The media is flooded with news and speculations as Britain votes to leave the EU. Here are some important industry updates which we feel are worthy to know on this D-day!
Let us start with the Crude:
The Crude is not as crude as it looks like and it takes a Free fall on this D-day.
The Brent crude has slipped under $50/bbl and it is $48.95/bbl as we write this update while Britain voted to leave the EU. The WTI Crude slipped by 3.85% and it stands at $48.18/bbl (Source: Bloomberg )
Vermilion Energy CEO says ‘leave’ vote would be a mistake for Britain – A Calgary CEO whose oil and gas company has extensive holdings in Europe says he thinks it would be a mistake for Britain to vote to leave the European Union in the so-called “Brexit” vote.
Asian Shares – Fall!
Shares in maritime companies across Asia reacted negatively to the United Kingdom’s decision to leave the European Union (EU). In Singapore offshore related stocks were amongst the hardest hit in early trading with most shares down between 5% to 8% as the decision emerged in London.
- Shares in Vard were down 5.7% in early trading, while the shares of Ezion, Ezra and Pacific Radiance were down 5.6%, 7.8% and 5.3% respectively.
- In Hong Kong, bulker carrier operator Pacific Basin saw its share price slide by 6.5% at lunchtime, while China Ship Development was down 4.7%.
- Tokyo stocks plunged more than 7% and South Korea’s Kospi tumbled about 4%. Crude oil prices and US futures also took a big hit.
- The British pound plummeted more than 10% in six hours while the yen surged nearly 4% to the US dollar as investors seeking safety snapped up the Japanese currency.
- The “leave” side was ahead by 52% to 48% with nearly all the votes cast.
World & Economy:
Other important point to consider is that as an EU member, the UK and companies based here can sell their goods freely to customers anywhere else in the EU without those customers having to pay additional taxes to import those goods.
The EU is made up of 28 Member States and some of the world’s largest container and passenger ports are situated in its territory including Rotterdam, Hamburg, Antwerp, and Piraeus. Four of the world’s five largest shipping companies are based in the EU. According to a recent Parliamentary Briefing, the EU is the UK’s largest trading partner, accounting for around 45% of exports, and 53% of imports, of goods and services. Over three million jobs in the UK are linked, directly or indirectly, to exports to the EU. European Union law, in the form of Treaties, Regulations and Directives, affects a wide number of commercial issues including trade, environmental regulation, international trade sanctions, competition law, employment, tax, immigration and infrastructure projects.
If the electorate votes for Brexit, the UK will be the first Member State to do so since the creation of the first European “Community” in 1952, marking a new chapter in the European experiment, and sending the UK into uncharted waters.
British consumers and companies can also import from elsewhere in the EU without tariffs. The EU also has agreements allowing free trade with countries such as Norway, Switzerland, South Africa and South Korea.
Outside the EU, the UK would need to strike new deals in order to have free trade with those countries or the remaining EU members.
Here are some important points gathered from Various Sources:
IMMIGRATION
Leave:
Britain can never control immigration until it leaves the European Union, because freedom of movement gives other EU citizens an automatic right to live here.
Stay:
Leaving will not solve the migration crisis but bring it to Britain’s doorstep because border controls from the Continent will move from Calais in France to Dover in UK.
CRIME
Leave:
The European Arrest Warrant allows British citizens to be sent abroad and charged for crimes in foreign courts, often for minor offences. Exit would stop this.
Stay:
Rapists, murders and other serious criminals who convict offences in Britain can only be returned once fleeing abroad thanks to the European Arrest Warrant. Exit would stop justice being done.
TRADE
Leave:
Britain’s links with the EU are holding back its focus on emerging markets – there is no major trade deal with China or India, for example. Leaving would allow the UK to diversify its international links.
Stay:
44 per cent of Britain’s exports go to other EU countries. Putting up barriers with the countries that Britain trades with most would be counterproductive.
LAW
Leave:
Too many of Britain’s laws are made overseas by dictates passed down from Brussels and rulings upheld by the European Court of Justice. UK courts must become sovereign again.
Stay:
The exit campaign has over-exaggerated how many laws are determined by the European Commission. It is better to shape EU-wide laws from the inside rather than walking away.
DEFENCE
Leave:
Britain could soon be asked to contribute to a EU Army, with reports suggesting Angela Merkel may demand the Prime Minister’s approval in return for other concessions. That would erode the UK’s independent military force and should be opposed.
Stay:
European countries together are facing the threats from Isil and a resurgent Russia. Working together to combat these challenges is best – an effort that would be undermined if Britain turns its back on the EU.
SOVEREIGNTY
Leave:
The British Parliament is no longer sovereign With the EU hell-bent on “ever closer union” and further economic integration likely after the euro crisis, it is best to call it quits before ties deepen.
Stay:
In a globalised world, every country must work closer with others if the want to flourish economically. A Little Englander desire for isolation will undermine the UK, plus the PM might have won an opt-out to “ever closer union” come the referendum.
FINANCE
Leave:
Talk of capital flight is nonsense. London will remain a leading financial centre outside the EU and banks will still want to be headquartered in Britain due to low tax rates.
Stay:
Banks will flee the UK and the City of London collapse if Britain votes for exit, because the trading advantages of being inside the EU help boost banks’ profits.
CLOUT
Leave:
Britain does not need the EU to prosper internationally. By re-engaging with the Commonwealth the UK can have just as much clout as it does from inside the EU.
Stay:
Britain will be “drifting off into the mid-Atlantic” if it leaves the EU, as Nick Clegg likes to say. In a globalising world the UK’s interests are best protected by remaining part of the EU block, with American and Chinese leaders indicating as much.
Source: Guardian, Telegraph, Bloomberg, Trade winds
