The Great Debate UK
from Breakingviews:
Saudi handouts ratchet up “fair price” of oil
By Una Galani
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
DUBAI -- Saudi Arabia's rulers have long thought they could tell what a "fair" oil price should be. Prior to the heightening unrest on its own borders, the Kingdom reiterated its long-held view that this was somewhere between $70 and $80 per barrel. But the recent pledge for a massive boost to spending on everything from housing to religious police is pushing Saudi into its largest budget spending. No wonder the Kingdom now thinks the market is "oversupplied". "Fair" looks set to become more expensive.
The Kingdom will need an average oil price of between $80 to just over $90 per barrel to balance its budget during 2011, according to various estimates. This is one of the highest breakeven prices within the bloc of six Gulf nations, up from previous forecasts of around $60 to $70 per barrel.
Of course, supply disruptions in Libya -- which produces a type of sweet crude that the Kingdom cannot easily replace -- and the threat of similar problems erupting elsewhere have pushed prices well above Saudi's needs to around $123 per barrel for Brent crude and $109 for WTI.
from Chrystia Freeland:
The revolutionary significance of job growth
It was striking to hear how encouraged both Klaus Kleinfeld and Dominic Barton sounded when Chrystia asked them about the effects of the recent turmoil in the Middle East on the business environment there. Barton believed the regime changes in Tunisia and Egypt were "the dawn of a new good thing that's occurring" and noted that it is likely that new capital will come into these countries as a new leadership emerges. Kleinfeld, whose company is in the process of building the world's largest integrated aluminum system in Saudi Arabia, said that Alcoa is still very comfortable in the region and that the only surprises with their Saudi partners have been positive surprises. For Kleinfeld, the most assured way to bring about stability in a region plagued by unrest is to have businesses come in and create jobs:
If there's one thing that the Middle East needs particularly for the young -- as well as well-educated people -- it's jobs. And it does it in a region which typically has not had much of an economic growth around Ras Azzour. So that's all very, very good. And not just for us as a company but also for the region. And it's gonna have a stabilizing as well as a kind of uplifting, positive element
from Pakistan: Now or Never?:
Wikileaks on Pakistan
In the State Department cables released by Wikileaks and so far reported, the most eye-catching as far as Pakistan is concerned is a row with Washington over nuclear fuel.
According to the New York Times, the cables show:
"A dangerous standoff with Pakistan over nuclear fuel: Since 2007, the United States has mounted a highly secret effort, so far unsuccessful, to remove from a Pakistani research reactor highly enriched uranium that American officials fear could be diverted for use in an illicit nuclear device. In May 2009, Ambassador Anne W. Patterson reported that Pakistan was refusing to schedule a visit by American technical experts because, as a Pakistani official said, “if the local media got word of the fuel removal, ‘they certainly would portray it as the United States taking Pakistan’s nuclear weapons,’ he argued.”
from Pakistan: Now or Never?:
Iran’s role in Afghanistan
Iran has been hosting regional leaders, including Afghan President Hamid Karzai, to celebrate the Persian New Year, or Nowruz (a spring festival whose equivalent in Pakistan, incidentally, is frowned upon by its own religious conservatives).
The Nowruz celebrations, which also included the presidents of Iraq, Tajikistan and Turkmenistan, are part of Iran's efforts to build regional ties and followed renewed debate over the kind of role Iran wants to play in Afghanistan. As discussed here, it has also been improving ties with Pakistan, and both countries may have worked together on the arrest last month of Abdolmalik Rigi, leader of the Jundollah rebel group.
from FaithWorld:
Pew measures global religious restrictions
The Pew Forum on Religion & Public Life has come out with a new report that tries to measure, country by country on a global level, government and social restrictions on religion. You can see our coverage of the report here and here and can download the whole report here.
The report, which Pew says is the first major quantitative study of the subject on a global level, ranks countries under two indices -- one measures government restrictions on religion, the other social hostilities or curbs on religion that stem from violence or intimidation by private individuals or groups.
from The Great Debate:
Obama and flawed logic on Cuba
-- Bernd Debusmann is a Reuters columnist. The opinions expressed are his own --
The U.S. case for isolating Cuba and keeping it out of international meetings such as this week's Summit of the Americas sounds simple: the country doesn't have democratically elected leaders, it holds political prisoners, it violates human rights and its citizens can't travel freely. All perfectly true.
from The Great Debate:
In China, OPEC’s nightmare comes true
-- John Kemp is a Reuters columnist. The opinions expressed are his own --
China's decision to link domestic fuel prices indirectly to the international crude oil market, subject to a price cap, while hiking the consumption tax on gasoline and diesel and phasing out a variety of road tolls and other fees shows Saudi Arabia's worst fears about high prices and demand destruction are starting to come true.
It seems likely to confirm the kingdom's determination to see prices stabilize around $75 per barrel, well below recent price peaks, and far below the level sought by some other OPEC members, as well as international oil companies and advocates of alternative energy.
from The Great Debate:
New economies want power before paying
--Paul Taylor is a Reuters columnist, the views expressed are his own--
Anyone who expected the major emerging economies to write fat checks in exchange for being invited to the first G20 leaders' summit on rescuing the world economy will have been disappointed.
But that should only have surprised the naive.
Despite intensive lobbying by British Prime Minister Gordon Brown of Saudi Arabia and China, the rising powers were never likely to make a cash down-payment to the International Monetary Fund before getting more seats and votes at the top table.
