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Opec and its allies have reached a deal to raise oil production in response to soaring prices, and set a target for the end of 2022 for restoring all the output cut during the early days of the pandemic.
Initially, Opec+ will pump an extra 400,000 barrels a day each month from August, ramping up output by about 2m b/d in total by the end of the year.
Those monthly production increases will continue next year, with Opec+ saying it has extended the deal until December 2022 from April 2022. The result of the long-delayed meeting should mean higher oil production from members in the months ahead, after tight supply pushed oil prices to the highest level in three years.
But the modest pace of output increases is a sign of lingering concern about the strength of the global recovery as Covid-19 variants continue to emerge. It also suggests oil producers are relatively comfortable with the current price of crude.
Five more stories in the news
1. Delta variant takes hold in developing world The Delta coronavirus variant that has rapidly become dominant across much of the world is exacting a grim toll on dozens of developing countries, where vaccination levels are insufficient to prevent a surge in cases from becoming a wave of deaths.
2. Pentagon drones ‘8 to 14 times’ costlier than banned Chinese craft
Camera drones developed by the Pentagon are more expensive and less capable than the Chinese-made ones they were meant to replace, according to an internal US government memo seen by the Financial Times.
3. Pandemic deprives Asia’s garment workers of almost $12bn in wages
Asian garment workers have been deprived of almost $12bn in wages and severance pay as international retailers cancelled orders and demanded price reductions in the wake of the pandemic, according to a labour rights group.
4. China markets the remains of Anbang empire The remains of China’s Anbang have been valued at more than $5.2bn in the latest attempt by state controllers to dissolve the once high-flying group led by jailed tycoon Wu Xiaohui.
5. Tokyo Stock Exchange chief defends progress on corporate governance The head of the Tokyo Stock Exchange has defended Japan’s progress on corporate governance following a high-profile scandal at Toshiba, rejecting accusations a market overhaul due next year was extensively watered down.
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The day ahead
Earnings IBM to publish earnings today after US markets close.
Reopening day in isolation UK Prime Minister Boris Johnson began 10 days in self-isolation Sunday after coming in contact with his health minister, Sajid Javid, who tested positive for Covid-19. Johnson is still moving ahead with his reopening plan that goes into effect today.
What else we’re reading
Olympic hope A 21-year-old Japanese swimmer has emerged as a rallying point for organisers of the 2021 Olympics. Rikako Ikei, who was expected to miss the Olympics in 2020 because of a battle with leukaemia, is getting her chance to attend the postponed games and drumming up excitement for the polarising event.
Opinion: Japan’s battle against ‘brazen rule breaking’ during the 2021 Olympics is hampered by the government’s lack of credibility, writes Leo Lewis.
Floods drive climate to heart of German elections With just over two months to go until polling day, the devastating floods that swept through western Germany this week have catapulted climate change to the heart of the country’s election campaign.
Inflation fears are overblown Early signs of rising prices are more reflective of a predictable, post-lockdown surge in animal spirits than any longer-term trend, writes Rana Foroohar.
Mediocre workers have nowhere to hide Do mediocre workers thrive more when they work from home or when they are in the office? While some employers doubt the motivations of staff who prefer remote work, some espouse the view that it’s easier to identify which staff add the most value when a team is working remotely.
Food & Drink
How the cooking of Eritrea came to Leeds Six young women who fled their country as children share recipes from home.