Business Briefs, December 28, 2015

Saudi Arabia Posts $98b Deficit, Raises Gas Prices

RIYADH, Saudi Arabia (AP) – Saudi Arabia on Monday said this year’s budget deficit amounted to $98 billion (367 billion riyals) as lower oil prices cut into the government’s main source of revenue, prompting the kingdom to scale back spending for the coming year and hike up gas prices.

A royal decree announced that petrol prices would go up by 50 percent effective Tuesday. Even with that jump, Saudis will pay just 24 cents (0.90 riyals) for a liter of 95 octane gasoline, less than a dollar per gallon.

Oil Slump Weighing on Housing Markets in Texas, North Dakota

(AP) – There’s a dark side to those delightfully low gas prices: Housing markets are slumping in communities that were recently flush from the U.S. shale oil fracking boom.

Home sales are down sharply this year in North Dakota and the West Texas cities of Midland and Odessa. Home sales have also slowed in El Paso and Houston.

The drilling boom, driven by high oil prices and new discoveries, brought tens of thousands of workers to oil fields to run drilling rigs and supply the equipment and services needed to produce crude. Then the price of oil tanked and oil companies abandoned drilling projects and began laying off workers.

Seasonal Spending Up 8 Percent; Online Sales Surge

NEW YORK (AP) – Americans spent more on items like furniture during the year-end shopping season this year, with online shopping in particular seeing a big spike, according to a report released Monday.

Overall spending rose 7.9 percent from a year ago, according to the MasterCard SpendingPulse report, which tracks retail sales across cards, cash and checks from Black Friday to December 24. The uptick was driven by people sitting in the comfort of their homes or at work, with online shopping up 20 percent.

Deutsche Bank Sells China Bank Stake for Up to $4 Billion

BERLIN (AP) – Deutsche Bank says it has agreed to sell its stake in China’s Hua Xia Bank to a Chinese insurer in a deal worth between 23 billion and 25.7 billion yuan ($3.6 billion-$4 billion).

Deutsche Bank AG said in October that it no longer considered its 19.99 percent stake in Hua Xia Bank strategic. Germany’s biggest bank announced Monday that it will sell the entire stake to PICC Property and Casualty Company Limited.

Freeport-McMoRan Chair and Co-Founder Moffett Resigns

NEW YORK (AP) – James R. Moffett, the executive chairman and co-founder of the mining company Freeport-McMoRan, is stepping down as plunging commodity prices lead to mass layoffs across the entire industry.

The company is one of the world’s biggest producers of gold and copper, both of which have tumbled in value this year. And activist investor Carl Icahn also recently revealed a large stake in the company. Icahn had pushed for cost cuts and came to an agreement with the company that put his affiliates on the board.

Moffett, who helped form the company in 1969, will resign as chair and leave the board of directors Thursday.

China Fines Global Shippers On Price-Fixing Charges

BEIJING (AP) – China fined seven foreign shipping companies that carry vehicles for automakers a total of $65 million on price-fixing charges Monday in its latest effort to end anti-competitive behavior in the auto industry.

Investigators found Europe’s Wallenius Wilhelmsen, South Korea’s EUKOR, Japan’s Mitsui O.S.K. Lines and other shippers improperly coordinated bids and routes to keep prices high, the Cabinet’s planning agency said. An eighth shipper, Japan’s NYK, was found to have colluded but was spared a fine.

To Read The Full Story

Are you already a subscriber?
Click to log in!