francine: that was bp ceo bob dudley speaking with bloomberg's tracy alloway in abu dhabi. we've had a headline come through to do with italy. the league is proposing a prime minister. this is a development as we heard just before we came on air as well as the president meeting later on today in the late afternoon. both the league and five star are close to forming a government. if we look at what the boom spread is doing, in terms of how yields are moving, we have seen that 10 year yield move higher. it is up three basis points. the spread with germany widening ever so slightly. nothing too dramatic today. let's get the bloomberg business flash. here's taylor riggs. the money manager who famously predicted the collapse in subprime mortgages before the 2008 financial crisis has recommended shortening deutsche bank shares. he made the comments in an interview with bloomberg in hong kong. >> deutsche bank has real profitability issues. they haven't spent money on technology in a very long time. they are probably undercapitalized. deutsche bank is a problem bank. the uae energ

withdraw from the iran accord and bob dudley says that he is not banking on this barrel rating being the norm. >> i think what we have seen is a with drawl from the agreement, which seems to be the beginning of a new negotiation. things anduld affect there is uncertainty, and that is reflective of the oil price now. any iranianurchased oil? >> i think it is good for us to take a breath. >> right. knocked ae gotten little about fiscal discipline. do you think that that was fair? market andet is the we have been really clear. you can do a lot more with capital today because of capital we have morend projects coming this year and i think that it is all about the discipline and the care and we have had circumstances that we are still working through. rethinkingu consider interests that you have thought about? because we will look at this. higher oil prices made this easier or harder for you? framework and we do acquisitions. and we haveinvolved we are not here and $75.ing this company on fairway.f of the u.s. production would jump and offset some of the declines. >> there seems to be dis

bob dudley gave his take this week. b: i think what we've seen is a withdrawal from the agreement, it seems to be the beginning of another negotiation of some kind, but when you couldn't leak one million barrels on the market, it would affect things. ♪ alix: i'm alix steel. this is bloomberg "commodity's dge."-- commodities e time for the data day, where we dig into market trends. the numbers showed a build everywhere of 106 billion cubic feet. but the really interesting number was the oil inventory number. oil exports were over 200 -- were over two and a million half barrels a day. we saw the the second largest gasoline drop so far is exports at about one million barrels. this is a total inventory drag for gasoline, as well as oil. another data point that caught my eye was how much opec and iea disagreed on demand. here's the deal, the iea cut demand growth forecast to 1.4 million barrels of oil a day in this year blaming higher prices eating into demand. opec took another route. the increased its call on demand to mill

withberg spoke extensively bob dudley. >> what we're seeing is a withdrawal from the agreement, whichs to be another negotiation. you could lead to one million barrels a day off the markets, and that will affect things. there is a lot of uncertainty. that is more reflect the -- reflected in what is happening in venezuela. vonnie: we are joined now by abhishek deshpande, jpmorgan head of oil market research and strategy. thanks for joining. cold changed from the iran deal -- call changed from the iran deal? paul: it -- abhishek: it plays well with what we were expecting. since is not being extended was part of our risk scenario. as of now, we believe there is a higher probability of prices remaining higher and going towards $80 plus benchmark for us for the rest of the year, at least. next year, the risk will play out differently, where we believe that high oil price risk demand route -- drought, but you also have more supply from your shale and possibly an ok deal not surprising -- not surviving. vonnie: what would push the price to $80? around $71 now. it does not seem to be moving a

bob dudley, the ceo, has worked with russia for quite a bit. he knows what he is doing.n't see any impacts right now. vonnie: what else came out of the call from analysts or anybody else that might have attracted attention? kelly: i think the other thing analysts really to about when i was whether the hard work they did in terms of lower costs translated into higher cash. that catches is for the companies used to pay back the investors who have stuck with the company for almost a decade of crises. that includes higher dividends, possibly. they may be talking about that. this is where we see the comparison with shell come in. the shell share price got hammered because they're not giving cash back at this rate. kelly: it's been surprising because shell has a little more wiggle room on its balance sheet to do something like this. they've taken the more cautious approach. overbought bg, spending $50 billion. they don't feel like their debt has come down enough, so they want to wait before they start to buy back program. caroline: if there is cash to spend it -- we saw yester

manus: and bob dudley coined the phrase lower for longer. let's talk about the fed.ave the minneapolis fed president addressing th eye yield curve. in thatfed colleagues group should not over do with aggressive rate hikes. >> we are not flat yet. we are not inverted yet. we could flatten the yield curve by the end of the year. it depends what happens. that is something i will be paying close attention to, our we overdoing it or coming close? that gives us some information about where neutral is. parry is still with us. we were talking to one investor and tried to talk about all parts of the globe. comingversation kept back to u.s. treasuries and the 3.5% or 4%. thinking in terms of what it does to other asset classes? w: the fable tipping point of u.s. treasuries. i don't think there is ever one level. i mentioned slightly earlier the fed have done a good job. i think we are often very critical of central banks, but they have been normalizing interest rates for quite some time. they are now getting to dispose of treasuries. it is the production of their reduction oft

bob dudley has worked in russia a long time and knows how to deal with them. a complaint where he he was nott this and so thrilled about that. the next round of sanctions does not affect him. let's bring it back to you you are looking at the and there isp undeniably $75 oil and that is good. dividend health. dividend --pare the the dividend yields. although i still think the bond yields are going to rise and the dividend yields are attractive, it is the oil prices trading for brent over the balance of this year and i think that that underpins the energy sector. you look at consensus earnings for the energy sector and they are very strong indeed and the consensus is the earnings forecast is going to be up 40%. >> you stay with the sector. are you concerned that they might be tempted to spend the cash? >> there are plans with the oil majors and it is quite interesting. a lot of this is on alternative energy or diversification. forinteresting question shell is if they are an oil company or a gas company. the economics of energy looks more attractive than it did f

see ifhe interesting to people like bob dudley to relax somewhat their spending.in the contract table is very steep. tim: that's not unusual. that you will expect that what happens will eventually rise up with people and be sustained. dangerous to say that a futures price tells you what the price is going to be. thank you ray much indeed. tim will stay with us. a quick look at what the world map is telling us about the state of european markets. it's an interesting story. not a lot of movement is probably the way i would read this one. a sea of great today, to be honest. it tells you the headline indices are not moving much. let's take a look at what else is going on. the governor france will provide some excitement. 9:00 a.m.. this is bloomberg. ♪ guy: let's talk about the headlines this morning. talks, a deald of is being near to form the tying government. the market seems ok with it. is this the sign of a risk of a trade war? chinese are talking about this right now. they're pretty happy. a next for tells bloomberg he's recommending shorting deutsche bank. good

cannot ask -- do not miss our exclusive interview with outgoing fed member bill dudley. a la bobearnings out, unbelievable. -- alibaba earnings out, unbelievable. the revenue from core commerce up 62% in the last quarter. david: they be on earnings per share and revenue. 60 sue percent up with this base -- 62% up with this base. ♪ alix: jobs number, an hour away. s&p futures down by about five point, dow down 30 points. dax up by 5/10. we have some pmi coming in squish year than anticipated. that is causing the euro to take a little bit of a hit, down 2/10 of 1%. most of the emerging-market currencies are getting hammered. we will be seeing more dollar upside after the jobs number. yields moving lower by one basis point. i am watching the 5-30 spread, flatter as she goes, back to 33 basis points. crude up 1/10 of 1% despite the stronger dollar story. can we talk about alibaba? david: everything, i cannot believe, it is extraordinary. core commerce up 52%, cloud computing up 103%, active users in the marketplace up 37%. revenue growth up 60%. david: they added 100 million active c