Maduro calls OPEC and NON-OPEC countries to stabilize market

Venezuelan president Nicolas Maduro called for OPEC (Organization of Petroleum Exporting Countries) and non-OPEC members to make a move to stabilize the global oil market. He confirmed that both OPEC and non-OPEC parties are close to making a deal, and hope that it can be announced this month.

"We had a long bilateral meeting with Rouhani. We're close to a deal between OPEC producer countries and non-OPEC," Maduro said in a news conference. Positive talks were established between fellow OPEC leaders who attended the Summit of the Non-Aligned Movement held in his own country, in the island of Margarita.

Aside from speaking with the Iranian president, Maduro said that he also talked to Rafael Correa, president of Ecuador, with the hopes of coming up with an agreement by the end of the month. Both countries are members of the OPEC.

According to Algeria’s official news agency, OPEC Secretary-General Mohammed Barkindo confirmed during a visit to Algeria that the 14 energy ministers of OPEC member-countries may call a special meeting to discuss oil prices if they reach an agreement at the sidelines of the International Energy Forum to be held in Algiers on September 26 to 28. Russia, a non-OPEC oil producer, confirmed attendance to the said forum.

Iran and Tehran is said to support any move to stabilize global oil market and lift prices. The Venezuelan president thinks that such steps are imminent at these times.

Talks on freezing oil production levels are also likely to be revived in the said meeting. After announcement of possible deal close, oil gains with West Texas intermediate recently up by 1.51 percent at $43.68 a barrel. Brent crude is up 1.7 percent, or 77 cents, at $46.54 per barrel while U.S. crude was up 78 cents, or 1.8 percent, at $43.81 a barrel.

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YEN “SAFE HAVEN” AS SHARE MARKETS WEAKEN

The yen remains strong on Thursday’s Asian trade, with investors prompted to buy the currency’s “safe haven” status as Tokyo’s share market weaken.

The greenback dipped by 0.2% to 101.94 yen in mid-morning Tokyo trade while it was at 102.42 yen in New York trade late Wednesday.

Rival currencies also experienced a slide. Euro went down by 0.2% to 114.65 yen and ended at 115.07 yen in New York. Australian dollar slipped to a two-month low of 75.97 yen and rose back midday to 76.35.

Stocks continue to dip down in the Tokyo Stock Exchange with Nikkei average down to 209.23 points, or 1.26 percent, ending at 16, 405.01.

Indexes went downhill as anxiety over Bank of Japan and U.S. Federal Reserve’s policy setting meetings rise. Both are scheduled on September 20-21.

As Fed attempts to increase its rates, BoJ plans on further lowering negative interest rates to steepen yield curve.

The BoJ’s next step seems to be clearer, but until the central bank’s scheduled meeting it is still uncertain what will happen.

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BAYER-MONSANTO MERGER LIKELY TO TAKE PLACE SOONER

A Bayer-Monsanto merger is expected to take place sooner as Bayer ups its offer—again – from about $128 per share to $129, nearing the $130 per share minimum price that Monsanto expects to get for any possible takeover to push through.

Bayer, the German chemical and pharmaceutical goliath, looks forward to strengthening its hold in the agricultural sector further through this risky but potentially ingenious move. With their stronghold in pesticides and Monsanto’s leading seed brands, these two giants will surely overtake similar companies belonging to the “Big 6” biotech corporations. This includes DuPont, Dow Chemical Co., BASF, and Syngenta.

However, investors are somehow skeptical with the attempts to increase the bid since Monsanto has been trading lower than the previous three offers made by Bayer. The latest offer is 22% higher than the former company’s closing price on Tuesday which fell down by 1.3% at $106.07 while Bayer closed at 95.69 Euros, rising by 1 percent.

The bid that started in mid-May at $122 per share, which was outright rejected by Monsanto for being “too low”, was further raised to $125 a share in July and to $127 in early September—both of which were also rejected.

Aside from the acquisition bid, Bayer also offered a reverse break-up fee amounting to about $3 billion. This was to ensure that in the event of antitrust watchdogs in Europe, America, and Asia upsetting the deal, Monsanto is guaranteed enough protection.

Although the US agrochemical and agrobiotechnology giant has long seen itself as a potential buyer, events might have proven otherwise. Previous attempts to acquire similar companies like Syngenta and parts of BASF never materialized.

Though many think that this acquisition will result to the world’s largest agrochemical business, Bayer’s high net debt—amounting to €17.45 billion ($19.71 billion) — gives analysts enough reason to question if this might hurt Bayer more than help it.

The proposal is assumed to be approved as early as Tuesday.

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