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Quest Means Business
Vaccine Optimism Clashes with Grim Health and Economic Reality; U.K. Set to Receive First Shipments of Pfizer-BioNTech Vaccine; England Drops Quarantine Requirement for High Value Visitors; Warner Media's 2021 Movies: On Stream And On Screen Simultaneously; The Power Of The Market Can Power Climate Change; OPEC Plus Agrees To Boost Oil Production; Tokyo 2021: The Games May Be The World's First Major Outing. Aired 3-4p ET
Aired December 03, 2020 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:29]
RICHARD QUEST, CNN BUSINESS ANCHOR, QUEST MEANS BUSINESS: And so an hour to go before the close of trade and the Dow could close above 30,000 for
the first time. Now, we've been above 30,000, of course, before, but this is the first time we look like we seriously -- in the last 60 minutes.
There's only 46 points above the top. It could go either way. Am I betting man? I am. But I'm not going to take a bet on that one.
We've got an hour to go. We'll know at the close of the program.
The markets and that's the way they look, and this is the day so far. United States suffers its deadliest day of the pandemic as the need for the
vaccine becomes ever more dire.
OPEC and Russia are making New Year's resolutions. They are going to pump more oil.
And the U.K. is dropping its quarantine rules for high value business travelers.
Were live from New York on Thursday, December 3rd. I'm Richard Quest and I mean business.
Good evening. Tonight, we all know that there is light at the end of the tunnel as the coronavirus vaccine wins approval around the world. But we're
going to point out tonight, the tunnel itself remains dark, and you need look no further for evidence.
The United States has just suffered its deadliest day of the pandemic. On Wednesday, more than 2,800 people died. Look at the graph. You'll see it's
the highest total since the beginning in spring. From COVID-19, there are 100,000 people in hospital. That in itself is also a record.
At the same time the job market recovery is slowly seemingly every week. New jobless claims are topping 700,000. Private payrolls simply aren't
growing at the rate economists had hoped, believed and thought that they would.
Now none of that should denude the fact that there is light at the end of the tunnel. The journey however, getting there between now and probably mid
to late next year is going to be painful and costly.
So over this program, in the next 60 minutes, whilst we also watch the Dow at 30,000 and question the wisdom of that, we will break down the steps and
the obstacles ahead.
Let's start with the health. The C.D.C. is predicting 329,000 Americans will have died by December the 26th. Jacqueline Howard from CNN Health is
here. Hang on. If I look at the total at the moment, Jacqueline, we're at 267,000 or something. Between now and Boxing Day as we call it. From now on
Boxing Day, you're saying the number is going to rise to more than 320,000?
JACQUELINE HOWARD, CNN HEALTH REPORTER: That's right, Richard. You know, the C.D.C. regularly looks at what it calls its ensemble forecasts. That's
several models that offer projections on you know, based on where the pandemic is going. And it projects how many cases or deaths we might see in
the coming days and weeks.
And that projection has been made just today by the C.D.C. ensemble forecast. And also just today, the U.S. has now reported more than 14
million cases of COVID-19. Those numbers just came in from Johns Hopkins University.
And so if you look at the projection that you know is happening right now, that's what is being forecast. This is a surge that experts have already
warned us about, the fall and winter surge and it appears that this surge is already happening -- Richard.
QUEST: But hang on. If this surgery is happening and it is getting worse. Now the vaccine is on its way and the first vaccinations will take place
before the end of the year, it really doesn't matter. It's December the 15th, the 20th or 21st. It's going to happen.
The issue is, I see President Obama said he would be willing to take or have the vaccine publicly. The Ruler of Dubai, of course did something
similar. So we think it makes much difference if people like Obama take it publicly?
HOWARD: Richard, there definitely is hope that not only former President Barack Obama, but other former U.S. Presidents as well -- George W. Bush
and Bill Clinton, they also have said that they're willing to get the vaccine publicly on camera or in a public setting and the hope there is
that by them doing this, it will encourage the public to follow suit as well.
[15:05:02]
HOWARD: We should have sound from former President Barack Obama on what he specifically said about this. Have a listen.
(BEGIN AUDIO CLIP)
BARACK OBAMA, FORMER PRESIDENT OF THE UNITED STATES: So if Anthony Fauci tells me this vaccine is safe, and can vaccinate, you know, immunize you
from getting COVID, absolutely, I'm going to take it.
I may end up taking it on TV or having it filmed just so that people know that, you know, I trust this science.
UNIDENTIFIED MALE: Okay.
OBAMA: And what I don't trust is getting COVID.
(END AUDIO CLIP)
HOWARD: So, you see, Richard, former President Barack Obama referenced Dr. Anthony Fauci and Dr. Anthony Fauci has served under six Presidents,
including Obama. And so you see there that if the science adds up, if Dr. Anthony Fauci, you know, does recommend this, then former President Barack
Obama said that he plans to follow suit.
Now, we do have to keep in mind that the first people to get vaccinated in the United States, most likely will not be former Presidents and Advisory
Committee to the C.D.C. recommended that healthcare workers and nursing home residents, residents living in long-term care facilities, that they
should be the first to get the vaccine.
So if states follow those recommendations, healthcare workers and nursing home residents will be first in line followed by the rest of us here in the
U.S.
QUEST: All right, Jacqueline, stay with me, though. I want your thoughts on this. The first shipments of the Pfizer-BioNTech vaccine are set to
arrive in the U.K. any moment now and vaccinations are slated to begin early next week.
Now Dr. Fauci said that he questioned the British authorities and the way that they had done their research into giving the approval saying that the
U.S. way was more careful.
I know regulators from different countries don't like to appear to pour cold water on fellow regulators elsewhere, but that's effectively what he
did, isn't he, to the British regulators?
HOWARD: You're right you know, when you say how it there is some controversy, there is some, you know, hesitancy to compare regulatory
processes, country by country.
But if you kind of look at where the U.S. is, right now, we still are in the process of evaluating data. There has not been an authorized vaccine.
And so, we still are in the process of waiting to see when that authorization might happen, based on the data what the next steps might be.
And then going back to how I mentioned, an Advisory Committee to the C.D.C. just this week voted on prioritization, who will get the vaccine first:
healthcare workers and long-term care facility residents were what was recommended.
But here in the U.S., it's really -- we're waiting to see if the states follow that advice and state by state what will happen.
So there, you know, we kind of are still waiting to see that process happen. But as you said, there is some hesitancy to compare process by
process, country by country. So we'll wait and see what happens here in the U.S. compared with what's already happening in the U.K.
QUEST: Thank you, Jacqueline. Now, let's stay with that thought of what's happening. The next obstacle on the long journey through the dark tunnel
we're talking about, the distribution snags could get in the way. Delays could cost lives and jobs.
Tonight, the Chief Executive of DHL Express, that's the company will be able to deliver frozen virus vaccines to the developing world.
The CEO, John Pearson is with me now from Bonn in Germany. That's a very important point. The one thing I've read and spoken on television a million
times about the Pfizer and the Moderna vaccine is the difficulty of getting it to those countries which have less sophisticated refrigeration or
storage systems, you say you can do it.
JOHN PEARSON, CEO, DHL EXPRESS: That's right, moving these vaccines -- moving these vaccines is right in our wheelhouse really. We've had a world
medical express product, WMX product that moves products across the world in a time sensitive and temperature sensitive manner for a couple of
decades.
The Pfizer product does require a temperature much more extreme than we are used to moving, but the way in which we receive the package and the
sophistication of how the dry ice protects the vaccine at that temperature means we can pick it up at origin, we can move it in the normal mode
through to destination and destination is not final airport destination, it is the final delivery address as requested by the consigner.
So that could be a Ministry of Health warehouse. It could be a clinic or it could be a hospital.
[15:10:06]
PEARSON: Now our standard transit time globally is anywhere between one and five days and these packages and the dry ice within them maintains the
temperature for up to 10 days.
So there's even a little bit of a buffer at the end of the five-day period for us and that's why we're extremely confident in our capability. And I
think the last thing I'd say is that the preparation has been pretty intense over the last two months.
We've been having frequent and content rich discussions with all the providers, most of the providers in terms of understanding their
requirements and making sure that we're ready to do that.
QUEST: I'm interested you say that, as far as you're concerned, the delivery point is not just if you like, to the main airport in the capital
or the main city, but it does get more difficult the further and more remote you go.
In this case, I mean, is the AstraZeneca-Oxford, and the COVAX from Germany, are those vaccines going to be easier in a sense to handle because
they don't have the same freezing requirement.
PEARSON: I think anything that has a lower temperature requirement is probably easier to handle. But as I said, the way in which these packages
are assembled with the dry ice keeps the product at the right temperature anyway.
So in terms of remoteness, I mean, we are operating in and out of 220 countries every day. Now, as it stands today, we don't know the final
delivery point. The more remote it is, the more difficult it'll be. But we are going into those places, as I say every day today. But there's no
specificity as to the final consignee in each country at this stage.
QUEST: A war on setup because I imagine at the moment, you know, you're going to be delivering a dozen boxes. But as more countries give approval
and the manufacturing ramps up, what sort of extra airlift do you think you're going to need?
PEARSON: Yes, I mean, that's the $64 million question. I mean, all year, Richard, we've been increasing our aviation assets ever since the PPE surge
in April-May of this year, we've been putting more aircraft on the ground in China and in Asia to provide uplift for PPE, to provide up lift for e-
commerce and provide uplift for all the B2B business that we move. So it's no different in that sense.
We've been scaling up our aviation capacity and as these moves come through, and as the clarity of what we need to move where, we will continue
to move aircraft tails around so that we can meet the demand.
I think it's fair to say, and I'll draw another analogy with e-commerce, there's so much of this stuff going to be around that I think everyone will
have a piece of the pie, and it's about organizations understanding their capability at origin and destination, understanding what they can do, and
putting their hand up for the particular parts of this supply chain requirement that they are best at and that's what these discussions with
the manufacturers are all about.
QUEST: And can we just turn on that e-commerce point because, if we look at the value of Amazon and we look at the value of those companies heavily
involved in e-commerce, somebody has to move the stuff and you do move a lot of e-commerce goods around.
Has it been dramatic in terms of what you've noticed? The volume of goods being shifted because balanced against the slowdown that's taken place
because of the pandemic, how do you net it out?
PEARSON: Yes, so traders basically rebounded to the same level as last year. So that's in the space of six short months, we're back at a level
that is roughly flat.
Some countries are going to be in growth. China is definitely going to be in growth. We have to -- that factor in itself is misleading. How to break
it down into different industries and e-commerce versus traditional B2B.
Once the PPE surge had died down, e-commerce was on our doorstep like never before. So we've been busy moving e-commerce to the U.S. to Europe on most
of the lanes the way e-commerce is very heavy. E-commerce destinations is polarized a little bit around U.S., Canada, Mexico, Australia, and we've
been very heavy on those lanes and we still see it to this day.
And we anticipated that as soon as Black Friday came around, e-commerce levels would be at all-time highs and we were breaking records every single
day.
The statement that we made that we thought e-commerce would be growing at 50 percent in quarter four, is give or take a couple of percent absolutely
accurate, and we expect that to continue until Chinese New Year.
[15:15:16]
QUEST: I appreciate it. John, let's talk more before Christmas, at the end of the year about how it's going and particularly as the ramp up comes. It
would be lovely to talk to you again on the program. Thank you for joining, taking time tonight.
As we continue, high value visitors are welcome in England without going through a quarantine. We will tell you who the British government considers
to be high value. In a moment.
(COMMERCIAL BREAK)
QUEST: Tonight, we're in the tunnel towards the light at the end of the tunnel, which is of course vaccination and economic growth. But the reality
is set again. Now, let's look at economic pain and economists are warning of a double dip recession as hiring slows to its slowest pace since July.
And it is a quarter of a million Americans who filed for unemployment benefits last week and the Labor Department says 712,000 people made
claims, slightly lower than the previous week. But you've got to put it into the context of a quarter of a million Americans receiving benefits and
the pandemic unemployment assistance program, the self-employed and contractors.
And yet at the same time, the light at the end of the tunnel -- that Wall Street bounce, the Dow is over 30,000 because the market believes that the
vaccine's benefits will come and it is pricing in future earnings.
Chris Hyams is the CEO of job seeking website, Indeed. He is in Austin in Texas. Forgive me, sir, you join me now.
The difficulty here is the market is telling us that they know things will get better next year. But the jobless numbers are telling us that there is
a surge underway, restrictions in the economy are coming in. So which way do you look at it?
CHRIS HYAMS, CEO, INDEED: Richard, thanks for having me. So as the number one job site in the world, we have 250 million job seekers in 60 countries
around the world coming to Indeed every month and so we get a pretty unique view on the overall labor market.
And we have a team of economists called the Hiring Lab who look at this data every week. And so what we've seen, you know, at the outset of the
pandemic, there was clearly a steep decline in job postings, which is the best way that we can measure economic activity.
But there was a quick rebound as restrictions were lifted and so it's as we've been talking about this K shaped or whatever shape you like, it has
been different in different sectors, and what we have seen is that there's been a really sharp growth in lower wage jobs and while there is still a
year-over-year decline in some of the white collar jobs, and that's really a difference between what happened back in the spring.
[15:20:23]
HYAMS: The service economy was hit really hard immediately and with the recovery, there's been growth in hiring in those jobs. The higher wage
office sector jobs didn't see the same kind of job loss. And so they're not seeing the same kind of hiring surge right now.
It is also very different around the world. A lot of that is different based on how different governments responded in Japan, for example. One
extreme where employers really can't fire workers, like the office sector here, there was very little job loss. So it's a slower recovery, wherein
the U.S., those protections don't exist. Millions of workers lost their jobs immediately.
But as different sectors picked back up, there has been more hiring. So I think there's no one or the other answer. It's a little more nuanced than
that.
QUEST: Okay. It may be nuanced, but the reality and I take your point on that well, but the reality is, what we're really seeking is two things now
understanding, firstly, how many more jobs globally are likely to be lost because of a second and a third wave before the vaccine.
But I think it's important what the British Finance Minister called the unviable jobs or the non-viable jobs. France had a massive program to keep
people in work. But many of those jobs are not viable.
HYAMS: Right, yes. So we look at distinctly our economists sort of break it down, there's four different categories of jobs. There's what you're
describing as what we're describing as the damaged category.
So hospitality, tourism, sports, arts and entertainment, anywhere where the occupations require people gathering together in large groups, we don't
know how long it's going to take and what any long term recovery will look like.
But there are the clear winners. So the massive companies that are hiring are construction, warehousing, and specifically driving and logistics jobs
that are fueling all the e-commerce. There's the sectors that are rebounding, like restaurants and stores that are slowly opening, those will
be volatile, because as there are surges, they'll close back down and open back up.
But then there's the ones that are on hold, the white collar office sector, banking, finance, software development jobs, those have been affected very
little. And so we expect between all of that there still is a huge amount of upside in recovery to come.
QUEST: Chris, that upside, I mean, the market is over 30,000. We know that there's a perversion going on because of low interest rates, et cetera et
cetera. I worry about an entire generation that simply won't have a job and won't be skilled because not only have they got to deal with a pandemic, AI
is going to prevent those jobs from coming back.
HYAMS: Yes, and that's an age old discussion that goes back to every single technological advance that has ever happened. The Luddites were the
first group that went and just destroyed the weaving looms, because they thought that weavers -- hand weavers were going to not have jobs anymore.
Clearly, there are a lot more people employed in textile today than there was back then. That has happened with every single technological shift over
the years.
There's a lot of debate right now about what the future of AI means. But if you -- I'm a humanist, and I believe that every single one of those
technology shifts has created more jobs long term.
Now, the real impact though is that there is short-term disturbance, and that will put people out of work. So if you look at something like
automated driving, there's no question that a quick shift when that happens, there will be millions of drivers who are put out of work. Long
term, it will end up creating more opportunity for more people.
QUEST: Chris, we do need to talk about this more often. And we will, and I'm grateful that you're joining us. Thank you very much for tonight.
HYAMS: Thanks so much for having me, Richard.
QUEST: Soaring unemployment, it's going to be a major talking point when CNN's Jake Tapper sits down with the U.S. President-elect Joe Biden and
Vice President-elect Kamala Harris.
It's their first joint interview since they won the White House. The whole thing is at nine o'clock tonight, if you're here in New York and to be
repeated throughout the day, of course, here on CNN.
England is announcing new quarantine exemptions, what it is calling high value business travelers. That starts on Saturday. Those who qualify will
no longer have to self-isolate upon arrival, no matter where they are coming from.
So here's what you if you're a high value. First of all, you've got to be involved in an activity that creates or preserves at least 50 U.K. jobs or
leads to 100,000 pound investment, $130,000.00 and executives returning to the U.K. are also exempt.
Selma Abdelaziz is in London. This is calculated, isn't it? This is basically saying we know there is a risk, but it is a risk worth running.
In other words, this policy does put a price on lives versus livelihoods.
[15:25:10]
SALMA ABDELAZIZ, CNN REPORTER: It absolutely does, Richard and that's exactly why it will be controversial and it will be -- it may be taken the
wrong way by some and there will be some backlash, and here is why.
Yes, that list says that there are some exemptions for those high value business people and those high talent people, such as journalists, sports
people, because the government wants to see those who are in those high industries that they consider most valuable, able to conduct global
business.
But there has been no new countries added on the travel corridor list and that's what an average family in the U.K. is going to be looking at. Can I
travel to go on holiday and come back without quarantine? Can I see a family member who lives abroad and be able to come back? Are those number
of countries that I can access, is that list growing? No, it's not Richard. And that's exactly why this is going to be controversial.
And it's important to remember, today, a very clear milestone rather here in the U.K., 60,000 deaths. Sixty thousand people have lost their lives due
to this virus. So yes, they are trying to reopen the economy, but they're still very much dealing with a deadly pandemic -- Richard.
QUEST: We're a business program, Selma, I'm going to push you on this for the British reaction. The reality is, though, that whilst it might be great
for people to be able to go and visit relatives and friends, those business travelers, if this is a proper policy, and I'm not sure it is, but if this
is a proper policy, they create the jobs, and they create the investment opportunity.
Is that not worth it? I don't know. What do you say?
ABDELAZIZ: Well, it's absolutely -- I mean, economists would argue it is worth it. But I think there is something here that we don't talk about
enough and that's public confidence and public trust.
And the U.K. government, to be honest, has been lacking in that. In the last few months, Prime Minister Boris Johnson has faced controversy after
controversy. He wants to be seen as a man for the people so that those people can follow the rules and restrictions that are around.
These types of things make people feel like the rules are for some and not for others -- Richard.
QUEST: Excellent. Good point. Thank you. Selma Abdelaziz in London tonight. I appreciate your time.
All right, coming up, investing in a cleaner Earth. My exclusive interview with Mark Carney, former head of the Bank of England on the intersection of
climate and finance. It is QUEST MEANS BUSINESS. Good evening.
(COMMERCIAL BREAK)
[15:30:00]
RICHARD QUEST, CNN ANCHOR, HOST OF QUEST MEANS BUSINESS: Hello, I'm Richard Quest, QUEST MEANS BUSINESS. A lot more between now and the end,
just about 30 minutes from now.
By the way, the Dow is over 30,000. We'll (inaudible) that to you.
But we've also got Warner Media says all of 2021 blockbusters will release on the big screen and streaming services simultaneously. Is Warner Media
shooting itself in the foot?
And part two of my exclusive interview with the former Bank of England governor Mark Carney on his new role as U.N. climate envoy.
Before we get to either or any or all, this is CNN. And on this network, the facts always come first.
Israel's warning of an elevated terror threat to Israelis abroad in the wake of the killing of a prominent Iranian nuclear scientist.
Israel's national security council's warned attacks on Israelis could take place in countries neighboring Iran, such as Georgia, Azerbaijan and the
UAE.
Iran has blamed Israel for the attack, Israel's neither claimed responsibility nor denied being behind the scientist's death.
Speaking from the Oval Office earlier today, President Trump declined to say whether he had confidence in his attorney general, William Barr.
A source tells CNN the two had a contentious White House meeting this week after Barr told the "Associated Press" the justice department found no
evidence of fraud that would change the outcome of the election.
New York State is to receive its first delivery of Pfizer's coronavirus vaccine in less than two weeks and should have enough initial doses for
170,000 people.
Governor Andrew Cuomo says if all approvals are granted, the state will get vaccines on December 15th with more from Pfizer and Moderna arriving later
in the month.
The big names in business, Amazon, Google, and Walmart are amongst 42 companies urging the U.S. to rejoin the Paris climate agreement.
Investors also need to focus on climate, says Mark Carney. In an inclusive interview, I spoke to the former head of the Bank of England about his new
role as U.N. Special envoy on climate action and finance.
(BEGIN VIDEO CLIP)
MARK CARNEY, U.N. SPECIAL ENVOY FOR CLIMATE ACTION & FINANCE: Our objective is to have in place the information, the tools and the markets so
that the private financial system can take climate change into account with every financial decision -- in fact, that it does take it into account.
So, in other words, when making a loan, making an investment, managing risk, you consider issues of climate change just like you consider issues
of the creditworthiness of the company or where interest rates are going or future technologies.
And so what we do is we work with the private sector to develop that information; those tools, those markets. And then through that process, we
then get the public sector -- the central banks, the governments, the standard setters around the world, the authorities, the IMF, others -- to
put in place a formal framework around those once we know that the markets are going to work.
And we're doing it on an expedited basis for Glasgow a year from now.
QUEST: But everybody sort of knows about climate change and CEOs have repeatedly said it is one of the most important issues facing but getting
to the practicalities --
CARNEY: Ah, yes. But, OK, now what's happening is this. First, you have $170 trillion -- and I want you to repeat that, $170 trillion of capital --
that is demanding information from companies on not just what their carbon footprint is today, how much they emit in terms of greenhouse gases, but
what they're going to do about it, OK.
That totally changes the game and that's something that's developed over the course of just the last couple of years. That changes the game.
And what it does is it means that if I'm making a loan or, more interestingly, if I'm making an investment, I'm looking at a company and
saying, hmm, where is their trajectory for their greenhouse gases, their climate emissions, their contribution to climate change? Are they part of
the solution or are they part of the problem?
If they're part of the solution, I'm going to make a lot of money, potentially, backing that company. If they're part of the problem, I'm
going to lose a lot of money backing them. If the world is serious about addressing climate change.
And so what we're doing is unpacking this issue so that investors, including people watching --
QUEST: So --
CARNEY: -- can be in a position so that they can put their money behind solutions, if they -- obviously if they want to.
QUEST: So are you --
CARNEY: And before -- Richard, sorry.
[15:35:00]
The point was before it was talk, now it's hard numbers, it's hard data, it's allocation of capital in size.
QUEST: Now you're a few years younger than me. You've held some of the top jobs, the very top jobs in finance and policy making.
What do you still want to do? This particular job, what's the goal here, what does Mark Carney -- I know you hate answering questions about yourself
--
CARNEY: I do.
QUEST: You're becoming uncomfortable even thinking about it.
CARNEY: I know. Yes, I know. Don't like -- I don't want to look inside my soul, Richard.
What do I want to do? Look, I was asked by the secretary-general and Prime Minister Johnson to do this role and this is the type of thing that I
really do get interested in and excited about. Because it's about using the power of the market and organizing market or organizing capitalism to
solve society's problems. So what -- and working on both sides of that.
You know the other role I have is I have a role in the private sector with Brookfield Asset Management which is impact investing to actually put money
behind part of this transition, moving from where we are to where we need to get to and finding the opportunities. So those are the things that
interest me.
I've been very fortunate in my career to have higher impact roles and work with great people and hopefully that will continue.
QUEST: Mark Carney talking to me.
The move towards renewable energy and the economic toll of the coronavirus pandemic created a crisis of the oil industry even as demand remains weak.
OPEC and Russia have agreed to ease existing production cuts and modestly boost oil output starting in January by 500,000 barrels a day.
The Saudi energy minister explained the decision.
(BEGIN VIDEO CLIP)
ABDUL AZIZ BIN SALMAN, SAUDI ENERGY MINISTER: It is all about addressing uncertainty. If you have an uncertain situation, you need to be attentive.
That's why central bankers, they meet every month. That's why tweaking happens at all levels. This is a grand arrangement, this is a grand
commitment. And this is a demonstration of responsibility by all participant.
(END VIDEO CLIP)
QUEST: Johnny D. is in Abu Dhabi. Good evening, sir. Now look --
JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR:. Hi, Richard.
QUEST: -- they may be letting a bit of oil back in the market but they're terrified of a repeat of what happened earlier this year.
Now, I am not saying, John, that it would ever go negative again as we did -- the futures as we saw earlier. But the opportunity for a collapse in
prices is ever there as we go through a surge in COVID cases.
DEFTERIOS: Yes. I think a good way to describe this, Richard, is kind of baby steps back to normality.
It's a huge challenge because a half a million barrels a day has compromises in this group of kind of 24 producers written all over it. And
I think you're absolutely right.
They know what the bottom feels like. They felt it in April, when Brent went below $10 a barrel and WTI went negative, right. They don't want to
feel that again.
But I also think this half a million barrels, putting it back on the market, doesn't say a lot about their confidence about demand going
forward.
We're in this strange in-between time, Richard, where you have vaccines coming onto the market but they admitted at the press conference this
evening that distribution's going to be a challenge.
And the harsh reality is that cars and trucks and planes and trains, too many are still sitting idle and that's why they're worried about what's
going to happen in the near future.
You have to remember, they were supposed to come back in January and put 2 million barrels a day back on the market when they designed this recovery
plan back in May.
They went from 9.7 million in cuts, 7.7, they were going to come to 5.7. Right now, Richard, they're parked at 7.5.
And also, Saudi Arabia came into this meeting and said they didn't want to cut --
QUEST: John --
DEFTERIOS: -- and maintain the status quo. And where the tension did come in, Richard, is that Russia, the UAE, Iraq said we want to add more to the
markets. So they had to come up with something. And voila, it was half a million barrels a day to keep this disparate group together.
QUEST: You see, you've just made the point; disparate group. How close is Russia and OPEC from falling out? Never mind the internal OPEC
shenanigans, just keeping these cuts in place.
I mean, Russia had to be dragooned back in and Saudi Arabia, certainly, is not a friend in this sense. So how difficult is it to keep them all
together?
DEFTERIOS: Well, I tell you what, they are so determined -- this is the week of the fourth anniversary of the OPEC Plus and the cooperation between
Saudi Arabia, Russia and the other producers there -- that they gave it a cushion of an extra two days to make sure they could find a compromise.
[15:40:00]
So there is a willingness to try to do this. But I think we're at a turning point here, Richard, and I'll tell you why.
It used to be Saudi Arabia's a de facto leader, it gives a mandate, everybody follows it.
What we're seeing now, because of the energy transition to renewables that's taking place -- Russia, Iraq, UAE especially, put $120 billion into
oil and gas over the next five years, they want to make hay while the sun is shining, if you will, Richard.
So they want to take advantage of oil and gas while the demand is still there before we make the transition.
And this is the fine line that Saudi Arabia's trying to toe here. Even the finance minister of Saudi Arabia was willing to step down as co-chair of
OPEC Plus then he was urged to stay on.
There were some tensions there, they added another 48 hours for negotiations. And Richard, after four years, there's a willingness to keep
it going because they're not clear what 2021's going to offer.
This is the worst year they could have, Richard. It was a drop of nearly 10 percent in demand. They got through it, we're at nearly $50 a barrel.
They do need to manage if prices go above this level right now, it entices the U.S. shale producers to come back.
It's not an easy game for them. And this is a very diverse group of people and countries, and they did keep this Humpty Dumpty glued together again.
QUEST: Yes. But -- we'll talk about that another time, John Defterios. John Defterios --
DEFTERIOS: Good to see you.
QUEST: -- it's late in Abu Dhabi, I'm going to let you go. Good to see you, sir. Thank you.
As you and I continue tonight on QUEST MEANS BUSINESS, the world's emerging from the dark tunnel of coronavirus pandemic.
The postponed Olympics, the executive director for the games will be talking to us next about how they will be changed. In a moment.
(COMMERCIAL BREAK)
QUEST: We've talked about the reality of the dark few months ahead. But at the end of the tunnel, there is light and that light at the end of the
tunnel is, of course, in this case, the fiery Olympic flame.
The torch, and a step closer to normality.
The Tokyo Olympic organizers say 18 percent of tickets already sold for the games are being refunded. And that's around 810,000, nearly 4.5 million
tickets sold. The ticket holders requested refunds due to the one-year postponement of the Games.
[15:45:00]
The organizers may resell refunded tickets before the games begin on July 23rd.
Joining me now is Christophe Dubi, the IOC Olympic games executive director. It's good to see you, sir.
We know the games are going to be different when they're held this next year but by then, certainly, all the athletes will probably have been
vaccinated. I imagine everybody concerned going in the stadia will be vaccinated.
Have you got any gauge of how big you think they can be as an event for people to attend?
CHRISTOPHE DUBI, IOC OLYMPIC GAMES EXECUTIVE DIRECTOR: Richard, first, thanks for having me tonight.
How big are they going to be? The event in itself is big, let's be very clear. From a sports standpoint, from a media standpoint, big. We will
have all the 11,000 athletes, we will have all of the media contingent and we will have spectators as well.
Now, if you ask me whether we're going to have absolutely full stadium or whether we'll have a number of social distanceation (ph) and some
restrictions, probably a little bit too early to say.
But nevertheless, all efforts -- you were mentioning vaccines, rapid testing we've seen in sport plays a huge role as well, this is what we're
looking into.
All the measures to ensure two things; one, that we have the safest possible games and two, that everybody that is in Tokyo, starting with the
athletes, enjoy themselves.
QUEST: Right, Christophe, OK. So then how important do you think the games will be -- and not as a sporting event, they're always important in
that sense.
But they're almost totemic as being the first major global event as we are at the light at the end of the tunnel that we've been talking about. And
you're going to want to make it feel like that, aren't you?
DUBI: Oh, yes. And it's not a miracle if in his first speech as prime minister, Mr. Suga declared exactly that. That this would be the first
world gathering where we all unite at the end of what you describe as the dark tunnel.
And this was also a declaration in context of the G-20 most recently.
So, yes, most definitely. This is the first event where we all gather at one place; at one point in time, the world unites in a great celebration of
solidarity. So indeed, very powerful symbol.
QUEST: If we look back at last year and the decision -- or this year, I should say -- gosh, it does seem a long year -- at this year's decision to
postpone, how difficult was it? Was it a case as it was with many people - - my own wedding, for example -- where you kept thinking, we're going to try and do it, we're going to try and do it, no, we will do it. And then
suddenly, this realization there's just no way we can do it. Was it like that for the Olympics?
DUBI: It was exactly like that, Richard. Listen, we go back February, January/February, and we see that Asia is hit by its first wave. But at
the same time, we have seen signs of recovery in Asia and then it shifts towards the U.S., towards Europe first.
And this is where we start to look at the situation degrading on every continent until WHO declare it's a world pandemic. At that point in time,
we have to make the decision to postpone, it's impossible to do it over the summer.
And there, quickly, you have to realize the following. The whole thing is operations, thousands, tens of thousands of people ready to go. We are in
the final stage and you have to postpone the whole system for a year.
So what it means is first, you have to ensure that the fundamentals -- the venues, sports venues for the media, accommodations as well as (inaudible)
will be re-signed for the next year. Not an easy feat when you take some of the big convention centers that were already full, for example, in 2021.
So you have to do that first, ensure that we have the fundamentals in place.
And then you project yourself into the event, about one year to go mark, where you look into the various scenarios and how they can play out. And
this is what we're doing right now, looking at the various scenarios and how it will unfold.
QUEST: We'll be with you throughout. We'll talk more, we'll catch up as we go through into 2021.
DUBI: We'll talk more.
QUEST: Thank you, Christophe. It's really lovely to talk to you tonight. I appreciate your time. Thank you, sir.
DUBI: Thank you for having me. Thank you so much.
QUEST: Now the cinema's been hit especially hard by COVID-19. Warner Brothers has a unique plan, Warner Media, for the year ahead.
It's revolutionary, some might say foolish. We'll talk about it after the break.
(COMMERCIAL BREAK)
[15:50:00]
QUEST: Warner Brothers says all the movies that it will put out next year will be at the cinema and on its streaming service, HBO Max, at the same
time for a limited period.
This includes everything from the sci-fi epics like "Dune" to the musical "In the Heights" from the creator of "Hamilton." With so many theaters
closed, studios are focusing on how to capitalize on streaming. Both Warner Brothers and CNN, of course, are both owned by Warner Media.
Brian Stelter is here in New York. Brian, forget we both work for Warner Media here. How much of this decision by Warner Media is a statement of
the reality versus a sea change?
BRIAN STELTER, CNN CHIEF MEDIA CORRESPONDENT: I think it's something that would have happened years from now but because of the pandemic, everything
is happening faster.
You talk all the time about how the pandemic is exacerbating trends in many industries, well, this is the example in Hollywood.
Hollywood will never forget this day because it's the first time that a major studio says it's going to release its entire slate of movies online
at the same time as it is in theaters.
I believe Disney and others could well follow in the weeks to come.
QUEST: Right.
STELTER: Look, it was only a couple of weeks ago that Warner Media said that "Wonder Woman," the sequel to "Wonder Woman" was going to come out on
Christmas Day on HBO Max as well as in theaters. Now 17 movies next year will be released simultaneously.
QUEST: OK. But this is a genie that you won't be able to put back in the bottle once vaccines -- this time in 18 months, will Warner Media be able
to say, ah, well, we did it because of COVID now it's movies first for the first four months and then stream is after?
STELTER: Even if they wanted to make that change and put it back in the bottle, the genie's not going to fit. Because this is about what
consumers want and this was probably going to happen anyway. Like I said, probably going to happen anyway, it is speeding up because of the pandemic.
That's why America's stock, one of the major theater owners, down 16 percent right now, Cinemark down 15 percent. This is something that the
theaters must have anticipated.
And yes, Warner Media does work out deals with these theater operators when they make an announcement like this. But it is a seismic change in
Hollywood, because this is what consumers want.
And you know, our boss's boss's boss, Jason Kilar, he came on about six months ago to run Warner Media. He comes from Silicon Valley, he comes
from big tech, he talks about what consumers want.
And I think the reality is, Richard, consumers want this, they want the option to see a film in the theaters or at home.
QUEST: Right.
STELTER: Look, I can't wait to go back to the movie theater, I would love to see some of these films on a big screen. But I'd also like the chance
to have them at home, if I can.
[15:55:00]
And so this is a huge shot in the arm for HBO Max, the streaming service.
QUEST: Right.
STELTER: It's a huge boost to streaming. And it is a direction that you can't walk back from. You're only going one way at this point, you can't
turn around.
QUEST: Brian Stelter, thank you, sir.
STELTER: Thanks.
QUEST: I think we both kept our jobs. Thank you.
Now a very quick last look at the markets before we go to the break. A quick look.
The Dow has come up slightly -- yes, I told you. Couldn't do it, couldn't do it.
It's because of some problems maybe over the vaccine and whether or not there are some delays. That's what's taken the air out of the balloon.
But we're going to be under 30,000 at the close.
A "Profitable Moment" after the break.
(COMMERCIAL BREAK)
Tonight's "Profitable Moment." We have asked repeatedly on this program, what is the price, the balance between lives versus livelihoods, what is
that price?
We now know the British government says it's protecting 50 jobs or 100,000- pound deal, about $130,000.
That allows you to avoid a quarantine in the United Kingdom if you've returned or going to do a deal; 50 jobs or a 100,000-pound deal. That is
the price of lives versus livelihoods as seen from the British.
We make no comment whether that's a fair price, a right price or a good policy but it does give clarity on what the answer is.
And one other point tonight. Major changes are taking place in business.
Look at what Warner Media has done, Warner Brothers, releasing the entire slate of films online and streaming at the same time in the theater.
Who says we are not seeing seismic shifts, not only in ethics, morality and thought, but also in basic business practices.
What is the price? What is the price? We now know.
And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York.
Whatever you're up to in the hours ahead, I hope it's profitable. We are not over 30,000 on the Dow but we do have "The Lead" with Pamela Brown.
And welcome to THE LEAD, I'm Pamela Brown. Jake Tapper is on assignment interviewing President Elect Joe Biden and Vice President Elect Kamala
Harris airing tonight at 9:00 pm Eastern.
END
