Baltic Dry Index. 2170 +40 Brent Crude 62.47
Never ending Brexit now October 31,
maybe.
Trump’s Nuclear China Tariffs
Now In Effect.
USA v EU trade war postponed to
November, maybe.
Both the depressed
economic situation arising from the collapse of the gold rushes, as well as a
desire for the establishment of truly responsible and representative government, led to enormous domestic pressure for British Columbia to join
the Canadian Confederation, which had been proclaimed in 1867. The Confederation League,
spearheaded by three future premiers of the province — Amor De Cosmos, Robert Beaven, and John Robson — took a leading role in pushing the colony towards this goal.
And so it was on July 20, 1871, that British Columbia became the sixth province
to join Canada. In return for entering Confederation, Canada absorbed B.C.'s
massive debt, and promised to build a railway from Montreal to the Pacific coast within 10 years.
The big news this weekend, is Iran’s
capture of one, possibly two British oil tankers in Iranian waters in the
Strait of Hormuz, though one appears to have been released. How this plays out in the hours and days
ahead, may determine if Britain, American and NATO end up in a new Middle East war
with Iran.
Given that at least 20 percent of global
crude oil supply passes through the Strait of Hormuz, plus about 26 percent of
global liquefied natural gas supply (LNG,) a war with Iran is about the last
thing the faltering global economy needs.
To say that this could spiral out of
control in a heartbeat, is probably the understatement of the year. A 1973 -
1974 type oil price spike is an all too real possibly if this goes wrong, which
was when the oil price went from $3 a barrel to $12 a barrel. Make that roughly
$60 to $240 today.
Below, a very bad news start to the
weekend. More tomorrow if there are developments.
Britain says Iran seizes two oil tankers in Gulf, Iran says captured one
July 19, 2019 / 6:56 PM
LONDON/DUBAI (Reuters) - Britain said Iran
seized two oil tankers in the Gulf on Friday and told Tehran to return the
vessels or face consequences in the latest confrontation to ratchet up tension
along a vital international oil shipping route.
Iran’s
Revolutionary Guards said they had captured the British-flagged Stena Impero,
announcing the move two weeks after the British navy seized an Iranian tanker
in Gibraltar.
Iran’s
semi-official Tasnim news agency said the second vessel, the British-operated
Mesdar, had not been seized. It said the ship had been allowed to continue its
course after being given a warning over safety and environmental issues.
The Stena
Impero and Mesdar changed direction sharply within 40 minutes of each other
shortly after entering the Gulf through the Strait of Hormuz, taking up a
course towards Iran, Refinitiv tracking data showed.
The data
later showed Mesdar changing direction again, heading westward back into the
Gulf.
“These
seizures are unacceptable. It is essential that freedom of navigation is
maintained and that all ships can move safely and freely in the region,”
British foreign minister Jeremy Hunt said.
Hunt later said,
in comments reported by Sky News, that there would be consequences if Iran did
not return control of the ships but said Britain was not considering military
options.
U.S.
President Donald Trump said he would talk to Britain about the issue, speaking
after a war of words earlier on Friday about whether the United States had shot
down an Iranian drone in the Strait of Hormuz.
Already
strained relations between Iran and the West have become increasingly fraught
since the British navy seized Iran’s Grace 1 tanker in Gibraltar on July 4 on
suspicion of smuggling oil to Syria in breach of European Union sanctions.
Oil prices
gained on Friday after the latest spike in tensions along the Strait of Hormuz,
through which a fifth of the world’s oil supplies pass.
Iran’s Guards, an elite force under the
command of Supreme Leader Ayatollah Ali Khamenei, said they seized the Stena
Impero at the request of Iranian authorities for “not following international
maritime regulations,” state television reported.
---- Norbulk, the manager of the tanker Mesdar, said the vessel had been boarded by armed personnel but was later allowed to continue its voyage. It said the crew were safe and well.
Iran had
said it would retaliate against the seizure in Gibraltar. Just days later,
three Iranian vessels tried to block a British-owned tanker passing through the
Strait of Hormuz but they backed off when confronted by a British navy ship.
Refinitiv
data showed the Stena Impero vessel is owned by Stena Bulk and indicated its
destination had been the Saudi port of Jubail on the Gulf. The tracking map
showed it veering off course about 1517 GMT and heading towards Iran.
---- “We received reports that the British Stena Impero oil tanker was causing incidents and, therefore, we asked the military to direct it to Bandar Abbas port for the necessary probes,” Allahmorad Afifipour, head of Hormozgan’s maritime authority, told Tasnim news agency.
Tasnim, which cited military sources as saying the Mesdar had not been seized, said the Stena Impero had been causing pollution by dumping oil residue.
---- Supreme Leader Khamenei said on Tuesday Iran would respond to Britain’s “piracy” over the seizure of the Iran’s Grace 1 tanker in Gibraltar.
Tehran has
repeatedly called for the ship’s release, denies the allegation that the tanker
was taking oil to Syria in violation of sanctions and says Gibraltar and
Britain seized the vessel on the orders of Washington.
More
In other news, the Japan v South Korea trade
war is rapidly heating up. Now President Trump wants to diffuse it. What about
diffusing that other trade war with China?
Japanese minister admonishes South Korea's envoy as row escalates
July 19, 2019 / 12:24 AM
TOKYO/SEOUL (Reuters) - Japan’s foreign
minister publicly admonished South Korea’s ambassador on Friday in a worsening
row over compensation for Korean forced labourers that has spilled over into
their trade in high-tech materials used to make memory chips and screens.
The dispute
between the key U.S. allies took a deadly turn when a South Korean man set
himself on fire in front of the Japanese Embassy in Seoul in an apparent
protest. He died later.
South Korea
accused Japan of violating international law with its curbs this month on the
export of high-tech materials to South Korean chipmaking giants, which could
disrupt global supply chains.
Japanese
Foreign Minister Taro Kono summoned South Korea’s ambassador, Nam Gwan-pyo, a
day after the expiry of Japan’s deadline for South Korea to accept third-country
arbitration of the forced labour dispute.
Ties been
the neighbours have been thorny for decades because of South Korean resentment
of Japan’s occupation of the Korean peninsula from 1910 to 1945.
The forced
labour issue was thrust to centrestage last year when a South Korean court
ordered two Japanese firms to pay compensation to Koreans forced to work for
them.
Japan says
the whole compensation issue was settled under a 1965 treaty.
Kono said South
Korea had to take swift measures to correct what Japan calls an improper ruling
by its Supreme Court ordering compensation.
“What the
South Korean government is doing now is equivalent to subverting the post-World
War Two international order,” Kono said at the beginning of a meeting with Nam.
Nam
responded by saying South Korea was working every day to create an environment
in which the lawsuits could be dealt with in a manner acceptable to both sides
and not harm ties.
Nam said
South Korea had already proposed a plan to resolve the issue, but that drew a
blunt interjection from Kono.
“Hold on,”
Kono said.
“We’ve
already told the South Korean side the South Korean proposal was totally
unacceptable, and that is not something that would redress the situation where
international law is violated. It is extremely impertinent to propose it again
by pretending to not know that.”
Neither
official specified what that plan was, but last month Japan rejected a South
Korean proposal to form a joint fund to compensate South Korean plaintiffs.
More
Trump offers to help ease tension in Japan-South Korea dispute
July 19, 2019 / 6:01 PM
WASHINGTON/SEOUL (Reuters) - U.S.
President Donald Trump on Friday offered to help ease tensions in the political
and economic dispute between Japan and South Korea, which threatens global
supplies of memory chips and smartphones.
Lingering
tension, particularly over the issue of compensation for South Koreans forced
to work for Japanese occupiers during World War Two, took a turn for the worse
this month when Japan restricted exports of high-tech materials to South Korea.
The United
States has been hesitant to publicly wade into the feud between its two biggest
allies in Asia. Trump said South Korean President Moon Jae-in had asked him if
he could get involved.
“He tells me
that they have a lot of friction going on now with respect to trade, primarily
with respect to trade. And Japan has some things that South Korea wants, and he
asked me to get involved,” Trump told reporters at the White House.
“So maybe if they would both want me to,
I’ll be. It’s like a full-time job getting involved with Japan and South Korea.
But I like both leaders.”
---- David Stilwell, the top U.S. diplomat for East Asia policy, said in Seoul on Wednesday that he took the situation seriously but did not elaborate on what steps Washington might take and said it was fundamentally up to South Korea and Japan to resolve their differences.
Japan has
denied that the dispute over compensation is behind the export curbs, even
though one of its ministers cited broken trust with South Korea over the labour
dispute in announcing the restrictions.
Instead,
Japan has cited “inadequate management” of sensitive items exported to South
Korea, with Japanese media reporting some items ended up in North Korea.
South Korea
has denied that.
The export
curbs could hurt global technology companies.
From beer to pens, South Koreans boycott Japanese brands as diplomatic row intensifies
July 19, 2019 / 4:36 AM
SEOUL (Reuters) - As soon as supermarket
manager Cho Min-hyuk got to work the day after Tokyo imposed curbs on exports
to South Korea, he pulled all Japanese products off the shelves.
It was Cho’s
way of taking a stand against Japan in a quickly worsening political and
economic dispute between the two east Asian neighbours.
Such anger
has prompted a widespread boycott of Japanese products and services, from beer
to clothes and travel, disrupting businesses in what was already the worst
economic climate for South Korea in a decade.
Cho, who
manages a 1,500 square metre Purunemart supermarket in Seoul, is taking the hit
voluntarily. Over 200 other supermarkets and grocery stores are doing the same,
according to Korea Mart Association, a trade group representing them.
“Japan
putting pressure on South Korea through export curbs, showing no regret over
its past wrongdoings, is completely unacceptable,” said Cho, adding the 10-15%
drop in sales he is already facing won’t change his mind.
Diplomatic
tensions intensified since a South Korean court last year ordered Japanese
companies to compensate Koreans who were forced to work for Japanese occupiers
during World War Two. On July 4, in apparent retaliation, Japan restricted
exports of high-tech materials to South Korea, but denied the move was related
to the compensation issue. Tokyo cited “inadequate management” of sensitive
exports, with Japanese media reporting some items ended up in North Korea.
Seoul has refuted that.
Seoul has resisted taking any countermeasures, saying it would raise the dispute with the World Trade Organisation. But Koreans are taking matters into their own hands, with beer apparently an easy target.
The country’s top two convenience stores CU and GS25, run by BGF Retail (282330.KS) and GS Retail (007070.KS), told Reuters sales of Japanese beer plunged 21.5% and 24.2%, respectively, in the first two weeks of July from the previous two-week period. E-Mart (139480.KS) reported a 24.6% fall.
Hongcheon Culture Foundation, a beer festival organiser, told Reuters it cancelled an order of 1.2 tonnes of Kirin beer even as at last year’s edition the Japanese brand accounted for a tenth of revenues.
South Korea buys 61% of Japan’s beer exports, spending 7.9 billion yen ($73.13 million) in 2018. Asahi Super Dry is the most popular imported brand, with sales tripling in the past five years, according to Euromonitor.
More
Finally, yet more bad news from France.
This weekend it seems, if it wasn’t for bad news there’d be no news at all.
Weather woes hit French vineyards - wine production seen falling this year
July 19, 2019 / 2:17 PM
PARIS (Reuters) - Wine output in France,
the world’s second largest producer, may fall by as much as 13% this year after
vineyards were hit by adverse weather including hail, frost and a
record-breaking heatwave, the farm ministry said on Friday.
In its first
estimate for 2019, the ministry forecast production in a range of 42.8 million
to 46.4 million hectolitres, down 6-13% from 49.4 million in 2018.
A hectolitre
represents 100 litres, or the equivalent of about 133 standard wine bottles.
The
ministry’s initial 2019 forecast range was also 2-5% below the average production
of the past five years.
“In many
vineyards, flowering occurred in unfavourable weather conditions (rain and
cold),” the ministry said in a note. “Heat and hail have also contributed to a
decline in production potential.”
Western
growing regions including Bordeaux were particularly affected by poor flowering
conditions during spring, while some southern areas saw grapes scorched during
a heatwave in late June, it said.
France
recorded its highest-ever temperature at 45.9 degrees Celsius (114.6°Fahrenheit)
at the end of June during an intense hot spell that fuelled wildfires and
withered some vineyards.
Lack of rain
in the past month has also worsened drought conditions in parts of the country,
and the farm ministry said soil moisture levels in most wine regions were below
normal.
Like hail,
frost also caused localised damage this year, including in the Bordeaux and
Burgundy regions, it said.
The
Champagne area saw good flowering conditions and limited weather damage,
although production was expected to be below last year’s, the ministry added.
French wine
grapes are harvested in late summer and early autumn, and the ministry said its
estimates were tentative given uncertainty over conditions until the harvest.
1973 oil crisis
The 1973 oil crisis began in October
1973 when the members of the Organization of Arab
Petroleum Exporting Countries proclaimed an oil embargo. The
embargo was targeted at nations perceived as supporting Israel during the Yom
Kippur War.[1]
The initial nations targeted were Canada, Japan, the Netherlands, the United
Kingdom and the United States with the embargo also later extended to
Portugal, Rhodesia and South
Africa. By the end of the embargo in March 1974,[2]
the price
of oil had risen nearly 400%, from US$3 per barrel to nearly $12 globally; US prices were
significantly higher. The embargo caused an oil crisis, or "shock",
with many short- and long-term effects on global politics and the global
economy.[3]
It was later called the "first oil shock", followed by the 1979
oil crisis, termed the "second oil shock."
More
New: This weekend’s musical diversion.
Mozart shows the way.
Mozart - Horn Concerto No. 1 in D, K. 412
Euston was the first inter-city railway station in London. It opened on 20 July 1837 as the terminus of the London and Birmingham Railway (L&BR).[13] The old station building was demolished in the 1960s and replaced with the present building in the international modern style.[14]
The site was chosen in 1831 by George and Robert Stephenson, engineers of the L&BR. The area was mostly farmland at the edge of the expanding city, and adjacent to the New Road (now Euston Road), which had caused urban development.[15][16] The station was named after Euston Hall in Suffolk, the ancestral home of the Dukes of Grafton, the main landowners in the area.[17]
The monthly Coppock Indicators finished June
DJIA: 26,600
+51 Up. NASDAQ: 8,006 +70 Down. SP500: 2,942 +50 Up.
The S&P has reversed again to up after only one
month. The Dow has reversed to up, while the NASDAQ remains down. On to next month’s numbers for clarification.
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