- U.K. July Retail Sales Rise, Led by Surge in Demand for Food
U.K. retail sales rose more than forecast in July, driven by the biggest jump in purchases of food in almost two years.
The volume of goods sold increased 0.3 percent, just ahead of the 0.2 percent gain predicted by economists, the Office for National Statistics said Thursday. The increase in June was revised down to 0.3 percent from 0.6 percent, though the total for the second quarter was unrevised.
Sales in July were largely driven by food, and figures covering the past three months show how pressure on consumers from faster inflation is weighing on retailers. Annual growth in the quarter through July was 1.8 percent, the weakest in almost four years. Price increases have accelerated in the past year largely because of the pound’s decline since the Brexit vote.
The retail report follows data on Wednesday showing that real incomes fell 0.5 percent in the second quarter as wages failed to keep pace with inflation. Consumer confidence has weakened this year and shoppers are already changing their spending habits to save money. More than half of households in a Nielsen survey published Thursday said they’re making cost-cutting efforts, the highest proportion in two years.
According to the report, 30 percent of households said they switched to cheaper grocery brands to save money, the most popular method of thrift ahead of saving on gas and electricity and spending less on new clothes.
The ONS data showed that demand at supermarkets led the retail gain in July, with food sales up 1.5 percent, rebounding from a 1.1 percent drop the previous month. Almost every other category of sales saw a decline.
The strain on household budgets is likely to continue for some months yet, according to the Bank of England, although things may not get much worse as inflation may be near its peak. Still, economic growth is forecast to cool this year and next.
“The worst is probably over for the British consumer,” Dan Hanson and Jamie Murray, economists at Bloomberg Intelligence, wrote in a note on Thursday. “Rising inflation made for a torrid start to 2017, but the shock is already fading. While things are looking brighter for households, uncertainty is likely to mean companies remain cautious.”
South Africa’s iGas, PetroSA and Strategic Fuel Fund Merge to Create South African National Petroleum Company
The South African Department of Mineral Resources and Energy (DMRE) has announced the merger of Central Energy Fund (CEF) subsidiaries iGas, PetroSA and the Strategic Fuel Fund (SFF).
The merger will be effective from 1 April 2021 and the new company will be called the South African National Petroleum Company.
The merger, driven by the pursuit of implementing a new company that has a streamlined operating model via the development of a shared services system and a common information platform, comes a few months after cabinet approval and the confirmation that PetroSA had incurred losses of R20 billion since 2014.
Additional factors which prompted the move included the determination to strengthen PetroSA which had not had a permanent CEO in five years prior to the appointment of CEO Ishmael Poolo last and, had become majorly ungainful since its failure to secure gas for the gas-to-liquids refinery project in Mossel Bay.
While the merger deadline has been set, the portfolio committee expressed reservations to the department’s likelihood of meeting the deadline, considering the existing legislative regime, pending issues raised in the SFF and PetroSA forensic reports, as well as PetroSA’s current insolvency and liquidity challenges, the official press statement on the briefing revealed.
“South Africa’s energy sector is entering a new dawn,” said NJ Ayuk, Executive Chairman of the African Energy Chamber. “With gas discoveries off the coast and the announcement of the REIPPP programme bid window 5 and 6 on the horizon, now is the most opportune time for the merger of the CEF subsidiaries. Of course, it is not an easy task and delays may be anticipated but, this move signals a real change towards a meaningful strategy that will not only be beneficial to the DMRE but to potential investors and local development as well.”
The African Energy Chamber welcomes this move and acknowledges that this is yet another step supporting the country’s determination to restarting the engines of sustainable growth and the transformation of energy policy and infrastructure.
Crude Oil Hits $71.34 After Saudi Largest Oil Facilities Were Attacked
Brent Crude Oil Rises to $71.34 Following Missile Attack on Saudi Largest Oil Facilities
Brent crude, against which Nigerian oil is priced, jumped to $71.34 a barrel on Monday during the Asian trading session following a report that Saudi Arabia’s largest oil facilities were attacked by missiles and drones fired on Sunday by Houthi military in Yemen.
On Monday, the Saudi energy ministry said one of the world’s largest offshore oil loading facilities at Ras Tanura was attacked and a ballistic missile targeted Saudi Aramco facilities.
“One of the petroleum tank areas at the Ras Tanura Port in the Eastern Region, one of the largest oil ports in the world, was attacked this morning by a drone, coming from the sea,” the ministry said in a statement released by the official Saudi Press Agency.
It also stated that shrapnel from a ballistic missile dropped near Aramco’s residential compound in Eastern Dhahran.
“Such acts of sabotage do not only target the Kingdom of Saudi Arabia, but also the security and stability of energy supplies to the world, and therefore, the global economy,” a ministry spokesman said in a statement on state media.
Oil price surged because the market interpreted the occurrence as supply sabotage given Saudi is the largest OPEC producer. A decline in supply is positive for the oil industry.
However, Brent crude oil pulled back to $69.49 per barrel at 12:34 pm Nigerian time because of the $1.9 trillion stimulus packed passed in the U.S.
Market experts are projecting that the stimulus will boost the United States economy and support U.S crude oil producers in the near-term, this they expect to boost crude oil production from share and disrupt OPEC strategy.
A Loud Blast Heard in Dhahran, Saudi Arabia’s Largest Crude Oil Production Site
Loud Blast Heard in Dhahran, Saudi Arabia’s Largest Crude Oil Production Site
Two residents from the eastern city of Dhahran, Saudi Arabia, on Sunday said they heard a loud blast, but they are yet to know the cause, according to a Reuters report.
Saudi’s Eastern province is home to the kingdom’s largest crude oil production and export facilities of Saudi Aramco.
A blast in any of the facilities in that region could hurt global oil supplies and bolster oil prices above $70 per barrel in the first half of the year.
One of the residents said the explosion took place around 8:30 pm Saudi time while the other resident claimed the time was around 8:00 pm.
However, Saudi authorities are yet to confirm or respond to the story.
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