Australian Prime Minister Anthony Albanese leaves a media event in Sydney on July 11. (AP)

BEIJING, July 13, (AP): Australian Prime Minister Anthony Albanese kicked off a visit to China this weekend meant to shore up trade relations between the two countries. Albanese met with Shanghai Party Secretary Chen Jining on Sunday, the first in a series of high-level exchanges that will include meetings with Chinese President Xi Jinping, Premier Li Qiang and Chairman Zhao Leji of the National People’s Congress.

Albanese is leading “a very large business delegation” to China, which speaks to the importance of the economic relations between Australia and China, he told Chinese state broadcaster CGTN upon his arrival in Shanghai Saturday. During a weeklong trip, Albanese is set to meet business, tourism and sport representatives in Shanghai and Chengdu including a CEO roundtable Tuesday in Beijing, his office said.

It is Albanese’s second visit to China since his center-left Labor Party government was first elected in 2022. The party was reelected in May with an increased majority. Albanese has managed to persuade Beijing to remove a series of official and unofficial trade barriers introduced under the previous conservative government that cost Australian exporters more than 20 billion Australian dollars ($13 billion) a year.

Beijing severed communications with the previous administration over issues including Australia’s calls for an independent inquiry into the origins of and responses to COVID-19. But Albanese wants to reduce Australia’s economic dependence on China, a free trade partner. “My government has worked very hard to diversify trade … and to increase our relationships with other countries in the region, including India and Indonesia and the ASEAN countries,” Albanese said before his visit, referring to the 10-member Association of Southeast Asian Nations.

“But the relationship with China is an important one, as is our relationships when it comes to exports with the north Asian economies of South Korea and Japan,” he added. Chinese state-run Xinhua News Agency, in an editorial Sunday, described China’s relationship with Australia as “steadily improving” and undergoing “fresh momentum.” “There are no fundamental conflicts of interest between China and Australia,” the editorial stated. “By managing differences through mutual respect and focusing on shared interests, the two sides can achieve common prosperity and benefit.”

President of the Directorate General of Civil Aviation (DGCA) Sheikh Humoud Al-Sabah meets with Executive Vice President of Airbus Wouter van Wersch.

KUWAIT CITY, July 12: President of the Directorate General of Civil Aviation (DGCA) Sheikh Humoud Al- Sabah has affirmed that the directorate prioritizes the development of its relations with major international aviation companies, most notably Airbus, due to the latter’s advanced technical and industrial expertise. In a meeting with Executive Vice President of Airbus Wouter van Wersch and his accompanying delegation last Thursday evening, Sheikh Humoud Al- Sabah confirmed that Kuwait is keen on benefiting from the expertise of Airbus in order to meet the needs of national airlines and enhance their operational readiness under the highest international standards. On the other hand, Wersch stressed that he is proud of the relationship between his company and the State of Kuwait, indicating that Airbus fully supports the plan of Kuwait to modernize the civil aviation sector.

He pointed out that Airbus is working continuously to provide innovative solutions that contribute to raising operational efficiency and achieving environmental sustainability, in line with global trends in terms of emission reduction and enhancement of operational efficiency. Meanwhile, DGCA stated that during the meeting, the two parties discussed many topics of mutual interest; such as the development of vocational and technical training programs for the national manpower; investment in modern air transport projects in a way that enhances the position of Kuwait as a regional center in the field of civil aviation and air services; and prospects for cooperation in the fields of aviation industries, aviation services and modernizing the air fleet. Also, Minister of Finance and Minister of State for Economic Affairs and Investment Noura Al-Fassam and Wersch met on the same day to discuss various ways of boosting future collaboration, in light of the implementation of some development projects in Kuwait. The Ministry of Finance disclosed in a press statement that both sides affirmed historic relations between Kuwait and Airbus, and reviewed the latest developments in their current partnership. Managing Director of Kuwait Investment Authority (KIA) Sheikh Saud Salem Al-Sabah was also present at the meeting.

By Mohammad Al-Enezi
Al-Seyassah/Arab Times Staff and Agencies

 Demand for oil is weak from major consumers in Asia, including China, Japan, and South Korea, with a reduction of more than 400,000 barrels per day. These countries are the main consumers of oil from Arabian Gulf producers, so the decline will have a major impact on Gulf economies without exception. In addition, demand in the United States has slowed by 70,000 barrels per day, along with reduced demand from Mexico. Oil prices have now fallen below $68 a barrel, a level not seen even during the 2009 financial crisis or the COVID-19 pandemic.

The sad reality is that oil prices are now much lower than in previous years, possibly reflecting the impact of U.S. tariffs, which may also be affecting domestic demand. Meanwhile, Europe and emerging markets such as India, Pakistan, and Vietnam show reduced demand. This could suggest that Far East countries either have surplus oil with no available storage capacity, or they are holding off in anticipation of further price drops. This is certainly bad news for OPEC, which recently increased crude output, pushing more than one million barrels per day in excess into the market.

With global oil demand at 104 million barrels per day and supply at 105.2 million, the market is now oversupplied by over one million barrels daily, and it is struggling to find buyers. As a result, prices have dropped below $68 a barrel, with no immediate signs of recovery. The question remains whether OPEC+ will return to its traditional policy of supporting crude oil prices by cutting production, a strategy that may ultimately benefit non-OPEC producers and erode OPEC+’s market share. This could lead to the same cycle of repeated policy shifts. Or will this time be different, as OPEC+ becomes more accustomed to outside borrowing? The oil market needs stability and clear guidance from OPEC+ to take the right actions that balance supply while managing oil prices at an acceptable level. This raises questions about the effectiveness of the quota system and the success of the overall policy of OPEC+. Most of the time, their measures work only briefly before the organization relaxes its stance. When oil prices rise, other producers increase output to capitalize on the situation, undermining OPEC’s efforts. This cycle repeats as prices eventually harden again.

The decline in oil prices is likely to continue, and nothing can change this unless OPEC+ intervenes as usual by calling for further production cuts, resulting, as always, in losses for the organization. As mentioned before, OPEC+ is relying heavily on borrowing from external banking sources to cover its deficits, a trend that is expected to continue unless oil-producing countries reduce their expenses and cut their budgets. In addition, it is important to explore new sources of income. Governments must also focus on creating jobs for recent graduates despite the drop in oil revenues. The future looks challenging, with lower oil prices and reduced income from oil. Our governments need to find alternative revenue streams and provide job opportunities for new entrants to the labor market. We must face these new realities – weaker oil prices, higher expenses, and growing numbers of job seekers. These are the new challenges facing the Arabian Gulf countries amid a period of lower oil prices.

By Kamel Al-Harami
Independent Oil Analyst
Email: [email protected]