10/07/2017 BBC Business Live


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This is Business Live from BBC News with Ben Bland and Alice Baxter.


As the industry gathers in Turkey, will the second half of the year


Live from London, that's our top story on Monday 10th July.


Oil prices have yet to show much of an increase


despite the continued production cuts from OPEC.


Full steam ahead for Chinese shipping giant Cosco.


A $6 billion bid for rival OOIL would make it the world's third


The figures are all in positive territory. We will look at what the


week might have in store for the markets.


Man has always relied on the oceans for fishing and trade,


but what threat do over-fishing, climate change and plastics pose?


We'll speak to the woman behind a new charity trying to flag up


Are your streaming habits impacting your sleep?


Today we want to know, are your streaming viewing habits


It's all too easy, you start watching one episode, you think, one


more, and the hours just go. As one of the world's most


important commodities, the cost of everything from filling


up our cars to shipping For the top oil producing


nations, it also underpins So perhaps what everyone


at the World Petroleum Congress in Turkey wants most


is the stability to plan ahead. As you can see, while a global deal


between major producers, but not the US, to limit supply has


somewhat stabilised the price of the black stuff,


oversupply now means the price In fact, the oil price is down


more than 12% this year, with an uptick in global demand


insufficient to absorb rising output, a lot of it


from the United States. The latest data shows


that US oil production - driven by shale oil output -


rose 1% last week to 9.34 It used to be the case that US shale


production wouldn't be cost effective with a price below


$50 a barrel. However, increased efficiency


and technological advances Since 2013, the average price


at which it becomes profitable has dropped from $80


per barrel to $35. Trevor Sikorski is the head


of natural gas and carbon Ben was talking a lot about oil and


Rex Tillerson is an oilman, so it was expected that he might talk at


length about in Turkey. He actually didn't. The focus was more on gas.


Yes, that is one of the interesting things about this. Thematically,


when you look at the conference, it is as much about gas and


sustainability as it is about oil. It is almost like yes, there is a


lot of supply out there and rain in the supply in has been a challenge.


The longer term challenges are more on the demand side. What will happen


with energy transition? What role does gas play in that? What role do


renewables play? All of that will probably squeeze oil. Why do you


think Rex Tillerson took that tack? I think that now, he's not speaking


as the head of the world's largest oil company, he is speaking as


Secretary of State the US. And a big part of US policy under Trump has


been pushing ahead in trying to progress US natural gas exports.


Last year, the US became a natural gas export of the first time,


investing a lot in export capacity. This is a big thing for Trump. It


creates jobs domestically, and it also makes gas more expensive in the


US, which is good for coal, which is another big part of Trump. We talk a


lot about shale production in the US and how that contributes to the glut


around the world of oil and gas and keeps prices suppressed. It is a


dramatic level to which prices have dropped. That will surely just


encourage the shale producers to keep pumping the stuff out.


Absolutely. Shale production is a new technology. We have seen huge


increases in the advancement of those techniques. That creates more


supply. With the latest down and pick in crude prices, we are


starting to see a slowing in drilling activity in the US, but it


is still healthy. The demand for oil is not going to be helped by big car


companies like Volvo and VW saying they are going to do try and get rid


of their internal combustion engines and go electric. Tesla today were


unveiling their mass-market model. This is the big threat for oil. The


electrification of transport. It is exciting because it is new


technology and it is very good for the climate. But within that, you


need to have low carbon fuels generating a lot of electricity. Gas


plays into that because it is a lot less carbon intensive than oil or


coal. So when you look ahead as a transition fuel, gas has a big role


to play. That is why it is so high on the agenda. Trevor, good to talk


to you. Let's take a look at some of


the other stories making the news... Tobacco giant Philip Morris has been


ordered to pay millions of dollars in legal fees after unsuccessfully


suing the Australian government In 2012, Australia legislated that


cigarettes must be sold in unappealing packets


with graphic health warnings. The International Permanent Court


of Arbitration hasn't published the amount Philip Morris must pay,


but Australian media Kuwait Airways and Royal Jordanian


have become the latest Middle Eastern airlines to remove


restrictions on passengers taking laptops in the cabin


on US-bound flights. Both carriers said they had


worked with US officials The US imposed the ban in March


on direct flights from eight mainly Muslim countries to address fears


that bombs could be The former boss of one of the UK's


leading supermarket chains, Sainsbury's, has told the BBC that


Brexit will mean higher food prices, Justin King says the UK food


system has been shaped by the European Union for 40 years


and leaving will be tough The Chinese shipping giant Cosco


look set to buy its Hong Kong and would make Cosco the world's


third biggest shipping company. Monica Miller is in our


Asia Business Hub in Singapore. What more do you have on this? Cost


those stocks are gaining traction after the news broke of the weekend


that the shipping company offered to buy its rival, Orient Overseas


International out of Hong Kong for $6.3 billion. That will make it the


third biggest container ship company in the world. This comes at a


crucial time for the Chinese government that wants to raise its


global shipping profile, which was a big part in its initiative aimed at


increasing a supply chain to the West. They will now have 400 vessels


to achieve that goal. But analysts say that the sooner shares often


fall after an announcement like this. But Cosco's stock rose to its


highest in almost two years today. Monica, thanks.


Tokyo stocks closed higher as Chinese data kept investors


upbeat on the global economy while a weak yen boosted exporters.


They were also lifted by Wall Street's strong


performance on Friday, while the US dollar extended gains


made after much stronger than expected June employment data.


Let's show you how the European markets begin the trading week. All


of them are in positive territory. We will see what Janet Yellen as to


say when she makes her speech later this week. What the US Fed does will


have an impact on other markets around the world. We will get into


that in a moment. Samira Hussain has the details


about what's ahead On Monday, a trial is set to begin


against General Motors. The claim is that a faulty ignition


switch caused a power failure General Motors has conceded


that an earlier version of the switch was defective,


but denies any such problem with the newer version at issue


in this upcoming trial. The other big event happening


this week is of course the Federal Reserve chair


Janet Yellen's testimony This is her semi-annual appearance,


where she will be asked questions No doubt she will certainly be asked


about the Fed's plan to reduce some Finally, the week ends


with a bit of a bang as some of America's biggest banks


will report second-quarter earnings. Joining us is Jeremy Stretch,


head of currency strategy Let's start with talking about the


US dollar. It has been given a boost by better-than-expected jobs


numbers. Indeed. The US Labour market continues to generate a large


number of jobs. The Labour market is tight in the US. That implies that


economies are growing at a reasonable clip and by virtue of


that, that suggests that the Fed's policy of raising rates gradually


still has further to run. So that sets the template for Yellen's


testimony on Wednesday and Thursday this week. Talking of that, what are


your main expectations to come out of that? As I say, the markets are


looking for the backdrop of the interest rate story. Not only what


they will do about interest rates, but also what they will do about


balance sheets. They have bought huge numbers of US Treasuries. They


need to gradually release those back into the market. Markets will be


looking for signs on both interest rates and the balance sheets, and


that will have implications for the dollar and other global banks. Other


central banks are considering raising rates as well. They will


also be looking for hints about the Fed started paper it's balance sheet


and selling the bonds it holds. Indeed. We have seen interest rates


in terms of bonds are moving significantly, so that does create


uncertainty in relation to things like mortgage rates, because if bond


yields were to rise too quickly, that would push up mortgage rates or


would risk pushing them up. So there is a difficult balancing act here,


and markets are watching to see how Janet Yellen will pursue that over


the next few weeks. Another major economy we all look too is China.


They had some inflation data out. They did. They had both consumer and


producer price inflation, and those numbers were in line with where the


market would like things to be. We were not seeing prices moving too


slowly so we were not seeing a defect risk. But we are not seeing


prices are increasing too quickly, which would imply that the central


banks would need to move faster. So it is a Goldilocks scenario as far


as the Chinese inflation story is concerned. Inflation is going up,


but not too quickly. One of the by-products of that is what is


happening in the oil markets, going to your previous discussion. It is


important that we don't see oil prices moving up to dramatically,


because that would have implications for inflation. We have that major


meeting of Opec members later in the week. Jeremy, you will take us


through the papers later. We'll get the inside track


on a new charity trying to keep our oceans alive


for Generation Z. You're with Business


Live from BBC News. The takeaway industry is said


to be worth ?4.5 billion, but a new trade group representing


the sector says it's struggling. The British Takeaway Campaign -


a new umbrella group representing the sector -


has commissioned a report from the Centre for Economics


and Business Research and it shows despite the record number


of jobs in the sector, businesses are struggling


with recruiting staff and inflation Graham Corfield is the managing


director at Just Eat, What changes do you want to see? It


is important to celebrate the success we have had and to keep


things running. British businesses contribute to the economy. Right


now, the challenges are around skill shortages and the impact of the


recent rates evaluation. What practical steps can be done to


improve the situation for businesses? At British Takeaway


Campaign we are keen to talk to the Government on the skills shortages


side around vocational training, British people see takeaway as a


career opportunity and huge opportunities within it, we're


working with the Government to make sure that vocational qualifications


include a takeaway module within it so that it addresses the skills


shortages across many cuisines. There is certainty as we head to the


Brexit discussions and the immigration system, making sure both


EU and non-EU workers working in the sector today are assured of their


roles but equally understanding that the new rules as they go forward


understand there are specialist skills sets that underpin the


sector. Do you feel the Government is listening to you? It is great to


see some certainty is being issued. When I talk to restaurant owners


they are concerned it could have a serious impact on the sector, it is


a 9.5 billion sector and we need to sustain it to make it continue. We


are going to have to leave it there, thank you, you are watching Business


Live. As the oil industry gathers in


Turkey, prices are up slightly. Let's have a look at the markets are


faring. The main indices across Europe, this is how they look at the


start of the trading week. All in positive territory.


And now let's get the Inside Track on a social enterprise


which is hoping to raise awareness of environmental issues.


We Are The Oceans aims to tackle the issue of plastic waste


in the world's oceans, and it's taking aim


The not-for-profit organisation focuses on getting its message out


via millennial-friendly mobile games, and collaborations with


We Are The Oceans has already generated support


from gaming giant Rovio - the creator of Angry Birds -


fashion house H, and global sports brand Vans.


We're joined by Daisy Kendrick, the founder of We Are The Oceans.


Thank you for joining us here in the studio. We began by saying that your


organisation is aimed at raising awareness amongst young people,


so-called generation Z. Your generation, if you like? Exactly,


our aim is to bring the oceans to the most connected generation using


technology, gaming and platforms we engage with every single day. How


easy or difficult was it to get onto, for example, the makers of


Angry Birds and say, we want to do something with you, because their


brand is so strong, they have a well-established business, how


receptive were they? They were very receptive, they have a huge existing


audience and we, as a charity, could tap into that and reach people on


their terms and engage them in experiences that they are already


engaging with, and Rovio were open to supporting the cause and pursuing


their social responsibility angle with us as well. It is impressive


stuff, because, if you don't mind me saying, you are only 23 said to get


onto a platform like Angry Birds is hugely impressive, but it is not


just gaming apps and things, it is things like music festivals and


more? We are appealing to millennials with music as well, we


have a collective and will be releasing a song later in the year


called We Are The Oceans but we have multiple versions of the song using


mainly YouTube influences to do their version and spread their


version of the song to their audiences. I wonder what your aim is


with the organisation because it has been going for eight months now so


still fairly early days, what is your ambition for a? Our ambition is


to educate as a primary cause, but we also want to support small island


developing states and those communities that are completely


dependent on their oceans for their livelihood, their food and their


income. Overfishing is a major concern, isn't it, and as I


understand you began with an on project in March this year in Haiti,


where it is a huge problem? We started with the community on the


Western point of the island that is in famine, ten years ago the


community was driving with fish to eat and sell at market but today


because of overfishing, pollution and climate change this community is


dependent on food packages. How do you fund the campaign? We are


fortunately supported by the United Nations office of projects and


services who are a division of the UN, who are great supporters of this


start-up campaign, which is quite unique. Do you have any ambitions to


source more private funding? Jess, private funding and collaborations


with brands in particular because We Are The Oceans is striving to bring


innovation into supply chains and fund and develop alternative


products, and until sustainability becomes the norm in the supply


chains, big change for the environment will not be able to


succeed. I was going to say, that is where the challenge comes because


you can get individual consumers to change their habits but until you


get the big brands to buy into it and the big retailers, it almost


feels part like a drop in the ocean whatever we do. By 2020, generation


Z will be 40% of the consumer market, and they are seeking and


wanting to buy sustainable products but there is not enough in the


market right now. Daisy, thank you for coming on, we wish you the best


of luck with everything. Daisy Kendrick there, founder and CEO of


We Are The Oceans. Let's bring you the latest


in our CEO Secrets series where we ask the bosses


of the world's biggest organisation Today it's the turn


of Alex Beard, chief executive It's got to be all about the people.


I'm Alex Beard, chief executive of the Royal Opera House, and I have


the very best job in the world! Every single night, round about 300


people come together to make something pretty well impossible


happen on our stages, and that is to present Lyric theatre, ballet and


opera at the very highest level and that means individual passion but


also organisational brilliance. The machine has got to work like a lot


work towards that 7:15pm moment when the lights go down, the curtain goes


up, and you, the audience, are transported into a different world


and a different sense of yourself. So each individual needs to feel


passionate sense of commitment about what goes on stage. Simply, hire an


amazing group of people, give them the space to thrive and keep


questioning. What other business


stories has the media been Jeremy Stretch is joining


us again to discuss. Good to see you. Let's begin with


the story that we saw in the FT, it is an interview by the CEO of


Netflix, the movie and TV streaming app platform. What did you make of


the interview? It was quite telling insight into the man behind what has


become a phenomenon. It really is a phenomenon because if you consider


the humble origins of the company in terms of going back to how we use to


watch films on television via external recording systems to now


having an industry heavyweight creating its own content, that is a


fascinating things because of course the company is very much driving the


market, creating its own content and demanding that others follow through


and in a sense it creates a changing business landscape because of course


it is one of the driving forces behind the sky 20th Century Fox deal


so it is a driver in the market. He gave an interesting insight into the


culture of the organisation, saying that adequate performance wasn't


enough, that result in some sort of severance package, he also touched


on the fact that Netflix is a highly competitive arena competing with


pretty much everyone and everything, including our sleep, and we put that


out to view was this morning, whether our streaming viewing


habits, because it is so mobile now that we can do it on our phone that


night, is it getting in the way of our speed? That appears to be the


case and psychologists would argue if you are looking at streaming


devices late at night it will create blue light which disturbs your sleep


patterns, creating a raft of other issues, psychological issues, so in


a sense there is this mass of content we can see on all different


platforms, not just a case of sitting in front of the television.


As anybody on the underground knows, you will see people watching things


they have downloaded, so there is this inexorable process of almost 24


hours which is creating a compete with our sleep in certain cases. And


the CEO, Reed Hastings, says it has been a dizzying ride but it is just


at the beginning. Jeremy, do you have a unicorn in


your basement? Not as far as I am aware! This is extraordinary, it is


on the BBC News website, and man who built a ?1 billion computer firm in


his basement, one of those entrepreneurial stories that people


aspire to. And it is, it has taken a prolonged period and was clearly an


enormous risk for this individual to decide to set up his own computer


company in his basement, in a small city outside of Toronto which I have


visited on a number of occasions and had no idea of this company so it is


a story that is fascinating to me as well, but it underlines the fact


that if you have an idea, in fact he did not have the idea until he


started the process, but if you have an idea, you can create a business.


Good to talk to you. We will see you soon, goodbye.


Good morning, it has been muggy night across the south-east, fresher


further north, over the coming days


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