NEW YORK (Reuters) – Oil prices tumbled about 2% on Friday on rising U.S.-China tensions and doubts about how quickly fuel demand would recover from the coronavirus crisis.
FILE PHOTO: A TORC Oil & Gas pump jack is seen near Granum, Alberta, Canada May 6, 2020. REUTERS/Todd Korol/File Photo
Fuel demand plummeted in recent months as the pandemic caused governments to impose restrictions on movement and businesses closed their doors. Oil has rallied in recent days as activity started to resume.
But prices dropped after China said on Friday it would not publish an annual growth target for the first time. Beijing also pledged more government spending as the pandemic kept hammering the economy.
“The coronavirus has nullified a decade of global oil demand growth and the recovery will be slow,” said Stephen Brennock of broker PVM.
Brent crude futures fell 93 cents, or 2.6%, to settle at $35.13 a barrel. U.S. West Texas Intermediate (WTI) crude ended 67 cents, or 2%, lower at $33.25 a barrel.
China is set to impose new national security legislation on Hong Kong after last year’s pro-democracy unrest, a Chinese official said on Thursday, drawing a warning from President Donald Trump that Washington would react “very strongly.”
For the week, Brent and WTI gained 8% and 13%, respectively, but some said they may have come too far, too fast.
“A second wave (of the coronavirus) is not such a remote possibility and a new round of lockdowns could send prices back to much lower levels very quickly, and the market knows it,” said Rystad Energy senior oil markets analyst Paola Rodriguez Masiu.
Oil prices have plummeted more than 40% so far in 2020. The recent rebound was due in part to efforts by the Organization of the Petroleum Exporting Countries and allies to reduce supply. OPEC+ is reducing supply by a record 9.7 million barrels per day from May 1.
The U.S. rig count, an indicator of future output, fell by 21 to a record low 318 this week, according to energy services firm Baker Hughes Co’s data going back to 1940.,
In a sign of the glut easing, U.S. crude inventories fell last week.
Money managers raised their net long U.S. crude futures and options positions in the week to May 19 by 23,229 contracts to 380,211, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.
Reporting by Stephanie Kelly in New York, additional reporting by Alex Lawler in London and Aaron Sheldrick in Tokyo; Editing by Marguerita Choy, Tom Brown and David Gregorio
Mending JPM chief drops into Mt. Kisco Chase branch
Jamie Dimon’s first public sighting since he underwent heart surgery three months ago has resulted in a photo of him kneeling at a local Chase branch — sparking questions about whether he was “taking a knee” in solidarity with widespread racial justice protests.
The 63-year-old CEO of JPMorgan Chase underwent emergency heart surgery on March 5, before the coronavirus crisis escalated, and has been away from the office ever since due to Empire State lockdown orders.
According to a JPMorgan spokesperson, the photo took place at his local Chase branch in Mt. Kisco, NY, and is the result of Dimon’s first interaction with his staff since his emergency acute aortic dissection.
Sources say Dimon dropped in on the branch on Friday while wearing a face mask and ended up chatting with 10 staffers there. He fielded questions on topics ranging from how he’s feeling post-surgery to how small business clients are faring in the area, and congratulated the Mt. Kisco branch on staying open throughout the pandemic.
At some point during the impromptu powwow, the man sometimes referred to as “America’s Banker” dropped to one knee alongside five other masked staff members. Five more staffers stood behind them in front of the bank’s massive vault, while another staffer took the photo.
Chase declined to comment on whether Dimon’s kneel was a show of support for protests that have engulfed America following the death of George Floyd at the hands of Minneapolis Police. Footage of the arrest shows an officer kneeling on the neck of an unarmed Floyd for more than eight minutes.
Earlier this week, Dimon issued a statement in support of the protests.
“Let us be clear — we are watching, listening and want every single one of you to know we are committed to fighting against racism and discrimination wherever and however it exists,” he wrote as part of his memo to staff.
Dimon, who has been working from home since early April, is returning to an economy crushed by widespread lockdowns. But he appeared to predict a quick return to normalcy last week during a virtual financial conference held by Deutsche Bank.
“You could see a fairly rapid recovery,” Dimon said at the time, citing government stimulus and reopening the consumer economy as a potent combination.
Sycamore Partners in talks to buy JCPenney
Private equity firm Sycamore Partners is in preliminary talks to acquire JCPenney out of bankruptcy should the US department store chain’s negotiations with its creditors fail, three people familiar with the matter said on Friday.
Shares of JCPenney jumped almost 55 percent on the news.
JCPenney, which employs roughly 85,000 people, filed for bankruptcy protection in May after the coronavirus pandemic forced it to temporarily close its more than 800 stores across the US, compounding financial woes that stemmed from years of dwindling sales.
Sycamore is weighing acquiring JCPenney outright or making an investment in the troubled retailer, the sources said.
There is no certainty that the talks between Sycamore and JCPenney will result in a deal, which would require a bankruptcy judge’s approval, the sources said.
JCPenney is also in touch with some of its landlords, including Brookfield Asset Management and Simon Property Group, about possible transactions, the sources said. Under one scenario being explored, Sycamore, Brookfield and Simon would join forces on a bid for JCPenney, two of the sources said.
The sources requested anonymity because the discussions are confidential. Sycamore and JCPenney declined to comment. Brookfield had no immediate comment while Simon did not immediately respond to a request for comment.
JCPenney is in discussions about handing over control to its lenders in exchange for reducing its nearly $5 billion of debt. This hinges on a slew of investment firms that hold the company’s senior debt and have provided the company’s bankruptcy financing agreeing to JCPenney’s business plan by July 14.
If the Plano, Texas-based company does not persuade enough lenders to approve its plan by the following day, July 15, the terms of its bankruptcy loan require JCPenney to abandon its reorganization efforts and pursue a sale.
It is unclear how much Sycamore is willing to pay for JCPenney, which is in the process of permanently closing stores and cutting jobs.
Sycamore, a New York private equity firm that specializes in retail and consumer investments, has in the past taken control of high-profile businesses such as office supplies chain Staples, women’s clothing retailer Talbots and department-store operator Belk.
Last month, Sycamore walked away from a $525 million deal to buy a majority stake in L Brands’s Victoria’s Secret, as the pandemic hammered sales at the lingerie chain.
Brookfield and Simon operate malls across the US. Brookfield in May said it would devote $5 billion to non-controlling investments designed to revitalize retailers struggling in the wake of the coronavirus outbreak.
During a court hearing on Thursday, US Bankruptcy Judge David Jones approved fresh financing from senior lenders to aid JCPenney’s operations while it navigates Chapter 11 protection, and expressed concern the 118-year-old chain needed to restructure quickly to survive.
In July, the lenders will “decide whether the dream lives or the dream dies,” said Cathy Hershcopf, a creditors’ lawyer, during the hearing.
Under a plan being discussed with its creditors, JCPenney would be split into two companies. One would be a real estate investment trust that would hold some of the company’s property and lease it back to JCPenney. The other would operate JCPenney’s retail business.
Joshua Sussberg, a Kirkland & Ellis LLP lawyer representing JCPenney, said during Thursday’s court hearing that the company needed to persuade lenders negotiating to take control of the restructured business to keep it alive and that he planned to hold them accountable for how the case ended.
Even in less-fraught times, many retailers, including Barneys New York Inc and Toys ‘R’ Us, have failed to reorganize under bankruptcy protection and gone out of business for good.
JCPenney on Thursday said it plans to permanently close 154 stores, and may shut more. It has so far reopened nearly 500 stores that were closed due to the pandemic, and plans to bring additional locations online in coming weeks. Still, concerns remain that customers might be slow to return amid health concerns and job losses not seen since the Great Depression.
JCPenney is also seeking permission from landlords to skip rent payments for June, July and August, Sussberg said last week.
Marriott says Trump ordered cease to Cuba hotel business
The Trump administration has ordered Marriott International to wind down hotel operations in Communist-run Cuba, a company spokeswoman told Reuters, extinguishing what had been a symbol of the US-Cuban detente.
Starwood Hotels, now owned by Marriott, four years ago became the first US hotel company to sign a deal with Cuba since the 1959 revolution in the mark of the normalization of relations pursued by former President Obama.
But the administration of President Trump has unraveled that detente, saying it wants to pressure Cuba into democratic reform and to stop supporting Venezuelan President Nicolas Maduro.
The move could help Trump bolster support in the large Cuban-American community in Florida, a state considered vital to his reelection chances in November.
“We have recently received notice that the government-issued license will not be renewed, forcing Marriott to cease operations in Cuba,” a company spokeswoman told Reuters.
The spokeswoman said the US Treasury Department had ordered the company to wind down its operation of the Four Points Sheraton in Havana by Aug. 31. It would also not be allowed to open other hotels it had been preparing to run.
The US Treasury Department and State Department did not immediately reply to a request for comment.
“In 2017, Trump promised he would not disrupt existing contracts US businesses had with Cuba,” wrote William LeoGrande, a Cuba expert at American University in Washington, on Twitter. “Promise made, promise broken.”
The news comes two days after the US State Department expanded its list of Cuban entities with which Americans are banned from doing business to include the financial corporation that handles US remittances to Cuba.
US sanctions have further crippled an economy already struggling with a decline in aid from leftist ally Venezuela and the end of hard-currency generating Cuban medical missions in Brazil and elsewhere.
Philip Peters who runs the business consultancy FocusCuba and had advised Marriott, said no good had come from a lifetime of US sanctions that separated the US and Cuban peoples, harmed Cuba’s economy, and limited American influence in Cuba.
“Marriott .. will hopefully return to do business in Cuba, along with others, to encourage American travel and to help Cuba prosper and integrate into the global economy,” he said.
Kazakh police detain dozens of anti-government protesters
Ayushmann Khurrana Wants to Step Into the Shoes of ‘Joker’; Time for Some Grey Shades in His Everyday Characters? (View Tweet)
Iranians must live with virus ‘for long time’: Rouhani
‘Am I going to get shot?’ kids ask, as brands try to explain racism and violence to children
Washington prepares for major protest as U.S. officials move to rein in police
Malaysia reports 37 new coronavirus cases, one new death
Robert Englund Birthday Special: From A Nightmare On Elm Street To Maniacs, A Look At His Best Horror Movies
Graphic: What U.S. police are shooting at protesters
Australia, Asia protests embrace ‘Black Lives Matter’ movement
Sanjay Dutt Goes Down Memory Lane, Shares a Childhood Photo on His Father Sunil Dutt’s 91st Birth Anniversary (View Post)
New Yorkers fleeing coronavirus shunned by ‘pissed-off’ locals
Pelosi says legislation coming soon in response to Minneapolis George Floyd killing
Queens man rips up Black Lives Matter sign, admits he’s racist
Teen’s half-‘blackface’ makeup tutorial on TikTok sparks outrage
“Was Like A Slap In The Face To Her”: Bradley Beal Reveals That His Mother Didn’t Speak To Him For Two Months Over A College Decision
Doping: CAS to hear Salazar appeal in November
Zoominfo aims to price IPO above target in largest 2020 tech listing
Greek tourism minister says all foreign visitors welcome
Looters swipe $2.4M worth of watches from SoHo Rolex store
Restauranteur Svitlana Flom says 911 call video ‘twisted the entire thing’
Entertainment2 weeks ago
Betaal Full Series in HD Leaked on Telegram & TamilRockers Links for Free Download and Watch Online; Shah Rukh Khan’s Production for Netflix Faces Piracy Threat?
Sports1 week ago
NASCAR Responds to Kyle Busch and Chase Elliott Breaking Safety Protocols at the Coca-Cola 600
Entertainment2 weeks ago
Salman Khan Launches his Own Grooming and Personal Care Brand ‘Frsh’ and We are Already Ordering it Online
Sports2 weeks ago
What is Ronaldinho’s net worth and how much does the Brazilian star earn?
Entertainment6 days ago
Betaal All Episodes in HD Leaked on TamilRockers & Telegram Links for Free Download and Watch Online; Shah Rukh Khan-Produced Web Series for Netflix Faces Piracy Threat?
Technology1 week ago
Amazon.com was briefly down for many in the US
General News2 weeks ago
8 countries have coronavirus death rates above 10%, either due to disaster or limited testing
Technology1 week ago
Mom laughs after getting caught naked during daughter’s class on Zoom