FirstFT: White House says ‘nothing off table’ in response to Opec+ oil cuts

The White House said nothing was off the table a day after Opec+ angered Washington with sharp cuts to world oil supply, as it considered responses — including new releases from the US Strategic Petroleum Reserve to contain energy prices.

The Opec+ cartel led by Saudi Arabia and Russia on Wednesday agreed to lower production targets by 2mn barrels a day, or roughly 2 per cent of global oil consumption. Oil markets rose further yesterday, with Brent crude reaching $94 a barrel.

Brian Deese, director of the White House’s National Economic Council, described the decision as “unnecessary and unwarranted” and said the US was looking at further sales from its strategic stockpile, which has already been drawn down by more than 200mn barrels in the past year.

He did not rule out an export ban or limiting exports on petrol and other refined products when asked if the idea was under consideration. “What the president has directed us, and it continues to be the case, is to take nothing off of the table,” Deese said.

Opec+’s announced reduction unleashed shockwaves as the oil industry has become increasingly worried over the prospect of curbs on refined oil product exports. Europe’s energy crisis would be made worse by such a move, as the continent imports significant quantities of fuel from the US and is soon to halt all seaborne Russian oil imports.

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Five more stories in the news

1. EU and Norway agree on ‘joint tools’ to tackle gas crisis Oslo says it will work with Brussels to develop tools aimed at reducing Europe’s high gas prices ahead of a looming energy crisis this winter. Norway replaced Russia as the EU’s biggest supplier of gas after the invasion of Ukraine.

2. Xi Jinping cracks down on disloyalty ahead of party congress In the weeks leading up to this month’s Communist party congress, China’s courts have orchestrated a series of high-profile corruption trials of senior cadres from the state’s police and security apparatus, including the former justice minister and the former deputy minister of public security.

3. Do Kwon denies prosecutors froze $67mn of crypto assets Seoul law enforcement said yesterday that they had frozen Do Kwon’s bitcoin holdings, but Kwon, co-founder of collapsed crypto operator Terraform Labs, denied the claim. “I don’t know whose funds they’ve frozen, but good for them, hope they use it for good,” he wrote on Twitter.

4. BoE says £65bn gilt intervention staved off UK financial ‘spiral’ The central bank defended last week’s intervention in the UK government debt market, saying it stepped in to prevent a £50bn fire sale of gilts that would have taken Britain to the brink of a financial crisis.

5. Israel-Lebanon deal on maritime border dispute falters Israel has accused Lebanon of seeking “substantial changes” to a proposed US-brokered deal on the two countries’ maritime border, throwing into doubt hopes of an imminent resolution to a long-running dispute involving a gasfield in the eastern Mediterranean Sea.

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The day ahead

Economic indicators The US and Canada both publish respective September unemployment figures today, and the UK will publish quarterly productivity figures, the Halifax monthly house price index, and the Recruitment & Employment Confederation and KPMG monthly employment report.

Corporate earnings JD Wetherspoon releases its fiscal year report today.

EU leaders meet in Prague Members of the European Council reconvene in Prague to discuss Russia’s war in Ukraine, the energy crisis, and the economy.

Putin’s birthday Russia president Vladimir Putin turns 70 today.

What else we’re reading

Global economy gets gloomy assessment from IMF chief The global economy will feel like it is in recession next year, according to IMF managing director Kristalina Georgieva, with at least two quarters of economic contraction in 2023. The remarks signal that the IMF is set to downgrade its economic forecasts again next week, for the fourth consecutive quarter.

Why Big Tech shreds storage devices it could reuse Companies such as Amazon and Microsoft, as well as banks, police and governments, destroy millions of data-storing devices each year in the name of digital security, the Financial Times has learnt. But industry insiders say there is a better option.

Best US cities for foreign business, ranked Miami has been ranked the best city in the US for foreign multinationals to do business, in the inaugural Investing in America ranking compiled by the Financial Times and Nikkei. Last year the Florida city pulled in the most foreign direct investment per capita of any place studied.

Why Japan remains the biggest investor in the US Japan has been the biggest foreign investor in the US for three straight years, despite difficulties such as the cost of labour and Joe Biden’s push for domestic manufacturing and supply chains.

Investors reap rewards from bets on Musk closing Twitter deal Carl Icahn, Hindenburg Research and Florida-based hedge fund Pentwater Capital Management are among investors who predicted the billionaire would close the deal.

Fashion

Consider sneakers the footwear equivalent of Facebook: somewhat passé now that they’re pervasively co-opted by baby boomers and billionaires. Millennials and Gen Z are retiring their trainers to revisit formal shoes — even with leisurewear.