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Oil price rises to $56 as market reacts to Biden govt

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Oil price has risen to $56 a barrel for as the market expects the new United States administration to ‘act big’ in the next COVID-19 relief package.

As of 9:17am ET on Wednesday, the Inauguration Day for Joe Biden as the 46th President of the United States, West Texas Intermediate crude was up 1.53 per cent at $53.77, and Brent crude prices were trading above $56 a barrel.

The new Brent price was up by 1.16 per cent at $56.52, very close to the 11-month high prices hit last week, according to oilprice.com.

The US dollar dropped after Treasury Secretary nominee, Janet Yellen, told the Senate Finance Committee on Tuesday that the US should ‘act big’ in the upcoming stimulus package.

The weaker dollar makes crude cheaper for holders of other currencies, while the overall bullish market sentiment also sent investors and speculators to riskier assets such as shares and commodities.

On Wednesday, the market was looking beyond the near-term oil demand scares, stoked by the continued lockdowns in many parts of Europe and now returning in parts of China, too. On Tuesday, Germany extended its lockdown until the middle of February.

But market participants were looking beyond the first quarter, hopeful that a large stimulus package in the US would result in a rebound in the world’s biggest economy, and relief packages in other economies would also help growth, and by extension, oil demand, later this year.

Although it cut oil demand forecasts for Q1 and 2021, the International Energy Agency said in its closely-watched Oil Market Report on Tuesday, “Much more oil is likely to be required, given our forecast for a substantial improvement in demand in the second half of the year.”

The bank’s analysts also said, “The market shrugged off another downgrade to global demand growth from the International Energy Agency who said that renewed lockdowns to contain the pandemic would weigh on consumption during the current quarter,” Saxo Bank said early on Wednesday.

“The market remains bid on a combination of Saudi production cuts and the prospect for more fiscal stimulus, increased mobility and continued monetary easing eventually supporting demand.

“The biggest short-term risk is whether these have been fully priced into the current price level.”

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Aviation

Rains: NiMet warns of severe turbulence, flight cancellations

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The Director-General, Nigeria Meteorological Agency (NiMet), Prof. Mansur Matazu, has said airlines will encounter severe turbulence, flight delays and cancellations during rainfall.
He therefore called on pilots and airline managements to adhere to the weather forecast as the likely severe turbulence could cause discomfort, injury to passengers, instability and even loss of control for small aircraft.
Matazu was quoted in a statement on Friday as saying, “Heavy rains could also lead to skidding of aeroplanes due to surface wetness and impaired horizontal visibility.
“Thunderstorms could also lead to accidents, incidents, flight delays, flight cancellation, death, damage among others.
“Windshear could lead to accidents, incidents, aircraft nosedive, discomfort, aircraft lost control and death.”
The NiMet boss urged airline operators to take weather forecast seriously, stating the turbulence usually would cause poor visibility.
He also called on passengers to be patient with the airlines as flight delays, flight cancellations and flight diversion will be experienced within this period.

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Business

Navy arrests 10 vandals with smuggled 210,000 litres of diesel

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Operatives of the Nigerian Navy Ship (NNS) Beecroft have arrested 10 suspected vandals with 210,000 litre of stolen diesel.
The suspects were alleged to have attempted to smuggle the products concealed in water tanks to neighbouring Benin Republic through a wooden boat when they were intercepted around the Lagos anchorage.
A statement released on Friday by Base Information Officer, Sub-Lieutenant Veronica Effiong, said the suspects with the seized products had been handed over to the Nigerian Security and Civil Defence Corps, after preliminary investigations.
She said, “The vandals and seized products were on Tuesday, June 15, handed over to the Lagos Command of the NSCDC for further investigation and prosecution.
“The Commander NNS BEECROFT Commodore Bashir Mohammed reiterated the NNS BEECROFT`s commitment to the protection of critical national infrastructure and the eradication of all illegal activities in its area of responsibility in line with the Chief of the Naval Staff`s mission statement and strategic directive of 2021-5.
“As partners for a safe maritime environment, members of the public especially our host communities are enjoined to kindly furnish the base with credible information to assist in curbing the activities of criminal elements and economic saboteurs.”

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Business

Buhari challenges MTN on quality service, data rate

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President Muhammadu Buhari has asked the MTN Group to offer quality service to its Nigerian subscribers at cheaper rates.
He stated this when he received in audience members of the board of MTN Group, led by its President and Chief Executive Officer, Ralph Mupita, at the State House, Abuja, on Friday.
Buhari said, “I congratulate you on your appointment as the Group President of MTN. I wish you all the best.
“Nigeria is your most lucrative market in Africa, Asia and the Middle East as well as the source of a third of the income of the entire MTN Group. As such, we urge you to offer top-of-the-range and affordable services to Nigerians.
“As we seek to make broadband widely available and affordable, we urge MTN to continue to support our efforts by expanding high-quality connectivity to Nigerians in un-served and under-served areas.”
The President also called on MTN to support the implementation of the National Policy for the Promotion of Indigenous Content in the telecommunications sector.
He said, “I recently unveiled and launched the National Policy for the Promotion of Indigenous Content in the Nigerian telecommunications sector.
“I call on MTN to support the implementation of this policy and, train and engage more Nigerians in your company.”
He assured his visitors that his administration was doing everything possible to make Nigeria investor-friendly by addressing identified challenges.

He said, “We have identified and addressed the key challenges that affected the growth of the digital economy sector. I am happy to note that the right of way charges have now been pegged at a maximum of N145/linear metre.
“I have given directives for the protection of critical national infrastructure and this has addressed the issue of vandalism of such infrastructure.”

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