OPEC Agrees Oil Cut Extension to End of 2018

OPEC agreed on Thursday to extend oil output cuts until the end of 2018 as it tries to finish clearing a global glut of crude while signalling it could exit the deal earlier if the market overheats.

Non-OPEC Russia, which this year reduced production significantly with OPEC for the first time, has been pushing for a clear message on how to exit the cuts so the market doesn’t flip into a deficit too soon, prices don’t rally too fast and rival U.S. shale firms don’t boost output further.

The producers’ current deal, under which they are cutting supply by about 1.8 million barrels per day (bpd) in an effort to boost oil prices, expires in March.

Two OPEC delegates told Reuters the group had agreed to extend the cuts by nine months until the end of 2018, as largely anticipated by the market.

OPEC also decided to cap the output of Nigeria at around 1.8 million bpd but had yet to agree a cap for Libya. Both countries have been previously exempt from cuts due to unrest and lower-than-normal production.

The Organization of the Petroleum Exporting Countries has yet to meet with non-OPEC producers led by Russia, with the meeting scheduled to begin after 1500 GMT.

Before the earlier, OPEC-only meeting started at the group’s headquarters in Vienna on Thursday, Saudi Energy Minister Khalid al-Falih said it was premature to talk about exiting the cuts at least for a couple of quarters and added that the group would examine progress at its next meeting in June.

“When we get to an exit, we are going to do it very gradually… to make sure we don’t shock the market,” he said.

The Iraqi, Iranian and Angolan oil ministers also said a review of the deal was possible in June in case the market became too tight.

International benchmark Brent crude rose more than 1 percent on Thursday to trade near $64 per barrel.

Capping Nigeria, Libya

With oil prices rising above $60, Russia has expressed concerns that such an extension could prompt a spike in crude production in the United States, which is not participating in the deal.

Russia needs much lower oil prices to balance its budget than OPEC’s leader Saudi Arabia, which is preparing a stock market listing for national energy champion Aramco next year and would hence benefit from pricier crude.

“Prices will be well supported in December with a large global stock draw. The market could surprise to the upside with even $70 per barrel for Brent not out of the question if there is an unexpected interruption in supply,” said Gary Ross, a veteran OPEC watcher and founder of Pira consultancy.

The production cuts have been in place since the start of 2017 and helped halve an excess of global oil stocks although those remain at 140 million barrels above the five-year average, according to OPEC.

Russia has signaled it wants to understand better how producers will exit from the cuts as it needs to provide guidance to its private and state energy companies.

“It is important… to work out a strategy which we will follow from April 2018,” Russian Energy Minister Alexander Novak said on Wednesday.

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New Dengue Vaccine Could Worsen Disease in Some People

Drugmaker Sanofi says that its dengue vaccine, the world’s first, should only be given to people who have previously been sickened by the virus, according to new long-term data.

 

In a statement, Sanofi said it had recently examined six years of patient data. Scientists concluded that while the vaccine protects people against further infection if they’ve already been infected with dengue, that’s not the case for people who haven’t previously been sickened by the disease.

 

“For those not previously infected by dengue virus…the analysis found that in the longer term, more cases of severe disease could occur following vaccination,” Sanofi said. “These findings highlight the complex nature of dengue infection.”  

 

People who catch dengue more than once can be at risk of a hemorrhagic version of the disease. The mosquito-spread disease is found in tropical and sub-tropical climates worldwide. It causes a flu-like disease that can cause joint pain, nausea, vomiting and a rash. In severe cases, dengue can cause breathing problems, hemorrhaging and organ failure.

 

The World Health Organization says that about half the world’s population is at risk of dengue and estimates that about 96 million people are sickened by the viral infection every year.

 

Sanofi is proposing that national authorities update their prescribing information. It also said doctors should assess the likelihood of prior dengue infection in people before choosing whether they should get the vaccine.

“For individuals who have not been previously infected by dengue virus, vaccination should not be recommended,” Sanofi said. The vaccine is currently recommended in most dengue-endemic countries for people over age nine.

 

The company expects to take a 100 million euro ($118 million) loss based on the news.

 

There is no specific treatment for dengue and there are no other licensed vaccines on the market.

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More Than Half the World’s Population Lacks Social Protection

The International Labor Organization says a majority of the world’s population, four billion people, have no social protection, leaving them mired in an endless cycle of poverty. 

The report says 45 percent of the global population is covered by at least one social benefit.  But that leaves 55 percent without any social protection, a situation ILO Director General Guy Ryder calls unacceptable.

“That means that they do not receive any child benefit, any maternity benefit, any unemployment protection, any disability benefit, any old age pension and that they do not actively contribute to social security systems,” Ryder said.

The consequences are severe and tangible.  The report finds the lack of social protection leaves people vulnerable to illness, poverty, inequality and social exclusion.  The ILO regards the situation as a significant obstacle to economic growth and social development.

Ryder tells VOA governments would benefit from considering social protection as an investment in their populations.

“Social protection is a human right and we should be pursuing it because it is a human right,” Ryder said. “But, also, I think there is a great deal of evidence to demonstrate that when social protection systems are in place and where they function well and one can think of the whole cycle of protection from kids right through to old age, then you reap economic benefits from it.” 

The report says the lack of social protection is most acute in Africa, Asia, and the Arab States.  It recommends those regions increase their public expenditure to at least guarantee basic social security coverage to all their people.

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Eurozone Recovery Fueling Jobs But Wages, Prices Lag

The buoyant economic recovery across the 19-country eurozone has pushed unemployment down to its lowest level in nearly nine years but has yet to translate to a sustained pick-up in wages and prices, official figures indicated Thursday.

 

Eurostat, the European Union’s statistics agency, said the jobless rate fell to 8.8 percent in October, from 8.9 percent the previous month. That’s the lowest since January 2009, when the region, like the world economy, was reeling from the global financial crisis and the ensuing deep recession.

 

Across the region, there were 14.34 million people out of work, down 1.5 million in the past year. That’s clear evidence that the economic recovery, which has gathered momentum during 2017, has invigorated the jobs market, especially in some of those countries that saw the biggest spikes in unemployment after the financial crisis. That’s especially true in Spain, which for much of the past few years lumbered under the weight of an unemployment rate of around 25 percent. Now, following strong growth, unemployment has fallen to 16.7 percent.

 

Though the eurozone is growing strongly, inflation is still a way short of the European Central Bank’s goal of just below 2 percent, a level it considers healthiest for the economy.

 

Eurostat said its headline measure of consumer price inflation rose to 1.5 percent in November, largely because of higher energy prices. While up from October’s 1.4 percent, it was below expectations in markets for a rise to 1.6 percent and indicates that underlying inflation pressures largely related to wages remain modest despite falling unemployment. The core rate of inflation, which strips out volatile items like food, energy, alcohol and tobacco, was stuck at 0.9 percent in November – again below expectations of a rise to 1 percent.

 

ECB President Mario Draghi has said there are a number of reasons why wages are not rising strongly, including the possibility that after years of low interest rates and weak inflation, wage negotiators may have been focused more on keeping jobs than on securing higher pay. He said these kinds of factors are likely to be “transitory” and that the recent “remarkable” increases in employment should start to show in a rise in nominal wages. With spare capacity in the economy diminishing, the hope is that a pick-up in wages that can support consumer demand and give inflation a boost.

Over the past few years, the ECB has enacted a series of stimulus measures, including cutting its main interest rate to zero, in the hope of getting inflation back up to target. Recently it eased up on its bond-buying stimulus program, which aims to keep market interest rates low, amid mounting evidence of economic growth.

 

Economists are not predicting any further changes soon, with Thursday’s figures adding to that perception.

 

“Today’s figures are unlikely to prompt the bank to accelerate the process of monetary normalization,” said Pablo Shah, an economist at the Center for Economics and Business Research.

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Hollywood’s Long-Awaited Movie Museum to Open in 2019

The founders of the Academy of Motion Picture Arts and Sciences, including silent film stars Mary Pickford and Douglas Fairbanks, said at its inception in 1927 that the organization needed a library and museum. The Academy, best known for giving Oscars at its annual awards ceremony, soon got its library, but has been waiting nearly a century for the museum. 

The long wait is nearly over, said film historian Kerry Brougher during a tour of the site of the $388 million Academy Museum of Motion Pictures, which is under construction and scheduled to open in 2019 with Brougher as its director. The 27,000-square meter facility will be built around a historic department store that was built in 1939, and which, since 1994, has been used for exhibitions of the Los Angeles County Museum of Art next door. The expanded facility will include a glass-domed sphere with a view of the Hollywood Hills and a 1,000-seat theater.

​Brougher says the museum will open as Hollywood enters a new phase in creating entertainment, extending its reach beyond movie theaters. “Film is expanding,” he says. “It’s in the theaters still, but it’s also projected onto buildings, it’s also on your iPhone, it’s on your computer…It’s part of the art gallery world, with film installations.” And while films and multi-media projects are made worldwide, he says the heart of the industry is still in Hollywood.

​The museum will feature exhibits from the Academy’s collection of 12 million photographs and 80,000 screenplays, and which include props, costumes and set elements from such classic films as Casablanca, Psycho and The Ten Commandments.

Known as the Academy Museum, the venue will also feature Oscar statuettes donated by people who won them.

Brougher says visitors will have the feeling that they are in a movie in immersive exhibits. They will even get a chance to walk on a red carpet and accept their own Academy Award.

It will be “like a journey,” Brougher says. “You won’t necessarily know what’s coming next, what’s around the next corner. And you’ll be in environments sometimes that make you feel like you’ve gone back to the past, that you’re in the era that you’re actually exploring.”

​Visitors to Los Angeles have been able to tour movie studios and view the sidewalk plaques that honor movie stars or the footprints of them in the courtyard of Grauman’s Chinese Theatre in Hollywood. They can visit the Dolby Theatre, where the Oscars are presented, but beyond that, they are often at a loss, says Los Angeles Mayor Eric Garcetti. “I think they wander around wondering where they can experience this great golden ticket…to the movies,” he says. “Now they’ll have a place.” That will include the hundreds of thousands of people who work in the movie business and who will finally be able to visit a site that celebrates LA’s iconic industry, Garcetti notes.

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NBC Fires Morning Show Host Over Harassment Allegations

The U.S. television network NBC has fired its leading morning news anchor, Matt Lauer, just days after receiving a complaint against him describing sexual misconduct. Hours later, U.S. lawmakers discussed how to handle harassment on Capitol Hill. Esha Sarai reports.

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