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Oil Prices Rise On Fed’s Low Rates Plan

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Crude oil prices rose after the Federal Reserve announced it plans to keep United States interest rates near a record low through 2014 and a report showed durable goods orders in the world’s biggest crude-consuming country increased.

Crude oil for March delivery rose $1.29, or 1.3 per cent, to $100.69 a barrel at 10:26 a.m. on the New York Mercantile Exchange. Prices touched $101.39, the highest level since January 19. Futures are up 15 per cent in the past year.

Brent oil for March settlement climbed $1.53, or 1.4 per cent, to $111.34 a barrel on the ICE Futures Europe exchange in London.

Futures advanced above $100 a barrel as Fed Chairman Ben S. Bernanke said on Wednesday that policy makers are considering more bond purchases to boost growth after extending the pledge to maintain interest rates. Bookings for goods meant to last at least three years climbed three per cent in December, data from the Commerce Department showed.

“Between Bernanke and the durable goods orders, people are starting to feel a little bullish about the economy,” said Michael Lynch, president of Strategic Energy and Economic Research in Winchester, Massachusetts. “The durable goods number points to increasing economic growth and fuel demand.”

The Federal Open Market Committee had previously said the benchmark rate would stay low through mid-2013. Fed officials also lowered their projections for economic expansion and inflation for this year and next.

Oil in New York has traded in a $6.34 range for the past month with futures staying between $97.40 and $103.74.

“Earlier this week we wanted to test the bottom-end of the range,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut.

“After Bernanke made his statement on Wednesday, the shorts got cold feet. Now we’re back in the middle of the range and are looking for a catalyst to launch another assault at the upper end.”

U.S. durable goods orders were forecast to climb two per cent last month, based on the median of estimates by 78 economists surveyed by Bloomberg News. Another report showed jobless claims increased last week. New home sales last month probably rose to the highest level in a year, another report may show.

The index of U.S. leading indicators rose in December for a third month, indicating the economy will keep growing in early 2012. The Conference Board’s gauge of the outlook for the next three to six months increased 0.4 per cent after climbing 0.2 per cent in November, the New York-based group said.

The median forecast of 44 economists surveyed by Bloomberg News called for a gain of 0.7 per cent.

“Negative economic sentiment in the U.S. has receded,” McGillian said.

Talks on a debt swap to avert a Greek default resumed, as international policy makers argue over the mounting cost of the rescue. European finance ministers have insisted bondholders take bigger losses on their Greek debt.

Oil prices have shifted over the last two years on the latest developments in the European debt crisis and the projected impact it would have on energy demand. The crisis that began in Greece has spread to Ireland, Portugal, Italy and Spain and threatens economic growth in the region.

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Crude Hits Seven-Year High On Recovery Hope … Equity Rally Runs Out

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Crude oil hit a more than seven-year high yesterday on optimism that the global recovery will ramp up demand.
However, concerns about the end of long-running central bank support and rising Treasury yields saw most equity markets reverse early gains.
After an almost uninterrupted rally from the early days of the COVID-19 pandemic, world markets are showing signs of levelling out as global finance chiefs shift from economy-boosting largesse to measures aimed at reining in inflation.
Still, there is an expectation that equities will enjoy further gains this year as countries reopen and people grow more confident about travel, especially as studies suggest the more prevalent Omicron coronavirus variant appears to be milder and as vaccines are rolled out.
Analysts are also watching the corporate earnings season that is underway, with hopes that firms can match their stellar performances last year.
But while Asian markets started the day brightly after Monday’s travails, traders returned to selling, with US Treasury yields surging on expectations the Federal Reserve will have to unveil several interest rate hikes to tackle a worrying spike in inflation. Wall Street was closed Monday.
Tokyo, Hong Kong, Sydney, Seoul, Singapore, Taipei, Mumbai, Bangkok and Jakarta all fell.
There were gains in Shanghai in hopes of fresh economy-boosting measures, while Wellington and Manila also edged up.
London, Paris and Frankfurt all fell at the open.
But oil built on its early promise, with Brent climbing to $88.13 a barrel and WTI hitting $85.74, both levels not seen since October 2014.
The gains came thanks to demand optimism as the world reopens and concerns about Omicron ease. The loosening of travel restrictions in several countries has seen jet fuel costs soar.
Hopes for more monetary easing by major consumer, China, to reinforce its stuttering economy were also seen as key support for the oil market.

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NPA, MWUN, Others Synergise On Labour

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President General of Maritime Workers Union of Nigeria (MWUN), Comrade Adewale Adeyanju, has reaffirmed commitment to ensuring smooth working relationship with  management, Tin Can Island Port Complex (TCIPC) of the Nigerian Ports Authority (NPA) on labour related issues.
Adeyanju, who made the commitment during a working visit to the Port Manager, TCIPC, Mr. Buba Jubril, in Lagos, noted that the union will continue to promote industrial peace and harmony in the  operational activities at seaports.
Noting that synergy among all the maritime stakeholders was key for port efficiency, he hinted that the union has changed the narrative from being tagged as hooligans to a more responsible and civil Institution in the maritime industry.
Earlier, the Port Manager, TCIPC, Buba Jubril, thanked the  PG of MWUN for the systematic approach on labour related issues at the port level
Disclosing that the PG has been instrumental to the existing peace in port operations, Jubril assured on the existing synergy the port authority and all the unions.
Jubril further said that “ Myself and the President General MWUN has come a long in the industry.
“I have known him (PG) for over 33years and that will tell you that he is my friend and friend to management of the Nigeria port authority”, he said.

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Osinbajo Wants More Stakeholders’ Involvement In Blue Economy … Inaugurates Committee

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Vice President Yemi Osinbajo has sought for wider participation of relevant stakeholders in the blue economy project to deepen participation and benefits of Nigerians from the country’s marine resources.
Making the call at the  inaugural meeting of an Expanded Committee on Sustainable Blue Economy in Nigeria at the Presidential Villa yesterday, the Vice President said “a viable blue economy project will offer vista of opportunities not only for littoral states where there are bodies of waters, but for the entire country”.
He identified areas to be exploited to include ports, terminals, fishing, training, environment, tourism, power,oil and gas.
While identifying possible challenges of sustainability, the VP urged all the ministries, departments and agencies to strengthen their collaborations in an atmosphere of inter ministerial working groups and advised all members to attend the meetings faithfully for maximum results.
Osinbajo , who formally inaugurated the expanded committee, identified the need for a legal framework that will be more robust than other international maritime conventions on blue economy, which Nigeria has been signatory to.
He said the scope and participation of the committee will be further improved upon to accommodate more members from government agencies and relevant private sector stakeholders
“There is no doubt that the blue economy is a new frontier for economic development and a means of diversifying the economy through the use of resources from oceans, seas, rivers and lakes for the well being of the people.
“It also provides positive contribution to the achievement of the Sustainable Development Goals(SDGs) 2052 Africa Integrated Maritime Strategy (2052AIM) and the UN 2030 agenda
“This concept for economic diversification is promoted by the international community and provides friendly means of livelihood in line with this administration’s agenda on job creation’, he said.
He continued that “the ocean economy as an emerging economic frontier applies to ocean-based industry activities and the assets, goods and services of marine ecosystems.
“Countries have to define the scope of their blue economy based on their priorities. For example, in Bangladesh, the ocean economy consists of the following broad and growing economic sectors; living resources, minerals, energy, transport, trade, tourism and recreation, carbon sequestration and coastal protection.
“These industries and ecosystem services do not develop in isolation, but rather interact as an economic ecosystem”, the VP said.
Earlier in his remark,Transportation Minister, Rotimi Amaechi said the blue economy is capable of improving government revenue, create employments and grow the gross domestic product of Nigeria.
Amaechi, who was represented by the Permanent Secretary of the ministry, Dr Magdalene Ajani, also expressed optimism in the benefits derivable from a well exploited marine environment
Speaking at the event,  Dr. Paul Adalikwu, Secretary General of Maritime Organisation of West and Central Africa (MOWCA) lauded the initiative of the expansion while recommending inclusion of financial institutions such as the Central Bank of Nigeria (CBN) and African Development Bank (AfDB), as well as key financial institutions that will contribute meaningfully to realizing Nigeria’s Blue Economy objective.
In addition to  maritime agencies such as the Nigeria Ports Authority, Nigerian Maritime Administration and Safety Agency, and Maritime Academy of Nigeria, the expanded committee also include ten state governors.
They the Governors of Rivers, Lagos, Delta, Akwa Ibom, Borno, Ogun, Ondo, Cross River, Bayelsa and Edo States.
Other members are Ministers of Foreign Affairs, Power, Finance, Environment, Trade and Investment, Agriculture and Water Resources , Chief of Naval Staff, Comptroller General of Customs, Lake Chad Basin Commission, Nigeria Economic Summit Group, etc.

By: Nkpemenyie Mcdominic, Lagos

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