opec and non-opec producers are meeting in kuwait.e reviewing the impact of their output cuts and will be assessing to see whether the kurds need to extend beyond the summit. yousef gamal el-din joins us now from kuwait city. , importance of and expectations for this meeting. yousef: a lot at stake here. if you look at what is happening with oil prices, reversing their games, we are back at the level from late last year. meeting, they're going to be looking to review the progress or arguably the lack thereof. saudi arabia has been shouldering most of the cuts. then you need to look at compliance levels from the other members. 91% according to the iea when it comes to opec. arguably a decent report card. and thee becomes russia non-opec group. that is only 41%. possibly as high as 67%. backdropat against the where you have more oil coming into the market. look at what is happening with u.s. crude inventories. this tells the story. one is u.s. crude inventory. still at the highest seasonal level in over three decades. countering the oil

and also non- opec countries.of our opportunities in iraq, we are working according to the commitments and decisions made by the ministry of oil that decide which oil fields are to produce how much. at this stage, lukoil is producing 400,000 barrels of oil a day. and we're maintaining that. so, no real impact for now. youref: what about the, broader strategy for the rion, because iraq is a key part of that you also said iran is on your radar. a concern is the new administration under donald trump and what that could mean with relations with iran. does that detract at all from your ambitious plans to make business with iran? >> you mentioned at the start that lukoil's russia's second-largest oil producer. in fact, we are the second largest private oil company in terms of reserves and sixth in oil production. in the middle east, more than orf of the world's reserves are located in our main operations ar in iraq and egypt. we have taken decision to grow our business in the middle east. and one of the new opportunitie

who was there in terms of opec and non— opec?ting of a joint ministerial monitoring committee composed of five nations —— there was. three opec member countries, algeria, kuwait and venezuela, and two non— opec member countries, joe marler and russia. important players but not the likes of saudi arabia and by not the likes of saudi arabia and by no means the full crew. —— i'm an. what did we expect from the meeting and what did we get? -- oman. it was the second time they met and it was established in january two compliant with the clubs agreed in november and december —— to comply with. the effectiveness and the power of this committee is as yet unclear. discussions had as to whether or not they extend the cuts from the currentjune deadline for another six months. the thinking is they probably will, that was the sentiment we got from the meeting, but it's a consideration at this point that they can't give you any ha rd point that they can't give you any hard responses? absolutely. they look to measure whether or not compliance i

the decision by opec to cut production at the end of last year is impacting all the non-opec, opec andes. in terms of our opportunities in iraq, we are working according to the commitments and decisions made by the ministry of oil. and companies have decided which oil fields to produce how much. stage, they are producing $400,000 a day from the field. and we are maintaining that. no real impact for now. yousef: what about the broader set for the region? part of that, you say it is on the radar. a concern for oil producers is the new administration under donald trump and what that could mean for iran. does that distract from your ambitious plans to make business with iran? start,mentioned at the russia's second-largest producer. we're the second-largest oil company in the world in terms of reserves, and six in terms of production. in the middle east, more than half of the world's oil reserves are located. yet our main locations are in iraq and egypt. aat is when we have made decision to actively grow in the middle east. the new opportunity is iran. the iranianng with national company, l

low seasonal demands and rising non-opec supplies is clouding the efforts of opec. also spoke with the russian energy minister. here was his take terms of the possibility of an extension. that in orderided to make any decisions like this or recommendations, there needs to be a ministerial meeting. david: it is time to check in on some of the headlines around the world. korean prosecutors are seeking a warned for the ousted president. she was questioned last week about the scandal that forced her from office. she has pressured -- she is accused of pressuring businesses. the scandal has embroiled some big names including james wiley. sanctions on 15 american with allegations they support terrorism. this comes with after the u.s. freshd fresh influence -- sanctions on iran. it includes a wide range of companies, including a major arms manufacturer that are not known to do business in iran. president begins his visit to russia on monday. he will be in moscow for a two-day trip. he will meet at vladimir putin on tuesday where energy and transportation will be discussed.

can opec and non-opec go for another six months? interesting to see some of the minors under pressure in australia on the back of those more general move lower. and gold stocks on the rise in australia because there's more output of gold. let's get the bloomberg first word news. in germany, angela merkel's election victory has delivered a reality check in this year's contest for the chancellery. energized by the candidacy of martin schultz, the spd headed into the ballot with a paul vance. merkel's cdu posted its biggest win in the state in 13 years, taking 40.7% of the vote. the you k's prime minister will follow her initiation of the brexit process by setting out how she plans to bring thousands of regulations under british control. theresa may is due to send a letter to the e.u. on wednesday, announcing the start of departure negotiations. her government will publish detailed plans for its great repeal bill. portugal's economy minister told bloomberg negotiations must not weigh on the rest of the block. >> in the next two years o

was 100% ance level for opec, and 64% for non-opec. they are going to get this up soon.you extend this agreement? i sat down in a conversation with alexander novak. here is what he had to say. >> we have discussed such a possibility. i would like to remind you that in the decoration of corporations signed back in december, there is an option. so there is option a lot there to extend the agreement if we agree to do so for another six months. but we have decided that in order to make any decisions like this or even any recommendations there needs to be a minute sterile meeting. we have asked the secretary to prepare more materials on the current state of the market and or this material to be communicated to members. when this is done, we are going to have more data on conformity, more data on how markets and indoris are reacting, what is the reaction in opec and other non-opec countries. this will give us the information to make a decision. then in the minute sterile meeting the decision could be made. it is too early today, especially considering the fact that not all par

ony said time is not really opec's side.ger this drags on the more likely you're are going to have unintended consequences in the united states with bill in inventory. it is all coming back. we will see what they come up with in the conversations. that brings up the discussion around fiscal breakeven points and how it affects this part of the world. there is no way to sugarcoat this. far far away. that is how far we are from the breakeven prices for gcc countries. close to $100 a barrel. is still not anywhere near the current level of oil prices we are seeing on brent and wti. faison, as you look to what is you look at the local story here in kuwait. look at the kuwaiti stock exchange. best-performing index in the middle east and north africa. you are up over 20% this year. a lot of investors look at the valuations and are not really sure what it is like either. is this something happening with the fundamentals of the kuwaiti economy? guest: the indices are somewhat deceptive. to 8%,ket is up closer 8.5%. it is onebeing said

at $458 barrel -- $48 a barrel does that mean opec has failed? >> we don't think opec has failed.'t think the shale production uptick was a surprise. our view is oil would remain lower longer and fiscal reforms remain in place. so it is not really about oil anymore but the government's ability to diversify the economy away from oil. i think opec is no longer the shale producer. unless you get an agreement where the shale producers are part of it i don't think the supply glut will go anywhere any time soon. longer term that would depend on global demand growth and whether what you've seen over the last two years will impact oil production going forward. in the meantime for this year we don't think oil is going anywhere. anthony: perhaps it is too early to say opec's plan was a failure. mohamed: yes. anthony if: if they do see the prospect of the rising shale and say we're not going to extend the agreement for six months but end the agreement now what message would that send to the market in terms of the future of the oil price? you'd have perhaps the count veiling factors of morrow

yousef: russia once to lead the charge from the non-opec french. 64% for non-opec.e is worried here. they are convinced they will get this up very soon. the other question becomes --do you extend the agreement? i sat down with alexander novak. here is what he had to say. possibility and i would like to remind you that in the declaration of cooperation signed in december, there is an option. .o extend the agreement for another six months. we will discuss this option. we have decided that in order to make any decisions -- any decision like this, there needs to be a ministerial meeting. we have asked the opec secretary to prepare materials on the current state of the market. that should be communicated to jmc members. we will have more data on conformity and how markets and inventories are reacting. and what is the production in the u.s. and other non-opec countries. this will give us more information to base a decision on. -- at theadd in his ministerial meeting, a decision can be made. it is too early to draw conclusions on this today. not all participating countries

that mean opec has failed?t think opec has failed. we do not think that was a surprise to anyone. from that perspective, fiscal reforms remain in place. it is not about the oil anymore. i think opec is no longer the shale producer and less you get an agreement where [indiscernible] they are [indiscernible] longer-term, that would defend on global demand growth. in the meantime, we do not think oil is going anywhere. >> perhaps it is too early to say that their plan was a failure. if they see the prospect of that extende are not going to the agreement for six months. what message would that center the market in terms of the future of the oil price? the factors of more opec production. if we see a lower price, does that take more shale off the market? >> i do not think there will be an answer. they will it up to supply and demand. it will be oil prices go back down again. back production falls until shale producers become more cost efficient. findme point, you might cuts by oil majors coming into play where produ

the deliberations of opec's monitoring committee have come to a close.e kuwait, algeria, and on the non-opec front, by russia and oman. this was always going to be about the level of compliance. alliance 6% on the non-opec front lower at 64%, but they are convinced that this will come up very fast. they did cite some of the key challenges in global oil markets. at low seasonal demand, refinery maintenance come and rising non-opec supply clouding the efforts of this agreement and of the group. they are waiting for more data to make a call about a further extension, but what they have asked opec to do is to deliver recommendations about how they would like to go about that extension. on anrmal decision extension is expected on may 25 in vienna. has you heard, kuwait was the first nation to call for extending production cuts, saying inventories have grown more than expected. are looking for is a five-year average of inventories. 285 above thew at five-year average, so once the inventory start going down, hopefully we we will go towards the five-year average

>> i think opec producers and non-opec producers will try to do something to get expectations .e have a decent floor that around 50. as you said, you are inviting production elsewhere in that could weigh on sentiment. we are looking at for the balance of this year. we are almost at three dollars now. see we are at -$3. quite a widespread. what is the cause of this? takesh every spread, it to to tango. time spreads. is then the other hand global effort in terms of producers trying to reduce supply. fred does not have a physical delivery so you will never see the weakness in terms of time spread and differentials as you would from ati perspective. vonnie: how have you been from thet the markets u.s. and canada? clearly, we will have some regional changes that will .appen in terms of w-2 ui that is going to happen with the dakota access pipeline. keystone, it essentially is not built yet. it's so needs to be -- that is going to bring competition to the likes of venezuela and mexico. mark: we started with the opec meeting. let's and with it. deeper cuts is something you propose. wha

both on the opec and on opec side.hat is going to be interesting is how the numbers reflect those efforts. they are not immune to the realities of what is happening in the global oil market. they pointed out in their press release as well. and spoke about maintenance not opec supply clouding the work they are doing. ultimately, it sets the stage or perhaps all options coming to the table to be able to react to additional supply. ultimately, they have to take action if their efforts are not working out. if the extension happens -- this is interesting mark, you are looking at a second half price north of $60. the question will be as to how much of an impact that will have going forward. mark: yousef, great job. thank you for joining us. yousef in kuwait city. vonnie: while opec is considering cuts, producers are expecting production to rise. let your more from alyx steel. >> you are dealing with the shell production in the u.s.. joining us now is the ceo of new field energy. lee, good to see you. you just raised your fou

inventories are offsetting opec's efforts.becomes, are we reading too much into this, because that is what goldman is saying. it needs time to work through the system. is that something you agree with ? i think the key concerns for the falling price is the cost of and foreignh u.s. countries. i would say that the markets abouteen overly concerned this issue because of a few reason. the higher industries came during this period. this could be a seasonal thing. the revisedlook at u.s. oil production cost by the u.s. department, that they are only forecasting above 9.2 billion barrels a day of from 9 billion barrels a day of increase for this year. this is about 200,000 barrels a day of increase. in opec oilust this forecast -- they actually look for 1.2 million barrels of cuts. this raises a question, is the opec strategy working, or when they come in huddled together, do they need to raise their game and take more oil out of the market? barnabas: as i was saying during the higher u.s. oil production and the falling opec product

and some other non-opec countries particularly russia were trying to engage in. this is helping to reflood the market with oil and it's a real threat to the price stability that we had experienced over the past couple months. >> reporter: don't underestimate opec with the ramco, saudi arabia state run oil company looking toward an ipo. there's a strong incentive to keep prices on the high side. if opec and the saudis were to extend the production cut, prices could head back higher. for "nightly business report," i'm jackie deangelis. >> on wall street today trading was choppy as the move in oil prices starts to ripple through the broader market. investors were also in wait and see mode ahead of the monthly job reports due out tomorrow. today the dow jones industrial average rows just two points to 20,858. that's wait and see folks. the nasdaq and the s&p 500 were both up a point and change. >> as tim mentioned small moves in the market today but that wasn't the case eight years ago. we were in the depths of the financial crisis and if you were like many investors

we are looking at opec inchoate.before extending oil cuts into the second half of the year. >> we have decided that in order to make a decision like this or any recommendations, there needs to be a meeting. we have asked the opec secretary to prepare more materials on the current state of the market and for this material to be communicated to members. are joined now from kuwait where those ministers have been meeting. talk to us about compliance. they are talking about whether or not they are complying to the cuts and whether they will extend supply cuts. itthey're calling conformity, but this is crucial because there were doubts about compliance, given opec's track record. we heard a lot of rumblings from iraq about how the barrels are being counted and there will also concerns that russia may not be living up to its part of the bargain and saudi arabia is getting impatient, not willing to carry other people's weight. you have other people on the same page saying they like the compliance levels they are seeing. the

opec is made that clear -- specific price. opec has made that clear.is not about oil prices, this is about clearing the inventory. the reality is and i find this fascinating, many people out there are calling oil rices -- prices. barclays is saying the drop you are seeing is just temporary. who the winners and losers are in the next couple of days. alix: it's going to be fun. thank you very much for joining us from kuwait. what are the ramifications when it comes to the oil market and how does it spread to other asset classes? you can really see bloomberg high-yield energy index, that is the white line. oil is the blue line. you have the yield at 6.7%. the last time we saw that, oil was trading at $80 a barrel. how does that make sense. jim joins us. jim: there is a lot that has gone on since 2015. embedded in some of the spreads was an expectation of a recession or a global pullback. ining that recession commodities, there were a lot of enhancements done. oil companies were issuing equity, they hedged a lot of foreign production. they improved credit

opec prepares to meet this weekend in kuwait. this is bloomberg. ♪ mark: this is "bloomberg markets ." oil headed for a weekly loss. opec preparing to meet for a review of their production cuts. joining us from the cme, chief market strategist at ira trader. thank you for joining us again. is there anything out there to make you change your bearish stance on crude right now? bill: i'm only getting more bearish by the day. the price of crude oil at $48 is at a more critical level than it was at $54. an opec meeting this weekend. i don't see much coming out of that. this is a technical breakdown in the market and if we start closing below $47, there's a lot of room to go down to $40. julie: how quickly could we go down to $40? phil: we have seen a very marginal decrease in those record longs. weree in the same spot we in the middle of january with the market in the mid 40's -- mid 50's. if the market starts closing below $47, we will start to see a lot of liquidation. opec is talking about potentially cutting their production the s

it is countering the opec cuts.loomberg intelligence is looking at the crude oil cuts are likely to remain more range found even as the opec cuts hold this is an interesting element of this story, with the u.s. production, there is 9 million euros a day. the prices dropping again, this coming in healthy, we will talk more about this and the major .mplications let's get you into some of the action that has happened and this part of the world. that's in abu dhabi. picture across the board. it is down about 3/10 of a percent. flats there in dubai. then in turkey, it is down 1.5%. we now have a look at your first word headlines. >> china prices are surging worrie. that is a look at the global in inflation stories. monthsctually just five ago with deflationary happened. -- 8/10 of a percent. it has been revealed that president trump did meet with the russian ambassador late last claiming he had zero dealings with the russian campaign. with this envoy before he took office. he called this a ruse. they have been having a t

american production and opec. jonathan: yousef gave us the opec calendar.of it is assuming the production cuts get extended. why is plain and simple, an ipo coming up in saudi arabia. >> exactly right. jonathan: if you are a traitor with a long-term horizon, you are going to look at this and say, once the aramco ipo is done -- >> well, first of all, i don't want to get too far ahead. we aren't even getting that meeting until june 1. that's a long time to wait for this market to bounce around between $47, $50 -- i don't know where we are going to go. i'd like to look at this as an opportunity, for the next month and a half, that there is not necessarily going to be an extension and there are opportunities to buy. jonathan: let me ask the question another way. do you buy the aramco narrative out there? after the ipo, it is back to business? but'm not sure about that, yes, you write a narrative -- you ride the narrative. they are the ones controlling opec, controlling the need for an extension. right now, the compliance numbers have been outstanding. if you lo

the opec community.his is bloomberg. ♪ ♪ we are counting down to the citi open and a brand-new trading week getting underway. we are seeing a few lackluster things when it comes to futures. it is the last sunny day in sydney, looking at pressure when it comes to the japanese markets when they open as well, betty. i'm haidi lun is it me. betty: i am -- in sydney. betty: donald trump blames democrats for the failure of obamacare. he criticized conservatives who oppose the bill because they said it does not go far enough. if you look at the bloomberg 7124 there we#vtb go, the dollar took a dip thenst the g-20 peers after republicans canceled the vote. our reporter has been tracking us.of this for tonight you have got the blame game and appointing the fingers at this point, but that will not do investors any good. what about this week? where does the white house pivot to this week? reporter: we should expect the white house to start pushing congress to do a big tax reform bill. this is something president tr

coming up, the final spread. , the fed, and opec meeting in kuwait city. we are of course watching develops on capitol hill. paul ryan meeting with the freedom caucus chair, mark meadows, as the debate on the health care bill continues. wall street on the edge ahead of the health care vote. in new york, you are watching bloomberg. jonathon: from new york city, i'm jonathan ferro. this is bloomberg, the real yield. next weekgenda coming including an opec meeting this weekend and the uk's triggering two years of brexit negotiations. indexrclays high-yield price by crude at $80 per barrel. thatt to talk exit and agenda. bob michael guests, and michael collins. look at the energy sector. underlined the index. >> they have done a lot. generally speaking, raising but,ends, consolidating, there is still a lot of risk in high-yield energy space. if you look at the average on energy bonds, it is not much higher than the high-yield. you're not getting a big premium for the volatility of the commodity. for example, there is a credit we will look at yesterday, i will

and how long can opec and non-opec stay compliant?tion is how long saudi arabia is willing to carry along with this compliance. for now, it looks fantastic. we have 100% compliance because the saudis are capping a lot. as far as initial compliance, forward. have broke they are not actual cuts. i think the difficult bit comes in the second half of the year when you get not the help of -- in the summer, typically activity increases. it will be difficult for russia to comply. , thank you for joining us. he covers energy and commodities for us. still ahead, we are looking at american industry. the plan for emerging markets. it is vonnie quinn versus mark barton. in on wednesday for the full coverage on the fed decision. that coverage of janet yellen will start at 1:00 eastern time. former federal reserve vice chair alan blinder. what a week. this is bloomberg. ♪ ♪ vonnie: --julie: welcome back to "bloomberg markets." vonnieudging mark versus b in the battle of the charts. i am very excited for this. vonnie will kick it off for us. vonnie:

opec will meet in may. says u.k. may need to pass as many as 15 pieces of legislation before the country leaves the european union. they have been examining the onden brexit will put parliament. the report also said the additional work will leave mp's little time for any other bills. slowing. then economy there was a slight drop from the same quarter one year earlier. egypt's government is aiming for a growth of about 5% this year. a crypto currency, bitcoin, continues to fall after losing value due to a spat within the developer community that will split the virtual currency. the fight is over the size of transaction. only blocks of one megabyte can be processed. some want to increase the size. news 24 hours a day powered by more 2600 journalists and analysts. this is bloomberg. >> the japanese market is on holiday. the markets that are open are mixed. the regional benchmark is gaining ground. let's get the details. >> japan and risk appetite are on a break. a lot of the safe havens, gold is up by 4/10 of 1%. onsaw

that is an issue within opec. you have shale coming on more strongly.ll put pressure on the market because we still have those stockpiles out there if production does continue to ramp up. delays are drawing down those stockpiles and that will put pressure on prices. we will see prices bounce back and forth, especially with strong news like out of libya last week. yousef: let's lighten up the conversation. this rising tide of u.s. oil, the latest numbers up seven to 609, that is the sixth straight week of gain. how concerned are you that this won't derail opec? >> they are now above 9 million again. they are sort of where they were. i would say that opec is still having critical impact on the overall oil market. they have been somehow able to decouple the oil price from the dollar over the last month. that is quite remarkable. i would say overall, i see somewhere a cap to the oil price, not too far away where it is now. you have increasing production in the u.s., as long as oil prices are above 50. going forward, we will see some slowdown in the global e

and non-opec producers.g that a smidge from what they initially had cut which was more than they had agreed to cut and they are making clear to the markets that as the saudi minister said last week in houston, they are not going to carry free riders. vonnie: fighting words. you won't get a chance to see this because literally crossing now, new headlines from saudi arabia. saudi is said not to be raising supplies in the national oil market and the visit was implying opec cuts. they didn't say anything about the second half at least not yet. for the second quarter, yes -- >> they have opened the door of the aunt june because they see high u.s. inventories which is a warning sign the cuts have been taken as much of the market as they had hoped. mark: that brings us nicely to the next 24 hours where we have a couple of inventory reports. what a they going to tell us? >> it has been interesting because for a long time we have been complaining the oil markets have been really boring in the last week or so that has

swollen stockpiles are depressing oil prices but what can opec and non—opec members do now and what didhey discuss over the weekend? we will tell you all you need to know. a record fine for bt with the firm setting aside hundreds of millions of dollars for delays in installing high—speed lines. this is how the european markets are looking. it's a big week for pound as divorce proceedings with the eu are kicked off in london. and we'll be getting the inside track on how demand for luxury goods from britain is being turned into an upmarket hotel in the middle east. in the wake of the story that two girls have been grounded by united airlines for wearing leggings we want to know has the airline gone too far? or is it reasonable for an employer to dictate the dress code for the family of employees? what do you think? let us know using the hashtag bbcbizlive. welcome to the programme. lower oil prices might be good for consumers — it keeps energy prices down as well as transport and distribution costs for businesses. but it's not good for oil producing nations. and this weekend, many of them

there was a big run-up before the opec agreement came in and we saw a big drop down.you look at the averages, it is not been that significant a drop in my view in terms of output either. if they were to go back the way they producing in the third or fourth order of last year, -- quarter of last year, i don't think it is going to be a massive increase in supply. and then you have countries facing volatility like liberia and nigeria. again my sense is it is too early to call whether they will roll over the agreement or not. and the saudi's are still pulling all the weight producers inale north america ramp up production and producing continuing to rise, i don't think there will be an extension of that agreement. tracey: we have to leave it there. thank you for bringing up the latest on the energy market and take you to the head of the research for immigrants for being such a wonderful cohost. thank you. c help to deliver strong results on the back of maternity and fertility demand. wheels big with their new ceo. this is bloomberg. ♪ watchingou're "bloomberg markets: mid

will handle opec strategy.anus: in aisle three we headed to the checkout with a basket of financials as this supermarket releases its latest comedy results. this is bloomberg. > opportunity for> europe and players to take advantage of precisely these construction which would be more completed. i remain optimistic and i see step-by-step more and more positive steps in the europe banking sector. anna: that was ceo frederick benaiah -- oudea. speaking to jamie dimon later today. 12:45 u.k. time. manus: juliette saly is standing by. thank you. exxon mobil may separate the 4.8 billion euros specialty chemicals is an is. rejecting an unsolicited it for the whole company from u.s. rival ppg industries. amsterdam-based asko says the 83 euros per share proposal is undervaluing the company and was not in the interest of it stakeholders. quebec has agreed to buy general atctric's water unit valued three point 2 billion euros. the french company and the canadian funds manager will hold 70% and 30% of the unit respectively.

the real issue for opec right now is stockpile.t really unnerved the market was this 8 million barrel gain in u.s. stockpiles. they are sitting at a sort of 20% above the five-year average and they are not budging. i think investors are waking up to the fact that despite the opec cuts, there's still too much oil around. matt: how much of this is due to a drop in demand? are people actually using less oil? will: absolutely not. demand has been fairly robust. their estimate for global demand this year. this is really a supply-side issue. if you look at some of the numbers coming from the u.s., between october when opec first agreed its cuts, and december, production rose by 7400 barrels a day. that negates a huge amount of what opec is taking out of the market. talk about what the shape of the table looks like. we've got this much flatter shape. looks like it is coming up a little bit. will that help the shale guys? if the backend comes up a little bit, they can sell more. will: i think you've hit on a real issue there for opec. one

people are looking at what opec does, for sure. opec and saudi arabia. thank you, david in houston.the rate hike uncertainty, is the fed meeting going to be a drama free zone? we will dig into it. ♪ ways wins. especially in my business. with slow internet from the phone company, you can't keep up. you're stuck, watching spinning wheels and progress bars until someone else scoops your story. switch to comcast business. with high-speed internet up to 10 gigabits per second. you wouldn't pick a slow race car. then why settle for slow internet? comcast business. built for speed. built for business. live-streat the airport.e sport binge dvr'd shows while painting your toes. on demand laughs during long bubble baths. tv everywhere is awesome. the all-new xfinity stream app. xfinity. the future of awesome. the trading day in sydney. you can see the stocks lower than futures had indicated, down 3/10 of 1%. we are getting breaking news from australia on consumer confidence from the index, rising a touch, a slight bump here, to a reading of 99 .7. at that is a gain of 1%. last month had risen

and now it is and opec and non--opec. until recently, america was declining.on growing. demand on the one side going up, supply having keeled over. scarlet: when you look at the demand side, what is at most risk of not delivering when it comes to demand? >> the data late last year, early this year, wobbly in ,laces like india, in china which has seen the look a growth, if you want. america, still clicking over positive. then we don't think the china stroke india are new structural issues. , we think broadly speaking growth, developed markets, a little bit positive in the aggregate, 1.4 point dollars, $1.5 million. joe: you mention the reason for the improve supply picture is we have 2 1/2 years of low prices. the cure for low prices is low prices. the other people point to the fact that rig counts are surging in the u.s., inventory in the u.s. is high. the u.s. is not enough of a swing producer to change the global picture, is that what you are saying? >> we learned that back in 2013, 2014, the united states is capable of messing the whole thing up. this time

i think the deal is the top in the market. >> so i think the opec cut. i think it's a problem for oil. but i think it is the idea of the deal. maybe people getting ahead of it already. >> the concept that it is a reason why oil markets have been supported right to. say that the politics of oil changed at all just because opec, if anything, we've established there's open everything and nonopec compliance. russia was probably one of the biggest producers with the most swing. when business u.s. shale, we're back near all time highs. we're 9.5 billion barrels a day. the shale, the delta, where all the growth is coming from. to say the market can flood rest of the world. >> why wouldn't russia have been on board? russia has a vested interest. the russian economy depends on it. >> you're telling never u.s. can blow out the entire oil market for the world. alone by their production. >> i think the saudis have potential to blow it out. of course. when you look at the deregulation, there will be drilling, fracking, digging, anything. >> opec has controlled the oi

what is happening with opec? it is hard to know. opec does not control the price anymore. even after the cuts since before christmas, the increase of shale supply has, you know, cap oil. one of the things we are seeing is fragility in the hole of that context. how much they control the price. we are going to get more details in the coming months about how much they are actually supplying. are they supply more than they are saying? they have a reason to talk up the price so we have to wait for more details over the coming months. i am not bullish on oil. matt: this, clearly, plays into the inflation question as well, right? if we see oil prices coming down or stabilizing at lower levels, that takes a lot of pressure off inflation going forward both for the u.s. and europe. mark: i think that is a really important elements to what is happening fo. it is hard to get sustainable inflation in any country where input prices are falling. we had very low commodities one year ago, so generally, the last couple of months, we have had positive -- to get the going opposite dynamic if

of cuts question, iss a the opec strategy working?need to raise their game and get more oil out of the market? previously,saying the contrast between the higher u.s. oil production and falling opec production is -- if you look at fundamentals, a lot of the notion is that the spirit to 2017 -- ifhalf of you look at one or two data points, it is hardly evidence to show that this still continues. up, delivered strong for your results. we are from the company's newly appointed ceo about his ♪ prescription for success. this is bloomberg. ♪ >> welcome back to the best of bloomberg markets: middle east. the first uae health care company to list on the london stock exchange after a strong earnings report this month is now considering issuing bonds to fund acquisitions. we asked the ceo for sam on this about how abu dhabi's new rules might impact the performance for 2017. changes are a lot of happening in the last few years. this was started by of adobe. despite a big change the way in which of adobe's interests health care flipped in the last

. >> coming up, oil has been on a wild ride as opec and france cut.e ask where they see prices going. ♪ >> welcome back to the best of bloomberg markets middle east. oil has had a roller coaster ride on data from the u.s.. it raised oil production back above 10 million barrels. cots itg a third of the introduced in january. more from anthony. >> it was differing information coming out. investors were reading different things. was thateadline we saw the saudi's increased production in february. opec is looking to cut production as a whole. those are merely held in the u.s. and europe. the saudi said they went even a day.0 million barrels that was more than they needed to take. so they could get that production off the market. they were up over 10 million. we see saudi's increasing. the studies were below the level they had set for themselves. it was the saudi's have the lifting that did help opec meet or come close to meeting those targets. seeing producers looking downstream for alternative revenue. how is it playing out now? >> as we have seen with a

if the opec deal about to fall apart? we are snowed in in new

crude fell to the lowest since the opec supply deal was struck. puerto rico's governor joins us from sam on -- san juan. now it is time to talk to bondholders. u.s. markets close in two hours. let's check with the julie hyman . julie: we are seeing the major averages fall. seen the effect on businesses and people staying home from the storm. no matter theday snow level on the ground. it's having an effect on the airlines. had 8800 flights canceled in the northeastern u.s., 60 600 today, delta, american, and ual fly. ,e are watching restaurants restaurants with northeastern exposure in particular could see a decline in same-store sales. we have shake shack down 1.8%. was one of the restaurants that could lose 50-100 basis points. on the flipside, some of the company selling cold-weather gear are up today. columbia sports wear catching a bid today. another interesting weather related phenomenon, natural gas, rising in advance of the storm, and now pulling back as it is not as bad as had been anticipated. are following as well today, down .2%. oil, w

deal, opec and non-opec. do think to rebalance the market you have to see some kind of substantial extension from opec and non--opec going forward? guest: there's always this conflict between opec suppliers of oil and non-opec suppliers of oil as you rightly identify. the shale suppliers in the u.s. being part of that. quite how that plays out in the coming months and years to my obviously is unknown. i do not know how that will play going forward. my hunch is that the deals struck by opec which are deals about restricting the supply of oil and support the price will not be stuck. if the past is any guide. been stuck for a few months at most and after that, 70 always breaks the deal. it is in their interest to do so and i imagine something one have been like that in the future. anna: goldman sachs has this great graphic to show you. which shows returns and various asset classes since 2008. you see here european high-yield, s&p five -- 500 doing well. you can make that link if you like to. on the other hand co

they both say the agreement between opec and non-opec members will work.ey'd knowledge that inventories are not falling as quickly as they expected. earnings as growth from delivering online orders flattens. the cheek executive, frank appel, says they are not shopping itself. >> there is no need to do something like the u.k. and europe. it will be significantly more organic. civilk there is no answer. in some markets it is better to acquire something and in others it is better to do something organically. it depends on the availability of a proper target. but with the combination of weanic acquisitions, i think have found the right recipe for success. mark: adidas has raised the sales and earnings forecast through 2020. profits should rise as much as 22% a year. the new chief executive also announced plans to sell the ccm hockey division. wants to raise equity since the financial crisis. $20 billion for the latest global buyout fund. last year, the firm went on a buying spree, snapping up companies such as adt and diamond resource international. vonnie: ti

opec is stillat having critical impact on the overall oil market. some open people to decouple the oil price from the dollar over the last month. that is quite remarkable. i would say overall, i see oilwhere a cap to the price, not too far away where it is now. you have increasing production in the u.s., as long as oil prices are above 50. going forward, we will see some slowdown in the global economy. we will see a stronger dollar, you will see china breakdown. europe and japan are ultimately more recessive than anything run massive they commercial surpluses. it is wise to be prudent, rather than to optimistic on oil price. >> and want to pick up more on the oil price. in ave seen oil trading really tight range. what is the prospect we actually get some sort of break on the downside or upside before opec meets in may? very difficult to say. i a will have to pause on that. marginsspeaking, those -- it is difficult to forecast the veryrice in near-term. i think it is important to have in mind there is a cap there. it can't go too much higher. region,

speaking of opec look at this chart.gh crude has not recovered to its 2014 levels, the bloomberg barclays high yield energy index pricing crude is still at $80 a barrel. i want to talk brexit and energy. i want to bring in our guests. michael beginning with you. looking at the energy sector, have these companies underlie that index enough to warrant -- done enough to warrant what the spreads are? >> they have done a lot. they have done a great job generally speaking, cutting their dividends, raising cash, issuing equity in some cases, consolidating. but, they are still a lot of risk in the high-yield energy space. if you look at the average spread on energy bonds, it is not much higher than the height yield index energy. you are not getting a big premium for the volatility of the commodity. there is a credit we are looking yesterday they have a bond, a , terms of leverage. they have a bond trading $.70 on the dollar. if oil stays at 50, the bond is worth that. if oil goes to 40 you get a goose egg, no recovery at all. th

lots of pats on the back, lots of praise, 106% for opec members , 64% for non-opec, but any of the voicesed of those and are confident that number is going to bounce back. the other factor was the picture and terms of challenges, and they did cite the fact there are rising inventories, refinery maintenance, and low seasonal demand. the kuwaiti energy minister had this to say in terms of what they are looking for exactly when it comes to inventories. >> what we are looking for is a five-year average of inventories. 285 stands right now at above that five-year average, so start goingentory down, hopefully we will go towards the five-year average of which we hope to reach around the end of the third quarter. even though on the sidelines of the meeting, a lot of opec members have been vocal about the need for an extension, the fact there is still so much oil out there. nobody was able to comment as to whether they would be open to refining the agreement, amending quotas even further. the russians are saying well until the data comes in. early and the inventory drawdown is not expected to mate

it's difficult for opec. they're heading into the may 25th meeting, they will be looking at themselves handing shares to the u.s. it will be difficult. some of those earlier comments suggested or highlighted that we are seeing increasing efficiency coming out of the u.s. we're not seeing that cost inflation that many expected that could weigh on u.s. production. >> we had comments overnight from the russians and iraqis talking about whether this agreement might be extended. they say it is too early to say. it is set to expire at the end of may. do you think there's enough to extend it? secondly, will it make a difference in the face of rising production in the u.s.? >> if they want to sustain oil prices, they may need to make further cuts. but there's a clear difficulty in trying to ensure that non-opec members that joined in with the cuts complied. there are remarks from russia saying 50% of their cuts. whether they honor those cuts cis key. >> what is the base scenario for you? >> we are working around a $4

that is upsetting opec at the moment. we have seen noises from various opec ministers in texas.eral talking about bringing about shale producers into the opec fold and tried to get them on message when it comes to boosting oil prices. francine: you went to the joe weisenthal university of macroeconomics, how cartel is the cartel, are the unified within the gulf states or separate and apart? >> they are certainly presenting a unified front. we have -- the way we have fed and they opec speak are all on message but the berdych -- brought of the production cuts are borne by specific members. specifically saudi arabia. if you look at the price differential between psi rating crude and wti crude, it is massive. saudi arabian crude is much more expensive than what you get in the u.s. going back to the free rider problem, one of the least effective solutions to this is appealing to people's sense of -- allrism or fairness truism and fairness and that is what opec is doing in texas, talking about your producers and trying to get them on board. whether that will be effective is a question

one of the topics was opec and its latest production cut. >> opec has cut production to try to accelerateng of the marketplace and so we're seeing that happen right now and there are debates about whether the market is fully balanced or getting there. but the general point is as demand grows about $1 million a day and as we start to see the impact of lower investment in the business, the market is coming into balance. so i think we're seeing that more and we can anticipate some recovery in prices over the last six months or so. >> john martin suggesting that the market is not over supplied and there's going to be demand for barrels of oil still above what is being produced. oil price sitting around 55, $50 for wti in brent. it has been hovering here but it has not stopped the u.s. for doing huge production. exxon talked about this, huge amounts of capital. >> i'm very interested with the opec secretary general has to say about u.s. production and the impact on the cuts that they're having, whether that completely balances it out or whether it can mean higher prices. >> be sure to stick ar

gaining after a kuwaiti new service reports the oil minister says opec is considering all the opec members on extending production. kuwait is on board as well. oiled got a spike on the and is holding on to a gain of 1.5%. vonnie: we will continue on that topic now of energy. we are watching conoco phillips shares surging after the company decided to on but it's taken in oil venture and other canadian holdings in a $13 billion transaction. alix steel is here with the ceo of konica phillips. alix: ryan lance, thank you so much for joining us on this day. good to talk to you. i spoke to one analyst earlier today to set the first question you have to ask is how does it feel to have done the deal of the decade, or the year i should say? ryan: thank you. it is good to be with you again. we talked last november and had a long conversation about some of these issues. it is great for our company. also good for synovus as well. but for conoco phillips this jump starts and turbocharge is our value proposition. it sets us up to reduce the debt on the balance sheet and return money back to shareholders

oil is trying to rebound today, but the continuing rise of shale producers may blunt opec cuts.fwill speak with tim dove pioneer natural resources. at theaking a look equity movers. stocks are rising today. stocks and bonds and sovereignties, the markets have come down from yesterday's post -- health care even where we saw in move away from risk and into defensive assets. this is a great chart showing the inverse relationship between the sterling and the ftse 100 index. the pound has become a bit of a wait on the ftse index. it's 1.6 gain against the dollar is undercutting interest in the ftse which is packed with those multinational companies whose earnings accrue when the sterling strengthens. stanley recommends selectively buying domestic stocks and buying price year foreign exports -- price year foreign exports. foreign exports. the dollar is the white line, in the ftse is the blue line. what a chart that is. that is a chart we will continue to focus on. we are tracking shares which are seeing it largest inflow since exit last week. -- since brexit talks last week. steady, s

reporter: the big question the oil market continues to think about is the opec and non-opec productionut. the answer appears to be in new orleans, yes, to a certain degree. i spoke with the ceo of pioneer natural resources to see where he sees this going and how resistant -- resiliency is with lower prices. dollarllar-nine production cuts when it comes to taxes. and we are interests below $20 a barrel. impressive, sounds but the real life prices of different story. a resource's ceo said the industry is still losing capital around $50 a barrel. continental resources is not scared. they are watching prices very carefully. i asked them what a 40-40 dollar price would mean. the president of cap financial gave an answer. >> we would start rethinking the level of investment. we have so much option alley with our assets. i thought you about the uncompleted wells we are going to complete. we would probably continue on with completing those wells, we also might consider backing off on the rig cap at that time. reporter: the town is also been more conscious. it was moving higher in 2017. compani