Oil price surges as Trump predicts fast Russian-Saudi resolution

Trump: ‘The oil industry is being ravaged’

President Trump believes the oil dispute between Russia and Saudia Arabia will resolve things in the coming days.

President Trump said he expects Russian and Saudi leaders will reach a resolution in their oil price war that has plunged oil’s value, saying during a coronavirus news conference Wednesday that both sides “know what to do to solve it.”

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The price of benchmark crude oil surged 9 percent on Thursday to $22.22 per barrel Wednesday. The price of Brent crude oil, which is used as an international standard, jumped 9.5 percent to $27.13.

“I think that they will work it out over the next few days,” he said. “It’s too simple. They both know what they need to do.”

The president said Tuesday that he’d spoken with both Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman about the issue and that the conversations had gone well.

President Donald Trump speaks in the James Brady Press Briefing Room of the White House, Wednesday, April 1, 2020, in Washington. (AP Photo/Alex Brandon)

AS OIL TANKS, TRUMP TALKS WITH PUTIN, SAUDI CROWN PRINCE

Trump also announced Wednesday that he’ll be meeting with oil industry leaders on Friday and independent oil producers sometime over the weekend as the international price war over output levels and reduced demand due to the coronavirus pandemic have dinged the U.S. oil industry as well.

White House officials said the industry executives will discuss the price crash and what can be done to respond.

“We have a great oil industry, and the oil industry’s being ravaged,” Trump said.

CORONAVIRUS PUSHES GAS PRICES BELOW $2 FOR FIRST TIME IN 4 YEARS

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Trump said the price at the pump could fall as low as 99 cents per gallon and likened it to a tax cut. The national average price for a gallon of regular gasoline was down to $1.99 as of Tuesday, the first time it fell below $2 in about four years, according to AAA.

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Vodafone Idea offers prepaid validity extension for low-income feature phone subscribers

The free extension in plan validity duration will enable millions of feature phone users of both Vodafone and Idea to continue to receive incoming calls, even if the validity of their plan expires earlier

Vodafone Idea on Tuesday announced an extension of validity on prepaid plans availed by low income customers using feature phones till April 17, and ₹10 talktime credit to help such users stay connected during the lockdown to contain coronavirus pandemic.

Telecom operator Bharti Airtel on Monday had announced an extension in the validity period of more than 8 crore pre-paid connections until April 17 as well as credited talk time of ₹10 in these accounts.

State-owned telecom operators BSNL and MTNL too have announced they will extend validity period of their prepaid mobile services till April 20 and offered ₹10 additional talktime even after zero balance, to enable users, especially poor and underprivileged, to stay connected during the 21-day nationwide lockdown.

“The unprecedented situation arising from the outbreak of COVID-19 has created several hardships, especially for low income, prepaid customers using feature phones. To ensure that such customers remain connected amidst these troubled times, Vodafone Idea Limited (VIL)…today announced extension in validity of its prepaid plans, availed by low income customers using feature phones, till 17th April 2020,” VIL said in a statement.

The free extension in plan validity duration will enable millions of feature phone users of both Vodafone and Idea to continue to receive incoming calls, even if the validity of their plan expires earlier, the statement said.

It has also anounced a talktime credit of ₹10 in the account of nearly 100 million feature phone users to help them stay connected with their family and friends by making calls or sending text messages.

“This talk time is being credited in the accounts of all eligible customers, as fast as possible, over the coming days,” the statement added.

Commenting on the latest move, Avneesh Khosla, Marketing Director, Vodafone Idea said, “Our customers must remain connected without worrying about any disruption, especially in these troubled times. Extending plan validity and crediting talk time will particularly benefit migrant workers and daily wage earners, whose lives and livelihoods have been most unsettled due to the precautionary lockdown“.

The company’s network teams are already operating round-the-clock to ensure seamless connectivity, Mr. Khosla added.

With this special initiative for low-income feature phone users, Vodafone Idea customers can now continue to remain fully connected and access relevant, latest updates from local authorities, the company said.

Customers availing Vodafone Idea’s services via smartphones can continue to recharge their accounts using online and digital platforms, it said.

Sector regulator TRAI on Sunday had asked telecom operators to extend prepaid validity period to ensure that subscribers get uninterrupted services during the 21-day nationwide lockdown.

Telecom Regulatory Authority of India (Trai) has also sought details of the steps taken to ensure availability of uninterrupted telecom services to such customers on a “priority basis”.

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Harvest Health, Verano Holdings Terminate Merger Deal

Cannabis company Harvest Health & Recreation Inc. (HRVSF) and privately-held Verano Holdings, LLC said Thursday that they have agreed to mutually terminate their merger transaction, citing the “persistent challenges” in consummating the transaction as well as current market conditions.

The companies noted that various factors contributed significantly to the decision not to go ahead with their business combination agreement. These include prolonged obstacles in meeting state and local regulatory requirements required to transfer ownership and operational licenses, adverse capital market conditions, and a challenging environment for asset sales.

No breakup fees or other considerations are owed by either party due to the termination of their business combination agreement.

Harvest Health said a year ago, in March 2019, that it agreed to acquire Verano in an all-stock transaction for an estimated purchase price of about $850 million.

“We remain focused on continued development of assets in our core markets including Arizona, Florida, Maryland, and Pennsylvania. Recent capital raising efforts have afforded the company sufficient resources to continue to invest in strategic projects while moving toward profitability,” said Steve White, CEO of Harvest Health.

“Now with the COVID-19 pandemic often being dealt with in the very agencies that must approve the transaction, it has become clear that this combination would not be completed within the established timeframe. We look forward to continuing to grow our operations as one of the largest privately held multi-state operators in the U.S.,” said George Archos, CEO of Verano Holdings.

Harvest Health said it will provide an in-depth corporate update on its capital, merger and acquisition strategy and outlook during its fourth quarter earnings call on Tuesday, April 7.

Some other merger transactions in the cannabis industry were also terminated recently.
In October 2019, California-based MedMen Enterprise said it decided to terminate a deal to acquire marijuana company PharmaCann LLC in all-stock transaction, citing market developments over the past twelve months and the continued evolution of its business strategy.

Cresco Labs said in November 2019 that it decided to terminate its proposed acquisition of VidaCann Ltd. The transaction was announced in March 2019. The company said it plans to re-allocate resources to existing higher return opportunities.

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Mega bank consolidation on track; to take effect from April 1: Finance Minister

The government is not considering extending the deadline despite the coronavirus pandemic, said Nirmala Sitharaman

The government on Thursday said the mega bank consolidation plan is very much on track and will take effect from April 1 despite the onslaught of coronavirus pandemic throwing the country out of gear.

The Union Cabinet earlier this month approved amalgamation of 10 public sector banks into four global size lenders, beginning next financial year.

Also read | Big bank theory: On Public Sector Bank mergers

Asked if the government is considering extending the deadline for merger of public sector banks, Finance Minister Nirmala Sitharaman said “at the moment there is nothing on that”.

Banking Secretary Debasish Panda said the merger process was very much on track and expressed hope that the banking sector would be able to meet the challenges thrown by the pandemic.

“That is very much on the track. It’s parallel activity going on. As far as fund transfers, etc, are concerned, necessary arrangements will be made,” Panda said.

Also read | How will mergers affect public sector banks?

The statement assumes significance as there has been demand from some quarters for deferring the deadline due to coronavirus outbreak.

All India Bank Officers’ Confederation (AIBOC) on Wednesday requested Prime Minister Narendra Modi to defer mega merger exercise of banks in view of coronavirus outbreak.

Banking services across the country are impacted due to COVID-19 as the lockdown is being observed across the country.

Following the consolidation, there will be seven large public sector banks (PSBs), and five smaller ones. There were as many as 27 PSBs in 2017.

As per the mega consolidation plan, Oriental Bank of Commerce and United Bank of India will merge into Punjab National Bank; Syndicate Bank into Canara Bank; Andhra Bank and Corporation Bank into Union Bank of India; and Allahabad Bank into Indian Bank.

Also read | ‘It’s wrong to presume that mergers will solve banks’ woes’

The merger will result in creation of seven large PSBs with scale and national reach, with each amalgamated entity having business of over ₹8 lakh crore and it would help create banks with scale comparable to global banks and capable of competing effectively in India and globally.

In addition, consolidation would also provide impetus to amalgamated entities by increasing their ability to support larger ticket-size lending and have competitive operations by virtue of greater financial capacity.

Last year, Dena Bank and Vijaya Bank were merged with Bank of Baroda. Prior to this, the government had merged five associate banks of SBI and Bharatiya Mahila Bank with the PSB.

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HDFC Bank’s Aditya Puri calls for rate cut

The MD also seeks relaxation in asset classification in view of COVID-19

Aditya Puri, the managing director of HDFC Bank, has called for interest rate cuts from the Reserve Bank of India, apart from a relaxation in asset classification for bad loan recognition, to fight the economic losses caused due to the spread of COVID-19.

In a teleconference with the media, the chief of the largest private sector lender also allayed concerns over asset quality, particularly of the unsecured portfolio, raised by some analysts, saying most of the lending was to highly-rated entities.

“Asset classification, in my view they [RBI] don’t have a choice. Again on fiscal stimulus, they don’t have a choice,” Mr. Puri said.

Banks have to classify a loan as sub-standard if repayment is due for more than 90 days and there is a demand from the industry to extend the default date to 180 days.

“Total unsecured portfolio is 16%, 6% is cards and 10% is personal loan. 75% of personal loan is to top-tier clients. So, there is no reason to be worried,” Mr. Puri said.

On the small and medium enterprises portfolio, he said 80% of the bank’s exposure was covered by additional securities.

‘Granular portfolio’

“NPA here is in the 2% range, maximum. It is a granular portfolio where we have 85% self-funding, which means 85% of the people we have lent to are self-funded. It comes across reasonably tough credit standards,” he said.

He said the bank had recently tightened internal norms for credit appraisal.

“You have to look at the cash flow, you have to see if certain people have the ability to bear the strain. That we have [done] a month-and-a-half ago. Our existing portfolio is showing no strain. Rejections rates are higher [after norms were tightened],” he said.

He also said the bank had an excess liquidity of $5 billion which was benefiting the bank as it was deployed in government securities where yields were softening.

He also said about 40% of the bank staff were isolated due to the spread of COVID-19, including the senior management.

With Mr. Puri retiring from the bank in October this year, the bank has started to look for his successor and has appointed a search committee. Mr. Puri said the names were ready and the search committee would announce them shortly.

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Cement firms upbeat as A.P. to lift 12 million tonnes more a year

State projects offer hope to makers hit by slowdown

Indian cement manufacturers are in an upbeat mood as the Andhra Pradesh Government has sought more than one million tonnes of cement per month for its projects for the next fiscal.

“The yearly consumption of cement by the Andhra Pradesh Government is about 18 million tonnes per year. If the State assures [it would] lift another 12 million tonnes a year, it would give a big boost to the cement industry, which had been affected due to sluggish demand,” said a top official of a cement company on the condition of anonymity.

Welcoming the initiative, the official said: “Almost all cement manufacturers have had a very bad third quarter due to the economic slowdown and stalling of major infrastructure projects by the Andhra Pradesh and Telangana governments. But, this is a good initiative as everyone will get a fair share,” he said.

At a joint review meeting held by Andhra Pradesh Chief Minister Y.S. Jagan Mohan Reddy on Monday at Vijayawada, he had asked the cement majors to supply cement in huge quantities for various government’s affordable housing projects.He also informed them that his State required over one million tonnes per month for various projects, including one for affordable housing and that the cement should be supplied at lower prices.

The meeting was attended by representatives of India Cements, Ramco Cements, KCP, Ultratech and JSW, among others.

They agreed to supply cement ‘at lower prices’.

“We also took part in the meeting. We are committed to supply about 40,000-50,000 tonnes per month and this would provide us some relief,” said another manufacturer.

According to them, the housing department required 40 lakh tonnes, Panchayat Raj Department 25 lakh tonnes, Water Resources Department 16.57 lakh tonnes and Municipal Department 14.93 lakh tonnes.

While releasing the company’s third quarter results, India Cements vice-chairman and managing director N. Srinivasan had said that all infrastructure projects ought to be implemented in order to bail out the industry from the turmoil it has been undergoing.

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Passenger vehicle retail sales down 1.17% in February: FADA

Passenger vehicle retail sales in February last year stood at 2,28,959 units, the Federation of Automobile Dealers Associations said in a statement

Automobile dealers’ body Federation of Automobile Dealers Associations (FADA) on March 12 said retail sales of passenger vehicles, measured by registration, declined 1.17% to 2,26,271 units in February.

Also read | Passenger vehicle sales pick up after 11 months

Passenger vehicle retail sales in February last year stood at 2,28,959 units, the FADA said in a statement.

Two-wheeler retail sales stood at 12,85,398 units last month as against 12,66,163 units in February 2019, a growth of 1.52%, it added.

Commercial vehicle retail sales also grew by 13% to 92,805 units last month as compared with 82,129 units in the year-ago period.

FADA said three-wheeler sales were up 20.7% at 65,752 units as compared with 54,474 units in February 2019.

Tractor retail sales stood at 41,485 units as compared with 36,543 units in February last year, a growth of 13.52%.

Retail sales of total vehicles across categories stood at 17,11,711 units in February 2020 as compared with 16,68,268 units in the same month a year ago, it said.

Commenting on vehicle retail sales, FADA President Ashish Harsharaj Kale said February turned positive for most of the segments as the entire auto ecosystem, especially auto dealers, focused on liquidation of their BS-IV Stocks.

“Rural sales contributed for retail sales turning green with tractors also being in double digit growth for second month in a row,” he added.

Despite the growth, the overall retail sales were much below expectations as the expected pre-buying for the BS-IV stock was not seen, he said.

“Many customers held onto their purchase decision expecting sweeter deals towards the end of March,” he added.

Commenting on inventory levels, Mr. Kale said it remains a very serious concern for BS-IV two-wheelers, and asked manufacturers to handhold dealers for 100% liquidation of stocks before March 31 deadline.

“FADA survey reveals a very high number of two-wheeler dealers will not be able to fully liquidate their BS-IV inventory and expressed inadequate support from their OEMs [original equipment manufacturers] for 100% liquidation of this stock,” Mr. Kale said.

With regards to passenger vehicles and commercial vehicles, he said overall inventory is at a reasonable level, but the challenge remains in slow-moving, non-popular models as dealers look for adequate OEM support for liquidation of the same in March.

“FADA has already advocated for return of unsold BS-IV stocks and will be pursuing this for its members, if the need arises, as many dealers will be unable to sustain such losses,” Mr. Kale said.

On the outlook for March, he said with banks and NBFCs getting into a cautious mode with regards to financing BS-IV stocks and many RTOs (Regional Transport Offices) across the country prescribing their own cut-off dates for permanent registration, liquidation of BS-IV inventory continues to be a challenge.

“Dealers are now facing a new challenge with coronavirus cases being detected in India and alarming drop in customer walk-ins in auto showrooms,” he said.

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Petrol, diesel prices cut across major cities

The prices of petrol and diesel have come down by about ₹5 a litre each since the beginning of this year

State-owned oil marketing companies (OMCs) have reduced the prices of sensitive petroleum products such as petrol by 24-27 paise a litre and diesel by 24-26 paise a litre across major cities as the price of international crude oil fell the most in a day since the Gulf war in the ’90s.

Petrol prices in Delhi decreased by ₹0.24 to to ₹70.59 per litre while diesel dropped by ₹0.25 to ₹63.26 per litre in Delhi, according to Indian Oil Corporation data.

In Mumbai, petrol prices were cut by ₹0.27 and are now retailing at ₹76.29 a litre. Diesel prices, on the other hand, stand at ₹66.24 a litre after witnessing a price cut of ₹0.26 from last changed prices.

Down ₹5 per litre

The prices of petrol and diesel have come down by about ₹5 a litre each since the beginning of this year.

In Kolkata, petrol was retailing at ₹73.28 a litre, down 23 paise compared with yesterday’s price of ₹73.51 a litre while a litre of diesel will cost ₹65.59, or 25 paise less than yesterday’s rate. Similarly, in Chennai, prices of petrol and diesel are ₹73.33 (25 paise less) a litre and ₹66.75 (26 paise decrease) a litre, respectively.

The prices of petrol and diesel are likely to come down further in the coming weeks as India follows the monthly average pricing of benchmark crude oil.

Experts see the Brent crude oil price fall as a blessing for the macroeconomy as India imports over 83% of its requirements. Shares of state-owned oil marketing companies (OMCs) surged on falling crude oil prices.

On the BSE, shares of HPCL gained 6.17% to close at ₹213.25.

BPCL shares closed up 5.2% to ₹423.80 in a weak Mumbai market on Monday. Meanwhile shares of Indian Oil Corporation (IOCL) fell 1.34% to close at ₹99.45 on Monday.

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Outbreak affects another Princess cruise ship

SAN FRANCISCO — Another Carnival Corp. cruise ship has become embroiled in an outbreak of Covid-19, the disease caused by the novel coronavirus — this time in a West Coast-based liner called the Grand Princess where health officials say at least one former passenger has died after a recent cruise.

The ship, on a voyage to Hawaii with a stop in Mexico, has been ordered to return to port in San Francisco. The vessel has a capacity of 2,600 guests and 1,150 crew.

Gov. Gavin Newsom said late Wednesday the cruise ship won’t be allowed to come ashore until state officials appropriately assess the passengers and the vessel. "It’s a dynamic situation," Mr. Newsom said in a press briefing.

Officials of Carnival’s Princess Cruises said in a letter early Wednesday to passengers that the Centers for Disease Control and Prevention had notified them it was investigating "a small cluster" of Covid-19 cases in Northern California tied to the same ship’s voyage in February between San Francisco and Mexico.

The company, the world’s biggest cruise operator, also operates the Diamond Princess, where dozens of passengers became infected with Covid-19 when it docked in Japan in January. That ship was quarantined for two weeks.

An elderly passenger from the Feb. 11-21 Mexico cruise became the first person in California to die from the illness, after being hospitalized in Placer County, Calif., following likely exposure on the trip, health officials said Wednesday.

Mr. Newsom said another passenger from Sonoma County, Calif. is in a "difficult condition" and being monitored for possible Covid-19 complications.

Placer County officials said other cruise passengers may also have been exposed, and that they were working with the CDC to find and alert them. Mr. Newsom said several of those people from Placer County were part of a tour.

On Princess Cruises’s website, Chief Medical Officer Grant Tarling advised guests on the February cruise to immediately seek medical attention if they have experienced any symptoms of the virus, including fever, chills or cough since returning home.

Dr. Tarling said in an open letter that the Grand Princess, until today en route to Ensenada, Mexico, about 100 miles south of the U.S.-Mexican border, would turn around and return to San Francisco for further investigation.

Passengers were told to remain in their staterooms until they had been cleared by medical staff. "You may order room service while you wait for the medical screening to be completed, and we apologize for any inconvenience," Dr. Tarling said in the letter.

The company said 62 passengers who sailed the previous Mexico voyage remained on board for the current Hawaii voyage.

"In an abundance of caution, these guests and other potential close crew contacts have been asked to remain in their staterooms until screened by our onboard Medical team," the company said.

The company said it was taking precautionary onboard measures, including disinfecting major traffic areas and barring passengers from serving themselves from the buffet.

Princess Cruises gained fame in the 1970s when one of its ships, the Pacific Princess, was cast in a starring role in the television series, "The Love Boat."

The Grand Princess, launched in 1998, was refurbished last year. On its February trip from San Francisco to Mexico, the ship passed Cabo San Lucas on Valentine’s Day.

The cruise director dressed in a red suit with white hearts joined the ship’s captain to perform wedding vow renewals for dozens of couples, according to a passenger video posted online.

Passengers enjoyed live entertainment, including a production of a show called "British Invasion" and "Stardust," a Blues Brothers tribute band.

Travelers are backing out of planned cruises over fears of the spread of coronavirus, dealing a punishing blow to the industry at a time of year when ships typically start to fill up.

Erin Ailworth contributed to this article.

Write to Jim Carlton at [email protected]

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Campbell’s says millennials really like their tomato soup

Campbell Soup Co. says it can thank millennials and their taste for tomato soup for its latest earnings results.

The iconic soup company posted better-than-expected earnings and sales in the fiscal second quarter, sending shares soaring more than 7% in Wednesday trading.

Mark Clouse, Campbell’s chief executive, said the company’s condensed soups, an item it is known for, and its broths, including the Pacific brand, gave the results a boost.

“Not only are we attracting new households, we are attracting younger households, which bodes well for the future,” Clouse said, according to a FactSet transcript of the company’s Wednesday morning earnings call.

Read: Wendy’s is roasting the competition ahead of its breakfast launch and analysts approve

“In particular, on tomato soup, a good percentage of the gains came from millennials households. Frankly this is a trend that many did not think was possible.”

In 2017, Campbell CPB, +7.50% had a big soup problem. Now, the company says it is seeing momentum in not just tomato soup, but chicken noodle, cream of mushroom and cream of chicken.

In the most recent quarter, sales of soup in the U.S. were up 1%.

“Consumers responded favorably to our messaging and quality improvements,” said Clouse. “As a result, we saw improved lifts in the business across both eating and cooking varieties. Given the importance of the business, this was a key pillar in our strategy and was the single biggest priority going into the season.”

Among those quality improvements are the addition of fresh cream and the six tomatoes that go into the tomato soup.

Convenience has also been a factor for consumers that cuts across other parts of the company’s business, including items like Prego pasta sauce.

Clouse says “the simple assembly of ingredients to get a meal, and in particular with younger millennial households” is something that Campbell Soup has focused its efforts on.

Campbell Soup says sales in the meals and beverages category, which includes soup, totaled $1.22 billion, with total sales of $2.16 billion, down from $2.17 billion last year. The company said there was also strength in broth but results were offset by weakness in ready-to-serve soups, which are also sold under the Campbell’s brand.

Going forward, CFRA’s Arun Sundaram thinks the coronavirus outbreak could impact results.

“We think private label competition will ramp up in U.S. soup, and an unusually warm winter 2019-2020 could negatively impact overall U.S. soup consumption trends,” the CFRA note says. “We think consumer stockpiling related to COVID-19 could help sales in fiscal Q3 but may hurt sales in a future period.”

CFRA rates Campbell Soup stock sell with a $41 price target.

Campbell Soup shares have rallied 42.4% over the past year, outpacing the S&P 500 index SPX, +3.13% , which has gained 10.7% for the period.

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