Australia’s building approvals climbed by the most in the years in July, putting an end to the downward trend seen in recent months.
The approvals rose 11.3 percet to 20,987, the largest increase since September 2013 and the second-highest monthly figure in the history of the release, the Australian Bureau of Statistics reported.
While this is an impressive headline figure, it has been attributed to a mere surge in housing approvals, with little effect on the growing concerns of apartment glut in some of Australia’s largest cities.
Paul Brennan, Josh Williamson, and Vivian Jiang of Citi’s economics research team, voiced their concerns over the enormous lift in apartment construction in parts of Melbourne and Brisbane, Australia’s second and third-largest cities.
“Brisbane already is in oversupply, and Melbourne is on the way to oversupply,” the Citi team wrote. “When account is taken of approvals, only Sydney has underlying demand slightly higher than the level of approvals. This reflects the relatively greater scale of previous undersupply in Sydney in the ten years prior to the current construction boom.”
Citi suggested that “the extent of oversupply will depend on whether developers proceed or not with all the approvals to build… If this trend [of building all approvals] continues, as seems likely given no prospect of the RBA tightening, the risk of oversupply will increase”. In their view, “the developing oversupply will continue to build into 2017 and 2018”, and that “will intensify settlement risks which so far are low”.
Apartments surged by 23 percent to 11,393, leaving them up 15.7 percent on the levels of a year earlier.
Nigeria to Become Leading Gold Producer in West Africa – Adegbite
Adegbite Says Nigeria to Become Gold Hub in West Africa
The Minister of Mines and Steel Development, Olamilekan Adegbite, has said Nigeria is on its way to becoming a leading gold producer in West Africa.
Adegbite made the statement in Abuja while taking stock of his first year in office as minister.
He said, “Indeed, the international roadshows we have had in the past have produced fruits. Today, we have Thor exploration in Osun State through the Segilola Gold project.
“The exploration firm is projected to start producing (gold) in the first half of next year. The project is expected to create about 400 direct jobs and 1,000 indirect jobs.”
According to Adegbite, the Federal Government has licensed two gold refineries that would refine in line with the London Bullion Market Association standard.
He added, “Numerous industries will spring up when our gold economy becomes full-fledged. Some of them will include equipment leasing and repairs, logistics and transport, as gold requires a specialised means of transport, security, insurance, aggregators, and so on.”
The minister noted that for the first time, the country had mined, processed and refined gold under the Presidential Artisanal Gold Mining Development Initiative for use as part of Nigeria’s external reserves.
Adegbite also stated that the mines ministry had initiated a process that would lead to local capacity development in the production of barite.
“Presently, the barite that is used in the oil and gas industry is imported. But we are resolved to reverse this trend. As you may know, barite is a critical weighting material in drilling fluids due to its high specific gravity,” he said.
NUPENG, Lagos State Agree to Call Off Strike
NUPENG Agrees With Lagos State, Call Off Strike
The Nigeria Union of Petroleum and Gas (NUPENG) has ordered Lagos State Petroleum Tanker Drivers (PTDs) to call off its ongoing strike.
This was disclosed in a joint communique signed by the Lagos Commissioner of Energy and Mineral Resources, Olalere Odusote, and the NUPENG Deputy National President, Solomon Kilanko.
It would be recalled that Investors King had reported that NUPENG directed all PTDs to withdraw their services from Lagos State effective from Monday 10 August 2020 because of the persistent extortions and harassments of PTDs by both uniform security agencies and touts.
However, on the 10th of August, the commencement day of the strike, Lagos State government met with the leadership of NUPENG to address the union concerns and eventually agreed on a way forward.
Part of the communique reads “The Lagos State Government met today with the representatives of NUPENG, which agreed to call off its strike immediately.
“Other decisions taken at the meeting are security – the state government will meet the heads of all security agencies and secure their commitment to ensure the free passage of petroleum products vehicles given their importance to the economy.”
“Area boys’ – the menace of ‘area boys’ will be handled by relevant government agencies and a dedicated phone number will be established, within the next week to ensure the petroleum products transporters have prompt access to security agencies.”
The communique also stated that the Lagos State government will set up a standing committee to communicate with the union on an ongoing basis, saying it will help address a similar issue going forward. See the complete communique below.
Crude Oil Expands Gain on US Stimulus talks, Better Than Expected Chinese Factory Data
Crude Oil Gains on US Stimulus, Better Than Expected Chinese Factory Data
Oil prices extended its gains on Tuesday following a better than expected factory data from China and a possible agreement between Democrats and Republicans on economic stimulus.
“The oil complex is heavily reliant on that aid. We need people to be able to boost economic activity to spur demand,” said John Kilduff, partner at Again Capital in New York.
President Trump on Monday said House Speaker, Nancy Pelosi and Senator Chuck Schumer, top Democrat in the chamber of Congress, wanted to meet him to discuss or make a deal on coronavirus-related economic stimulus.
The possibility of a stimulus deal, coupled with a reduction in China’s factory deflation in the month of July due to the surge in oil prices and improved industrial activity bolstered the outlook of the energy sector.
China is the world’s largest importer of crude oil. Therefore, improved factory activity generally boosts the oil market.
Also, the announcement from Iraq that it planned to cut an additional 400,000 barrels per day in August and September to compensate for its previous overproduction above OPEC+ quota aided the oil market this week.
“This would send out a strong signal to the oil market on various levels. That said, this would also require the international companies operating in Iraq to join in with the cuts,” Commerzbank analyst Eugen Weinberg said.
The Brent crude oil, against which Nigerian oil is priced, expanded from $41.30 per barrel it traded on Monday to $45.40 per barrel on Tuesday at 10:10 am Nigerian time.
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