Graeme Wearden 

Oil price slumps to 2018 lows; Black Friday protests and warnings – as it happened

Rolling coverage of the latest economic and financial news, as the oil price hits a 13-month low and Amazon workers push the company to mend its ways
  
  

Activists of French NGOs ‘Les Amis de la Terre’ (Friends of the Earth) and ANV Cop21 hold banners outside the French headquarters of US online retailer Amazon today
Activists of French NGOs ‘Les Amis de la Terre’ (Friends of the Earth) and ANV Cop21 hold banners outside the French headquarters of US online retailer Amazon today Photograph: -/AFP/Getty Images

Finally, here’s our news story on the meltdown in the oil market:

Plus the latest from America, where Black Friday has been a little less boisterous this year...

Amazon has reiterated that today’s protests didn’t stop it handling customer orders, saying:

“We were fully operational today as our associates focused on delivering for our customers. Any reports to the contrary are simply wrong.

We respect the rights of groups and individuals to have their voice, but for us it was business as usual inside our Fulfillment Centres.”

Some shoppers have also been having a jolly time, by the look of it....

More from the GMB:

Currys PC World report that Nintendo Switch, Xbox 1 and iPad minis were their most popular products today.

Sales of Ring smart doorbells are up 200% (they let you see who’s at the door remotely, and chat to them).

Barclaycard has updated its transaction data; by 3pm, the number of UK payments handled today was up 10% on last year, but the amount spent is down 12%.

Despite being one of Europe’s most depressed markets, Black Friday in Greece is so popular that it began four days ago and will only end next week on ‘Cyber Monday’.

The Hellenic Confederation of Commerce and Entrepreneurship, which represents small and medium-sized businesses announced this afternoon that one in two Greeks had taken advantage of the super sale with clothes and electronic goods flying off shop shelves nationwide.

Buoyed by good weather consumers could be seen in central Athens flooding stores earlier in the day.

Greeks trawling the net for buys have increased by a whopping 26%, according to data compiled by the national statistics agency. Earlier this week Paypal said it had calculated e-shopping has jumped 50% on Black Friday and Cyber Monday in Greece, a country where hardships still abounds on the back of the nation’s long-running economic crisis and where these events were foreign concepts not that long ago.

Plenty of charities, local groups and fashion brands are doing Black Friday differently.

Sarah Butler explains:

Greenpeace has teamed up with partners including Fashion Revolution and Shareable to back Make Smthing week, during which artists and crafters lead workshops on creative ways to reuse, repair or recycle goods.

Events taking place over the weekend include ShareFest in Totnes, Festival of Sustainable Fashion in London’s Hackney and Leeds Community Clothes Exchange.

The Charities Aid Foundation is backing the UK’s efforts for global charity event Giving Tuesday on 27 November, which encourages people to do something for – or give something to – a charity they care about. Celebrities including blogger and Strictly Come Dancing participant Joe Sugg, Ricky Gervais and Martin Lewis are supporting the day which last year raised £213m online alone around the world.

In the UK, PayPal will match donations made on the day via its fundraising page or app up to a total of £50,000.

Some brands will also be supporting charitable efforts on the day including clothing chain FatFace, tea label Pukka Herbs and Pret a Manger.

Fatface will donate up to £100,000 of profits made over the weekend to charities including Nepal Appeal, the Prince’s Trust Tomorrow’s Talent programme and recycled swimwear maker Ocean Positive. It will also give the top 10 trading stores £2,000 each to donate to local community charities....

Rebecca Long Bailey MP, Shadow Business Secretary, is pushing the government to protect workers facing redundancy at Ellesmere Port:

“This is devastating news for workers and their families in the run up to Christmas and is especially shocking considering the car maker’s recent return to profit.

“Bosses must now urgently meet with unions to ensure that there are no compulsory redundancies and work to provide long term certainty to workers and their families during this difficult time.

“This distracted Government cannot sit back and allow for the decimation of such a vital industry with its highly skilled workforce, the loss of which will be felt not just locally but nationally.”

Bleak news from the UK car sector -- Vauxhall is cutting 241 jobs at its Ellesmere Port plant, which makes the Astra model.

In a statement, the company says:

“This restructuring is critical to ensure that the Ellesmere Port plant develops its competitiveness during this difficult time within the industry,”

The firm, owned by US auto group GM, had already cut jobs earlier this year, and in 2017.

This is eBay’s biggest Black Friday ever, according to Rob Hattrell, UK VP of eBay, who adds:

We’re expecting up to 100 million visits to our marketplace over this weekend and we’ve lined up some great deals – the X Box One is performing exceptionally well this week. Black Friday isn’t just about tech, we are seeing high sales volumes in Menswear, DIY equipment and furniture too.

It’s not just about the big brands, we support thousands of small businesses on our platform like Velocity Electronics, and on Cyber Monday we’ll be handing over our biggest advertising space on Piccadilly Lights to them.

The dropping oil price is part of a broader theme....

Here’s our comprehensive round-up of the best offers out there:

Labour leader Jeremy Corbyn has backed the push for better conditions at Amazon:

Brent crude has now plunged by 28% since early October, when it was trading at $84 per barrel.

Brent crude falls through $60/barrel

Newsflash: Oil is having a Black Friday sale of its own.

Brent crude has just fallen through the $60/barrel mark for the first time since October 2017. That’s a 4.5% drop today, extending its earlier losses.

US crude is also slumping deeper, down 6.6% at just over $51 per barrel.

Why? Traders are concluding that slower economic growth and ongoing trade wars means less demand for energy.

Cailin Birch, global commodities analyst at the Economist Intelligence Unit, explains:

“Oil prices’ recent slide primarily reflects the weakening outlook for global oil demand.

The US’s decision to issue waivers for major importers of Iranian oil has erased earlier fears that US sanctions would create a supply crunch. Against that backdrop, the slowing pace of Chinese GDP growth, and therefore energy demand growth, is a concern. Emerging economies in Asia, primarily China, will be responsible for much for the new oil consumption in the coming years, so oil prices will remain very sensitive to the region’s economic performance.”


The other big trend this year is that more shoppers are buying on their mobiles, rather than making that cold and lonely trek to a special 5am opening.

Sarah Butler explains:

Argos said half of its orders so far had been made on a handset, up from 40% last year, while Carphone Warehouse said its sales through smartphones were up 8% year on year. Midnight until 1am was the busiest period for online shopping with 87% of sales made via mobiles, according to one estimate.

Barclaycard reports that there are more UK Black Friday shoppers than last year, but they’re spending less.

Here’s the details:

  • 16% increase in the volume of payment transactions compared to the same period on Black Friday last year
  • 21% decrease in the amount spent compared to Black Friday last year

Shoppers need to be extra-careful not to fall for a bad deal today, says Nicla Di Palma, equity analyst at Brewin Dolphin.

“After a tough year for the UK high street and the dominance of online retailers, this year’s Black Friday will cover a broader range of products and offer more pronounced discounts. This could see customers lured away from Christmas deals, as they stock up on products ahead of the festive period.

“The competition between retailers is intensifying and this should, in theory, benefit customers. But, as today’s Which report highlights, customers need to be vigilant as to whether those amazing Black Friday deals really are what they claim to be. The report said 87% of the Black Friday deal items they investigated were available for the same price, or cheaper, at other times of the year.”

More protests, this time at Amazon’s Milton Keynes offices.

This time, the GMB have turned up with an ASBO (anti-social behaviour order), accusing the company of deliberately using loopholes to cut its corporation tax bill.

For the record, Amazon UK paid a corporation tax bill of £4.5m last year -- half as much as in the previous 12 months, despite a 35% rise in turnover.

Tax is paid on profits, not revenue, of course.

Amazon: Strikes aren't affecting operations

Amazon tells us that it is business as usual today, despite the protests in the UK, and strikes in Germany, Spain and Italy.

The e-commerce giant says:

“Our European Fulfillment Network is fully operational and we continue to focus on delivering for our customers and reports to the contrary are simply wrong.”

Updated

In Madrid, unions have hung a banner reading “Exploitation without rights” on the fence outside an Amazon logistics centre.

Police are guarding the entrance...

Back in the markets, oil is continuing to slide.

Brent crude is now down 3% at $60.55 per barrel, the lowest since November 2017.

US crude has slumped by 5% as traders brace for a supply glut.

The GMB union have created a powerful video for Black Friday, urging Amazon to treat its workers fairly, not like unfeeling automatons:

French environmental groups ANV Cop21 and Les Amis de la Terre (Friends of the Earth) are also protesting against Amazon today.

They’ve just dumped a load of broken electronics devices outside its French headquarters in Clichy, in northwest France.

Les Amis de la Terre accuse Amazon of causing environmental damage by destroying unsold products and failing to help recovery electrical and electronic waste - as well as “waging an economic war” on other retailers.

Just in: A video clip from Spain of Amazon workers striking, at its San Fernando de Henares warehouse.

Amazon hit by Black Friday protests

Unions across Europe are holding protests today against the ‘inhuman conditions’ at retail giant Amazon.

They’re using Black Friday as an opportunity to highlight problems at Amazon, including tough performance targets, jobsite hazards, and anti-union hostility.

In the UK, the GMB union is holding a protest at five stores - including in Swansea:

The GMB says:

Amazon fosters a brutal, high-pressure work environment in which speed is valued over safety, according to warehouse employees, and the company’s demanding goals over long, gruelling shifts cause widespread injuries. For example, a GMB survey of UK workers found that 9-in-10 have pain on the job.

“I have repetitive strain, and spondylosis with arthritis,” said one Amazon worker organising with the GMB who fears retaliation. “The work is dehumanising, you are a number not a person. if you have health issues, the Amazon way is to pay you off and replace you with temporary workers with less terms and conditions.

Elsewhere, chronic pain is too common.

Workers in Germany, Italy and Spain are planning to strike today, causing disruption on one of Amazon’s biggest days of the year.

Here’s the details:

  • Germany: Amazon workers, members of ver.di, walked off the job this morning at the Bad Hersfeld facility at 8:30 a.m.
  • Italy: Italian labour union FILCAMS CGIL announced a “state of agitation” and Black Friday solidarity actions at several Amazon facilities.
  • Spain: The Comisiones Obreras (CCOO) will lead a strike at Amazon’s San Fernando de Henares on November 23 and 24. The Madrid-area facility employs 1,800 workers and was last on strike during Amazon Prime Day in May.
  • United Kingdom: The GMB will hold large protests outside of five Amazon warehouses in the UK. One of those “fulfilment centres,” the 1,500 worker Rugeley warehouse, was recently called “one of the most dangerous places to work in Britain.”

Here’s Chris Williamson, Chief Business Economist at IHS Markit, on the eurozone slowdown:

“The cooling of Eurozone business growth to a four- year low adds to signs that the economy faces a disappointing end of the year.

“Manufacturing remains the main area of weakness, linked in part to having been hit hard once again by deteriorating exports. The slowdown is also being temporarily exacerbated by persistent disappointing car sales.

However, November also brought further signs that the manufacturing-led slowdown is spilling over to services, as consumer and corporate demand was often reported to have weakened in the face of headwinds such as rising political uncertainty, tighter financial conditions and higher prices.

Eurozone business growth hits four-year low

Uh ho.... growth across the eurozone’s private sector has hit its lowest level since the end of 2014

That’s according to the latest survey of purchasing managers in Europe, from data firm Markit.

Firms reported slower order book growth and falling exports, alongside deteriorating optimism about the outlook, plus rising costs and prices.

This dragged Markit’s PMI, a measure of growth, down to 52.4 (from 53.1 in October). That’s a 47-month low.

Manufacturing firms suffered particularly badly - suggesting that the trade disputes triggered by America this year are now hurting.

Markit says:

Manufacturers commonly blamed slower growth on subdued global demand, rising political and economic uncertainty, trade wars and especially sluggish car sales.

The survey also shows that Germany’s economy lost pace. That’s worrying, especially as the German economy shrank between July and September.

Updated

Don't fall for Black Friday tricks

Shoppers are being urged not to be tricked by dubious ‘bargains’ today.

My colleague Sarah Butler has the details:

Research from consumer group Which? released this week found that nearly nine in 10 “deals” available on Black Friday last year had been even cheaper at other times of year.

Jon Holt, head of financial services at KPMG, said:Black Friday plays on the excitement of spending while frictionless finance and cheap credit puts that buying buzz within everyone’s grasp.

“Our poll found that 51% of respondents didn’t even think the discounts they’re offered on Black Friday are a genuine saving! Having an economy disproportionately built on debt is not sustainable for consumers, retailers or financial services.”

Retailers are also at risk of diving further into the red as a result of slashing prices, according to credit ratings agency Moody’s. It said retailers without a carefully thought-out strategy only succeeded in booking sales they would have made anyway in December, but at lower levels of profit.

The nation’s inboxes are bursting with Black Friday offers:

Debenhams: Black Friday is worth it

Sergio Bucher, chief executive of Debenhams, says Black Friday is one of the retailer’s biggest days of the year, and well worth the heavy discounting of prices.

He told BBC Radio 4’s Today programme:

“It’s the starting gun of the Christmas campaign. Yes, customers are going to be coming to stores and buying some discounted products, but they’ll also buy some full-priced products, they’ll be having a coffee, eating a piece of cake, drinking gin and tonic.

“This Friday we’re going to be selling probably pretty much four times as much as a normal Friday so it is a big event for us. It is one of our biggest days of the year.”

Commenting on recent speculation that Debenhams could be the next big high street name to go under, Bucher insisted the department store chain has a future despite announcing plans a month ago to close about 50 stores.

“Retail overall is a tough place to be right now... we started our transformation about 12 months ago. If you were to go to Watford where we opened a new store you’d see a completely different face of Debenhams so I think that we have a very strong plan and we are transforming our product range as well. We are definitely here to stay. I bought shares two weeks ago, so I wouldn’t have done that if I didn’t have trust.”

“Yes there are a number of stores we will need to close in the future. We see a future for Debenhams with about 100 stores with a bigger online business, and we have started conversations with our landlords.”

Black Friday got off with a whimper, rather than a bang, this morning.

Some retailers threw their doors open early, but there was little sign of a rush.

My colleague Jasper Jolly trudged to Tesco Extra in Surrey Quays, south-east London, and found only a handful of eager punters in the pre-dawn chill.

Staff at the Tesco, one of more than 700 holding Black Friday sales across the country, unlocked the giant store at 5am, an hour earlier than usual. They easily outnumbered the seven people waiting outside.

Brendan Boshell, a 26-year-old working at a small start-up, was the first outside, hoping to snap up a bargain Xbox One games console.

“I’m quite surprised I’m the only one,” he says, after reading about fights for products . In the past, police waited at different stores during the Black Friday sales.

Factcheck: Donald Trump seems to have mixed up his oil price numbers in that tweet.

US crude only peaked at $76 per barrel last month - it was Brent crude that got into the 80s.

Donald Trump has been keen to take some credit (OK, all the credit) for the drop in oil prices, as these tweets show:

Certainly, Trump’s refusal to condemn Saudi Arabia over the murder of Jamal Khashoggi has cut the risk that Riyadh hits back with a supply shock [this position leaves the White House is now at odds with the CIA over the case].

Trump’s trade war has also left America with an oil glut, as China has cut imports of US crude.

In addition, Trump’s decision to grant waivers to allow certain countries to keep buying Iranian oil has also pushed prices down - while also startling the Saudis.

Forbes has a good take:

Saudi Arabia was caught off guard by the decision to grant waivers, which resulted in too much oil in the market. The price of oil predictably plunged, but Saudi Arabia has vowed to cut production. They are also working with other countries to engineer an even bigger production cut.

The President is now attempting to pacify Saudi Arabia by giving the country a pass on the murder of dissident journalist Jamal Khashoggi in October, and by publicly thanking them on Twitter. But that will be unlikely to compensate for billions in lost revenue over what Saudi Arabia undoubtedly considers to be a double cross.

Here’s Jasper Lawler of London Capital Group on the sliding oil price:

Oil experienced another volatile session overnight. Swings of over 1% have been the norm in the latter part of this week and volatility has been high since the beginning of November. This highlights just how jittery the oil market is right now. US inventories hitting their highest level in 11 months fuelled concerns over a global crude glut amid a worsening economic outlook.

The fact that oil traders shrugged off expectations that OPEC will start withholding supply in 2019 to rein in a glut reflects just how concerned oil traders are over the future outlook.

The agenda: Oil hits 2018 low; Black Friday kicks off

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

The oil price is sliding this morning, as oversupply fear and trade war angst continues to take their toll.

Brent crude has dropped to $61.52 per barrel overnight, its cheapest point since early December 2017.

US crude is under pressure too - down 2% today to just $53.39 per barrel, a level not seen since October 2017.

Several factors are in play. In particular - signs that supply glut is building up. The fracking industry generating more supplies, and Iran’s production is still getting to the markets thanks to US sanction waivers.

Opec, the producers’ cartel, is likely to vote to cut production when it meets next month. That expectation isn’t providing much relief now, though.

Oil is also being hit by the general drop in asset prices this autumn, and also suffering from fears that the global economy will slow in 2019.

Stephen Innes of trading firm OANDA explains:

The overhang from swelling US inventories which remain freshly minted in trader minds suggests the massive crude glut continues to outweigh OPEC output cut although tentatively curbing traders downside ambitions.

But while a weaker oil price gives Opec a headache, it’s good news for countries who import the stuff. Motorists ought to see some benefits at the petrol pump, eventually....

Also coming up today

It’s Black Friday, famously a time when Americans put down their turkey drumsticks, pick up their credit card, and head to the mall. European retailers have embraced the idea too -- so we’ll be watching for any notable deals, queues and scuffles.

Amazon couldn’t even wait for the big day itself (honestly, what happened to tradition?), and launched a pop-up shop in London yesterday:

Plus, we get new data showing how the eurozone’s private sector is faring this month.

The agenda

  • 9am: Eurozone flash composite PMI for November

Updated

 

Leave a Comment

Required fields are marked *

*

*