29/09/2016 BBC Business Live


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This is Business Live from BBC News with Sally Bundock


The first deal for 8 years - the oil cartel OPEC agrees


a landmark deal to limit the production of crude.


But will it boost prices in the long term?


Live from London, that's our top story


Oil prices surged after the surprise agreement from OPEC so does this


mean a new lease of life for the divided cartel?


VW pledges a cleaner future as it tries to leave diesel-gate behind.


The boss has been speaking to Theo Leggett who is at


We'll be hearing that interview a bit later.


And energy stocks are pushing up markets


worldwide this is the scene in Europe right now.


Later in the programme we'll get the Inside Track on one of the most


And today we're looking at aggro in the air,


yes, unruly passengers causing incidents on board planes,


we saw a sharp increase of those last year -


so we want to know what ticks you off once you've left the tarmac


and should airports limit the amount of booze served in


A very warm welcome to the programme.


Don't hold back, tell us what gets on your nerves when you are on the


plane. We start in the Algerian capital


Algiers where the OPEC group of oil producing nations have


been holding talks. They have shocked global markets


by agreeing to limit oil production The collapse in the price


of crude from more than $100 a barrel to less than $50 has


hit oil producers hard. But in-fighting between them has


meant no co-ordinated action since the global financial crisis


eight years ago. Opec is proposing to


limit total oil output by its members to between 32


and a half million and 33 At the moment they are pumping


33.2 million barrels a day. So that's a production


cut of up to 700 It's not a lot on a global level -


and the details still have to be agreed -


but the news sent crude prices soaring -


Brent crude jumped 6% Cornelia Meyer Chief executive


of Meyer Resources is with me. Cornelia, great to have you with us.


They have agreed to agree, let's say, can I just say, I think this is


a walk. Because at a time when Russia is breaking records,


producing over 11 million barrels a day, you've got to run, getting back


up to speed, 700,000 won't do much. It won't do much but what is


significant is that they were able to have an in principle agreement


which as Sally says has not happened in eight years but hasn't happened


by design because they want to ease out shale producers and get people


who have a higher cost of production a bit out of the market. Yes it will


be very hard between now and the meeting in November for all the


countries to agree on the individual quotas because it isn't just Iran


that wants to increase production as they get out from under sanctions,


it's Nigeria and Libya who have come from out of internal strife and want


to up production again and Iran is trying to push production up. We


say, yes, they have reached a deal, they have because Saudi Arabia wants


to play ball now because its plan to knock of these American shale


producers who do fracking by keeping the price low has backfired. Saudi


Arabia has been dipping into its budget. We had a story yesterday


about Saudi ministers having big play cuts, it's in trouble. I am not


sure it is in trouble. What you always see when oil prices go down


in Saudi Arabia is that they suddenly have to write policies.


They stopped the ridiculous subsidies for Phil also some -- for


fuel, so some play cuts are good and they are acting more like a normal


economy which in the long run is a good thing -- play cuts. And the


Deputy Crown Prince is trying to wean the country and that off oil


and trying to get other industries further. Some say it is kicking the


can down the road, we've got until November 30 when this deal has to be


done for it to actually happen. In the meantime what will happen with


the price of oil, it is above $50 a barrel in the future, maybe towards


60, your thoughts? It's gone up way too fast overnight and it will come


down. It will be between 45 and 50. But next year you will see the price


go up because at some stage next year there will be an equilibrium of


demand and supply and watch out for 2018 because the oil price will be


so low, companies have and invested and when demand goes up they would


produce more and the lack of investment will affect production


and it isn't just like a light switch you can turn on. So watch out


for 2018 when I see oil prices and 60 and above. We will hold you to


that, Cornelia! You know you'll be punished if it doesn't come to! She


likes a challenge. Now other business stories.


A court in South Korea has denied request by prosecutors to arrest


the chairman of Lotte Group, Shin Dong-bin.


Prosecutors made the request earlier this week, for the court


to approve the arrest of the chairman.


That's on suspicion of embezzlement and breach of trust for activities


Lotte is a conglomerate with businesses ranging


Music streaming company Spotify is reportedly in talks to take over


The two sides are in advanced negotiations, according


The talks come at a time when competition in the streaming


Sweden's Spotify remains the market leader but faces increasing


competition from Apple Music and Amazon's recently


The UK Government and French energy giant EDF are set to sign a key


contract today that the new ?18 billion Hinkley Point see nuclear


power station. The EDF boss is expected to join high-ranking


officials from the UK, France and China at the behind closed doors


ceremony in London. This would be the UK's first nuclear plant is a


generation. The Heathrow expansion could be


coming back into the headlines. Check out our website. It's reported


that Theresa may may have enough support to press the


Maybe she can do it after all. Sharon is in Singapore, tell us all


about the energy stocks, liking the Opec news. That's right, to some


extent, you have told us a bit, it's all about the cut in production for


the first time in almost a decade by Opec, lifting Asian shares,


especially the Asian related ones so we are seeing shares of Japanese oil


companies doing well, up about 6% at the close. Japan patrolling


exploration, up to as much as 8% and we are even seeing Chinese oil


producers, some jumping of a 5%, Australia's Woodside Petroleum is up


over 7% today due to oil prices having surged the most since April


do to that decision. It had a domino effect with currencies of oil


exporting nations such as the Australian dollar which hit


three-week highs. Nonetheless analysts, as well as yours earlier


point out that this might all be short lived because we have the US


shale producers, who have been cutting production in recent months.


They might start increasing output now and drive down prices again.


It's the next Opec gathering in November that a lot of people say


will solidify those plans to cut output such as putting in place


targets for each member. That is when all of that will be decided.


Thank you, good to see. It's similar story in Europe, let's quickly show


you Europe which is trading well. For the FTSE 100, BP and Shell have


a heavy weighting in many pension funds. That market is up higher and


so are the other markets across the board for Europe. In terms of what


is happening in the US, Samir Hussein is on the case. The chief


executive of the US bank will again be going to Capitol Hill. His second


chance to explain how 2 million accounts were opened at his bank


without customers's knowledge. Earlier this month Mr Stump was


mauled by US lawmakers who criticised him and the bank for not


holding senior executives accountable. It seems the big


moneymaker for Pepsi these days but its premium and healthy brands. US


consumers are increasingly looking forward for healthier options. But


with demand for sports drinks like bottled water and juice means


third-quarter results could be affected. Grocery sales have hit


record lows which could affect one wholesaler and retailer, it's also


phasing out the sale of tobacco products which will also affect the


bottom line. Costco, I haven't used it here but I like it in the US. I


know it's your! James Foley, senior currency strategist at Rabobank is


here. Good to see you. Higher oil prices, what does that mean on the


currency market? It's good for commodity producers, even Australia


which does not produce much oil, you've got to put this into context,


most of these countries don't want a stronger exchange rate. Most


countries would still rather have a weaker exchange rate and that


includes of course the likes of Canada and Australia as well. The


Malaysian currency is going up strongly although the Japanese yen


has weakened, that's great news for Japan, struggling with a strong


currency. Interesting to see how all these things are tied up. It is.


About federal banks, the big boss of the Federal reserve, she was


speaking... Is this about central banks being independent? She was


grilled yesterday and one question was about questions that one Fed


official had made to the Clinton campaign, should she stand down? She


argued that there wasn't a conflict of interest although this does come


in the context of a big market discussion on central-bank


independence. There's a fear that central banks will lower interest


and we are in a cul-de-sac, we can we go from here, how else can this


two-minute growth, they've done everything they can. Should central


banks, more under the government all become more independent? It's an


unresolved argument. And with an election coming up in the USA Donald


Trump saying he isn't so happy about the independence of the Federal


reserve. Interest rates are lower now because the Fed is doing what


Obama wants so if Donald Trump were to win the presidency what would


happen to the independence of the central bank? Comeback, Jane,


to take us through the newspapers, we've got some good stories, what


ticks you off in the air? My children probably. Coming up,


learning languages, we'll get the heads up on one of the most popular


languages apps. Now let's talk some more


about Deutsche Bank and the German supersize bank has been in focus


all week with speculation This time yesterday it announced


the sale of one of its assets Deutsche that is facing liabilities


into the billions in the US. Our Business Correspondent Dominic


O'Connell joins us now If you ever tried to learn a


language, it's very hard to keep up with it. We get it into very small


chunks that you can use every day and integrate it in your day. Talk


us through how it works then, to you talk to your device, does it talk


back to you and can you have a conversation with your device in


that language, is that kind of how it works? Not exactly. You do talk


to your device because you have to practise the speech so there is a


speech recognition that gives you a score on how the conversation works,


but it's basically a structure that takes you from "hello my name is...


" to whatever level you want to go to and it's all the grammar in


there, it's pronunciation training, vole cab and everything that would


you would expect from language -- vocab.


It is a crowded market out there right, you have got Resetta,


Duo-Lingo. How do you deaf Rennes Shay? The shortest possible answer


is, it works. It sounds trivial because people have been learning


languages for a long time and it's nothing completely new but learning


languages with a device is something that we started with nine years ago


and that's still pretty new. It's not easy to get people using that


device to real proficiency giving them a language they can actually


use. In terms of your reach, you have got a great presence in Europe,


you have been in the US for one year, you are hoping to expand in


the United States. What about Asia though, you have not really gone for


the Asian market. Why not? The Asian markets are in the moment a little


too far for us because what we care about is the pairing of language. So


a British person will learn French in a different way than a German


person. We care a lot about these differences. Asian languages are a


very different base, they would require different learning


experiences, that's one. For two, the Asian markets are very exotic in


the online field. If you have a pure online offering, marketing like


China is not only dangerous but very, very expensive to go into. We


have got to wrap it up. I'm curious though, the hikes of the Spanish and


French are straightforward but the obscure languages? Is Indonesian


obscure enough for you? ! I think so, yes! It's suddenly easy enough


-- certainly easy enough. So we stick to European languages.


Russian? Yes, Russian is still European in a way, and that's the


only language that hasn't a pure Latin alphabet. We keep it to


languages that people use in these areas and that you can learn with


the same methodology. Learning Chinese requires a different app.


I can imagine so. How many languages do you speak? Meanwhile I would say


four, but I'm not good at languages like many, many of our users and I


still am trying and making progress. I have to say, continental


Europeans, you are much better than we English speakers, we are pretty


lazy. That's what I hear on this island a lot and I don't buy it. You


don't? ! OK. That's not true. OK. Thank you. Good luck with it all.


Fascinating stuff. To Paris now where the Motor Show


is getting under way. On Wednesday VW unveiled its latest


model, a small electric car. It has pledged to sell two


to three million electric The German car giant is struggling


to draw a line under the worst crisis in its 78-year history


after admitting using technology in its diesel cars


to cheat emissions tests. Our correspondent Theo Leggett


is there and has been speaking to VW Well, undoubtedly this company made


a huge mistake. We lost the trust of the authorities and our customers.


We are in the process of resolving the crisis. We are working very


constructively with the authorities in Germany, Europe and especially


the United States. We want to get an agreement with the Department of


Justice, hopefully this year. So that we can plan for the future


from a sound base, especially regarding the fines we are going to


have to pay. The investigations are going to show


what the route causes were. In the meantime, we've revised our business


methods. It remains to be seen who exactly was involved.


Jane Foley is joining us again to discuss.


Tubb Tubb Passengers in the air 17% up, trouble in the air? ! Only one


in four are related to alcohol and drugs, so three and four, you


know... What is going on? Exactly. A lot were


It's lack of education, people not used to flying and not knowing the


precedence yet. I don't know how much time we have, but we have got


Wayne who's tweeted saying I've not experienced boozy passengers but


those who use mobiles ticks him off. In the Daily Telegraph, the European


Union could implode when Britain leaves, says Liam Fox. Jane gives us


your take on that? Not sure that I agree with a lot of the context but


it's true to say that the European Union has got an awful lot of


stresses and strains and we know that from opinion polls. France,


Italy et cetera. Many countries have a lot of anti-EU sentiment and it


means next year will be a very interesting election year, France,


Germany, Netherlands. That's going to give us a big take. All European


politicians are aware that there are problems. Terrorism, immigration,


all part of this mix with Brexit as well. Some of his concerns though,


the implication being that it makes it worse when Britain exits, is a


little shallow I think. Great stuff, we appreciate that,


take care, thank you. Bye. Good morning. We have some autumnal


weather on the cards for the last few days of September.


Low pressure in the north bringing gales at


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