18/04/2016 World Business Report

Oil prices fall sharply after major producers fail to agree

on a plan to limit global production to drive up revenues.

And another blow for Brazil's President, Dilma Rousseff.

Its lower house of Congress has voted to start impeachment

proceedings over charges of manipulating government accounts.

Also in the programme: India's Finance Minister tells us economic

The world's leading oil producers have failed to come up with

an agreement to cap production in a bid to stabilise prices.

They met in Doha this weekend to try to thrash out a deal.

But in the end they had to concede they "need more time".

After that statement, crude prices swiftly fell more than 5%.

To give you some perspective on what's at stake,

Around 1.5 million barrels of crude are produced every day

in excess of demand, according to the International Energy Agency.

The IEA believes that oversupply will fall to 200,000 barrels

per day in the second half of this year, but the agency says freezing

at current levels would have limited impact as both Saudi Arabia and

Russia are already pumping at near record rates. And Iran says it will

not agree to a freeze in production now as it wants to hit pre-sanction

Oil kingpin Saudi Arabia had counted on rock-bottom oil ending America's

But America's frackers, although they've been hard hit, are seeing

David Hunter is an energy analyst with Schneider Electric.

Good morning, David. I must confess I wasn't surprised to hear there was

no agreement in Doha and yet markets were really anticipating a good

result prior to this weekend, were they not? That is right. Since their

potential freeze was announced in February there has been more

optimism in the markets, it has risen from the trough something like

two thirds up to the mid- $40 per barrel. No agreement has spooked

markets. Where do we go from here? Clearly, OPEC producers and some

non- OPEC producers, who have all met, cannot agree, which was kind of

what happened last time, when it was quite chaotic, wasn't it? That is

right. I think what is driving this, what sits behind the discussions is

the geopolitical differences between Saudi Arabia and Iran and also Saudi

Arabia's memory of what happened in the past with weak oil prices, in

that it risks losing market share by cutting production. That affects a

number of countries, they are desperate not to lose market share

because it is difficult to get it back. Iran, obviously, as pointed

out, is trying to increase production post sanctions, and that

is really behind it, in that Iran feels it has the right to do that,

meanwhile Saudi Arabia does not want to lose market share. Talk us

through the consequences. Oil prices will remain low for the rest of this

year. Who will be the biggest losers? We have mentioned fracking

in America. Some companies are in dire straits. Saudi Arabia it self,

although it has deep pockets and large reserves, is struggling. Any

economy that depends largely on oil is struggling at the lower prices we

have seen -- itself. Some African countries, also in Venezuela, Russia

is travelling as well. These major producers are finding it very

difficult and they would all like the oil price to stabilise, to

recover, for the market to come back into balance -- struggling. As you

mentioned, in the US, the unconventional oil production has

been relatively higher cost, and as the price per barrel has fallen,

that has resulted in lower production, falling production in

the states, but these producers have been more resilient than Saudi

Arabia anticipated. Thank you for your time. That is a story we will

talk about when we look at the papers today as well.

Since India has overtaken China as the world's fastest growing

economy, there's been a strong focus on the government's reform drive

The International Monetary Fund has just confirmed its bullish stance

on the country, despite gloomy predictions for the global outlook.

India's Finance Minister Arun Jaitley told us about

I don't think double-digit growth is so easy. Countries can reach that

target when the global nations are all supported. When they are hostile

it is extremely difficult. Even within the present limitation of the

world economy going slowly, volatility being fair, commodity

prices being low, I think if we have a good monsoon and if we are able to

address several domestic reforms, including strengthening the Indian

banking system, which is what we are trying to do, for us to grow over

the 7.5% we have reached is reasonably possible -- being there.

That was the finance minister of India.

Other business stories: As rescue efforts continue in the south

of Japan after the weekend's earthquakes, factories in

Car maker Toyota has suspended much of it's production

across the entire country because of a shortage of parts from suppliers.

Honda has suspended work at a motorcycle plant near the quake-hit

city of Kumamoto, while electronics firm Sony has halted operations at

The first Air France flight has landed in Tehran after a gap

of 7.5 years, following last July's agreement to

The airline had suspended flights to Tehran in October 2008 as the UN

On board the flight was a delegation of French business

leaders and the French Transport Minister, Alain Vidalies.

-- Brazil's President Dilma Rousseff has lost her fight against plans to

She says she will take her political battle for political survival to

Two thirds of the lower chamber in Congress voted

It comes after she was accused of tampering with government

She says the impeachment amounts to a political coup.

With me Jimena Blanco, head of Americas at risk consultancy

Lovely to see you at again. We have talked about this on many occasions,

haven't we, as this has unfolded. Talk us through this latest

chapter. What now? It's now goes to the Senate. It is a 3-step process.

The first two steps require a simple majority. It is likely the

impeachment procedures will continue. Towards the third stage,

what we would call a formal trial, at that point the head of the

Supreme Court takes over as head of the Senate and overseas that process

to ensure its constitutional, legal process cannot be challenged. I

understand that he, you can remind me of his name, it is an individual

many see as one that is not tarnished by the various allegations

that not just pointed at Dilma Rousseff but many players in the

political scene. Yes, when we look at the public opinion polls, the

electorate has taken a negative at look of the political class. It is

not just Dilma Rousseff but the vice president, the head of the lower

chamber and the Senate, who people would like to see out of their jobs.

When we get to the head of the Supreme Court, that is when public

opinion turns and has a more positive outlook of him as an

individual who can look over this process. How is the economy going

with this going on? It is battling with low commodity prices, as with

many economies around the world, but this political instability... And of

course, not to forget the Olympics coming up. How is the economy sort

of dire jesting all of this? It isn't. It is a captain less ship.

The official data shows the recession is very deep and none of

the changes are taking place. Therefore we don't see an end in

sight. -- Ricardo Lewandowski it is worrying time for Brazil --

captain-less ship. The political stalemate could continue -- it is a

worrying time for Brazil. Even when President Rousseff, if she was

removed from office, we don't know what would happen and who could be a

viable successor to bring the Brazilian economy back on its feet.

OK. We appreciate your time. Thank you so much. It is a story we will

keep across. The price of oil has slid dramatically after the Doha

meeting. It has pulled down share markets across Asia with Japan at

one point down 3%. I will see you in a few minutes' time.

Families across England will learn today where their children

According to research by the charity, "Teach First,"

parents from poorer households are losing out in the competition for