Global Terms of Trade Shift as Oil, Currencies Face Wild Fluxes
- Oil prices have continued their steep decline last week and so far today, paired with a surge in the US dollar’s value against everything from the Euro and Yen to the currencies of many emerging economies. Russia’s ruble is suffering the same fate [WSJ] as the country’s main export, dropping as much as 9% earlier today before somewhat rallying.
- All this means that contractors from outside of the US are getting respite after years of an arguably overpriced Euro, while their American competitors will face more difficult export odds. If this lasts, it’s bad news for US firms such as Raytheon or Textron who have pointed to foreign sales as their way to balance decreasing American orders.
- Talks of oil dropping as low as $30 [Bloomberg] still seem a bit outlandish absent a demand crash, but then few were predicting the speed and strength at which oil prices have already declined.
- Airbus has started divesting a portion of its Dassault Aviation stake, and plans to finish that exit by the end of next year. Reuters.
Middle East & Africa
- The rise of piracy in the Gulf of Guinea reported last year has continued through 2014. The Economist explains the nature of the attacks, with a supporting map.
- The US is shifting aircraft [NYT] from Afghanistan to Iraq, including A-10s and Reapers.
- At least 50 ISIS insurgents were killed over the weekend in the Syrian town of Kobani, according to the UAE’s National based on data from the Syrian Observatory for Human Rights. Freelance photographer Frederic Lafargue took shots [WSJ] of the enormous damage he’s seen in the town where 60,000 people used to live. Today’s video, from the AP, also shows what’s left there, where about 2,000 people somehow still live after weeks of heavy fighting: