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Oil drops to 18-year low on global demand crunch, storage woes

Oil extended its slide in Asia, trading near two-decade lows after agreed-upon cuts by the biggest producers were seen barely making a dent in the lack of demand wrought by COVID-19 and on increasing concerns that traders are quickly running out of room to store crude. Futures in New York dropped as much as 5.5 percent to the lowest since November 2001, following a 20 percent slump last week. China reported its first economic contraction in decades Friday, a sign of how bad things could get in Europe and North America, which have yet to emerge from their virus lockdowns. Near-term prices for West Texas Intermediate crude are trading at huge discounts to later-dated contracts on concern the storage hub of Cushing, Okla., will fill to capacity. That has seen prices disconnect from Brent futures in London. Still, there were at least grounds for cautious optimism. New York Governor Andrew Cuomo said the state may be past the high point of coronavirus deaths, and fewer daily deaths were reported in Italy, Spain, and the United Kingdom. Hedge funds were again caught out by crude’s descent, increasing their net-bullish position by 13 percent in the week ended April 14. It was the second straight week money managers boosted their net-long position in the face of 20 percent price drops in both weeks. Oil explorers shut down 13 percent of the US drilling fleet last week as the swelling worldwide glut of crude spurred drastic cost-cutting and project cancellations. — BLOOMBERG NEWS


Neiman Marcus could file for bankruptcy within days, report says

Neiman Marcus Group is preparing to seek bankruptcy protection as soon as this week, Reuters reported on Sunday, citing unidentified people familiar. The department store operator is in the final stages of negotiating a loan that would amount to hundreds of millions of dollars and help bankroll some of its operations during the process. A bankruptcy filing could come within days; however, the timing could change, Reuters said. Neiman Marcus and owner Ares Management declined to comment to Reuters; its other owner, the Canada Pension Plan Investment Board, did not immediately respond to Reuters’ requests for comment. Bloomberg reported late last month that the retailer had held initial talks with lenders about a potential bankruptcy loan that would keep the company running while it works out a recovery plan. It was already struggling before the pandemic forced it to shut its stores. Creditor Marble Ridge said April 16 in a letter to the Neiman Marcus board that it had failed to make a $5.7 million bond payment, triggering a 30-day grace period for Neiman before a formal default takes effect. — BLOOMBERG NEWS



Facebook to introduce an app for gaming

Facebook plans to introduce the Facebook Gaming mobile app Monday, its most decisive move into the video game business, as people seek entertainment during the pandemic. The free app caps several years of investment at Facebook, which said more than 700 million of its 2.5 billion monthly users already engage with gaming content. The app is designed largely for creating and watching live gameplay, a fast-growing online sector in which Facebook is battling Amazon’s Twitch, Google’s YouTube, and Microsoft’s Mixer services. The $160 billion global games business is booming. Facebook had intended to release the app in June but accelerated its plans as the quarantine’s scope became clear. “It’s entertainment that’s not just a form of passive consumption but entertainment that is interactive and brings people together,” said Fidji Simo, head of the Facebook app. “We’re seeing a big rise in gaming during quarantine,” she said. The company plans to release the app on the Google Play store for Android devices. Versions for iOS will be released once Apple approves them, Facebook said. The app includes casual games and access to gaming communities, but its fate will depend largely on how successfully it entices people to watch and create live game streams. A function called Go Live lets users upload streams of other mobile games on the same device by pressing just a few buttons. — NEW YORK TIMES



PepsiCo’s purchase of Rockstar Energy clears Hurdle

The Federal Trade Commission has approved PepsiCo’s purchase of the energy drinks company Rockstar Energy for $3.85 billion, the New York Post reported, citing unidentified sources. PepsiCo is expected to close the deal in the coming days after regulatory approval was obtained Friday, the publication said. The FTC did not respond to the newspaper’s request for comment. — BLOOMBERG NEWS