TMR

SAUDI Arabia reported to OPEC that its crude oil production collapsed further last month to the lowest since 1990, as the Iran war choked off exports from the Persian Gulf.

The kingdom told the organization that output fell by another 651,000 barrels a day in April to 6.316 million a day, according to a monthly report from OPEC’s secretariat obtained by Bloomberg on Wednesday. It brings the loss since February to 42%, and marks the lowest level since the start of the Gulf War 36 years ago, when OPEC nation Iraq invaded fellow member Kuwait.

The current disruption comes as OPEC members are again embroiled in conflict, with the Iran war blocking shipments from the Persian Gulf and causing a record drop in output from nations such as Saudi Arabia, the United Arab Emirates and Iraq. Fuel prices have surged, heightening the risk of global recession.

Riyadh told the Organization of the Petroleum Exporting Countries that its “supply to market” — which excludes movements into storage — was a little higher than production, at 6.879 million barrels a day.

In addition to the figures communicated directly by OPEC members to the group’s secretariat in Vienna, the report also includes a set of estimates compiled from estimates by external consultants and media outlets, known as secondary sources.

This data shows output from OPEC members plunged again in April, slumping by 1.727 million barrels a day to average 18.98 million a day, with the Saudis accounting for about half the decline. It puts the kingdom’s output slightly higher than its official submission, at 6.768 million barrels a day.

UAE Exit

The UAE said last month it planned to leave the group in May after roughly six decades of membership. 

Abu Dhabi announced its surprise exit following years of tension with group leader Saudi Arabia over OPEC’s output quotas, as well as discord over regional political issues. OPEC’s statutes state that the UAE will technically remain a member until Jan. 1.

While the output losses inflicted on the Saudis by the war have been severe, the kingdom’s ability to divert some oil exports away from the Gulf along another pipeline to the Red Sea has mitigated the impact. The UAE also has an alternate route for some of its exports. Other Gulf states have been hit harder.

The second-biggest decline in April was in Kuwait, which saw its output roughly slashed in half to just 600,000 barrels a day, according to the report. Kuwait is now pumping less than a quarter of prewar levels. 

OPEC trimmed forecasts for global oil demand growth in 2026 to 1.2 million barrels a day from 1.4 million a day. This still leaves the group’s projections considerably at odds with other forecasters. The International Energy Agency said in its monthly report earlier on Wednesday that world demand will contract by 420,000 barrels a day this year, the steepest since the Covid pandemic in 2020. –BLOOMBERG

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THE North Atlantic Treaty Organization is planning to invite representative from four Gulf states to the summit in Ankara with the Iran war and the transatlantic rift likely to loom large over the talks, said people familiar with the matter.

The countries — Bahrain, Kuwait, Qatar and the United Arab Emirates — are all members of the Istanbul Cooperation Initiative, a partnership between NATO and non-members in the broader Middle East. 

Their foreign ministers are expected to be invited to the meeting in Turkey’s capital on July 7-8, according to the people who spoke on condition of anonymity because the talks are confidential. NATO press office declined to comment. 

The meeting comes in the wake of growing transatlantic tensions over the war in Iran after President Donald Trump criticized NATO allies for failing to help reopen the Strait of Hormuz and later announced the withdrawal of about 5,000 troops from Germany. 

The initiative is partly driven by NATO’s plan to bolster its so-called southern flank, particularly in the context of the war in Iran, one of the people said.

The summit will consist of one core session restricted to the alliance’s 32 leaders like last year, and while inviting leaders from other countries such as the Indo-Pacific or Ukraine is being considered, they would participate in side events, the people said.

For the second year in a row, the summit is being planned in an extremely stripped-down and condensed format to accommodate the US president, they said. 

Allies are also considering holding summits less frequently than once a year, which was the practice before the start of the full-scale invasion of Ukraine, but there is no consensus on the matter yet, according to one of the people.

The planning will be firmed up when NATO foreign ministers meet in Sweden next week. –BLOOMBERG

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ANT Group Co.’s quarterly profit continued to decline after the company increased investment in artificial intelligence technology for its health care, large language model and payment services. 

The fintech company contributed 375 million yuan ($55 million) of profit to Alibaba Group Holding Ltd., which owns a third of Ant. That translates to an estimated 1.13 billion yuan in profit for the three months ended Dec. 31, a 79% decline from a year earlier, according to Bloomberg calculations based on Alibaba’s earnings report. 

Alibaba’s revenue rose 3% for the three months ended March. Ant, whose results lag behind Alibaba’s by a quarter, did not respond to an emailed query. The fintech firm’s profit fell 91% in the previous quarter. 

Ant, the operator of China’s ubiquitous financial services app Alipay, has been investing in AI to find new revenue streams following a regulatory crackdown that wrapped up about two years ago. The company has injected hundreds of millions of dollars in digital health care and built robots, while its global unit is expanding in cash management.

The company’s online loan business is likely to have posted moderate growth after Chinese regulators restricted its lending capacity, according to estimates by Bloomberg Intelligence analyst Francis Chan. 

Ant’s 50%-owned consumer finance affiliate Chongqing Ant Consumer Finance Co. has an estimated lending capacity of as much as 620 billion yuan, according to Bloomberg calculations. 

The fintech firm’s Singapore-based international arm brought in $3 billion of revenue for 2024, paving the way for a potential initial public offering of the unit. Revenue at the division grew about 25% in 2025, people familiar with the matter have said. 

Ant last year showcased its first humanoid robot, which can provide medical consultation and perform basic kitchen tasks. It’s building out its health care app AQ, which served 140 million users as of September.

In 2023, an Ant share repurchase proposal valued the company at about $79 billion, well below the $280 billion valuation during its attempted IPO in Shanghai and Hong Kong in late 2020. –BLOOMBERG

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ALIBABA Group Holding Ltd. posted its first operating loss since the depths of the Covid pandemic, underscoring the extent to which China’s e-commerce leader is spending on the AI initiatives it hopes will power its next phase of growth.

The company posted a loss from operations of 848 million yuan ($125 million) for the March quarter — its first deficit since the same three months of 2021. That’s while revenue during the period grew a less-than-projected 3%. Net income doubled, though much of that came from equity investment gains.

Alibaba’s disappointing performance followed a similarly lackluster report from Tencent Holdings Ltd., which also reported sales that lagged analysts’ estimates. The reports reflect how China’s biggest tech firms are struggling to wring significant revenue from AI despite billions of dollars of investment in the data centers, research and talent required to drive the technology’s development. Alibaba’s shares slid 2% in pre-market US trading, extending about an 8% slide since the start of 2026.

Alibaba this year broadcast its intention to begin monetizing AI — making money off a plethora of initiatives from its cloud service to AI agents and enterprise software.

The Hangzhou-based company raised prices for its AI and cloud services, pivoted to focus on proprietary models and restructured its teams this year to better profit from its AI capabilities. Chief Executive Officer Eddie Wu has said the company aims to quintuple cloud and AI revenue to $100 billion annually in five years. But its performance has been affected by competition with Meituan and JD.com Inc. in food delivery over the past year. 

Like their US peers, China’s top AI players including Alibaba are facing increasing pressure from investors to translate their AI expenditures into lucrative returns. Among major Chinese tech firms, Alibaba is one of the biggest spenders with a pledge to shell out some $53 billion on AI over a three-year span, while its cloud service unit has become its fastest-growing business. 

“We are confident in our business outlook and will continue to invest in AI + Cloud to strengthen our competitive advantages,” Chief Financial Officer Toby Xu said in a statement.

As part of the Hangzhou company’s AI commercialization efforts, Wu helped set up and lead a new business group — Alibaba Token Hub — to streamline operations by bringing most research functions as well as consumer and enterprise products under one umbrella, a move that has earned positive reactions. 

“We expect Alicloud growth momentum to remain intact, supported by a robust surge in token usage,” Morgan Stanley analysts led by Gary Yu said in a pre-earnings note. 

The company now has an AI app integrated with shopping, navigation and payment tools, and offers an agentic tool dubbed WuKong targeting enterprise clients. It’s connected its Qwen AI app to its Taobao platform to drive e-commerce growth and raised its cloud service prices earlier this year, including hiking the cost of AI computing and storage products by as much as 34%. 

Alibaba’s ambition goes beyond AI applications. Wu has said his company is committed to building all-stack AI capabilities including hardware. Alibaba is now planning to list its chipmaking unit T-Head to tap strong investor interest in Chinese alternatives to Nvidia Corp., after its semiconductor arm won mobile operator China Unicom as an external customer.  –BLOOMBERG

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AN UPCOMING meeting between US President Donald Trump and his Chinese counterpart Xi Jinping could be the next test for stocks that are clocking one record after the next. 

Some of the chief executives who are attending the summit in Beijing are already seeing share prices of their companies pop. Nvidia Corp. is trading 2.5% higher premarket after co-founder Jensen Huang joined Trump on his visit to China as a last-minute addition. Shares of Micron Technology Inc. and Qualcomm Inc. are up 5.8% and 4.9%, respectively. Tesla Inc. shares are up 1.3% and Boeing Co. shares are up 0.7%. 

Overall though, US investors seem largely unperturbed heading into the high-profile talks scheduled for Thursday and Friday. The S&P 500 Index is projected to move about 0.7% on each of these days, data compiled by Piper Sandler show. That’s less than the predicted move in Chinese Internet stocks over the same span or in the 500-member gauge following Nvidia’s earnings next week.

The sanguine outlook in the face of wider concerns about everything from geopolitics to the pace of inflation creates the risk of a surprise for markets trading at all-time highs. Discussions are expected to cover tariffs and the war in Iran, as well as trade in sectors such as aerospace, agricultural products, critical minerals and technology.

“With call volumes hovering near records, anything that isn’t positive for technology and AI shares related to trade relations between the US and China — or renewed Middle East tensions in Iran — would be perceived poorly by investors,” Danny Kirsch, head of options at Piper Sandler, said by phone. Any fresh trade-war threats may spark equity selling, he added. 

Here are the sectors and stocks that Wall Street investors will monitor for any reaction to the summit. 

Boeing and Its Suppliers

China is considering a deal for about 500 Boeing 737 Max aircraft, Bloomberg has reported. The planemaker’s Chief Executive Officer Kelly Ortberg, who is attending the summit, recently told analysts that Trump’s visit would be a “meaningful opportunity.”

“There is a high probability a Boeing order is announced,” Bloomberg Intelligence analyst George Ferguson said. “Boeing shares could get a bounce but the effect on Boeing’s income statement won’t occur for some time, if at all.” 

An order for Boeing planes is effectively a purchase of General Electric Co. engines, Ferguson said. It would fuel demand for RTX Corp.’s Collins equipment business, he added.  

Agriculture and Ag Equipment

Any commitment by China to buy US agricultural products would be a boon for American farmers, who are struggling in part because the Asian country avoided buying their goods during last year’s trade tensions. The likes of tractor maker Deere & Co. and seed provider Corteva Inc. could move the most, according to Oppenheimer analyst Kristen Owen. 

Chinese officials are in discussion with their US counterparts to buy crops including corn, traders briefed on the matter have said. Soybeans are also part of the discussions, according to the traders.

There’s a risk that geopolitical tensions will scuttle any deal.

“If there’s positive momentum, or some positive outcome from the summit that helps lift commodities prices, that’s going to ease the burden on the farmer,” Owen said. “If there’s a negative surprise, that’s going to further pressure the farmer, but the incremental downside here is somewhat limited.” 

Critical Minerals

China has used its control over rare earth metals as leverage, kicking off a US effort to develop its own supply chains. An agreement on flows of the metals is a risk to shares of MP Materials Corp., which has emerged as a US champion, JPMorgan analyst Bill Peterson told clients. 

The Pentagon last year took an equity stake in the company, setting off a more than 100% rally. The US government has also taken a stake in rare earth contender USA Rare Earth Inc., as well as critical mineral players Lithium Americas Corp. and Trilogy Metals Inc. 

Semiconductors

China’s access to artificial intelligence semiconductors may also be on the agenda. Nvidia has already secured a license to sell some less-advanced processors to customers there, a small step toward returning to the world’s largest market for chips.

The countries could strike a deal involving both rare earths and semiconductors, said Josh Lipsky, senior director of the Atlantic Council’s GeoEconomics Center. Rather than breaking new ground, the nations could agree to fulfill promises they’ve already made to ship the products — something that may take time to become clear for investors.

Still, any movement could give the latest boost to US semiconductor stocks that are already on a record-shattering run.

“Nvidia has an assumption of zero China sales in their outlook,” said Scott Ladner, chief investment officer at Horizon Investments. “If that were to materially change, that really changes the demand prospects for the entire chip industry.” –BLOOMBERG

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BEIJING – US President Donald Trump landed in Beijing on Wednesday for a high-stakes summit with Chinese leader Xi Jinping aimed at easing deep tensions between the rival superpowers.

Beginning the first visit to China by a US president in nearly a decade, Trump touched down on Air Force One at Beijing Capital International Airport at 7:50 pm (1150 GMT) after the long flight from Washington.

Ructions over Iran, trade and Taiwan loom over the highly anticipated meeting between the leaders of the world’s largest economies, which Trump had already delayed from March because of the war in the Middle East.

But Trump appeared firmly focused on business deals, with Nvidia chief Jensen Huang boarding the plane at the last minute in Alaska and Tesla’s Elon Musk also travelling on the presidential jet.

As the global AI race hots up, China is currently banned from purchasing the cutting-edge chips that Huang’s company produces under US export rules that Washington says are to protect national security.

Trump said in a social media post en route that he would be “be asking President Xi, a Leader of extraordinary distinction, to ‘open up’ China so that these brilliant people can work their magic”.

Visiting China for the first time since 2017 during his first term, Trump is expected to receive a lavish welcome from Chinese authorities and will have a packed itinerary.

Trump and Xi will hold talks at 10:00 am (0200 GMT) on Thursday in Beijing’s opulent Great Hall of the People, where they will also enjoy a state banquet in the evening.

On Friday, they are set to have tea and a working lunch before the US president heads home.

As he departed the White House, Trump said he expected a “long talk” with Xi about the joint US-Israeli war with Iran, which sells most of its US-sanctioned oil to China.

But he also downplayed disagreements, telling reporters that “I don’t think we need any help with Iran” from China and that Xi had been “relatively good” on the topic.

The Chinese foreign ministry said Wednesday it “welcomes” Trump’s visit and that “China stands ready to work with the United States… to expand cooperation and manage differences”.

‘Big deal’

Yet Beijing is growing impatient for peace, with Foreign Minister Wang Yi urging his Pakistani counterpart on Tuesday to step up mediation efforts between Iran and the United States.

Trump said Monday he would speak to Xi about US arms sales to Taiwan, the self-governing democracy claimed by China — a departure from historic US insistence that it will not consult Beijing on its support to the island.

The long-simmering trade war between the two countries will also be top of the agenda, after Trump’s sweeping tariffs last year triggered tit-for-tat levies that exceeded 100 percent.

Trump and Xi are set to discuss extending a one-year tariff truce, which the two leaders reached during their last meeting in South Korea in October, although a deal is far from certain.

China’s controls on rare earth exports and agriculture exports are also expected to be on the menu.

The tense buildup to the summit was already visible on the streets of Beijing, with police monitoring major intersections and checking the ID cards of passengers on the metro, AFP journalists saw.

“It’s definitely a big deal,” said Wen Wen, a 24-year-old woman travelling from the eastern city of Nanjing, when asked by AFP about Trump’s visit.

“Some progress will certainly be made,” she said, noting that she hopes China and the United States can ensure “lasting peace” despite “recent instability in the global situation”.

Trump has repeatedly touted a strong personal relationship with Xi, which he insisted on Monday would prevent a Chinese invasion of Taiwan.

Trump’s trip will be closely scrutinised by Taiwan and Asian allies for any sign of weakening US support. –AFP

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BORDEAUX – French authorities on Wednesday confined more than 1,700 passengers and crew on a cruise ship docked in Bordeaux after a passenger died from a suspected norovirus, officials said.

The Ambassador Cruise Line ship — with a majority of the 1,233 passengers from Britain or Ireland — arrived in the western port of Bordeaux on Tuesday.

One 90-year-old passenger on the Ambition had died and about 50 people have shown symptoms of norovirus, health officials said.

Norovirus is a form of gastroenteritis, which causes vomiting and diarrhoea and is highly contagious.

The ship, which left the Shetland Islands on May 6, stopped in Belfast in Northern Ireland, Liverpool in Britain, and Brest in France before reaching Bordeaux, from where it was scheduled to depart for Spain. –AFP

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