Sunday, December 6, 2015
Obama resists ground war plan against Isis; UK manufacturing faces demand slump; More pain in sight for crude market
1 Obama resists ground war plan against Isis (Dan Roberts in The Guardian) Barack Obama resisted pressure for a more aggressive military response to the threat of Islamic State-inspired terrorism in a rare address to the nation that sought to reassure Americans following the deadly shooting in San Bernardino.
Acknowledging the attack was an “act of terrorism designed to kill innocent people” the president largely reiterated his existing strategy to counter Isis in Iraq and Syria through a mix of air attacks, assistance to local forces and special forces. “We should not be drawn once more into a long and costly ground war in Iraq or Syria; that’s what groups like Isil want,” he said, using an alternative term for Isis.
“They know that if we occupy foreign lands they can maintain an insurgency for years, killing thousands of our troops and using our presence to draw new recruits,” he said. Obama also reiterated his call for Congress to take steps to curb access to assault weapons in the US, saying gun control had become a “national security issue”.
2 UK manufacturing faces demand slump (BBC) UK manufacturing is encountering a poor end to the year amid "gathering gloom" from the global economy, according to industry body the EEF. It has cut its manufacturing forecasts, expecting a 0.1% fall in 2015, with 0.8% growth next year.
Its survey also points to serious concerns about the future outlooks for the global and UK economy. It says weakening demand from developed and emerging markets have become more prominent, leading to falling exports.
As well as exports, the EEF says job prospects have also been hit, particularly with more spare capacity in the oil industry, which has been hit by falling prices. Meanwhile, recent job losses in steel companies have also hit the sector. Manufacturing accounts for about 10% of the output of the UK economy.
The production industries: mining, quarrying, gas, electricity, water and sewage account for another 5%, and construction makes up 6%. In the last decade, manufacturing grew gradually from 2005 to 2008, at which point it took a dive in the financial crisis in common with the rest of the economy.
It recovered from 2010 until the start of 2012 and its growth has been volatile since then. The sector is still below its pre-crisis peaks, unlike the service sector, which is well above its pre-crisis level.
3 More pain in sight for crude market (Siddesh Suresh Mayenkar in Gulf News) Oil prices are pretty much taking the path that Opec had wished for. Brent crude fell 1.9 per cent to $43 a barrel Friday, nearing its lowest level in six years amid a supply glut, and analysts feel that these cuts may get deeper. Analysts are predicting brent will fall to $38 per barrel next week.
On Friday, Opec decided to keep pumping about 31.5 million barrels a day (mbpd), setting aside their previous daily output target of 30mbpd. Opec will wait until June to decide on a new limit, its secretary-general Abdullah Al Badri said.
Oil has slumped 40 per cent since the Saudi-led Opec decision in November last year to maintain production and defend market share against higher-cost shale companies. In June last year, crude had traded above $100 a barrel.
However, over the longer term, Saleem Khokhar, head of equities at National Bank of Abu Dhabi’s asset management group, sees a limited downside. “The supply-demand equation would balance out next year and we do see [the] supply side adjusting accordingly,” Khokhar said.