1. Oil prices have the strongest opening since 2014.
2018 is off to a good start. Oil prices posted their best opening to a year since 2014, with crude rising to mid-2015 highs. Prices have been driven by large anti-government rallies in Iran and ongoing supply cuts led by OPEC and Russia.
U.S. West Texas Intermediate (WTI) crude futures (CLc1) were at $60.61 a barrel, their highest since June 2015. Brent crude futures (LCOc1), the international benchmark, were at $67.12 a barrel. This is the first time since January 2014 that both crude oil benchmarks opened the year above $60 per barrel.
2. South Korea seizes another ship with oil headed to North Korea.
According to customs officials, South Korean authorities have seized a ship flying the Panama flag suspected of transporting oil products to North Korea in violation of international sanctions.
The seizure is the second reported by South Korea within a few days, as the United Nations steps up efforts to squeeze essential oil supplies to the uncooperative North following its nuclear and ballistic missile testing.
3. UAE And Saudi Arabia End Tax-Free Living.
The United Arab Emirates and Saudi Arabia have long provided tax-free and heavily subsidized living for foreigners. However, recently they introduced and International Monetary Fund (IMF)-backed value-added tax (VAT) starting January 1. The general consensus is this is due to oil prices slumping and causing significant budget shortages across the board for the countries. The 5% levy is imposed on most goods and services and aims to boost revenue after the collapse in crude prices over the last couple years. Although it threatens to slow economic growth at a time when it is already sluggish, the UAE is expected to raise around $3.3 billion from the tax.