Oil price tumbles nearly 4% as OPEC Plus meeting delayed

Crude oil prices fell nearly 4% on Wednesday as OPEC Plus producers delayed a meeting on output planned for Sunday, raising questions about the future course of crude production cuts. Brent crude futures declined 3.7%, to US$79.40 a barrel by 1313 GMT and WTI crude futures were down 3.82%, to US$74.80.

OPEC Plus delayed its ministerial meeting scheduled for November 30, OPEC said in a statement, without giving a reason for the postponement.

Earlier on Wednesday, Bloomberg News reported that the OPEC Plus meeting could be delayed for an unspecified period of time after Saudi Arabia expressed its dissatisfaction with other members about their output numbers.

Analysts had predicted before the delay that OPEC Plus was likely to extend or even deepen oil supply cuts into next year.

Both Brent and WTI oil benchmarks have fallen for four straight weeks.

 

Two ships divert course away from Red Sea

Two commercial ships that diverted their course in the Red Sea and Gulf of Aden were connected to the same maritime group whose vessel was seized by Yemen's Houthis, according to shipping data and British maritime security company Ambrey.

Israel on Sunday said the Houthis had seized a British-owned, Japanese-operated cargo ship in the southern Red Sea, describing the incident as an Iranian act of terrorism with consequences for international maritime security.

The Houthis, an ally of Tehran, confirmed that they had seized a ship in that area but termed it Israeli.

Japan's top government spokesperson on Monday confirmed the capture of the Nippon Yusen-operated ship Galaxy Leader, adding that Japan was appealing to the Houthis while seeking the help of Saudi, Omani and Iranian authorities to work toward the swift release of the vessel and its crew.

Two other ships also listed as commercially managed by Ray Car Carriers, Glovis Star and Hermes Leader, diverted their sailing routes, Ambrey said on Monday.

"The vessel continued to sail back to where it had come from, providing a new AIS destination as Hambantota, Sri Lanka," Ambrey said. "The vessel incurred a minimum four-day business disruption and sailed an additional 1,876 nautical miles."

The Glovis Star drifted for a number of hours in the Red Sea before continuing its journey, AIS ship tracking data showed on Monday.

Isle of Man registered Galaxy Maritime, which is the registered owner of the Galaxy Leader, said in a statement on Monday that the vessel was illegally boarded by military personnel via a helicopter on November 19.

When asked about the other two vessels diverting, a company spokesperson said it was not commenting further on political issues.

Houthi leadership last week said their forces would make further attacks on Israel and they could target Israeli ships in the Red Sea and the Bab al-Mandeb Strait.

US maritime administration MARAD in an advisory said the Galaxy Leader had been hijacked approximately 50 miles west of the Houthi-controlled port of Hodeidah, adding that ships should exercise caution when transiting this area.

"We saw yesterday a new record - for the first time we saw an official announcement of pirates taking over a ship on the high seas, which I think is a major threat to international law and order," Israeli President Isaac Herzog said in comments on Monday, referring to the Galaxy Leader.

 

Iran aims boosting trade with Pakistan

The Islamic Republic of Iran is aiming to expand its economic and trade relations with Pakistan through establishing joint free zones and trade centers with the country, IRIB reported.

According to Ahmad Jamali, the deputy secretary of Iran’s Free Zones High council, Tehran has reached an agreement with Islamabad to establish a joint free zone on the border between the two countries.

“We have identified 200 investment opportunities in potential joint free zones with Pakistan which can be used to boost export to the country,” Jamali said in a meeting held on Monday by the Trade Promotion Organization (TPO) for exploring Iran-Pakistan business opportunities.

Noting that Chabahar free zone in Sistan-Baluchestan Province is a good platform to develop exports from Iran to Pakistan, the official added, “Identifying investment opportunities in free zones can lead to the prosperity of businesses and trade of the two countries’ economic operators.”

Jamali further noted that Iran has considered significant incentives for the exporters to Pakistan and the government fully supports business operators active in the mentioned country.

Mentioning an upcoming exhibition of Iran-Pakistan trade opportunities, which is scheduled to be held in mid-January 2024, Jamali said holding such exhibitions would also be another great way to expand economic relations between the two countries.

Also speaking in the same meeting, Director of TPO’s South Asia Department Hadi Talebian-Moghadam announced a plan for establishing trade centers in Pakistan in the coming months, saying: “We are planning to increase the volume of trade between Iran and Pakistan, because the two countries need each other's goods and products.”

Stating that currently the highest level of trade between Iran and Pakistan is nearly US$2.5 billion, he added. “In the two countries’ strategic cooperation roadmap, we seek to increase the level of exports and exchanges between the two countries to five billion dollars bartering and free trade.”

The value of Iran’s non-oil export to Pakistan increased by 62% during the first seven months of the current Iranian calendar year, as compared to the same period in the past year, the spokesman of the International Relations and Trade Development Committee of Iran's House of Industry, Mining and Trade announced.

Ruhollah Latifi said that Iran exported non-oil commodities worth US$1.14 billion to its neighbor Pakistan in the seven-month period of this year.

He also announced that Iran imported commodities valued at US$352.64 million from Pakistan during the first seven months of this year, with 39% drop YoY.

The official has previously announced that Iran’s non-oil export to Pakistan increased by 18% in the previous Iranian calendar year.

Pakistan was Iran’s fifth largest export market in the previous calendar year, importing non-oil products worth US$1.488 billion from Iran, Latifi said in May.

He added that Iran imported non-oil goods worth $842 million from Pakistan last year, up 170% from the previous year.

The intertwining of economic, security, and transit relations between Iran and Pakistan has made the relations of the two countries beyond the neighborhood and turned them into strategic partners with common interests at the regional level.

Having more than 900 kilometers of joint border can lead to closer cooperation between the two countries in areas such as transit corridors and bilateral trade.

Iran and Pakistan signed a Memorandum of Understanding (MoU) in mid-January to facilitate bilateral trade between the two countries.

The MoU was signed by the former Head of Iran’s Trade Promotion Organization (TPO) Alireza Peyman-Pak and Head of the Trade Development Authority of Pakistan (TDAP) Muhammad Zubair Motiwala.

Based on the MoU, which was signed on the sidelines of Iran’s Exclusive Exhibition in Karachi, the parties pledged to exchange business information, support each other’s private sectors, and provide the conditions and context for the presence of their trade delegations in the other country.

Speaking at the signing ceremony, Peyman-Pak said that signing this MoU was indicative of the two sides’ determination for removing the obstacles in the way of bilateral trade and prepare the ground for the businesspersons of both sides to bolster cooperation.

He considered the holding of exclusive exhibitions, exchanging trade delegations and investment in joint production units as positive steps for knowing the capacities and needs of the two countries and expressed hope that such events would continue.

 

Israel’s ultimate objective: Occupy Gaza energy resources

An expert on Middle East security and nuclear policy specialist at Princeton University says, the ultimate objective of the extremist regime of Benjamin Netanyahu is to expel Palestinians from their homeland Gaza and get control over multi-billion-dollar energy resources.

To realize this goal, Seyed Hossein Mousavian says, as the war continued with no ceasefire in sight, on October 29 Netanyahu’s government awarded 12 licences to six companies, including BP and Italy's ENI, for natural gas exploration off the Mediterranean Basin area.

Following is the text of the article published on November 15 on Middle East Eye: 

After October 07 Palestinian fighters' attack, which killed around 1,200 people and led to hundreds of hostages being taken to Gaza, Israel responded ferociously. 

It has dropped more than 18,000 tons of bombs on Gaza so far, killing more than 12,000 Palestinians - mostly women, children and elderly people - in more than a month of relentless air strikes.

A top UN official in New York recently resigned calling the events in Gaza a textbook case of genocide in which Western governments have been wholly complicit.

Israeli Prime Minister Benjamin Netanyahu has vowed that his country will not surrender until Hamas is eliminated.

As the horrific onslaught enters its seventh week, the issue of energy resources could add another layer of complexity to the ongoing war.

According to the United Nations Conference on Trade and Development (UNCTAD), significant reservoirs of oil and natural gas have been found off the Gaza Strip and elsewhere under the occupied West Bank. 

"The Occupied Palestinian Territory lies above sizeable reservoirs of oil and natural gas wealth, in Area C of the occupied West Bank and the Mediterranean coast off the Gaza Strip. However, occupation continues to prevent Palestinians from developing their energy fields so as to exploit and benefit from such assets," said the study conducted by UNCTAD in 2019.

In this context, the issue of sovereignty over Gaza’s gas fields is vital for Israel.

The Oslo II Accord signed in 1995 gave the Palestinian Authorities (PA) maritime jurisdiction over its waters up to 20 nautical miles from the coast, therefore, the PA signed a 25-year contract for gas exploration with the British Gas Group (BGG) in November 1999.

In 2000, two wells drilled by British Gas off the coast of Gaza revealed gas reserves estimated at 1.4 trillion cubic feet. Sixty percent of those reserves belong to Palestinians. 

In July 2000, the Israeli prime minister granted BGG security authorisation to drill the first well, Marine 1, as part of political recognition by Israel that the well was under PA jurisdiction. 

After Russia invaded Ukraine in February 2022, Europe tried to secure alternatives to Russian energy supplies, and revived a Palestinian initiative to extract natural gas off the coast of Gaza. It was hoped that the US$1.4 billion project - involving the Palestinian Authority, Egypt, Israel and Hamas - could launch gas production by March 2024. 

Such a project could have laid the groundwork for a win-win collaboration between the Palestinians and Israel.

The new resources of oil and natural gas finds in the Eastern Mediterranean are valued at an astounding US$524 billion.

But as the Israel-Palestine conflict has dramatically escalated in recent weeks, that no longer appears to be on the horizon, with the project frozen for the foreseeable future. 

Instead, on 29 October, as the war continued with no ceasefire in sight, Netanyahu’s government awarded 12 licences to six companies, including BP and Italy's ENI, for natural gas exploration off the Mediterranean Basin area.

The new resources of oil and natural gas finds in the Eastern Mediterranean are valued at an astounding US$524 billion. However, according to the UN report, a significant portion of those assets will have to be sourced from within the occupied territory of Palestine.

In addition, during the G20 summit in New Delhi this September, the US and EU announced their backing for a plan to build an economic corridor linking India with the Middle East and Europe - a massive project to rival China’s Belt and Road Initiative. 

Netanyahu described it as a cooperation project that is the greatest in our history, adding, “Our country Israel will be a central junction in this economic corridor; our railways and our ports will open a new gateway from India through the Middle East to Europe, and back.”

Israel’s plan is to become a major exporter of gas and some oil. In the past 20 years, the country has been transformed from a net importer of fossil fuels to an exporter of natural gas.

Netanyahu’s October 2023 declaration of war on Gaza is a continuation of Israel’s previous invasion of Gaza in 2014 when at least 2,104 Palestinian were killed, including 1,462 civilians. The underlying military objective of the occupation of Gaza is the expulsion of Palestinians from their homeland.

Israeli defence minister, Yoav Gallant, has said the plan is to eliminate everything and another minister, Gideon Sa’ar, said Gaza must be smaller at the end of the war. Moreover, an Israeli government concept paper proposed to transfer the Gaza Strip's 2.3 million people to Egypt's Sinai Peninsula. 

However, the ultimate objective is not only to demolish Hamas and/or exclude Palestinians from their homeland, but to confiscate Gaza's multi-billion-dollar gas resources.

 

Saudi Arabia-China currency swap agreement

The Saudi Central Bank (SAMA) has signed a three-year currency swap agreement with the Central Bank of China, marking a milestone in financial cooperation between the two nations.

The accord establishes a maximum swap value of 50 billion Chinese yuan.

This strategic agreement reflects the commitment of both central banks to enhance collaboration and strengthen ties founded on mutual interests.

The three-year duration underscores the long-term nature of this financial partnership, showcasing the enduring commitment of Saudi Arabia and China to bolstering their economic relations.

West Bank the next target of Israel

Having nothing to claim a victory six weeks on, the Israelis are now being forced to move towards the south, in particular, the city of Khan Younis to try their luck there.

The regime has already forced Gazans to move from the north to the south. The Israeli military is now trying to squeeze them, if it can, into an even tighter area, closer to the Mediterranean coast.

This will create all types of problems in particular on a humanitarian scale, which is already at an extremely dire level. 

It will be a much more complicated battle for the Israeli ground forces if they try and go into the now even more densely populated areas of Khan Younis.

The regime is already paving the way for this ground offensive in the south by pounding the area from the air at the expense of innocent lives to make space for the ground forces to move in. 

The Israeli war on Gaza was primarily motivated by anger at a huge intelligence and military failure following the retaliatory al-Aqsa Storm operation by Hamas on October 07. 

There was indeed an immediate political imperative by the regime to do something and get on with it, rather than developing clear military objectives. 

After weeks of indiscriminate bombing campaigns against Palestinian civilians, the Israeli ground forces tried to invade the northern Gaza Strip. 

But the ground offensives in the north of Gaza have made no success, with Israeli commentators admitting so in talks with the regime’s media. 

After the ground offensives began in the north, the Israeli military's stated aims were to seize Gaza City, destroy Hamas, and free the hostages. 

The armed wings of Hamas and Palestinian Islamic Jihad have prevented the Israeli military from achieving any of its stated objectives. 

In terms of trying to achieve the goals the occupation allegedly set out, which is to eliminate the Palestinian resistance group, but also free the hostages held in the captivity of Hamas, the Israeli military has failed miserably to do either of those two things after six weeks of unprecedented air raids and ground invasion. 

In particular, the notion that Hamas can be destroyed and the war cabinet of the Israeli prime minister has put that objective as the primary goal of its war on Gaza has proven to be wishful thinking.

The Palestinian resistance is as strong as it was on the first day of the war on Gaza some six weeks ago. 

The effectiveness of the Palestinian resistance in blowing up Israeli tanks, targeting the mobilization of its troops, luring Israeli forces into booby-trapped explosive buildings and firing missiles at Israeli-occupied Palestinian territories.

After six weeks of the war on Gaza it is evident that Hamas and other resistance factions remain powerfully strong. 

It has been a total failure for the Israeli occupation, which will go down in the history books for the stubbornness of Prime Minister Netanyahu as a war criminal. 

The only achievement thus far for the Israeli military has been the storming of the Al-Shifa hospital complex. A desperate attempt to find a Hamas military base that both Israeli political and military leaders alleged the group had been using as a command center. 

Yet it proved to be another huge intelligence failure, despite days of thoroughly inspecting every part of the hospital. 

As of Saturday, Israeli ground forces were still operating in the medical center with Palestinian health officials in Gaza saying that many patients, medical staff, and displaced people have now left the site. This is while medical centers must be protected under the rules of war. 

News outlets indicate that the Israeli military has ordered a mass evacuation of the entire hospital despite thousands of disabled and very sick patients unable to do so without dying. 

The hospital’s director, Mohammed Abu Salmiya, told AFP that Israeli troops had instructed him to ensure the evacuation of patients, wounded, the displaced and medical staff, and that they should move on foot towards the seafront".

It is another instance of war crime that the West has once again failed to hold the Zionist regime responsible for. 

The only achievement by the Israeli military is killing Palestinian civilians on a mass scale as well as killing its own hostages due to its indiscriminate bombing campaign that has leveled large parts of the Gaza Strip. 

This is nothing to be proud of and yet governments in the West, with the United States and the United Kingdom in particular, are not only complicit in the Israeli war crimes but continue to support the regime. This support for the Zionist regime is continuing despite the mass weekly demonstrations in the Western world protesting brutality against the Palestinians.

The Gaza Strip is a very tiny coastal sliver and is the most densely populated region in the world. It has been described by international rights organizations as the world's largest open-air prison. 

Six Palestinians were killed on Saturday after an Israeli airstrike on a house in Deir al Balah in the southern Gaza Strip, health officials said.

About 26 Palestinians, mostly children, were also killed in Israeli strikes on Khan Younis in southern Gaza early Saturday morning, the Palestinian news agency WAFA said. 

In what has been labeled as the "second phase" of the Israeli war on Gaza, experts believe it is difficult to imagine that the Israeli ground forces backed by the United States’ air power will be able to crush the resistance without killing thousands of more women and children. 

It is quite clear that Palestinian civilians are about to face another fresh bombardment after leaving the northern Gaza Strip to escape the indiscriminate Israeli bombing campaign. 

What is also clear is that children are already bearing the brunt of this increased bombing campaign in the southern Gaza Strip. 

Yet an Israeli military spokesperson has ordered Palestinians to continue going to southern Gaza. He said those in the areas of Jabayla, al-Daraj al-Tuffah and al-Shuja'iya should leave immediately along the Salah ad-Deen Highway - which runs the length of the fully blockaded Gaza Strip.

This is despite the increased bombardment in southern Gaza, where the Israeli ground forces are about to invade on top of the attacks in the north.

It is pure cowardice by the Israeli regime.

Its military is not taking on members of the Palestinian resistance man to man. Rather, the Israeli military has taken its anger out on Palestinian civilians. 

But where should traumatized Palestinian families in southern Gaza head to now? 

Their only viable option is the sea.

This is exactly what academics would describe as an Israeli genocide in Gaza.
 

 

Pakistan: IMF Reaches Staff Level Agreement

International Monetary Fund (IMF) staff and the Pakistani authorities reached a staff-level agreement on the first review under Pakistan’s Stand-By Arrangement (SBA), subject to approval by the IMF’s Executive Board. Upon approval, Pakistan will have access to SDR 528 million (around US$700 million).

The agreement supports the authorities’ commitment to advance the planned fiscal consolidation, accelerate cost-reducing reforms in the energy sector, complete the return to a market-determined exchange rate, and pursue state-owned enterprise and governance reforms to attract investment and support job creation, while continuing to strengthen social assistance.

An IMF team, led by Nathan Porter, visited Islamabad from November 2-15, 2023, to hold discussions on the first review of Pakistan’s economic program supported by an IMF Stand-By Arrangement (SBA). At the conclusion of the discussions, Porter issued the following statement:

“The IMF team has reached a staff-level agreement (SLA) with the Pakistani authorities on the first review of their stabilization program supported by the IMF’s US$3 billion (SDR2,250 million) SBA. The agreement is subject to approval of the IMF’s Executive Board. Upon approval around US$700 million (SDR 528 million) will become available bringing total disbursements under the program to almost US$1.9 billion.

“Anchored by the stabilization policies under the SBA, a nascent recovery is underway, buoyed by international partners’ support and signs of improved confidence. The steadfast execution of the FY24 budget, continued adjustment of energy prices, and renewed flows into the foreign exchange (FX) market have lessened fiscal and external pressures. Inflation is expected to decline over the coming months amid receding supply constraints and modest demand. However, Pakistan remains susceptible to significant external risks, including the intensification of geopolitical tensions, resurgent commodity prices, and the further tightening in global financial conditions. Efforts to build resilience need to continue.

“In this regard, strengthening macroeconomic sustainability and laying the conditions for balanced growth are key priorities under the SBA. The authorities’ policy priorities include:

Continued fiscal consolidation to reduce public debt, while protecting development needs. The authorities are determined to achieve a primary surplus of at least 0.4 percent of GDP in FY24, underpinned by federal and provincial government spending restraint and improved revenue performance supported, if necessary, by contingent measures. The authorities are building capacity to expand the tax base and raise revenue mobilization and are committed to improving the quality of public investment and spending.

Strengthening the social safety net to better protect the vulnerable. The authorities will continue the timely disbursements for social protection under BISP’s budget allocation—which are about a third higher than in FY23. This will allow for the expansion of the Unconditional Cash Transfers (UCT) Kafaalat program to 9.3 million families this fiscal year, with an annual inflation adjustment of the stipend. Looking forward, the authorities are seeking to improve the UCT Kafaalat generosity level and to increase enrollment into the Conditional Cash Transfers programs supporting children’s education and health.

Further reforms to reduce costs in the energy sector and restore its viability. With the combined circular debt (CD) across power and gas sectors exceeding 4% of GDP, immediate action was critical. While protecting vulnerable consumers, the authorities implemented power tariff adjustments that were pending since July 2023 and increased gas prices after a long time, effective November 01, 2023. While these increases were substantial, they were necessary to avoid further arrears that threatened the viability of these sectors and the provision of critical energy supplies. The authorities are also moving to tackle cost-side pressures, including bringing private sector participation to DISCOs, institutionalizing recovery and anti-theft actions, improving PPA terms, and reducing the incentives for captive power.

Returning to a market-determined exchange rate and rebuilding FX reserves. While inflows following increased regulatory and law enforcement helped normalize import and FX payments and rebuild reserves, the authorities recognize that the rupee must remain market-determined to sustainably alleviate external pressures and rebuild reserves. To support this, they plan to strengthen the transparency and efficiency of the FX market and to refrain from administrative actions to influence the rupee.

Proactive monetary policy to lower inflation toward its target. With appropriately tight monetary policy, inflation should steadily decline and the authorities stand ready to respond resolutely if near-term price pressures reemerge, including due to second-round effects on core inflation or renewed exchange rate depreciation.

Building financial sector resilience. Continued vigilance is warranted to safeguard the soundness of the banking system. Priorities include addressing undercapitalized financial institutions, ensuring foreign exchange exposures within regulatory limits, and aligning bank resolution and crisis management frameworks with best practice.

Continuing state-owned enterprise and governance reforms to improve the business environment, investment, and job creation. Following passage of the State-Owned Enterprises (SoE) law, the authorities are moving forward with their SoE policy and implementation of their triage plan, including the privatization of select SoEs. High governance and transparency standards will apply to the management of assets under the ownership of the newly created Sovereign Wealth Fund (SWF) and the operations of the SIFC. To further strengthen governance, the authorities will ensure public access to asset declarations from Cabinet members and a task force, with participation from independent experts, will complete a comprehensive review of the anticorruption framework.

Deepening cooperation with international partners. The authorities have accelerated the engagement with multilateral and official bilateral partners. Timely disbursement of committed external support remains critical to support the authorities’ policy and reform efforts.

“The IMF team thanks the Pakistani authorities, private sector, and development partners for fruitful discussions and cooperation throughout this mission.”