Oil prices fall but market wary over supply outages

LONDON (Reuters): Oil prices fell sharply on Monday as concerns about supply disruptions eased and Libyan ports reopened while traders eyed potential supply increases by Russia and other producers. Benchmark Brent crude dropped more than 3 percent to a low of $73, before recovering slightly to around $73.15 by 1340 GMT. U.S. light crude was down $1.70 at $69.31. “The energy complex is a sea of red as concerns about supply outages subside,” said Stephen Brennock, analyst at London brokerage PVM Oil Associates. Supply outages in Libya, a labour dispute in Norway and unrest in Iraq all helped to push oil prices higher late last week, though prices still fell for a second straight week. Russia and other oil producers could raise output by 1 million barrels per day (bpd) or more if shortages hit the market, Russian Energy Minister Alexander Novak told reporters on Friday. “If we need more than 1 million bpd, I don’t rule out that we can quickly discuss it and make a quick decision,” he said.

Commerzbank commodities analyst Carsten Fritsch said the outlook for supply was unclear, with news of disruptions from several oil producers, but Saudi Arabia and Russia had reminded the market of their determination to pump more oil if needed.

“Novak’s comments indicate that Russia and Saudi Arabia could raise production fast if needed,” Fritsch said.

Production at Libya’s giant Sharara oilfield was expected to fall by at least 160,000 bpd after two workers were abducted in an attack by an unknown group, the National Oil Corporation said on Saturday. A Norwegian union for workers on oil and gas drilling rigs stepped up a six-day strike on Monday.

In Iraq, two protesters died on Sunday in clashes with security forces in the town of Samawa amid anger in southern cities over public services and corruption. Demonstrations have yet to affect crude production. Reinforcing supply concerns were comments published on Monday by U.S. Treasury Secretary Steven Mnuchin, who said the US aim was to squeeze Iranian oil exports “to zero”.

Mnuchin said that Washington wanted to avoid disrupting markets and would in some cases consider waivers, but that it had been made clear to allies that it expects them to enforce sanctions against Iran.

Investors were also on edge over the impact of the trade dispute between the United States and its big trading partners.

U.S. President Donald Trump and Russian President Vladimir Putin held their first stand-alone meeting in Helsinki on Monday. Trump has been vocal about his dissatisfaction with higher oil prices , asking OPEC to lower them.

Tourism strategy in final stages: PTDC

ISLAMABAD (APP): Formation of National Tourism Strategy is the final stages of completion, aims to promote tourism in the country. General Manager, PTDC Ali Akbar Malik stated this while addressing a panel discussion at the Meet Pakistan Conference through Arts, Culture and Society, organized by the Pak-US Alumni Network. He said that promotion of tourism in the country is the first priority of PTDC and efforts will be continued in this regard. "Due to the improvement in the security situation in the country, domestic tourism has increased significantly compared to last few years" he said. He added that along the CPEC, there are opportunities for investment in every tourism sector from Khunjrab to Gwadar. "For the development of tourism, the involvement of local community is essential so that high and quality facilities are made available to the foreign as well as domestic tourists" he said. Ali Akbar Malik said that the natural scenes, historical and cultural heritage and hospitable people of have a unique blend the world's tourist which makes it an outstanding country.

He said that new dimensions are being introduced to tourists' entertainment, including air and rail safari, tourism satellite channels etc.

President of the Sustainable Tourism Foundation and PTDC’s Honorary Coordinator, Aftabur Rehman Rana, while briefing on ECO-tourism said that some important steps are required to be taken to promote tourism in the country, which include establishment of a National Tourism Authority in order to promote tourism in the country as well as highlight the identity of the country.

On this occasion, PTDC established a Tourist Information Counter where tourism brochures and publications were distributed to the participants of the conference, while souvenirs were presented to senior figures.

China says its slow growth will damage global economy

BEIJING (AFP): China said on Monday its economic growth slowed slightly in the second quarter as a trade war with the United States gained pace, while it warned of the global damage that could be caused if the row persists. The world's second-biggest economy expanded 6.7pc in April-June, down from 6.8pc in the first quarter and in line with a forecasts in an AFP survey of economists. The data was released just as European Council President Donald Tusk said at an EU summit with China in Beijing that trade tensions could spiral into a "hot conflict", calling on the US, China and Russia to find a resolution. Despite the quarterly deceleration, growth was still higher than the annual target of around 6.5pc set by the government, but China nevertheless faces an "extremely complex environment both at home and abroad", said Mao Shengyong, a spokesman for the national statistics bureau. Beijing faces a multi-front battle to defend its economy, fighting to cut its debt mountain while the yuan currency and Chinese stock markets tumble.

"World trade protectionism continues to heat up, posing a major challenge to the world economic recovery and adding challenges and uncertainties for us," Mao said.

"From our domestic perspective, economic development has still been unbalanced and unstable, and is still in the process of structural adjustment and transformation."

The impact of the deepening trade conflict with the United States was yet to fully kick in, Mao said, noting that Beijing would continue to assess the situation in the second half of the year.

- Slowing down -

But he added that the fight "will have an impact on the economies of both China and the United States, and now that the world economy is deeply integrated, and the industrial chain is globalised, many related countries will also be affected", Mao said.

The dispute with Beijing comes on top of Washington's confrontations with other major trading partners including Canada, Mexico and the European Union, which have also retaliated against the US.

Washington and Beijing imposed tit-for-tat tariffs on $34 billion of goods this month and the US raised the stakes last week by threatening to impose measures on another $200 billion worth of goods, prompting China to vow retaliation.

Over the past decade, about 20 percent of China's exports have gone to US markets, according to Moody's Investors Services, with exports still accounting for a sizeable chunk of the giant economy.

Trump's latest threat would mean Washington will have imposed tariffs on around half of China's total exports to the United States.

"China's economy appears to be on a slowing path. The government seems to be easing policy gently... despite its goal of minimising financial risks," said Alaistair Chan of Moody's.

"Trade disputes with the US have hurt market sentiment, and investment is also cooling."

Beijing's battle against debt has curtailed spending -- with growth in fixed asset investment slumping to 6.0 percent in the first half of the year, the slowest pace on record.

Manufacturing activity also slowed in June, as did output at factories and workshops.

Although trade data last week showed China's export machine holding up, analysts warned the numbers may have been inflated by exporters pushing out shipments early to beat the scheduled tariffs.

Retail sales, a key gauge of Beijing's campaign to rebalance its economy toward domestic consumption, provided a bright spot, growing 9.0 percent in June.

The yuan's slide is hurting Chinese consumers while helping exporters who face the higher US tariffs.

- Stimulus measures -

"The upshot is that the statistics bureau is now starting to more publicly acknowledge that the economy is losing steam," said Julian Evans-Pritchard, China economist at Capital Economics, wrote in a research note.

"This should make it easier for officials to justify shifting to a more supportive policy stance."

The statistics bureau said economic progress must be balanced with "maintaining stability", indicating supportive policy measures could be rolled out as needed.

Noting the fall in infrastructure investment, Mao said "compliant projects may come to fruition at a faster pace" in the second half of the year.

China's central bank has taken steps to free up funding for small firms, and some analysts forecast an interest rate cut to stimulate the economy.

Bank of America beats on consumer loan profit growth, lower expenses

NEW YORK (Reuters): Bank of America Corp reported quarterly profit above expectations as the second-largest U.S. lender cut expenses and benefited from growth in loans and deposits on the back of a strengthening economy. The bank, like its other Wall Street peers, is getting a boost from recent moves by regulators and politicians to lower tax rates and raise interest rates. But concerns around an escalating trade war between the United States and China have cast some doubt on future loan growth. BofA’s total loans increased 2 percent in the quarter, with its consumer banking and wealth management businesses both recording growth of about 7 percent. In comparison, JPMorgan Chase & Co’s core loans, which exclude consumer credit and loans to the biggest corporations, rose 7 percent. Citigroup Inc’s total loans rose 5pc. “Solid operating leverage and client activity drove earnings higher this quarter... We grew consumer and commercial loans; we grew deposits,” CEO Brian Moynihan said in a statement.

Moynihan’s efforts to cut costs and trim the bank’s sprawling operations is also paying off, with noninterest expense dropping 5 percent in the quarter.

In the ninth year into his role, Moynihan has put much of the expenses stemming from the financial crisis behind the bank.

BofA’s shares rose 1 percent in premarket trading.

Net income applicable to common shareholders rose 36.3 percent to $6.47 billion in the second quarter.

Excluding items, it earned 64 cents per share compared with the average expectation of 57 cents per share, according to Thomson Reuters.

Net interest income rose 6 percent as the bank’s large stock of deposits and rate-sensitive mortgage securities helped it take advantage of four interest rate hikes in the past year.

Revenue, net of interest expense, fell 1 percent to $22.76 billion. Revenue in the year earlier quarter included a $793 million pretax gain on the sale of the bank’s non-U.S. consumer card business. Analysts had expected revenue of $22.29 billion.

(This version of the story has been refiled to correct to say that Moynihan is into his ninth year as CEO, not seventh, in paragraph 7.)