South Korea scrambles jets as North Korea launches 180 flights on border
South Korea launches 80 jets in response to aggressive flight action in North Korea
South Korea scrambled its jets on Friday after North Korea launched some 180 flights near the shared Military Demarcation Line dividing the two nations.
North Korean military forces were detected flying just north of the tactical line, also known as the Armistice Line, which was established in 1953 and formally ended the Korean War, first reported Reuters.
House Republicans release 1,000-page report alleging politicization in the FBI, DOJ
Whistleblowers say FBI is ‘rotted at its core’ in Republican report on alleged misconduct
House Republicans released a new report on Friday detailing whistleblower allegations of FBI misconduct and politicization at the highest levels of the Department of Justice.
“The Federal Bureau of Investigation, under the stewardship of Director Christopher Wray and Attorney General Merrick Garland, is broken,” the GOP report states. “The problem lies not with the majority of front-line agents who serve our country, but with the FBI’s politicized bureaucracy.”
Republicans on the House Judiciary Committee say this report is “the first comprehensive accounting of the FBI’s problems to date, which undermine the FBI’s fundamental law-enforcement mission.”
The report features testimony from whistleblowers who describe FBI leadership in Washington, D.C., as “rotted at its core.” They allege a “systemic culture of unaccountability” and say the bureau is beset by “rampant corruption, manipulation, and abuse.”
Some allegations were previously disclosed, such as accusations that the FBI is artificially inflating statistics about domestic violent extremism to fit the White House narrative on supposed dangers to democracy, or that counterterrorism authorities were instructed to investigate parents who spoke out at school board meetings.
Other allegations suggest that the FBI is actively seeking to “purge” employees with conservative views and those who dissent from “woke” diversity, equity, and inclusion initiatives.
Additionally, whistleblowers say the FBI’s “political meddling” “is dragging the criminal side [of the Bureau] down” as resources are “pulled away” from investigating crimes. One whistleblower alleged he was “told that child sexual abuse material investigations were no longer an FBI priority and should be referred to local law enforcement agencies.”
House Judiciary Committee ranking member Rep. Jim Jordan (R-Ohio) has spoken about several of these allegations for months. He and Senate Judiciary Committee ranking member Sen. Chuck Grassley (R-Iowa) have sent letters to the Justice Department and FBI leadership demanding answers on the whistleblower allegations they have received, and those letters are contained within the report.
“Americans deserve to have confidence that the enormous power and reach of federal law enforcement will be used fairly and free of any indication of politicization.The FBI has the power, quite literally, to ruin a person’s life — to invade their residence, to take their property, and even to deprive them of their liberty,” the report says.
“The potential abuse of this power, or even the appearance of abuse, erodes the fundamental principle of equality under the law and confidence in the rule of law. The FBI’s tremendous power is precisely why the people’s elected representatives in Congress must conduct vigorous oversight, particularly in light of allegations of abuse and misconduct made to date.”
Oil climbs 3% as U.S. dollar slips, EU ban on Russian oil looms
Oil rose by more than 3 per cent on Friday as the dollar eased, with an EU ban on Russian oil looming large and investors weighing the prospects for an easing of China’s COVID curbs.
Though fears of global recession capped gains, Brent crude futures were up $3.29, or 3.48 per cent, at $97.96 a barrel by 1203 GMT, set for a weekly gain of more than 2 per cent.
U.S. West Texas Intermediate (WTI) crude futures were up $3.52, or 3.99 per cent, at $91.69 and on course for a weekly gain of more than 4 per cent.
Both contracts were supported by a weaker dollar, which can boost oil demand because it makes the commodity cheaper for those holding other currencies.
While demand concerns weighed on the market, supply is expected to remain tight because of Europe’s planned embargoes on Russian oil and a slide in U.S. crude stockpiles.
“The slight weakness in the dollar, the upcoming ban on Russian oil sales are certainly supportive as focus is shifting from recession fears to supply issues,” said PVM Oil Associates analyst Tamas Varga.
“The main catalyst, however, is reports that China may ease its zero-Covid restrictions, which would be a boon to its economy and oil demand.”
The EU ban on Russian crude imports is due to take effect from Dec. 5. Details of G7 price capaimed at alleviating constraints on Russian flows outside the EU are still under discussion.
China, meanwhile, is sticking to its strict COVID-19 curbs after cases rose on Thursday to their highest since August, but a former Chinese disease control official said substantial changes to the country’s COVID-19 policy are to take place soon.
On the bearish side, fears of a recession in the United States, the world’s biggest oil consumer, grew on Thursday after Federal Reserve Chairman Jerome Powell said it was “very premature” to be thinking about pausing interest rate hikes.
“The spectre of further rate hikes dimmed hopes of a pick-up in demand,” ANZ Research analysts said in a note.
The Bank of England warned on Thursday that it thinks Britain has entered a recession and the economy might not grow for another two years.
Underscoring demand concerns, Saudi Arabia lowered December official selling prices (OSPs) for its flagship Arab Light crude to Asia by 40 cents to a premium of $5.45 a barrel versus the Oman/Dubai average.
The cut was in line with trade sources’ forecasts, which were based on a weaker outlook for Chinese demand.
Looking into next week, investors are awaiting the U.S. Energy Information Administration’s short-term energy outlook and the November U.S. Consumer Price Index for insight on the pace of inflation.
Canadian auto parts maker Magna lowers annual sales forecast on higher utility costs
Canadian auto parts maker Magna International Inc MG-T +1.92%increase cut its annual sales forecast on Friday, as supply chain snags and higher utility costs keep vehicle production under pressure.
Europe’s energy crisis has exacerbated power and logistics costs for auto firms, while coronavirus-related restrictions in China have disrupted production.
Automakers have flagged that inflation is beginning to take a toll on their balance sheets as they struggle with parts shortage, escalating raw material and energy costs, and soaring inflation.
Magna now sees its annual sales in the range of $37.4-billion and $38.4-billion, compared with its prior forecast of $37.6-billion and $39.2-billion.
The Aurora, Canada-based manufacturer posted a net income of $289-million, or $1 per share, in the third quarter ended Sept. 30, compared with $11-million, or $0.04 share, a year earlier.
Enbridge’s third-quarter profit rises on higher energy demand
Canada’s Enbridge Inc ENB-T +1.11%increase reported a higher third-quarter adjusted profit on Friday, delivering higher shipments on its oil and gas pipelines amid surging energy demand since Russia’s invasion of Ukraine.
Canada, the world’s fourth-largest crude producer, has been seeking ways to boost pipeline utilization amid a jump in U.S. LNG export volumes to Europe following Russia’s invasion of Ukraine.
Enbridge, which moves about 30 per cent of the crude oil produced in North America and nearly 20 per cent of the natural gas consumed in the United States, said it delivered nearly 3 million barrels of oil per day (bpd) on its Mainline system, compared to 2.7 million bpd a year ago.
Enbridge separately announced it received strong interest from producers bidding for capacity on its T-South section of the B.C. Pipeline system running from near Chetwynd, British Columbia (B.C.) and extending to the Canada-U.S. border at Huntingdon-Sumas.
It will also launch an open season to get bids for the T-north segment of the B.C. system.
“It’s clear that the world needs all forms of energy to meet future demand, especially in the context of the energy security, reliability, and affordability challenges,” said Enbridge Chief Executive Officer Al Monaco, who will step down from the top job in January after 11 years in charge.
The Calgary-based company’s adjusted earnings rose to C$1.4-billion ($1.03-billion), or 67 Canadian cents per share, in the three months to Sept. 30, from C$1.2-billion, or 59 Canadian cents per share, a year earlier.
Canadian economy added 108,000 jobs in October; unemployment rate at 5.2%
The Canadian economy added 108,000 jobs in October, reversing much of the losses observed in recent months.
In its latest labour force survey, Statistics Canada said Friday that the unemployment rate for last month held steady at 5.2 per cent as more Canadians looked for work.
The jobs gain comes after four months of job losses or little growth in employment.
It’s also at odds with bubbling fears that the Canadian economy is headed for a possible recession as interest rates rise.
Employment rose across a broad range of sectors in October, led by manufacturing, construction and accommodation and food services.
For the fifth consecutive month, wages grew on an annual basis. Compared with a year ago, wages in October were up 5.6 per cent.
However, with the annual inflation rate at 6.9 per cent in September, many Canadians have lost purchasing power over the last year.
The report highlights that high-wage earners were more likely to experience a wage increase over the last year compared with lower-wage earners.
Among workers who have been with their employer for the last twelve months, nearly two thirds of workers earning more than $40 an hour got a raise. In comparison, half of workers making less than $20 an hour saw their wages go up.
The employment rate among Canadian immigrants aged 15 and older reached a record high in October at 62.2 per cent.
With inflation this year reaching levels not seen in four decades, the report surveyed Canadians on their financial situations. More than one third of Canadians said they were finding it difficult or very difficult to meet their financial needs. Two years ago, just over one fifth of Canadians reported the same challenges.
Workers in accommodation and food services, retail trade and transportation and warehousing were among the most likely to report financial challenges.
Wages in accommodation and food services as well as retail trade fall below the national average and workers in these industries are more likely to be employed part-time.
U.S. payrolls surged by 261,000 in October, better than expected as hiring remains strong
Nonfarm payrolls grew by 261,000 in October, better than the estimate for 205,000.
The unemployment rate moved higher to 3.7%, while a broader jobless measure also increased, to 6.8%.
Big job gainers by industry included health care, professional and technical services, and leisure and hospitality.
Average hourly earnings rose 0.4% for the month and were up 4.7% from a year ago.
Job growth was stronger than expected in October despite Federal Reserve interest rate increases aimed at slowing what is still a strong labor market.
Nonfarm payrolls grew by 261,000 for the month while the unemployment rate moved higher to 3.7%, the Labor Department reported Friday. Those payroll numbers were better than the Dow Jones estimate for 205,000 more jobs, but worse than the 3.5% estimate for the unemployment rate.
Although the number was better than expected, it still marked the slowest pace of job gains since December 2020.
Average hourly earnings grew 4.7% from a year ago and 0.4% for the month, indicating that wage growth is still likely to serve as a price pressure as worker pay is still well short of the rate of inflation. The yearly growth met expectations while the monthly gain was slightly ahead of the 0.3% estimate.
Health care led job gains, adding 53,000 positions, while professional and technical services contributed 43,000, and manufacturing grew by 32,000.
Leisure and hospitality also posted solid growth, up 35,000 jobs, though the pace of increases has slowed considerably from the gains posted in 2021. The group, which includes hotel, restaurant and bar jobs along with related sectors, is averaging gains of 78,000 a month this year, compared with 196,000 last year.
Heading into the holiday shopping season, retail posted only a modest gain of 7,200 jobs. Wholesale trade added 15,000, while transportation and warehousing was up 8,000.
The unemployment rate rose 0.2 percentage point even though the labor force participation rate declined by one-tenth of a point to 62.2%. An alternative measure of unemployment, which includes discouraged workers and those holding part-time jobs for economic reasons, also edged higher to 6.8%.
September’s jobs number was revised higher, to 315,000, an increase of 52,000 from the original estimate. August’s number moved lower by 23,000 to 292,000.
The new figures come as the Fed is on a campaign to bring down inflation running at an annual rate of 8.2%, according to one government gauge. Earlier this week, the central bank approved its fourth consecutive 0.75 percentage point interest rate increase, taking benchmark borrowing rates to a range of 3.75%-4%.
Those hikes are aimed in part at cooling a labor market where there are still nearly two jobs for every available unemployed worker. Even with the reduced pace, job growth has been well ahead of its pre-pandemic level, in which monthly payroll growth averaged 164,000 in 2019.
But Tom Porcelli, chief U.S. economist at RBC Capital Markets, said the broader picture is of a slowly deteriorating labor market.
“This thing doesn’t fall of a cliff. It’s a grind into a slower backdrop,” he said. “It works this way every time. So the fact that people want to hang their hat on this lagging indicator to determine where we are going is sort of laughable.”
Indeed, there have been signs of cracks lately.
Amazon on Thursday said it is pausing hiring for roles in its corporate workforce, an announcement that came after the online retail behemoth said it was halting new hires for its corporate retail jobs.
Also, Apple said it will be freezing new hires except for research and development. Ride-hailing company Lyft reported it will be slicing 13% of its workforce, while online payments company Stripe said it is cutting 14% of its workers.
Fed Chairman Jerome Powell on Wednesday characterized the labor market as “overheated” and said the current pace of wage gains is “well above” what would be consistent with the central bank’s 2% inflation target.
“Demand is still strong,” said Amy Glaser, senior vice president of business operations at Adecco, a staffing and recruiting firm. “Everyone is anticipating at some point that we’ll start to see a shift in demand. But so far we’re continuing to see the labor market defying the law of supply and demand.”
Glaser said demand is especially strong in warehousing, retail and hospitality, the sector hardest hit by the Covid pandemic.
Suncor Reports Net Loss In Third Quarter As It Takes Writedown On Fort Hills
The Canadian Press – Canadian Press – Wed Nov 2, 7:56PM CDT
CALGARY — Suncor Inc. says it recorded a net loss of $609 million in the third quarter as it took a writedown of $3.4 billion against its share of the Fort Hills oilsands mine.
The net loss, which works out to 45 cents per common share, is in contrast to an $877 million profit, or 59 cents per common share, in the prior year’s quarter.
Suncor announced last week it will buy out Teck Resources Ltd.’s 21.3 per cent stake in the Fort Hills oilsands project for approximately $1 billion. The agreed-upon sales price reflects a lower market value for the mine, resulting in a non-cash impairment charge.
On an adjusted basis, Suncor says it earned $2.6 billion for the three months ended Sept. 30, or $1.88 per share, compared to $1.0 billion or 71 cents per common share in the same three months of 2021.
The adjusted profit from operations was primarily due to significantly higher crude oil prices and higher upstream production, partially offset by increased income taxes, royalties and operating expenses.
Suncor’s total upstream production increased to 724,100 barrels of oil equivalent per day (boe/d) in the third quarter of 2022, compared to 698,600 boe/d in the prior year’s quarter. Refinery crude throughput was 466,600 barrels per day and refinery utilization was 100 per cent in the third quarter of 2022, compared to 460,300 barrels per day and 99 per cent in the third quarter of 2021.
This report by The Canadian Press was first published Nov. 2, 2022.
Canadian Natural Resources Ltd. reported a profit of $2.8 billion in the third quarter and boosted its quarterly dividend by 13 per cent.
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Net earnings for the oilsands major were down slightly from the previous quarter as energy prices have fallen from their 2022 highs, but profit was still up 28 per cent compared to the same three-month period in 2021 thanks to higher year-on-year energy prices resulting from Russia’s invasion of Ukraine and continued global supply weakness.
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Strong drilling results helped the Calgary-based company to record average natural gas production of 2,132 million cubic feet per day (MMcf/d) — a 25 per cent increase over the same period last year. Canadian Natural also said it realized an average price of $6.57 per thousand cubic feet of gas during a period when the benchmark Canadian gas price (AECO) briefly turned negative. The company credited the higher realized price to the fact that approximately 37 per cent of its natural gas is exported to markets outside of AECO.
Canadian Natural said its high-value synthetic crude oil (SCO) also generated significant free cash flow for the company in the third quarter with an average realized price of $120.91 — a strong premium of US$8.87/bbl to benchmark West Texas Intermediate (WTI).
Canadian Natural also boosted its liquids production, averaging 983,678 barrels per day (bbl/d), an increase of 14 per cent from the previous quarter. The company said its liquids realized price was $84.91 per barrel, up 25 per cent over the third quarter of 2021.
The company said it would increase its quarterly dividend for the second time this year to 85 cents per common share, up from 75 cents, payable to shareholders of record on Dec. 16.
Pressed during a conference call on when the oilsands giant will begin spending in earnest on decarbonization, chief executive Tim McKay said Thursday that the work has already begun for Canadian Natural and the other oilsands companies belonging to the Pathways Alliance, a group which has proposed to build a major carbon capture and storage network in Alberta.
“The spending actually starts this year,” McKay said. “There’s a lot of environmental work. Obviously, we’d like to submit the regulatory pieces as soon as possible, hopefully here in 2023. And then with that, you would like to order pipe for the trunk lines. So there is a lot of work being done by proximately 200 different individuals between all the companies to expedite the project.”
Cenovus Energy Inc. chief executive Alex Pourbaix, whose company also belongs to the Pathways Alliance, said earlier this week that the federal and provincial governments will have to introduce more carbon capture incentives and certainty around carbon pricing before projects can move forward.
Ottawa willing to accept lower returns, more risk to put $15-billion growth fund to work
The federal government’s new $15-billion Canada Growth Fund is prepared to accept a lower return or increase its potential loss exposure in order to stimulate institutional investment in innovation and green projects with risky economic foundations, Ottawa announced Thursday as part of the fall economic update.
“Launching the new Canada Growth Fund … will help bring to Canada the billions of dollars in new private investment required to reduce our emissions, grow our economy and create good jobs,” Finance Minister Chrystia Freeland said, adding that the projects will have meaningful Indigenous participation and meet “the highest” environmental standards.
“From critical minerals, to ports, to energy, we will continue to make it easier for businesses to invest in major projects in Canada.”
The Liberal government has made several attempts to entice pensions and other institutional investors to fund projects to create jobs, improve Canada’s productivity and commercialize intellectual property.
In this latest iteration, the Canada Growth Fund will seek direct investments including co-investments with private investors and bilateral partnerships where the fund will invest in industrial emitters, clean-tech companies and other companies “across low-carbon supply chains” such as those involved in the production of critical minerals.
To “address demand risk and improve project economics,” the fund will also enter contacts to provide revenue for a certain volume of production in cases “where sufficient demand from prospective private buyers is still developing.”
It will provide anchor equity to fund projects in cases where the risk level or capital required would attract limited interest from private capital.
The fund plans to piggyback some of its investments on the pipelines of private funds, but there will also be sponsorships, where the fund identifies opportunities and tries to convene multiple financial and strategic partners.
Investment management teams will target companies and projects with “a reasonable chance to strengthen the development of Canadian workers and generate knowledge that will produce long-term benefits for the Canadian economy beyond those realized directly by the specific investment in the project or company,” according to a background document shared by the Finance Department as part of the economic update.
For example, companies and projects with a focus on intellectual property development and commercialization would be desirable, as would those that demonstrate an ability to improve Canadian competitiveness through new or existing value chains.
Investments will span the capital structure, and could include equity, debt and derivative contracts.
Ottawa said it will expect private investing partners to share in any downside, and will only make the concession investments — such as debt instruments where the Canada Growth Fund earns below-market returns or has higher exposure to loss through low-interest loans or subordinated debt — to the extent necessary to get a worthwhile project or company off the ground.
“While CGF may accept a first-loss position, for example, investors should share in the financial downside of under-performing investments,” according to the document.
