banks […]

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China premier warns against loose money policies

BEIJING (Reuters) – China needs to sustain economic growth of 7.2 percent to ensure a stable job market, Premier Li Keqiang said as he warned the government against further expanding already loose money policies. In one of the few occasions when a top official has enunciated the minimum level of growth needed for employment, Li said calculations show China’s economy must grow 7.2 percent annually to create 10 million jobs a year. That would cap the urban unemployment rate at around 4 percent, he said. "We want to stabilize economic growth because we need to guarantee employment essentially," Li was quoted by the Workers’ Daily as saying on Monday. His remarks were made at a union meeting two weeks ago but were only published in full this week. Yet even as authorities keep an eye on growth, Li sounded a warning on easy credit supply, which he said had […]

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EU Set to Recommend Overhaul of State Support in Energy Markets

The European Union is poised to call on governments to improve their state-aid mechanisms in energy markets, including support programs for renewable energy. The European Commission, the 28-nation bloc’s regulatory arm, aims to start a public debate on government intervention in the electricity market as end-user prices rise, according to a draft of an EU communication to be published in Brussels today. The increased costs are caused by high and rising taxes and levies on final power charges, as well as the costs of networks and fuels, according to the draft, which was obtained by Bloomberg News . “Public intervention can be useful and effective to attain policy objectives set at Union, regional, national or local level, but it must be well-designed and should be adapted to changes in market functioning, technology and society that occur over time,” the commission said in the document. The call for a public […]

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China’s grandees ready for crucial political event

A soldier outside parliament in Beijing ©Reuters A soldier in Beijing. The party will discuss ‘unprecedented’ reforms at their meeting, according to one leader In the coming days, the Communist Party of China will hold the country’s most anticipated political event of the year. The show trial of disgraced politician Bo Xilai may have given the masses a dose of high political theatre but the forthcoming closed-door meeting of party grandees could prove to be far more significant and far-reaching. The third plenary session of the 18th Congress of the CPC Central Committee will take place between November 9 and November 12. The party leadership has strongly hinted that Mr Xi will use this occasion to send a powerful message to the world about his plans for the rest of his decade in power. Last week, Yu Zhengsheng, the fourth-ranked leader in the party hierarchy, described the reforms to […]

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Iran's inflation hits 36.2 pct in 12 months

TEHRAN, Nov. 2 (Xinhua) — Iran’s inflation for 12 months ending on Oct. 22 hit 36.2 percent, 11.4 percentage points up from its corresponding figure last year, Tehran Times daily reported Saturday, quoting the Statistics Center of Iran. On Oct. 27, Iran’s Finance and Economic Affairs Minister Ali Tayebnia said the government planned to reduce the nation’s inflation rate by 6-7 percent by the end of the current Iranian year (March 20, 2014). Through curbing the runaway liquidity growth, the inflation rate is expected to be brought down, Tayebnia was quoted as saying. Adopting proper and efficient monetary and fiscal policies will help curb the inflation rate as well, he added. Also, Valiollah Seif, Governor of the Central Bank of Iran has pledged to control liquidity and bring down inflation, as President Hassan Rouhani has agreed to separate monetary and fiscal policies, giving the bank more independence, according to […]

Posted On : Published By : Tom Whipple