Sunday newspaper round-up: Oil, BoE, Lloyds, buy-to-let, Centrica

8th May 2016 15:45

(ShareCast News) - Low oil prices look set to drag on after Saudi Arabia's moderate oil minister Ali al-Naimi was ousted by the government. The replacement of Al-Niaimi, who was leading calls to help rebalance the struggling oil market, has scuppered hope that the world's major oil producing nations might agree to freeze output in a bid to raise prices in the oversupplied global oil market, the Sunday Telegraph said.In its inflation report this week, the Bank of England is expected to deliver a further, detailed warning of the implications for UK inflation and interest rates from a potential British exit from the European Union. Laying down preparations for the aftermath of a possible "leave" vote in next month's referendum, governor Mark Carney has been talking to senior bankers about their preparedness for the possibility of a rate cut, the Sunday Times reported.The BoE could also cut expectations for UK growth this year to below 2%, the the Sunday Telegraph added, as uncertainty surrounding the European Union vote clouds the economic outlook. Adam Posen, a former Bank policymaker, has recently warned of a "pseudo-sterling crisis" if Britain votes to leave the EU, which he said would actually force the Bank to push up interest rates to keep a lid on inflation.While markets are cot currently pricing in a rate rise from the UK central bank this year, a recent run of bad news on the economy may have chipped away at Governor Carney and other policymakers' certainty on the path for interest rates, possibly prompting at least one policymaker to push for a cut in borrowing costs to shore up stalling growth, the Observer said. The committee could discuss cuts at this meeting even if most members are not close to voting for such a move.Another Greek debt crisis also threatens to flare up ahead of the Brexit vote, the Sunday Telegraph said, as the country's embattled leaders prepare to fight for more leniency from their creditors. An emergency Eurogroup session of the finance ministers will see the issue of Greece's perilous finances return to center stage on Monday, with discussions over the €86bn (£68bn) bailout approved last summer and time and cash running out before looming repayment deadlines.Lloyds Banking Group has been charging its small business customers extra, hidden fees on currency deals as they are deemed to be "less sophisticated" than other clients, documents seen by the Sunday Times show, with some lawyers suggesting compensation might be due. An 'added value' (AV) charge of up to 1.5% is being a slapped on each trade, and possibly increased with managerial approval, though the practice is not believed to be limited to Lloyds, expert sources said.Britain's buy-to-let property boom is on the verge of coming to an end as stricter lending rules make it unaffordable for middle-class savers by requiring least a 40% deposit to qualify for a mortgage. Tighter lending criteria set to be enforced as early as this autumn by the Bank of England will lock large groups of savers out Britain's rental market, and limit it to an elite club of wealthy investors only, analysis by the Sunday Telegraph revealed.When it published its preliminary report this month, the Competition & Markets Authority (CMA) is set to refrain from demanding a radical overhaul of the big high street banks. The Sunday Times said sources at challenger banks had indicated scepticism about the potential for major changes being foisted on the big four to help level the industry playing field.China's April exports slumped nearly 2% compared with the same month last year, as imports fell almost 11%. The Observer reported that Chinese officials said China's export sector has shown year-on-year declines in dollar terms for nine of the last 10 months as the country's economic growth has fallen to its slowest level in a quarter-century.The surprise £700m placing by Centrica last week followed the collapse of ambitious plans to merge its North Sea oil and gas production arm with that of Engie, the state-owned French utility. The Sunday Times revealed that China's CIC sovereign wealth fund, 30% owner of Engie's production business, voted down the deal but that the French company's boss has opened talks about overturning CIC's decision.Deeply indebted explorer Premier Oil is likely to gain a stay of execution from its lenders, the Sunday Telegraph reported. Premier's mid-year covenant review is crucial for the oil explorer but ahead of its first quarter trading update this week, analysts say early signs are pointing in its favour.China will wade into the battle for control of Britain's biggest gas distribution network when National Grid formally launches the auction for a majority stake in its £12bn gas business next month. China's colossal sovereign wealth fund CIC recently joined forces with Australian investment giant Macquarie, the German insurer Allianz, and Dalmore Capital to compete in what, the Sunday Times said, is expected to be one of the biggest auctions of the year, facing up to investment giants from Kuwait, Canada and Abu Dhabi.The price of steel has risen sharply since the start of the year, the Mail on Sunday noted, which boosts hopes that Tata Steel UK might be sold in its entirety rather than being broken up. The latest figures come as a management buyout team, Excalibur, which submitted a letter of intent to make an offer for the company last week, confirmed it would axe 1,000 jobs in addition to the 1,000 announced by Tata before it was put up for sale.O2's Spanish owners Telefonica will revive their plans to float O2 as the European Commission this week is expected to torpedo plans to sell the British mobile brand to Hutchinson's Three. The Sunday Times said Telefonica could also sell O2 to Sky, France's Iliad or US-owned Liberty Global, as well as exploring a London listing or even spinning off its radio masts to raise cash.A potential new code to regulate the UK pubs industry has been delayed for a month to at least mid-June, business minister Anna Soubry told pub companies and tenancy groups after a loophole had been spotted in the legislation which would apparently have made many licensees ineligible to buy beer from sources other than their landlords. However, the Mail on Sunday wrote, legal advice to the pressure group British Pubs Confederation advised that the code as it stands would still have covered all tenants and that a delay was unnecessary.Wall Street investment behemoths Blackstone and Cerberus have talked to the government's UK Financial Investments (UKFI) agency about making bids for a £17bn slice of loans from failed mortgage lender Bradford & Bingley. The Sunday Times reported that UKFI adviser Credit Suisse had received interest about selling the loans in parcels or one giant package, either of which would potentially be the government's largest post-crisis asset sale.David Cameron is under increased pressure to invoke special powers that would force UK tax havens to end their secrecy. In the wake of the Panama Papers affair, which revealed the extent to which the likes of the British Virgin Islands (BVI) were being used to hide money offshore, the Observer said the prime minister was being urged to set a timetable for imposing stringent anti-corruption laws on Britain's tax havens, something that is extremely rare but has precedent.The near-400,000 people who have signed up for Tesla's Model 3 'affordable' electric car have helped accelerate the boom for a long-time niche metal: lithium. Lithium is a key element in batteries used in Tesla's and other electric cars, with Elon Musk's company calculated to need around 25,000 tons in each of the next few years, with Goldman Sachs estimating global demand will triple by 2025 to 530,000 tons a year, and seen the price of lithium carbonate imported to China triple in just six moths to nearly $20,000 a ton.William Hill took thousands of pounds from some customers' bank accounts in a blunder the bookmaker is blaming on human error. The UK's number-two bookmaker took the funds from 650 customers who had discovered a loophole in an online casino game, the Sunday Times said.British people benefit at the earliest opportunity from the best medicines produced by "cutting-edge" research because the UK is part of the EU, 93 business leaders and organisations from the life-sciences industry have said in a letter published by the Observer. The group, which includes executives from GlaxoSmithKline, AstraZeneca and Pfizer, said EU funding for research and Europe-wide regulations help produce new, more effective drugs more quickly.Immediate Media, the publisher of BBC magazines such as the Radio Times and Top Gear and consumer titles from Urban Cyclist to You & Your Wedding, is gearing up for what could amount to a £300m sale from private equity owners Exponent in coming weeks. The Sunday Times said City sources indicated a decision on auction was likely by the end of this month.