International News 30/05

May 30, 2024 No. 84

Analyst: The US medical device tariffs have proven to be ineffective, and China may find a way to circumvent them.

The recent increase in US tariffs on medical gloves, syringes, and face masks from China is unlikely to enhance the competitiveness of US manufacturers in the medical device sector, according to industry leaders. They anticipate that other low-cost suppliers, such as those from Malaysia, will step in to fill the gap in the near future. The US government has announced these tariff increases as part of a broader strategy to encourage domestic production and protect against supply shortages caused by the global pandemic. However, industry executives contend that these tariffs will not enhance the competitiveness of local producers. Chinese companies have the option of rerouting shipments through overseas supply chains, allowing them to circumvent the tariffs. Furthermore, suppliers from other countries can also benefit from this opportunity. Dan Izhaky, president of the American Medical Manufacturers Association, has stated that tariffs are not the solution and that US manufacturers require immediate assistance rather than a two-year wait.


Following shareholder approval, Hess and Chevron have merged.

Hess Corp shareholders have approved Chevron's $53 billion merger with Exxon Mobil. The deal is a big step towards Chevron controlling the Hess discovery in Guyana. However, the deal still needs to be approved by the regulators. This could happen next month. Chevron must also deal with arbitration with Exxon and CNOOC, Hess' partner in Guyana. Exxon and CNOOC can refuse to sell Hess' assets in Guyana. Some shareholders want more money if the deal is delayed. This could happen if Exxon's arbitration takes until 2025. If Chevron wins the arbitration from Exxon, it will be able to complete the deal and avoid geopolitical risks in Kazakhstan.

Crude stabilises early week, market focuses on OPEC+ meeting and US demand.

Crude oil prices stabilised after a weekly correction, with the market focusing on the upcoming OPEC+ meeting and US demand as the summer travel season begins. According to Bloomberg data, the Brent crude contract for July 2024 delivery was up 0.07% at $82.18 per barrel, while US West Texas Intermediate (WTI) crude futures for July 2024 delivery were up 0.10% at $77.80 per barrel. The OPEC+ alliance is expected to extend production cuts into the second half of this year during its online meeting. In addition, with the Memorial Day weekend marking the start of the summer driving season, the American Automobile Association is forecasting a significant increase in travellers to the highest level in almost 20 years. Despite this stability, the price of Brent crude oil is forecast to rise by around 7% by 2024 due to ongoing geopolitical risks and OPEC+ production cuts.