Stocks drop and dollar rises as inflation, rate fears return

HONG KONG - Equities tumbled Thursday, tracking a sell-off on Wall Street, while the dollar jumped further as surging inflation, interest rate hikes and recession fears returned to the fore.

Traders in Europe were keeping tabs on Westminster a day after Prime Minister Liz Truss's government was plunged into a fresh crisis and facing collapse following the resignation of home secretary Suella Braverman.

That came days after the sacking of finance minister Kwasi Kwarteng and has left Truss's premiership on a knife-edge.

The positive start to the week, helped by forecast-beating earnings and a major UK government policy U-turn, gave way to the downbeat mood that has characterized markets all year as traders contemplated an extended period of uncertainty.

News that UK inflation bounced back above 10 percent in September highlighted the struggle central banks have in bringing prices down, despite lifting borrowing costs in recent months.

That followed a similarly glum reading out of New Zealand earlier in the week and helped push up government bond yields around the world, indicating higher interest rates.

The unease on trading floors, and concerns that prices are showing no sign of easing, also sent investors back into the safety of the dollar, adding more inflationary pressure outside the United States and dragging on stock markets.

"As is often the case, rising US yields and the strong US dollar are the sledgehammers pounding global equities lower," said SPI Asset Management's Stephen Innes. 

After Wall Street's drop, markets across Asia were deep in the red, with selling also fuelled by concerns about the Chinese economy as Covid cases spike in the country and leaders stick to lockdown strategies.

A decision to delay the release of third-quarter growth data this week added to the unease among investors.

Hong Kong led losses, shedding almost three percent at one point, while Tokyo, Sydney, Seoul, Wellington, Taipei, Shanghai, Mumbai and Manila were also in the red.

There was a brief rally in the afternoon sparked by a report that China was considering easing quarantine rules for people coming into the country, though traders were unable to maintain momentum.

London's FTSE 100 fell in the morning. Frankfurt was also down but Paris edged up.

The losses wiped out most of the gains enjoyed at the start of the week, even as positive earnings reports came in from Netflix and top Wall Street banks, with Ellen Hazen of F.L.Putnam Investment Management warning worse could be yet to come.

"As we look at third-quarter results, we think there are going to be more misses than the market is currently expecting," she told Bloomberg Radio.

"If you look at GDP for this year, it keeps getting revised downward and it's really hard for companies to keep growing their earnings in the face of that."

On forex markets the dollar briefly broke to as high as 150.08 yen for the first time since 1990, putting pressure on Japanese authorities who said saying they were keeping a close watch on the market and were ready to step in to support the beleaguered currency.

But analysts warned the yen would continue to slide as long as the Bank of Japan refuses to tighten monetary policy at the same time as the Federal Reserve presses on with its sharp rate hikes.

The pound was also back under pressure, having bounced Monday after Britain's new finance minister Jeremy Hunt reversed virtually all of Truss's debt-fuelled, tax-cutting mini-budget that hammered financial markets.

Sterling was hovering just above $1.12 -- against more than $1.14 Tuesday -- owing to the chaos in Westminster, with many of the prime minister's own party calling for her to stand down, while there is speculation that more members of the cabinet could walk.

Oil prices extended Wednesday's rally that came in reaction to a drop in US petroleum stockpiles, and despite President Joe Biden's decision to release 15 million barrels from US strategic reserves.

The crude was the last batch to be released from the 180 barrels pledged by Biden earlier this year, aimed at bringing costs down.

But Innes added: "Markets will mostly ignore further releases from the Strategic Petroleum Reserves -- prices are elevated because of the medium- and longer-term gap between supply and demand resulting from years of oil industry swoon and the resulting low capital expenditure.

"So, the impact of additional... releases will likely have diminishing returns with (reserves) at a multi-decade low."

Key figures around 0810 GMT 

Tokyo - Nikkei 225: DOWN 0.9 percent at 27,006.96 (close)

Hong Kong - Hang Seng Index: DOWN 1.4 percent at 16,280.22 (close)

Shanghai - Composite: DOWN 0.3 percent at 3,035.05 (close)

London - FTSE 100: DOWN 0.2 percent at 6,914.36

Pound/dollar: DOWN at $1.1210 from $1.1219 on Wednesday

Dollar/yen: UP at 149.90 yen from 149.88 yen

Euro/dollar: UP at $0.9794 from $0.9778 

Euro/pound: UP at 87.18 pence from 87.10 pence

West Texas Intermediate: UP 1.5 percent at $86.86 per barrel

Brent North Sea crude: UP 1.2 percent at $93.52 per barrel

New York - Dow: DOWN 0.3 percent at 30,423.81 (close)

Agence France-Presse

Germany faces recession as energy crisis bites: think-tank

FRANKFURT, Germany - Germany will fall into recession next year, a leading think-tank warned Monday, with Europe's biggest economy facing soaring inflation as Russia slashes energy supplies.

The Ifo institute expects the German economy to shrink 0.3 percent in 2023 -- slashing its forecast by four percentage points from a previous prediction in June.

Inflation is expected to hit 8.1 percent this year and 9.3 percent next year, it said. 

"We are heading into a winter recession," said Timo Wollmershaeuser, Ifo's head of forecasts.

"The cuts in gas supplies from Russia over the summer and the drastic price increases they triggered are wreaking havoc on the economic recovery following the coronavirus."

Real household incomes and purchasing power will drop sharply, the think-tank warned.

There is likely to be a "return to normal" in 2024 with 1.8 percent growth and 2.5 percent inflation, Wollmershaeuser said. 

At the start of September, Russian energy giant Gazprom halted gas deliveries to Europe via the key Nord Stream 1 pipeline saying it would be under repair for an unspecified period. 

The shutdown accentuates an energy crisis in Germany, long reliant on Russian gas, and across Europe, with Moscow accused of using energy as a weapon amid tensions over the Ukraine war.

German inflation hit 7.9 percent in August, and earlier this month the government unveiled a new multi-billion-euro relief package to help households cope with soaring prices.

Last week, the European Central Bank hiked interest rates by a record 75 basis points as its seeks to battle sky-high inflation across the eurozone and said more increases were to come. 

Agence France-Presse

Stocks dip, oil slides and havens shine as growth nerves nag

SYDNEY, Australia - Stock markets slipped on Thursday and safe havens such as government bonds, gold and the yen were supported in Asia, as a hint of uneasiness crept in over the outlook for interest rates and growth, particularly outside of the United States.

Oil prices skidded to a six-week low on concern about a supply overhang and the prospect of China, Japan and the United States dipping into their fuel reserves, with Brent futures last at $79.77, more than 8 percent off last month's three-year high.

The risk-sensitive Australian dollar also fell to a six-week trough of $0.7256.

Japan's Nikkei was down 0.6 percent in early trade. MSCI's broadest index of Asian shares outside Japan dropped 0.5 percent and S&P 500 futures were flat after the index eased a little bit overnight.

The mood was softest in Hong Kong where concern over the earnings outlook weighed on tech stocks and an almost 5 percent drop in heavyweight Alibaba dragged the Hang Seng about 1 percent lower.

"We do seem to have stalled somewhat as we head into the year end," said Jun Bei Liu, a portfolio manager at Tribeca Investment Partners in Sydney.

"Investors perhaps are just taking a bit of pause," she said, in the wake of a strong US results season, but as inflation and China's slowdown loom as macroeconomic headwinds.

The yen, a safe-haven asset which has also lately been sensitive to oil prices, had its sharpest one-day jump against the dollar in three months on Wednesday while gold rose almost 1 percent and Treasuries rallied along the curve.

Gold rose a further 0.1 percent to $1,869 an ounce in Asia on Thursday. The yen edged up to 113.94 per dollar.

Benchmark 10-year Treasury yields were steady in Tokyo at 1.5889 percent after falling about 5.5 basis points overnight.

The day ahead is quiet on the calendar, with appearances from central bankers in Australia, the United States and Europe and US jobless claims data the highlights.

BIG DOLLAR

Against the backdrop of apparent caution is a surging US dollar, as US data has turned surprisingly strong just as doubts have arisen over the outlook for other major economies.

On Wednesday figures showed a jump in building permits and the backlog of house construction rose to a 15-year high - underscoring strong demand on the heels of a better-than-expected retail sales report on Tuesday.

By contrast Europe is grappling with a fourth wave of COVID-19 cases and fresh restrictions to curb it, while the central bank is pushing back on pressure to raise rates.

The euro has recovered from a trip below $1.13 on Wednesday but remains shaky at $1.1325 and is braced for its worst month on the dollar since June when the Federal Reserve had surprised investors with a hawkish shift in tone.

Currency traders are also assessing a sharp downdraft in the Aussie/yen cross, often a barometer of market sentiment. It fell through its 200-day moving average on Tuesday and has lost almost 4 percent in a dozen sessions.

"You've got the perfect storm there for bears," said Matt Simpson, senior analyst at brokerage City Index. "Fundamentally and technically Aussie/yen looks pretty good with lower oil prices."

(Reporting by Tom Westbrook in Sydney Editing by Shri Navaratnam)

-reuters-

US fuel crisis eases as pipeline returns to normal after hack

Widespread gasoline shortages along the US East Coast began to ease slightly on Saturday as the operator of the nation's biggest fuel pipeline said it was back to delivering "millions of gallons per hour" following last week's cyberattack.

Ships and trucks were deployed to fill up storage tanks after the six-day Colonial Pipeline shutdown, the most disruptive cyberattack on record, triggered widespread panic buying that left filling stations across the US Southeast dry.

"We have returned the system to normal operations, delivering millions of gallons per hour to the markets we serve," said the company, which had begun gradual restart of the pipeline on Wednesday.

More than 13,400 gas stations surveyed in the east and south by fuel tracking app GasBuddy were experiencing outages on Saturday, down from 16,200 early the previous day.

On Saturday evening, about 75% of gas stations in Washington, D.C. were still without fuel, an improvement from Friday's figure of 88%, the app showed. Shortages also eased in North Carolina and Virginia, but were about the same in Georgia.

U.S. gasoline demand dropped 12.6% from the previous week, probably due to an easing of "crazed" panic buying just after the pipeline shut, said Patrick De Haan, head of petroleum analysis at GasBuddy.

The nationwide average for a gallon of regular unleaded was $3.04 on Saturday, from $2.96 a week ago, according to AAA.

The pipeline outage accelerated increases in gasoline prices that were "already rising due to higher crude prices and demand ahead of Memorial Day," said AAA spokeswoman Ellen Edmonds.

She was referring to the May 31 holiday that traditionally kicks off the US summer driving season.

Places served by the pipeline saw the biggest price jumps this week - with Georgia and the Carolinas up 20 cents per gallon or more - but they should also see prices decline again as supplies improve, Edmonds said.

Florence, South Carolina had the nation's biggest price increase at 30 cents, while prices rose 9 cents in D.C.

Ships deployed under emergency waivers were also moving fuel from U.S. Gulf Coast refiners to the northeast, while 18-wheel tanker trunks were ferrying gasoline from Alabama to Virginia, helping to stem the shortages.

U.S. crude prices could edge higher as refiners process more oil to catch up from the gasoline storage that was drawn down while the pipeline was shuttered, said Robert Yawger, analyst at Mizuho Securities.

The approach of Memorial Day helps make "the sense of urgency supersized" for refiners, Yawger added.

In Washington, D.C., Dennis Li was stuck on Friday at a Sunoco gas station that was out of fuel. He had tried to find gas at four stations during the day, with no luck.

"I'm running on empty to the point where I don't want to drive anymore," said Li, who is from Annapolis, Maryland.

INITIAL BREACH UNKNOWN

The hacking group blamed for the attack, DarkSide, said it had hacked four other companies including a Toshiba subsidiary in Germany.

Colonial Pipeline has not determined how the initial breach occurred, a spokeswoman said this week. The 5,500-mile (8,900-km) pipeline carries 100 million gallons of gasoline, diesel and jet fuel each day to East Coast markets from Texas refineries.

Colonial has not revealed how much money the hackers were seeking or whether it paid. Bloomberg News and the New York Times said it paid nearly $5 million.

Colonial said it would resume on Monday its regular nomination process, in which shippers seek space on the line.

It released a revised schedule to shippers, with estimated delivery dates. The schedule suggested that diesel loaded in Atlanta on Friday would arrive at the northernmost point in Linden, New Jersey, 10 days later, as would gasoline.

Steve Boyd, a senior managing director at fuel delivery firm Sun Coast Resources, estimated that with gasoline moving on the pipeline at half Colonial's normal speed, it could take 12 to 20 days for new deliveries from Gulf Coast refineries to reach Linden.

Sun Coast has 75 trucks taking supplies from terminals in Alabama and Georgia to retailers as far away as Virginia.

"If customers need us for another week or three weeks, we'll be there," said Boyd. 

-reuters-

Shell says will take up to $22 billion hit from coronavirus

LONDON — Anglo-Dutch energy giant Royal Dutch Shell will take a vast second-quarter charge of up to $22 billion due to coronavirus and collapsing oil prices, it announced Tuesday.

The company said in a statement that it would face a charge of between $15 billion and $22 billion in the second quarter, after reviewing chronic fallout from the deadly COVID-19 outbreak that crashed global demand for energy.

"In the second quarter of 2020, Shell has revised its mid and long-term price and refining margin outlook reflecting the expected effects of the COVID-19 pandemic and related macroeconomic as well as energy market demand and supply fundamentals," the London-listed firm said.

"This has resulted in the review of a significant portion of Shell's upstream, integrated gas and refining assets." 

The energy major added that the move also reflected a planned reshaping of refining activities as it seeks to move towards becoming carbon neutral by 2050.

Shell's announcement comes after rival BP revealed earlier this month that it was taking a hit of between $13 billion and $17.5 billion in the same period as a result of "sustained" coronavirus fallout that ravaged the world's appetite for oil.

Agence France-Presse

Oil major BP to cut 15 percent of workforce

LONDON - BP will cut about 15 percent of its workforce in response to the coronavirus crisis and as part of Chief Executive Bernard Looney's plan to shift the oil and gas major to renewable energy, it said on Monday.

Looney told employees in a global online call that the London-based company will cut 10,000 jobs from the current 70,100.

"We will now begin a process that will see close to 10,000 people leaving BP – most by the end of this year," Looney said in a statement.

Reuters had earlier reported the planned job cuts, citing three company sources.

BP shares were up 3.3 percent by 1230 GMT, against a 2.2 percent gain for the broader European energy sector.

The affected roles will be mostly senior office-based positions and not front-line operational staff, the company said.

About a fifth of the job cuts will take place in Britain, where BP employs 15,000 people, a company spokesman said.

Like all the world's top energy companies, BP has cut its 2020 spending plans after the coronavirus pandemic brought an unprecedented drop in demand for oil. BP has flagged a 25 percent cut to $12 billion this year and said it would find $2.5 billion in cost savings by the end of 2021 through the digitalization and integration of its businesses.

On Monday, however, Looney said the company is likely to need to cut costs even further.

BP is giving no pay rises to senior employees until March 2021 and said it is unlikely to pay any cash bonuses this year.

ENERGY TRANSITION

The job reductions are also part of Looney's drive to make the 111-year-old oil company more nimble as it prepares for the shift to low-carbon energy, the sources said.

"It was always part of the plan to make BP a leaner, faster-moving and lower-carbon company," Looney said.

The spokesman said that the coronavirus crisis "amplified and accelerated" BP's transition plans.

Looney last month announced a large round of senior management appointments, halving the size of BP's leadership team under his plan to reshape the company's structure.

Shortly after taking office in February, the 49-year-old CEO said that he was creating 11 divisions to "reinvent" BP and dismantle the traditional structure dominated by its oil and gas production business and its refining, marketing and trading division.

Chevron Corp, the second-largest U.S. oil producer, last month said that it will cut between 10 percent and 15 percent of its global workforce as part of an ongoing restructuring.

Royal Dutch Shell, meanwhile, has initiated a voluntary redundancy program.

(Reporting by Ron Bousso and Shadia Nasralla Editing by Louise Heavens and David Goodman)

-reuters-

Saudi, Russia reach deal on oil cuts, raising pressure for compliance

DUBAI/MOSCOW - OPEC leader Saudi Arabia and non-OPEC Russia have agreed a preliminary deal to extend existing record oil output cuts by one month while raising pressure on countries with poor compliance to deepen their cuts, OPEC+ sources told Reuters.

OPEC+ agreed to cut output by a record 9.7 million barrels per day, or about 10% of global output, in May and June to lift prices battered by plunging demand linked to lockdown measures aimed at stopping the spread of the coronavirus.

Rather than easing output cuts in July, OPEC and its allies, a group known as OPEC+, were discussing keeping those cuts beyond June.

"Saudi Arabia and Russia are aligned on the extension for one month," one OPEC source said.

"Any agreement on extending the cuts is conditional on countries who have not fully complied in May deepening their cuts in upcoming months to offset their overproduction," the source said.

The group also considered holding an online meeting on June 4 to discuss output policy, after Algeria, which holds the presidency of the Organization of the Petroleum Exporting Countries, proposed bringing forward a meeting planned for June 9-10.

The OPEC source said that an earlier meeting on June 4 is also conditional on compliance and that the discussions now are about implementing criteria for those countries who have not fully complied with the oil cuts and how they can compensate for their overproduction in the coming months.

OPEC members Iraq and Nigeria has shown weak compliance with its output reduction targets in May. OPEC/O

Kazakhstan also failed to fully meet its obligations under the OPEC+ oil cut pact, sources said.

Two sources also told Reuters that Gulf OPEC producers Saudi Arabia, Kuwait and the United Arab Emirates are not discussing extending their deeper voluntary oil cuts of 1.180 million bpd beyond June.

Oil prices rose in recent days from the lows of April buoyed by a continuing recovery in China, the epicenter of the coronavirus outbreak, while other economies are slowly opening up after lockdowns to contain its spread.

"Overall the market is moving in the right direction with the gradual easing of the lockdown. But we still need to be cautious. There is always a risk of another wave of the coronavirus," the first OPEC source said.

"The other thing is how quickly will demand patterns recover. Inventories are still above average levels and that needs to be tackled." (Reporting by Rania El Gamal and Olesya Astakhova, editing by Louise Heavens and David Evans)

-reuters-

Crude crash brings down Singapore oil tycoon

SINGAPORE -- Singapore tycoon O.K. Lim built up his oil empire from a single-truck outfit through hard work and high-risk gambles, a rags-to-riches tale that made him a legend among crude traders.

But it all came crashing down when oil markets were plunged into unprecedented turmoil by the coronavirus pandemic and revealed the keen poker player appeared to have overplayed his hand.

Lim -- who projected a down-to-earth image but was, according to people who knew him, a "major risk-taker" -- dashed to court seeking protection from creditors for his firm Hin Leong Trading last month.

In a bombshell affidavit seen by AFP, Lim revealed the oil trader had "in truth... not been making profits in the last few years" -- despite having officially reported a healthy profit in 2019.

He admitted the firm he founded in the 1960s after emigrating from China had hidden $800 million in losses over the years, while it also owes almost $4 billion to banks.

Lim took responsibility for ordering the company, one of Asia's biggest oil traders, not to report the losses and also confessed it had sold off inventories that were supposed to backstop loans.

Hin Leong -- meaning "prosperity" in Chinese -- is one of the biggest industry casualties yet of the crude market collapse, and its demise last month marks an ignominious fall from grace for Lim.

'Major risk-taker'

The businessman -- whose full name is Lim Oon Kuin -- started the company with a single delivery truck shortly before Singapore became independent in 1965.

It grew into a major supplier of fuel used by ships, and its rise in some ways mirrored Singapore's growth from a gritty port to an affluent financial hub.

The firm played a key role in helping the city-state become the world's top ship refuelling port, observers say, and it expanded into ship chartering and management with a subsidiary that has a fleet of more than 150 vessels.

The picture that emerges of Lim himself, now in his 70s, is complex.

On one hand, he was a low-profile individual who sought to project a humble image -- you would not know he was a wealthy tycoon if you saw him walking down the street, according to those who knew him.

But he maintained a firm grip on Hin Leong, with one oil trader in Singapore -- who spoke anonymously -- describing him as a "typical Asian patriarch making all the decisions for the family business".

Jorge Montepeque, a veteran crude market executive who did business with Lim for a decade until 2001, said the Hin Leong founder could appear "almost detached" in meetings, as if unaware of what was happening.

"But that's not true, he very much knows what is going on... The reality is that he has been a major risk-taker," he told AFP.

'Too big to fail'

The firm's collapse has prompted a police investigation and sent shockwaves through the financial community, with a government agency offering assurances that the city-state's "oil-trading sector remains resilient".

The Singapore oil trade told AFP: "Nobody appeared to have thought that anything was amiss.

"The sentiment was that Hin Leong was too big to fail."

But it appears that taking risks and failing to hedge against a downturn came back to bite Hin Leong when it was hit by a double blow -- a Saudi-Russia price war and a virus-triggered demand shock.

Global oil demand has collapsed by around a third, according to some estimates, as the virus pandemic brings economic activity to a standstill.


A slide presentation made by Hin Leong for creditors before it went to court showed the company had total liabilities of $4.05 billion against assets of $714 million.

Bank debts of $3.85 billion comprised the lion's share of its liabilities -- with large sums owed to lenders including HSBC, Dutch bank ABN Amro and France's Societe Generale.

"What caught many by surprise was that they didn't have the cash. I mean, these guys were big," the oil trader said.

Hin Leong did not respond to requests to comment from AFP.

Lim has stepped down from his positions as director and managing director, although Hin Leong's final fate is still uncertain at this stage.

Observers say that the firm had likely hoped China would contain the virus and the oil market turmoil would be short-lived.

But such a strategy, said oil executive Montepeque, was like "taking all your assets and putting them all on the red on the casino roulette".

And after reading Lim's confessions, Montepeque said he believed the "game was up" for Hin Leong.

Agence France-Presse

Shell cuts dividend for first time since 1940s as oil demand collapses

LONDON - Royal Dutch Shell cut its dividend for the first time in 80 years and suspended the next tranche of its share buyback program on Thursday following the collapse in global oil demand due to the coronavirus pandemic.

"Given the continued deterioration in the macroeconomic outlook and the significant mid and long-term uncertainty, we are taking further prudent steps to bolster our resilience, underpin the strength of our balance sheet and support the long-term value creation of Shell," Chief Executive Ben van Beurden said in a statement.

Starting in the first quarter, Shell will reduce its quarterly dividend to 16 cents per share from 47 cents in the previous quarter.

For decades, Shell has taken pride in having never cut its dividend since the Second World War, resisting such a move even during the deep downturns of the 1980s.

Shell's first-quarter net income attributable to shareholders based on a current cost of supplies (CCS) and excluding identified items, fell 46 percent from a year earlier to $2.9 billion, above the consensus in an analyst survey provided by the company.

Shell's fourth-quarter net income was also $2.9 billion.

The company said it cut activity at its refining business by up to 40 percent in response to the demand shock. 

-reuters-

Saudi foreign reserves fall at fastest for two decades

RIYADH/DUBAI - Saudi Arabia's central bank foreign reserves fell in March at their fastest rate in at least 20 years and to their lowest since 2011, while the kingdom slipped into a $9 billion budget deficit in the first quarter as oil revenues collapsed.

The world's largest oil exporter is suffering from historic price lows, while at the same time measures to fight the new coronavirus are likely to curb the pace and scale of economic reforms launched by Crown Prince Mohammed bin Salman.

The Saudi Arabian Monetary Authority said late on Tuesday its net foreign assets, which include securities such as U.S Treasuries and foreign deposits, fell in March to $464 billion, their lowest in 19 years.

The nearly $27 billion decline - the biggest monthly drop in at least two decades - signals the kingdom's urgent need to tap into reserves to offset economic damage from oil prices and a severe coronavirus-driven slowdown of non-oil sectors.

"We believe that the magnitude of the drop ... reflected both higher government funding to cover the budget deficit and the support packages announced in March to help counterbalance the impact of COVID-19," said Monica Malik, chief economist at Abu Dhabi Commercial Bank (ADCB).

Finance Minister Mohammed al-Jadaan said last week the kingdom would limit its drawdown to a maximum of $32 billion from reserves this year to fill a widening deficit which it plans to cover instead by increasing borrowing to nearly $60 billion.

Early on Wednesday, the finance ministry reported a first quarter budget deficit of $9 billion, mostly because of a drop in oil revenues that reversed a first quarter surplus of around $7.4 billion in 2019.

Oil revenues in the first three months of the year posted a 24% annual decline to $34 billion and pushed total revenues down 22% year on year.

Saudi Arabia, which had registered more than 20,000 coronavirus cases as of Tuesday with 152 deaths, had originally projected a $50 billion deficit this year, or 6.4% of gross domestic product (GDP), widening from around $35 billion last year.

Jadaan has said the deficit could now widen to up to 9% of GDP this year, but some analysts have predicted 22% with oil prices at $30 a barrel.

PRICE PLUNGE

International oil prices have shed around two thirds value since the start of this year and are trading around $21.

"If Finance Minister al-Jadaan's plans are for merely $32 billion of reserves drawdown then, following a $27 billion reduction in March alone, that means almost all the remainder will be covered by new sovereign debt issuance, assuming there are no further privatisations, because of market conditions," said Hasnain Malik, head of equity strategy at Tellimer.

Saudi Arabia and other large producers recently agreed to cut output by almost 10 million barrels per day (bpd), in May-June, in an attempt to balance the market, but demand kept falling nonetheless due to the global slowdown.

Jadaan said last week he expects the pandemic to cause a slump in activity in the non-oil private sector too this year and that the government could take more actions on top of $32 billion in emergency stimulus measures announced last month.

Private sector loan growth, however, was solid in March, central bank data showed, "potentially reflecting the higher borrowing requirements of corporates with COVID-19 impacting cash flows," said ADCB's Malik.

Non-oil revenues in the first quarter fell 17% compared to the same period one year earlier, with revenues from taxes on goods and services plunging, in a sign of overall slowdown.

Saudi Arabia has already cut its 2020 budget by nearly 5% and further spending curbs are likely.

In Q1, however, capex spending declined only 4%, the finance ministry said.

Riyadh last month raised its debt ceiling to 50% of GDP from 30%. It has already borrowed $12 billion in international bonds this year.

($1 = 3.7600 riyals) (Reporting By Marwa Rashad and Davide Barbuscia; Additional reporting by Ahmed Tolba; Editing by Himani Sarkar, Shri Navaratnam, Barbara Lewis and Andrew Cawthorne)

-reuters-

Oil plunges again as virus ravages energy markets

SINGAPORE - Brent crude plunged more than 12 percent to below $17 a barrel Wednesday while US oil erased early gains and fell, as the coronavirus strangles demand and ravages energy markets, while storage facilities approach full capacity. 

In another day of volatile trading, US benchmark WTI surged in early Asian deals while Brent also edged up on news that top producers had held talks -- only for prices to suddenly change course.

Brent dropped 12.31 percent to $16.98 a barrel, extending heavy losses from a day earlier. 

WTI for June delivery, which had rebounded about 20 percent at the open, was down around five percent at $11 a barrel in the afternoon.

On Monday, WTI for May delivery collapsed to an unprecedented low of minus $40.32 as traders scrambled to sell it before the contract expired Tuesday, but could find few buyers with storage capacity fast filling up. 

The negative prices meant that traders were forced to pay to have the crude taken off their hands.

Analysts said the morning bounce was driven by news that members of exporting group OPEC, as well as some allies in the OPEC+ grouping, held a teleconference Tuesday -- but grim reality soon returned to the markets. 

Prices have plunged as lockdowns and travel restrictions introduced worldwide to stem the spread of the virus hammer demand, and observers believe there is little way out for oil except bringing an end to the pandemic. 

"The overtly bearish sentiment may well keep prices suppressed in the near-term until we find the light at the end of the tunnel with progressive resumption of halted economic activities across the globe," said Jingyi Pan, a market strategist with IG.

US crude has been particularly hard-hit because of storage problems, as WTI is delivered at a single, inland point, although the sell-off has now spread to Brent. 

The crisis was worsened by a price war between Saudi Arabia and Russia. They drew a line under the dispute earlier this month and, along with other top producers, agreed to slash output by almost 10 million barrels a day to shore up virus-hit markets. 

But that has had little effect, with prices continuing to plummet, as analysts predict it will not make up for the massive hit to demand. 

Agence France-Presse

Saudi says total oil curbs could reach 19.5 million barrels

RIYADH - Oil output cuts by OPEC and its allies, together with pledges from other G20 nations and purchases by strategic reserves, could remove 19.5 million barrels per day from the market, the Saudi energy minister said.

US President Donald Trump said Monday that the actual output cuts may be deeper than the headline figure of 9.7 million bpd -- with top producers considering slashing output by 20 million barrels a day under the deal.

"People are saying 10 million but we think the number they will actually hit is going to be closer to 20 million barrels a day," Trump said at a press briefing. 

He did not give details, but the figures chime with the Saudi breakdown.

The OPEC+ alliance, led by Riyadh and Moscow, agreed on Sunday to slash daily production by 9.7 million bpd over the next two months to arrest a slump triggered by the coronavirus shutdown and a price war between Saudi Arabia and Russia.

Saudi media on Tuesday quoted Energy Minister Prince Abdulaziz bin Salman as saying that G20 producers outside OPEC+ have pledged to cut 3.7 million bpd.

He also estimated purchases for countries' strategic petroleum reserves for use in emergencies at 200 million barrels over May and June, boosting the total impact to 19.5 million bpd.

Prince Abdulaziz said the kingdom could cut below its quota of 8.5 million bpd if necessary.

According to the deal, Saudi Arabia and Russia will cut 2.5 million bpd each from their production of 11 million bpd in October 2018.

But the minister was quoted by Energy Intelligence as saying that Riyadh will effectively be cutting 3.8 million bpd from current record-high output levels of 12.3 million bpd which were boosted during the price war.

Other Gulf states will be also cutting from recently increased output levels, he said.

"So, in reality, what OPEC+ will be doing effective May 1 will be a total of 12.5 million bpd," the minister said. 

The spread of the coronavirus has hit oil demand hard, with experts estimating that one-third of global demand -- which stood at 100 million bpd before the disease -- is being wiped out.

"We have to watch what is happening with demand destruction and demand improvement, depending on how things evolve," the minister said.

Agence France-Presse

Oil, equities slip as OPEC+ cut fails to lift confidence

TOKYO -- Oil prices and US stock futures dipped in early Monday trade as a landmark agreement by OPEC and its allies to slash output by a record amount failed to give investors any cause for lasting optimism about the economic outlook.

US S&P 500 mini futures dropped 1.54 percent, erasing a brief gain to a one-month high made right after the start of trading.

Nikkei futures traded in Chicago suggest Tokyo's benchmark is likely to slip about 0.2 percent.

US crude futures dropped to $22.67 per barrel, down 0.4 percent as they quickly erased earlier gains to hit the lowest level since April 2.

Brent futures were down 0.67 percent at $31.27 per barrel, having risen to $33.99.

A group of oil producing countries known as OPEC+, which includes Russia, said it had agreed to reduce output by 9.7 million barrels per day (bpd) for May-June, after four days of marathon talks.

A bigger question for investors, however, is whether the novel coronavirus pandemic, which has ravaged global economic growth, will soon peak in the United States and Europe, as had been hoped.

"While panic selling we saw last month has faded, not many investors would want to chase stock prices higher given we are about to see more evidence of economic downturns," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management.

OPEC+ said in a draft statement seen by Reuters it expected total global oil cuts to amount to more than 20 million bpd, or 20 percent of global supply, effective May 1.

That includes contributions from non-members, steeper voluntary cuts by some OPEC+ members and strategic purchases by the world's largest consumers, sources said.

Still, that falls short of completely offsetting an estimated 30 million bpd drop in worldwide fuel consumption caused by the COVID-19 pandemic.

"In the short term, the WTI may hold above $20 after the deal but it could fall below that level unless all the countries follow up their words with actions," said Tatsufumi Okoshi, senior economist at Nomura Securities.

Also in focus this week, US companies announce their earnings, starting from big banks, and China releases its trade data on Tuesday and closely watched gross domestic product data on Friday.

In foreign exchange markets, risk-sensitive currencies were softer while the safe-haven dollar and the yen found support.

The Australian dollar fell 0.3 percent to $0.6303 while the Mexican peso dropped 0.4 percent to 23.430 per dollar.

The euro stood flat at $1.0934 and the yen gained 0.15 percent to 108.34 to the dollar.

-reuters-

OPEC, Russia meet again to approve biggest ever oil cut

BAKU/DUBAI/LONDON - OPEC, Russia and other oil producing nations were meeting on Sunday in a bid to clinch a deal on the biggest oil cut ever, amounting to 10 percent of global supply, after their initial efforts to support oil prices amid the coronavirus pandemic were blocked by Mexico.

The group, known as OPEC+, was expected to start a video conference at 1600 GMT.

On Thursday, OPEC+ outlined plans to cut output by more than a fifth, or by 10 million barrels per day (bpd), but Mexico balked at the production cuts it was asked to make, delaying the signing of a final deal.

"The ministerial meeting between OPEC and non-OPEC members is a follow-up after the April 9 meeting," the energy ministry of OPEC+ member Azerbaijan said on Sunday.

Measures to curb the spread of the coronavirus have destroyed demand for fuel and driven down oil prices, straining budgets of oil producers and hammering the U.S. shale industry, which is more vulnerable to low prices due to its higher costs.

OPEC+ also said it wanted producers outside the group, such as the United States, Canada, Brazil and Norway, to cut a further 5% or 5 million bpd.

Canada and Norway signalled willingness to cut and the United States, where legislation makes it hard to act in tandem with cartels such as OPEC, has said its output would fall steeply by itself this year due to low prices.

Mexico President Andres Manuel Lopez Obrador said on Friday that U.S. President Donald Trump had offered to make extra U.S. cuts on his behalf, an unusual offer by a Trump who has long railed against OPEC.

Trump, who had threatened Saudi Arabia with oil tariffs if it did not fix the market's oversupply problem, said Washington would help Mexico by picking up "some of the slack" and being reimbursed later.

He did not say how this would work and OPEC leader Saudi Arabia has so far refused to accept the fix, according to OPEC sources.

Global oil demand is estimated to have fallen by a third as more than 3 billion people are locked down in their homes due to the coronavirus outbreak.

A 15 percent cut in supply might not be enough to arrest the price decline, banks Goldman Sachs and UBS predicted last week, saying Brent prices would fall back to $20 per barrel from $32 at the moment and $70 at the start of the year.

(Reporting by Reuters OPEC Team, Nailia Bagirova in BAKU, Katya Golubkova in MOSCOW and Tamara Vaal in NUR-SULTAN; Writing by Andrey Ostroukh and Dmitry Zhdannikov; Editing by Jason Neely, Alsion Williams and Alex Richardson)

-reuters-

Oil crash piles pressure on virus-hit Saudi economy

RIYADH - From empty hotels to shuttered beauty salons, oil-dependent Saudi Arabia is bracing for a coronavirus-led economic slump on top of possible austerity measures as crude prices go into free fall.

Huge losses are expected after the Arab world's biggest economy shut down cinemas, malls and restaurants, halted flights, suspended the year-round umrah pilgrimage and locked down eastern Qatif region -- home to around 500,000 -- in a bid to contain the deadly virus.

The top crude exporter also faces plummeting oil prices, which slipped below $30 a barrel this week for the first time in four years, on the back of sagging demand and a price war with Russia.

The shock of this liquidity sapping cocktail of events has necessitated austerity measures which are likely to imperil grandiose diversification projects.

Adding to the chain of events are the recent arrests of King Salman's brother and nephew, which triggered speculation of political instability amid the government's public silence on the royal purge.

"It's crisis time," said a Saudi government employee, explaining why he had begun converting part of his salary into US dollars and gold coins.

"Everything is unpredictable and we should be ready for the worst."

The central bank has shrugged off fears that plunging oil prices were straining the kingdom's currency, pegged for decades to the US dollar.

A jeweller in Riyadh told AFP he had fielded a number of enquiries to convert "substantial amounts of cash" into gold bars and coins.

SPENDING CUTS

Many government workers fear cuts to state allowances are coming despite rising living costs.

Some Saudis also worry that recruitment in the public and private sectors will freeze, just as unemployment was already high. 

Meanwhile, Saudi students are worried that government scholarships for overseas education will take a hit.

The finance ministry has instructed government bodies to submit proposals to slash this year's spending by 20 to 30 percent, the economic consultancy Nasser Saidi and Associates said in a research note.

"This will likely take the shape of postponed projects and delays in awarding contracts" among other economizing measures, the note said.

The kingdom is now preparing budget scenarios in which crude prices could drop as low as $12 to $20 per barrel, according to the Energy Intelligence Group.

"Public confidence depends on government spending and oil sentiment -— both are down," said a consultant advising a Saudi ministry on a major project.

"We don't know if we will have our jobs tomorrow."

The once free-spending OPEC kingpin has instructed Saudi ministries that they need to account for "every penny" they spend, the consultant added.

Saudi authorities did not respond to requests for comment.

Several Riyadh hotels —- many of them empty amid falling tourist numbers —- have been forced to send their staff on unpaid leave.

But providing some support, the health ministry has booked multiple Riyadh hotels to quarantine people after the coronavirus scare, according to several staff and guests who were forced to empty the properties at short notice.

'SURVIVAL OF FITTEST'

The oil crash follows the crude exporter's decision to hike production from April and offer the biggest price cuts in two decades, in retaliation for Russia's refusal to tighten supply as the virus saps demand.

Saudi Arabia has shrugged off criticism that the move could bankrupt its oil-producing rivals, indicating it was no longer willing to play the role of "swing producer" that bears the burden of stabilizing the markets.

"The days of Saudi Arabia absorbing oil market shocks on behalf of the global economy and other producers are probably over," said Saudi expert and author Ali Shihabi. 

"The energy game... is now a survival of the fittest."

The deep-pocketed kingdom, with fiscal reserves of around $500 billion, has reiterated it is an ultra low-cost producer of crude and can withstand low prices for years.

But Riyadh has posted a budget deficit every year since the last oil price rout in 2014. It has borrowed over $100 billion and drawn from its reserves to plug the deficit.

Crown Prince Mohammed bin Salman's multi-billion dollar projects to wean the economy away from oil remain vulnerable, and Saudi Arabia needs a crude price of about $80 a barrel to balance its budget.

As economic challenges rise, the detention of royal princes Ahmed bin Abdulaziz al-Saud and Mohammed bin Nayef has fueled fears of instability.

One source close to the royal court dismissed such concerns and said the detentions were meant to send a stern warning within the royal family not to oppose the crown prince.

Yet "the threat to Prince Mohammed isn't coming from his royal rivals," said Kristin Diwan of the Arab Gulf States Institute in Washington.

"It's from the collapse of oil revenues and with them his ambitious economic plans."

source: news.abs-cbn.com

Global stocks, oil plunge as Fed virus move fails to ease fears

LONDON - Stock markets and oil prices went into freefall Monday as interest rate cuts and fresh stimulus measures by central banks failed to lift confidence, with analysts warning that the Federal Reserve may have reached the limits of its power to fend off recession as the coronavirus spreads.

Brent North Sea oil plunged more than ten percent to a four-year low, as a price war between major producers Saudi Arabia and Russia added to sliding crude demand caused by the virus.

The euro surged one percent against the dollar after the Fed on Sunday slashed borrowing costs to almost zero -- its second emergency cut in less than two weeks. 

The US central bank also unveiled a massive asset-buying programme, similar to measures put into place during the global financial crisis more than a decade ago.

The Bank of Japan joined in on Monday, saying it would ramp up its bond-buying programme.

New Zealand's central bank also slashed rates to record lows in an attempt to cushion the economic blow, while the People's Bank of China has injected vast sums into financial markets to ease liquidity worries.

In joint action coordinated with the European Central Bank, Bank of England, Bank of Japan, Bank of Canada and the Swiss National Bank, the Fed moved to counteract global "dollar funding pressures" according to its boss Jerome Powell.

But traders were left unimpressed, with the virus showing no sign of letting up, while the head of the World Health Organization chief Tedros Adhanom Ghebreyesus said it was impossible to tell when it would peak globally.

With G7 leaders set to hold crisis videoconference talks later Monday, IMF chief Kristalina Georgieva called Monday for global governments to work together to provide massive spending as in the 2008 financial crisis to help the economy withstand the damage from the coronavirus pandemic.

Trading was halted on Wall Street just after the opening bell, with the Dow dropping nearly 10 percent. 

In afternoon trading in Europe, Paris 10.7 percent, Milan 10.9 percent, Madrid 11.3 percent, Frankfurt 9.5 percent and London 7.9 percent.

Airlines and tourism groups were the biggest fallers after slashing capacity, with TUI down by nearly a third and British Airways-parent IAG crashing 28 percent.

The car sector also slid as carmakers Fiat Chrysler and Peugeot-Citroen said they were halting production.

"While these (central bank) moves may go some way to easing any potential blockages in the plumbing of the financial markets, they won't adequately compensate for the upcoming economic shocks that are about to come our way," said CMC Markets analyst Michael Hewson.

The scale of the crisis was laid bare by data showing Chinese industrial production for January and February shrank 13.5 percent, the first contraction in around 30 years.

Meanwhile, manufacturing activity in New York state fell to its lowest level since 2009, according to the New York Federal Reserve Bank's monthly industry survey.

Equity markets continue to be whipsawed by the disease, which has now infected almost 170,000 people and killed more than 6,000 with several countries going into lockdown as Europe becomes the new epicentre of the outbreak.

ASIA MELTDOWN

Sydney's stock market led losses in Asia-Pacific, tumbling 9.7 percent in its worst daily drop on record, while Manila shed nearly eight percent and Bangkok and Mumbai dropped more than five percent.

Hong Kong, Singapore, Taipei and Jakarta all lost more than four percent. Wellington and Seoul were more than three percent off.

Shanghai tumbled 3.4 percent after the release of the industrial production data, which came a week after news that Chinese exports had collapsed.

Tokyo ended 2.5 percent lower, after a rally sparked by the Bank of Japan's support measures announcement fizzled.

The broad retreat followed a tumultuous week that saw some stock markets suffer their worst days in decades and in some cases their worst ever.

And experts said there was a concern that the Fed might be running on empty with regards to further action.

Sunday's move "raises the question of whether the Fed has anything left in the tank should the spread of the virus not be contained", said Kerry Craig at JP Morgan Asset Management.

"Our view is that the drag on the services sector from social distancing policies and shock from the fall of the oil price on the energy sector will be enough to tip the US into recession, but not necessarily a long one."

source: news.abs-cbn.com

Oil subdued after heavy falls on price war

SINGAPORE — Oil prices were subdued in early Asian trade Thursday following sharp falls overnight, after Saudi Arabia and the UAE escalated a price war by vowing to pump millions more barrels of crude.

Both main contracts fluctuated between small gains and losses. West Texas Intermediate was trading at around $33 a barrel while Brent crude was at about $36 a barrel. 

Crude markets suffered their biggest 1-day drop in a generation on Monday after top exporter Riyadh began a price war following a refusal by Moscow to reduce output to combat the coronavirus impact.

Prices have swung wildly since and fell heavily again Wednesday, mirroring falls on global stock markets, after Saudi Arabia and Gulf partner UAE said they would open the oil taps further.

They said they will together boost production by at least 3.5 million barrels per day (bpd), to 16.3 million bpd, from April.

Investors were also waiting for an address by US President Donald Trump, who is set to explain his plan for tackling the virus outbreak -- which has now been declared a pandemic by global health officials -- and economic assistance. 

The collapse of oil prices came after OPEC kingpin Saudi Arabia had led a push to reduce output further to shore up prices amid slumping demand.

But the move was blocked by Moscow, the world's second-biggest oil producer, prompting Riyadh to slash prices.

Analysts see no end in sight to the turmoil.

"We suspect that Russia and Saudi Arabia may not be interested in a de-escalation for the time being," said investment firm DWS in a note.

Agence France-Presse 

OPEC recommends drastic output cut to counter coronavirus

VIENNA -- Ministers from the OPEC cartel of oil-producing countries on Thursday recommended a drastic production cut of 1.5 million barrels per day to their allies to counter a slump in demand caused by the coronavirus outbreak.

However, it remains to be seen whether the OPEC+ states -- Russia in particular -- will be prepared to countenance such a large cut when they join the meeting of the Organization of Petroleum Exporting Countries on Friday.

OPEC nations -- led by the world's third-largest oil producer Saudi Arabia -- agreed Thursday to recommend "a further adjustment of 1.5 million barrels per day until 30 June 2020," a statement issued by the Vienna-based bloc said.

Countries in the OPEC+ grouping of the cartel's allies would be asked to take on 500,000 barrels of the cuts, the statement added.

Producers had already had to contend with abundant supplies weighing on prices -- agreeing to 500,000-barrels-per-day production cuts at their last meeting in December -- but the spread of COVID-19 across the world has sent prices plunging.

The European benchmark, Brent crude, sank to under $50 per barrel on Sunday, a level not breached since July 2017.

'MIGHT NOT BE ENOUGH'

The success of the summit will above all hang on the alliance between Saudi Arabia and Russia, the most important players in the OPEC and OPEC+ groupings respectively.

Russian President Vladimir Putin was quoted on Sunday as saying the current market price was "acceptable" and above the level foreseen in Russian economic planning.

Russia's RIA Novosti agency reported Wednesday that Moscow's delegation was proposing an extension of the existing deal with no fresh cuts.

Ann-Louise Hittle, an analyst with Macro Oils, said she expected that Russia, world's number 2 producer after the United States, to agree with the cut "given their history of co-operation with OPEC".

Tamas Varga of PVM told AFP that even the recommended extra cuts "might not be enough", saying OPEC's new forecasts for a drop in global oil demand growth may turn out to be "overoptimistic".

"I believe that oil prices will fail to recover significantly for the remainder of the year as the coronavirus crisis drags on," he said.

Some economists believe it is not impossible that the world economy could contract in the first quarter of the year, which implies lower demand for oil than OPEC has been forecasting, although activity is expected to bounce back once the crisis fades.

Oil prices drifted lower after the announcement.

'FOOTSHAKE'

Aside from bridging their differences on the effect of the virus on the market, the assembled officials are also having to accommodate changes to their routines in Vienna.

All those entering the OPEC headquarters have to undergo temperature checks.

After the meeting's opening speech, a medical adviser passed on hygiene guidelines, while assuring delegates that the risk of coronavirus infection in Vienna was "very, very low".

Austria nationwide has recorded more than 40 cases so far.

On Wednesday, OPEC's Secretary General Mohammed Barkindo and Russian Energy Minister Alexander Novak were seen in a video tweeted by the organisation attempting a "footshake", gently bumping the sides of their feet together in a more hygienic alternative to a handshake.

The cartel has also barred access to its headquarters for the media due to the "risk that would come from convening such a vast number of people in one place".

Livestreams of the beginning of meetings are instead being made available to journalists at a press center in a nearby hotel.

In a statement on Tuesday, OPEC said it was following UN guidelines and planned to "shorten the format of such gatherings, limit the number of participants and cancel any related side-events".

Agence France-Presse

OPEC divided on how to combat coronavirus fallout

VIENNA - Ministers from the OPEC group of oil-producing countries will meet in Vienna Thursday to try to overcome their divisions on how to react to the fall in oil prices in the wake of the novel coronavirus epidemic.

The group already had to contend with abundant supply on global markets weighing on prices but the spread of COVID-19 across the world has sent them plunging.

The European benchmark of Brent sank to under 50 dollars on Sunday, a level not reached since July 2017.

The effects of the virus on global demand -- particularly in worst-hit China -- has blown a hole through the group's attempt to support prices at its last meeting in December by agreeing on production cuts.

The only option for OPEC -- and its allies in the OPEC+ grouping who will be joining meetings on Friday -- would appear to be another round of production cuts.

The success of the summit, which has been called 3 months ahead of the next scheduled meeting, will above all hang on the alliance between Russia and Saudi Arabia, the world's second and third-biggest producers and the most important players in the OPEC and OPEC+ groupings respectively.

"Their objective will be to overcome their differences of opinion so as to be able to speak with one voice from tomorrow," said Carsten Fritsch, analyst at Commerzbank.

DIVISIONS LAID BARE

The splits on the way forward even within OPEC were on display on Wednesday as delegations arrived.

The chairman of Libya's National Oil Corporation Mustafa Sanallah said he was wary of any additional cuts.

"I think there's no need to reduce," Sanallah told AFP, adding: "I think the price is good right now."

However Iran's Oil Minister Bijan Namdar Zanganeh said a cut of "at least... around half a million barrels" was necessary to stabilize the market.

Saudi Arabia is also a supporter of further cuts, with Riyadh even thought to be amenable to a cut in the order of a million barrels per day.

But Russia may be harder to convince on this score, with Russian President Vladimir Putin being quoted on Sunday as saying the current market price was "acceptable" and above the level foreseen in Russian economic planning.

Russia's RIA Novosti agency reported Wednesday that Moscow's delegation was proposing an extension of the existing deal with no fresh cuts.

FOOTSHAKE

Aside from bridging their differences on the effect of the virus on the market, the assembled diplomats are also having to accommodate changes to their routines in Vienna.

Two medical workers were on hand to screen the temperatures of all those entering OPEC headquarters on Wednesday.

OPEC's Secretary General Mohammed Barkindo and Russian Energy Minister Alexander Novak were seen in a video tweeted by the organization attempting a "footshake", gently bumping the sides of their feet together in a more hygienic alternative to a handshake.

The cartel has also taken the extraordinary step of barring access to its headquarters for the media due to the "risk that would come from convening such a vast number of people in one place".

Livestreams of the beginning of meetings will instead be made available to journalists at a press center assembled in a nearby hotel.

In a statement on Tuesday OPEC said it was following UN guidelines for such meetings and planned to "shorten the format of such gatherings, limit the number of participants and cancel any related side-events".

source: news.abs-cbn.com