Trump, 3M clash over order to produce face masks for US

Dr. Nicole McCullough, a safety expert at 3M, demonstrates the correct way to put on an N95 respiratory mask. The mask, below, is the subject of a row between the company and US President Donald Trump. (Reuters)
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Updated 05 April 2020

Trump, 3M clash over order to produce face masks for US

NEW YORK: President Donald Trump said his administration will try to stop “profiteers” from exporting medical protective gear, shortly after picking a fight with manufacturing giant 3M, a major producer and exporter of face masks used to protect health care workers from the coronavirus.

3M argued that blocking exports will raise “significant humanitarian implications” abroad and lead other countries to retaliate by withholding much-needed medical supplies from the US.

Nearly all of 3M’s exports of high-grade N95 masks go to Canada and Latin America, and Canadian officials led by Prime Minister Pierre Trudeau took the company’s side. They lobbied Trump administration officials not to cut off part of their supply.

That was not enough to persuade Trump. Late on Friday, the president announced that he will direct the Federal Emergency Management Agency to prevent the export of N95 masks, surgical gloves and other medical protective gear. He said exceptions might be made to help Italy and Spain, which have been hit hard by the outbreak.

“We are not happy with 3M,” Trump added during a White House briefing.

The spat between the president and a leading American manufacturer started Thursday, after Trump used his authority under the 1950 Defense Production Act to direct the government to acquire the “appropriate” number of N95 respirators from Minnesota-based 3M and its subsidiaries.

The N95 masks, also called respirators, provide more protection against the virus than do ordinary surgical masks. Governors and hospital officials around the country have warned of a dire shortage of masks and other protective gear for health care workers.

The president followed up his order with a barbed tweet on Thursday night.

“We hit 3M hard today after seeing what they were doing with their masks. ‘P Act’ all the way. Big surprise to many in government as to what they were doing — will have a big price to pay,” Trump tweeted.

The events leading to Trump’s order against 3M began weeks ago. A White House official said when Vice President Mike Pence visited a 3M factory in Minnesota last month, he was told that 3M had 35 million N95 masks that were intended for commercial uses but could be used by health care workers.

This week, after 3M received liability protection that it sought, the White House learned that not all of those masks were ready for the US market, the official said.

Jared Kushner, the president’s son-in-law, has been leading administration contacts with the company to learn where the masks went and why some were not available as promised. The situation led Trump to invoke the Defense Production Act, said the official, who spoke on condition of anonymity to discuss events that have not been made public.

The company said that it has been boosting production for two months and working with the Trump administration to improve the supply of masks. 

3M said that it has raised US production of N95 masks from 22 million in January to 35 million in March, with the entire increase being distributed in the US. It said that 10 million masks that it produced in China will be shipped to the US.

The company exports about 6 million masks a month to Canada and Latin America, where 3M is a primary supplier. 3M objected to stopping those exports.

CEO Mike Roman said Trump’s insinuation that 3M was doing something wrong was “absurd.”

“The idea that we are not doing everything we can to maximize deliveries of respirators in our home country — nothing is further from the truth,” he said.

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Crude prices surge as OPEC+ agrees to extend cuts

Updated 06 June 2020

Crude prices surge as OPEC+ agrees to extend cuts

  • The eagerly awaited gathering comes as oil exporters globally are hurt by low prices

DUBAI: Crude oil prices on Friday surged on international markets after the OPEC+ alliance, led by Saudi Arabia and Russia, reached a deal to continue supply limits at their present historic level.

After a week of negotiation, a virtual meeting of the Organization of the Petroleum Exporting Countries (OPEC) was expected to take place on Saturday to formally seal the agreement to keep combined cuts at 9.7 million barrels per day (bpd) for at least another month.

Last-minute worries about Iraq, which had held out over committing to its share of the cuts, were overcome with a pledge by Baghdad to stick to the agreed limits and to make up any shortfall in the coming months, according to an official from one of the OPEC delegate countries.

In a speech in Washington, D.C., US President Donald Trump praised the work of OPEC+ in rebalancing the oil market. “We saved that industry (US oil) in a short period of time, and you know who helped us? Saudi Arabia and Russia and others. We got them to cut back substantially,” he said.

The deal struck in April to cut an unprecedented 9.7 million bpd, reinforced by an extra 1 million bpd voluntary cut by Saudi Arabia and smaller amounts by the UAE and Kuwait, has been credited with pulling global oil markets back from the brink of collapse.

Brent crude, the global benchmark, jumped nearly 6 percent in European trading, to stand above $42 per barrel. Oil prices have more than doubled since “Black Monday” on April 20, when West Texas Intermediate (WTI), the American benchmark, fell briefly into negative territory largely because of trading technicalities.

WTI was trading at more than $39 on Friday, raising the possibility that some of the US production lost due to well shut-ins and corporate failures might come back onto the market.

Saudi Energy Minister Prince Abdul Aziz bin Salman was due to address the OPEC+ meeting in his capacity as co-chairman of the joint ministerial monitoring committee (JMMC).

“The conditions right now warrant hopefully successful meetings. Coordination is under way to hold OPEC and OPEC+ meetings tomorrow afternoon,” Prince Abdulaziz bin Salman was quoted as saying by Reuters.

According to an official, the prince was expected to stress the need for vigilant monitoring by OPEC+ of supply limits.

UAE Energy Minister Suhail Al-Mazrouei, urged producers to improve their compliance with agreed cuts.

“As a representative of the UAE, I find it disappointing and unacceptable that some of the largest producers with capacity like (Saudi Arabia) and Russia comply 100 percent or more while other major producers do less than 50 percent,” he wrote in the letter seen by Reuters.

Iraq and Nigeria have been regarded as the biggest laggards on compliance in the OPEC+ partnership, both arguing that their financial needs required them to sell as much oil as possible. Last week Nigeria indicated its willingness to adhere to the limits.

Wrangling with Iraq continued into Friday until a breakthrough was finally reached, and Baghdad promised to abide by the terms of the original deal and stick to compliance agreements.

Monthly meetings of OPEC’s JMMC will take place until the end of the year to monitor compliance levels among OPEC+ countries, and to assess the overall state of the market.

There has been no decision as yet on whether Saudi Arabia and other Gulf countries will continue the extra 1 million bpd cuts, which could expire at the end of this month.

Oil-market sentiment was also lifted by a surprise fall in American unemployment, taken as a sign that the US economy could recover more strongly than expected.

Global oil exporters have come under intense pressure this year as the pandemic stifles the beginning of a recovery in energy investment that had started to materialize.

At the start of the year, global energy investment was expected to rise 2 percent in 2020, its biggest growth in six years, the International Energy Agency (IEA) had predicted. Instead, the Paris-based organization now expects global investment in energy to plunge by 20 percent this year — the equivalent of $400 billion.

 

(With Reuters)