This week, crude prices went up in smoke, a carmaker acquisition heated up and a lawyer was caught with his pants on fire - without even telling a lie.
Oil prices continued their descent this week, with the U.S. West Texas Intermediate (NYSE:WTI) benchmark oil price dropping under $50 per barrel for the first time in three months. Brent crude also slipped to its lowest level since last November.
The Organization of the Petroleum Exporting Countries (OPEC) and several large producer nations agreed to cut production in late November, which led to a sharp rise in the WTI at the end of last year. But there has been a large price drop during March on news that inventories of U.S. crude stocks have surged for a ninth successive month, leading to concerns of a supply glut from the revitalized U.S. shale oil market. Some forecasters are now viewing $50 per barrel as a ceiling, rather than a floor.
Car boot sale
PSA Group, which produces Peugeot and Citroën cars, agreed this week to purchase the European operations of General Motors (NYSE:GM), which includes the Vauxhall and Opel brands for £1.9 billion (US$2.3 billion). PSA is set to become the second-largest car maker in Europe, behind Volkswagen. Meanwhile, GM will focus on U.S. production, a policy that will doubtless please the Trump administration.
UK Business Secretary, Greg Clark said he was "cautiously optimistic" about the future of Vauxhall, although unions have expressed concerns that PSA will streamline operations and cut costs through plant closures and layoffs.
UK Budget: business as usual
For someone who goes by the nickname "Spreadsheet Phil," UK Chancellor Philip Hammond's first Budget was surprisingly upbeat. The UK economy is improving but is now expected to grow more slowly from 2018-20. And employment has reached a record high of 31.8 million people. Loosening of the purse strings allows a £2 billion (US$2.4 billion) injection into adult health and social care over three years.
However, it wasn't all good news. Mr. Hammond explained that the narrowing of the deficit will only be possible through continuing austerity, with significant cuts in public spending per head planned until 2021. And he announced a controversial increase in national insurance contributions for the self-employed. Shareholders will also lose out, with a reduction in the tax-free dividend allowance from £5,000 (US$6,075) to £2,000 (US$2,430) from April 2018.
Attorney Stephen Gutierrez had a baptism by fire in a Miami courthouse this week. The unfortunate incident took place midway through his defense of Claudy Charles, a man accused of…arson. The trial was interrupted after Gutierrez ran from the courtroom with smoke emanating from his trousers. Disappointingly, no one is said to have taken the opportunity to shout out "lawyer, lawyer, pants on fire." The flare-up was blamed on a rogue e-cigarette battery, and according to Gutierrez, was not a bizarre stunt to demonstrate Charles' defense. Circuit Judge Michael Hanzman fanned the flames further by raising the possibility that Gutierrez will be found in contempt of court. Talk about feeling the burn.
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