Focus: Oil, WTI’S moment of truth

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Updated 21 April 2020
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Focus: Oil, WTI’S moment of truth

What happened:

Monday was a historic day for oil. The May contract for WTI fell below zero for the first time in history. It reached -$37.63 per barrel at the end of the US trading session. The June contract closed at 20.43 per barrel. Brent closed at a very low $25.60 and stood at 23.80 in early afternoon trade in London, at which time WTI traded at minus $6.3 per barrel.

The price range is an indication of the fact that the world is running out of storage space, particularly in the US.

Markets turned negative on the news flow in the oil sector, which was exacerbated in Asia on reports that North Korean leader Kim Jong Un was critically ill, inserting a whiff of geopolitical risk.

President Donald Trump tweeted that he would suspend immigration temporarily, reflecting the huge increase in jobless claims of 22 million over the span of four weeks, which is again unprecedented.

Virgin Atlantic Australia went into administration, asking for commercial loans from the government.

As the earnings season continued it became clear that more and more companies were asking to have their guidance disregarded, and that other metrics would take precedence. This is because there is very little visibility on how the economy evolves going forward.

Background:

We should not forget that the WTI benchmark is set at Cushing, which has essentially run out of storage in as much as it is either full or spoken for. In other words, WTI crude for the May contract has nowhere to go.

Brent, which is a seaborne benchmark, trades globally and is therefore in a better position than WTI which is essentially landlocked and has nowhere to go -- notwithstanding that in real terms the commodity has not traded at such low levels since 1971.

According to the International Energy Agency, oil demand will decline by 29 million barrels per day (bpd) in April and 23 million bpd for the second quarter. The OPEC+ production cut of 9.7 million bpd pales in light of this unprecedented demand destruction. In other words, the current deterioration in the oil market and the resulting dislocation is beyond anybody’s control.

The ripple effects of this price deterioration will go beyond the oil sector. Many shale oil producers are being eased out because they have a relatively high cost base and also high leverage. They cannot service their debt at current oil prices. This will in turn have an impact on the loan portfolio of several lenders with high exposure to the shale space. Banks with outstanding hedges at higher prices will similarly be affected.

The sector has lost 51,000 jobs since the outbreak, leaving a dent on the unemployment numbers.

Where we go from here:

The May contract expires on Tuesday at 14:30 EDST. Negative sentiment has already rolled to the June contract, which stood at around $11 late morning CEST.

This can easily be explained by the fact that investors who felt that the market had bottomed out poured huge sums into exchange-traded funds on longer-dated contracts -- $4.3 billion since the beginning of the crisis and $1.6 billion last week alone. These contracts will now need to be rolled over.

A lot will depend on how the storage situation evolves, which in turn depends on how quickly the US and other advanced emerging economies will come out of the crisis, as well as on the shape and pace of any recovery.

The current developments will have ramifications on major oil-producing countries, like Saudi Arabia, the UAE or Russia. Low oil prices will impose a limitation on spending and reform programs. It is also reflected in the currencies of major crude oil exporters, which do not have a dollar peg – which again is different in the Gulf Cooperation Council. 

 

— Cornelia Meyer is a Ph.D.-level economist with 30 years of experience in investment banking and industry. She is chairperson and CEO of business consultancy Meyer Resources.

Twitter: @MeyerResources


Doctor at Brown University deported to Lebanon despite US judge’s order

Dr. Rasha Alawieh. (Supplied)
Updated 4 min 18 sec ago
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Doctor at Brown University deported to Lebanon despite US judge’s order

  • While in Lebanon, the US consulate issued Alawieh an H-1B visa authorizing her entry into the United States to work at Brown University, the lawsuit said. Such visas are reserved for people from other countries who are employed in specialty occupations
  • Alawieh, a Lebanese citizen who lives in Providence, was detained on Thursday after arriving at Logan International Airport in Boston after traveling to Lebanon to see relatives, according to a lawsuit filed by her cousin, Yara Chehab

BOSTON: A Rhode Island doctor who is an assistant professor at Brown University’s medical school has been deported to Lebanon even though a judge had issued an order blocking the US visa holder’s immediate removal from the country, according to court papers.
The expulsion of Dr. Rasha Alawieh, 34, is set to be the focus of a hearing on Monday before a federal judge in Boston, who on Sunday demanded information on whether US Customs and Border Protection had “willfully” disobeyed his order.
US District Judge Leo Sorokin, an appointee of Democratic President Barack Obama, said he had received a “detailed and specific” timeline of the events from an attorney working on Alawieh’s behalf that raised “serious allegations” about whether his order was violated.

HIGHLIGHTS

• Rasha Alawieh was removed after arriving at Boston airport

• Judge questions if Customs and Border Protection disobeyed his order

• Court hearing set for Monday

The agency has not said why she was removed. But her expulsion came as Republican US President Donald Trump’s administration has sought to sharply restrict border crossing and ramp up immigration arrests.
A CBP spokesperson, Hilton Beckham, in a statement said migrants bear the burden of establishing admissibility and that the agency’s officers “adhere to strict protocols to identify and stop threats.”
Alawieh, a Lebanese citizen who lives in Providence, was detained on Thursday after arriving at Logan International Airport in Boston after traveling to Lebanon to see relatives, according to a lawsuit filed by her cousin, Yara Chehab.
She had held a visa to be in the United States since 2018, when she first came to complete a two-year fellowship at Ohio State University before then completing a fellowship at the University of Washington and then moving to the Yale-Waterbury Internal Medicine Program, which she completed in June.
While in Lebanon, the US consulate issued Alawieh an H-1B visa authorizing her entry into the United States to work at Brown University, the lawsuit said. Such visas are reserved for people from other countries who are employed in specialty occupations.
Despite that visa, CBP detained her at the airport for reasons her family members have still not been provided, according to the lawsuit, which argued her rights were being violated.
In response to the lawsuit, Sorokin on Friday evening issued orders barring Alawieh’s removal from Massachusetts without 48 hours’ notice to the court and requiring her to be brought to a court hearing on Monday.
Yet according to the cousin’s attorneys, after that order was issued, Alawieh was flown to Paris, where she was then set to board a flight for Lebanon that had been scheduled for Sunday.
Sorokin on Sunday directed the government to provide a legal and factual response by Monday morning ahead of the previously scheduled hearing and to preserve all emails, text messages and other documents concerning Alawieh’s arrival and removal.
Concerns have also been raised in other cases about whether the Trump administration is complying with court rulings blocking parts of its agenda.
The Trump administration on Sunday said it has deported
hundreds of Venezuelans
to El Salvador under seldom-used wartime powers, despite a federal judge’s order temporarily barring such deportations.

 

 


Sudanese police accuse RSF paramilitaries after 11 bodies found at bottom of a well in Khartoum

Updated 20 min 33 sec ago
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Sudanese police accuse RSF paramilitaries after 11 bodies found at bottom of a well in Khartoum

  • The bodies of 11 people were recovered Saturday from the deep well in the Fayhaa neighborhood of the city
  • Police say the victims were killed by paramilitary by the paramilitary RSF when itwas controlling the area

CAIRO: Sudanese authorities said Sunday many bodies have been found at the bottom of a well in the capital, Khartoum, a few days after the military cleared the area from a notorious paramilitary group.
The bodies of 11 people, including women and children, were recovered Saturday from the deep well in the Fayhaa neighborhood of the city, according to police.
Col. Abdul-Rahanan Mohamed Hassan, head of the civil defense’s field team in Khartoum, said a search of the the area was mounted after residents reported that they found a dead body in the well.
“We found inside this well different characters (bodies), males and females, adults and children,” Hassan said, adding that authorities were still searching the well.
Police say the victims were killed by the Rapid Support Forces before being thrown into the well when the paramilitary force was controlling the area. The military retook the area earlier this month as part of its sweeping advances in Khartoum and its sister city of Omdurman.
There was no immediate comment from the RSF.
Afraa Al-Hajj Omar, a resident of the nearby Hajj Youssef neighborhood, said that the RSF killed many people in the area and their bodies were left for days in the streets. She said many bodies were thrown in the well. “They robbed us, beat us, and tortured us,” she said.
Sudan was plunged into chaos in April 2023 when simmering tensions between the military and the powerful paramilitary Rapid Support Forces exploded into open warfare across the country.
At least 20,000 people have been killed, though the number is likely far higher. The war has driven more than 14 million people from their homes and pushed parts of the country into famine.
The fighting, which wrecked Khartoum and other urban areas has been marked by atrocities including mass rape and ethnically motivated killings that amount to war crimes and crimes against humanity, especially in the western region of Darfur, according to the United Nations and international rights groups.
The war has intensified in recent months, with the military making steady advances against the RSF in Khartoum and elsewhere in the country.


Syria’s new rulers seek aid boost at EU conference

Updated 27 min 48 sec ago
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Syria’s new rulers seek aid boost at EU conference

  • Syrian Foreign Minister Asaad Al-Shibani is expected to take part in the event, along with dozens of European and Arab ministers and representatives of international organizations

BRUSSELS: The interim government in Damascus will take part on Monday in an annual international conference to gather aid pledges for Syria, facing dire humanitarian problems and an uncertain political transition after the fall of Bashar Assad.
The conference has been hosted by the European Union in Brussels since 2017 — but took place without the government of Assad, who was shunned for his brutal actions in a civil war that began in 2011.
After Assad’s overthrow in December, EU officials hope to use the conference as a fresh start, despite concerns about deadly violence this month that pitted the new, Islamist rulers against Assad loyalists.
“This is a time of dire needs and challenges for Syria, as tragically evidenced by the recent wave of violence in coastal areas,” EU foreign policy chief Kaja Kallas said.
But she said it was also “a time of hope,” citing an agreement struck on March 10 to integrate the Kurdish-led and US-backed Syrian Democratic Forces, which control much of Syria’s northeast, into new state institutions.
Hayat Tahrir Al-Sham, the group that toppled Assad, is designated as a terrorist organization by the United Nations. But EU officials want to engage with the new rulers as long as they stick to pledges to make the transition inclusive and peaceful.
Syrian Foreign Minister Asaad Al-Shibani is expected to take part in the event, along with dozens of European and Arab ministers and representatives of international organizations.
EU officials say the conference is particularly important as the United States under President Donald Trump is making huge cutbacks to humanitarian and development aid programs.
Last year’s conference yielded pledges of 7.5 billion euros ($8.1 billion) in grants and loans, with the EU pledging 2.12 billion for 2024 and 2025.
About 16.5 million people in Syria require humanitarian assistance, with 12.9 million people needing food aid, according to the EU.
The destruction from the war has been compounded by an economic crisis that has sent the Syrian pound tumbling and pushed almost the entire population below the poverty line. ($1 = 0.9192 euros)

 


Ivory Coast is losing US aid as Al-Qaeda and other extremist groups are approaching

Updated 47 min 12 sec ago
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Ivory Coast is losing US aid as Al-Qaeda and other extremist groups are approaching

  • In Kimbirila-Nord, US funding helped young people get job training, built parks for cattle to graze so they are no longer stolen by jihadis on Malian territory
  • In 2019, President Donald Trump signed the Global Fragility Act that led to the initiatives in northern Ivory Coast
  • In January, Trump ordered a freeze on foreign assistance and a review of all US aid and development work abroad

KIMBIRILA-NORD, Ivory Coast: With its tomato patches and grazing cattle, the Ivory Coast village of Kimbirila-Nord hardly looks like a front line of the global fight against extremism. But after jihadis attacked a nearby community in Mali five years ago and set up a base in a forest straddling the border, the US committed to spending $20 million to counter the spread of Al-Qaeda and the Daesh group here and in dozens of other villages.
The Trump administration’s sweeping foreign aid cuts mean that support is now gone, even as violence in Mali and other countries in the Sahel region south of the Sahara has reached record levels and sent tens of thousands refugees streaming into northern Ivory Coast.
Locals worry they have been abandoned. Diplomats and aid officials said the termination of aid jeopardizes counterterrorism efforts and weakens US influence in a part of the world where some countries have turned to Russian mercenaries for help.
In Kimbirila-Nord, US funding, among other things, helped young people get job training, built parks for cattle to graze so they are no longer stolen by jihadis on Malian territory, and helped establish an information-sharing system so residents can flag violent encounters to each other and state services.

A radio technician at Kaniasso FM, a community radio station formerly funded by USAID to disseminate information in the local languages to neighboring villages, plays a jingle in Kaniasso, Ivory Coast, Feb. 20, 2025. (AP Photo/Misper Apawu)

“What attracts young people to extremists is poverty and hunger,” said Yacouba Doumbia, 78-year-old chief of Kimbirila-Nord. “There was a very dangerous moment in 2020. The project came at the right time, and allowed us to protect ourselves.”
“Seize a narrow prevention window”
Over the last decade, West Africa has been shaken by extremist uprisings and military coups. Groups linked to Al-Qaeda and the Daesh group have conquered large areas and killed thousands in the Sahel and have been spreading into wealthier West African coastal states, such as Ivory Coast, Benin and Togo.
In 2019, President Donald Trump signed the Global Fragility Act that led to the initiatives in northern Ivory Coast. The US goal in this area was to “seize a narrowing prevention window,” according to this year’s congressional report about the implementation of the bipartisan legislation.
Experts say local concerns help drive the popularity of extremist groups: competition for land and resources, exclusion, marginalization and lack of economic opportunities. Across the region, Islamic extremists have recruited among groups marginalized and neglected by central governments.
“Ivory Coast is one of the few countries that still resist the terrorist threat in the Sahel,” said a UN official working in the country who was not authorized to speak on the matter publicly. “If we do not continue to support border communities, a minor issue could send them into the arms of extremists.”
Trump issued an executive order in January directing a freeze on foreign assistance and a review of all US aid and development work abroad. He charged that much of foreign aid was wasteful and advanced a liberal agenda.
“Everyone was just looking out for themselves”
In 2020, when the jihadis struck a Malian village 10 kilometers (6 miles) away, Kimbirila-Nord in many ways fit the description of a community susceptible to extremism.
The lives of Malians and Ivorians were intertwined. People crossed the border freely, making it easy for extremists, who like residents spoke Bambara, to access Kimbirila-Nord. Many residents did not have identity cards and few spoke French, leaving them with no access to states services or official information. Different ethnic groups lived next to each other but were divided by conflicts over scarce natural resources and suspicions toward the state. And young people did not have opportunities to make money.
“We were very scared” when the extremists attacked, said Aminata Doumbia, the head of the village’s female farmers cooperative. “Everyone was just looking out for themselves.”

A ranch belonging to Ibrahima Doumbia, president of the Association of Cattle Breeders, is seen in Kimbirila-Nord, near the Mali border, in Ivory Coast, Feb. 22, 2025. (AP Photo/Misper Apawu)

The Ivorian government runs a program that provides professional training, grants and microloans. But access is difficult in villages such as Kimbirila-Nord.
Kimbirila-Nord is home to refugees from Mali, Burkina Faso and Guinea. Sifata Berte, 23, fled there with his family two years ago from Mali. He is not eligible for the government-run program, but got training through the project funded by the US Agency for International Development and now works as an apprentice in an iron workshop.
Other things the USAID-funded project set up included a network of community radios in local languages, so people could get access to information. It also used mobile government trucks to help tens of thousands of people across the region get their identity documents. And it brought people together with microcredit cooperatives and with a special committee of ranchers and farmers that helps resolve tensions over land.
“It’s thanks to the project that we can sleep at night,” Doumbia, the village chief, said. “We learned how to be together.”

Equal Access International, an international nonprofit, designed and implemented the US-funded project.
The USAID project also has been the only direct source of information on the ground in northern Ivory Coast on violent events for the US-based Armed Conflict and Location & Event Data Project, the main provider of data on violence in the Sahel.
The village had big plans
Ivory Coast became known as a target for extremists in 2016, when an attack on the seaside resort of Grand Bassam killed tourists. In 2021, a string of attacks occurred near the country’s northern border, but the violence has been largely contained after Ivorian authorities, Western governments and aid groups rushed into this impoverished and isolated part of the country with military build up and development projects.
In 2024, the US Africa Command provided over $65 million to projects in Ivory Coast, most of which “focused on counterterrorism and border security” in the northern part of the country, according to the group’s website. The Pentagon said in a statement that it was “not aware of any budget cuts that have undermined counterterrorism training or partnership programs in Africa.”

A police barrier ahead of a Malian border is seen in Kimbirila-Nord, Ivory Coast, Feb. 21, 2025. (AP Photo/Misper Apawu)

Ivory Coast has the second-highest GDP per capita in West Africa, but according to the UN it remains one of the world’s least developed countries. Many in remote villages like Kimbirila-Nord do not have access to running water.
“At first we thought that we only had to solve these problems with a military solution,” Famy Rene, the prefect of Korhogo, the region’s capital, said. “But we saw that this was not enough. We had to put in place programs that strengthen the resilience of the population.”
Residents of Kimbirila-Nord had big plans before the US froze aid. The US was supposed to finance the first well in the village, help create a collective farm, and expand vocational training,
Now they fear they have been left alone to deal with extremists.
“If you forget, they will come back,” said Doumbia, the village chief. “As long as there is war on the other side of the border, we must remain on a high alert.”


Families of Syrians who disappeared during its civil war say the search must go on

Updated 57 min 50 sec ago
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Families of Syrians who disappeared during its civil war say the search must go on

  • A United Nations-backed commission on Friday urged the interim government led by Ahmad Al-Sharaa to preserve evidence and anything they can document from prisons in the ongoing search for the disappeared

DARAA, Syria: Family members of Syrians who disappeared in the country’s 14-year civil war gathered in the city of Daraa on Sunday to urge the newly installed interim government to not give up on efforts to find them.
The United Nations in 2021 estimated that over 130,000 Syrians were taken away and disappeared during the war, many of them detained by former President Bashar Assad’s network of intelligence agencies as well as by opposition fighters and the extremist Daesh group. Advocacy group The Syrian Campaign says some 112,000 are still missing.
When rebels led by the Islamist group Hayat Tahrir Al-Sham overthrew Assad in December, they stormed prisons and released detainees from the ousted government’s dungeons. Families of the missing quickly rushed to the prisons seeking their loved ones. While there were some reunions, rescue services also discovered mass graves around the country and used whatever remains they could retrieve to identify the dead.

Family members hold pictures of their relatives who disappeared in the nearly 14-year Syrian civil war, during a protest calling on the interim government to not give up on efforts to find them, in the city of Daraa, Syria, Sunday, March 16, 2025. (AP)

On Sunday, the 14th anniversary of the countrywide uprisings that spiraled into civil war, Wafa Mustafa held a placard of her father, Ali, who was detained by the Assad government’s security forces in 2013. She fled a week later to Germany, fearing she would also be detained, and hasn’t heard from him since.
Like many other Syrians who fled the conflict or went into exile for their activism, she often held protests and rallied in European cities. Now, she has returned twice since Assad’s ouster, trying to figure out her father’s whereabouts.
“I’m trying, feeling both hope and despair, to find any answer on the fate of my father,” she said. “I searched inside the prisons, the morgues, the hospitals, and through the bodies of the martyrs, but I still couldn’t find anything.”
A United Nations-backed commission on Friday urged the interim government led by Ahmad Al-Sharaa to preserve evidence and anything they can document from prisons in the ongoing search for the disappeared. The commission also urged the new government to pursue perpetrators.
Some foreign nationals are missing in Syria as well, notably American journalist Austin Tice, whose mother visited Syria in January and met with Al-Sharaa. Tice has not been heard from other than a video released weeks after his disappearance in 2012 that showed him blindfolded and held by armed men.
Syria’s civil war began after Assad crushed largely peaceful protests in 2011, one of the popular uprisings against Arab rulers known as the Arab Spring. Half a million people were killed during the conflict, and more than 5 million left the country as refugees.