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Oil Slips As Trade War Worries Outweigh Iran Sanctions

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Oil Slips As Trade War Worries Outweigh Iran Sanctions

Oil prices slipped on Friday as concerns over the impact of a global trade war depressed sentiment, although impending U.S. sanctions on Iran and falling Venezuelan output limited losses.

Benchmark Brent crude oil LCOc1 was down 40 cents at $77.37 a barrel by 1310 GMT. U.S. light crude CLc1 was 30 cents lower at $69.95.

U.S. President Donald Trump threatened on Thursday to withdraw from the World Trade Organization, his latest salvo in a deepening dispute between the United States and its major trading partners.

Economists worry that rising trade barriers between the world’s major economies will drag on global growth and erode energy demand.

“You have to wonder if it (crude) can sustain these prices in a world where President Trump doubles down on his battle with the EU and China at the same time,” said Greg McKenna, chief market strategist at futures brokerage AxiTrader.

Trump is prepared to ramp up a dispute with China and has told aides he is ready to impose tariffs on $200 billion more Chinese imports as early as next week, Bloomberg reported on Thursday.

Oil analysts cut their price forecasts for 2018 for the first time in almost a year in August, as concerns about the impact of the global trade war deepen, a Reuters poll shows.

A Reuters survey of 45 economists and analysts forecast Brent would average $72.71 in 2018, 16 cents below the $72.87 projected in July and above the $71.96 average so far this year. The price was forecast to average $72.58 in 2019. [O/POLL]

However, oil markets are tightening with a recent surplus draining, trade figures show.

The volume of unsold crude stored in the Atlantic basin has dwindled from around 30 cargoes to just a handful in recent weeks, a Reuters analysis showed.

Brent is on track for a rise of more than 4 percent in August with U.S. light crude gaining 2 percent.

Investors are worried that, with Venezuelan supply falling sharply, Iranian crude supply will be cut sharply ahead of the imposition of U.S. sanctions on Tehran in November.

“The November deadline to comply with the U.S. demands for an Iran oil embargo is moving closer, and in anticipation, buyers seemingly have begun reducing their purchases,” said Norbert Ruecker, commodity analyst at Swiss bank Julius Baer.

“Venezuela remains equally concerning,” he added.

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African News

Tunisia’s Parliament Approves New 2019 Budget With No New Taxes

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Tunisia's Parliament Approves New 2019 Budget With No New Taxes

Tunisia’s parliament has approved a 2019 budget imposing no new taxes on individuals and easing the burden on some sectors after years of tax hikes that have stoked public anger and at times violent protests.

The budget, adopted by 113 votes out of 217, projected a fall in the deficit to 3.9 percent of the gross domestic product next year, from about 5 percent expected this year.

Prime minister Youssef Chahed said earlier this year that 2018 would be the last difficult year for Tunisians, but his government remains under pressure from the international monetary fund to trim the budget deficit by cutting subsidies and reforming the bloated public sector.

Budget analysts expect Tunisia’s economy to grow by 3.1 percent next year, up from an estimated 2.6 percent this year.

The government will cut taxes in half next year to thirteen and a half percent for companies operating in sectors including technology, textiles, engineering, and pharmaceuticals.

Taxes on bank profits were raised from 35 to 40 percent.

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Business News

Experts Support Trade Multilateralism

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Experts Support Trade Multilateralism

Several experts from different countries have voiced their support for multilateralism in trade.  They particularly pointed to china’s actions to promote cooperation based on win-win results.

Sanusha Naidu, a foreign policy analyst based in South Africa, said the recent G-20 summit has told the world the significance of multilateralism in trade which has played an active role for the global economy.

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African News

Saudi Arabia To Invest 100m Euros In Africa’s Sahel Region

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Saudi Arabia To Invest 100m Euros In Africa's Sahel Region

Saudi Arabia has pledged 100 million euros  to support priority investment programs in Africa’s Sahel region.

Saudi’s state minister for African affairs Ahmed Qattan made the announcement at a donors meeting for the five-member Sahel group, held in the Mauritanian capital Nouakchott. The other countries making up the Sahel group are Burkina Faso, Chad, Mali and Niger.

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