Bas will be replaced as minister by Alexander Schweitzer, former state premier of the western state of Rhineland-Palatinate

International News via Reuters:

Germany’s labour minister and co-head of the centre-left Social Democrats (SPD) quit unexpectedly on Monday, adding to uncertainty around Chancellor Friedrich Merz’s struggling coalition after bruising state election defeats last month.

Baerbel Bas said she was resigning from both positions to deal with grief over her stepdaughter’s recent death.

She added that “public attacks against me, unfortunately also from within the ranks of our coalition partner,” had made her situation unbearable.

Bas will be replaced as minister by Alexander Schweitzer, former state premier of the western state of Rhineland-Palatinate, and the whole of the SPD leadership will face re-election in a special party conference at the end of the year.

While the departure of one minister was not expected to disrupt the overall government, it highlighted the turmoil facing Europe’s largest economy.

Merz’s coalition has been under growing pressure following state election victories for the far-right Alternative for Germany (AfD) in eastern Germany last month, which it views as the first step towards victory in federal elections due in 2029.

Merz’s government is languishing in opinion polls amid economic uncertainty and frustration over living costs.

Bas, whose former ministry oversees large parts of Germany’s welfare system, was the target of repeated criticism from some members of Merz’s conservative Christian Democrats (CDU) who accused her of standing in the way of economic reforms.

Finance Minister Lars Klingbeil, who shared the leadership of the SPD with Bas, cancelled a planned trip to India and it was unclear whether he would attend a meeting of the Group of 20 finance ministers in Thailand this week.

STRAINED RELATIONS

Klingbeil said Bas had been subject to “unacceptable” attacks from the CDU while mourning her stepdaughter.    

But at a press conference, Merz said he had urged his party to show her “every personal consideration, including Christian compassion,” in recent weeks. 

“I cannot see that we have failed to do so in any way,” he said, adding that he was confident new minister Schweitzer would swiftly advance pending legislation and cooperate well within government.

Merz was speaking after senior CDU members had held a two-day meeting to seek a way forward after months of coalition wrangling over planned tax, pension and labour laws aimed at reviving Germany’s sluggish economy.

“We want to demonstrate our readiness for change – something that is essential given the election results,” he added.

As part of the leaders’ five-page policy paper aimed at addressing voter discontent, he pledged to push ahead with a cut in electricity tax, reviving a measure that was shelved last year because of budget constraints.

While both sides in the coalition agree on the need for reforms to shore up the pension system as the population ages and to help industry confront a surge in energy prices and increasingly intense competition from China, significant differences remain.

Merz, a pro-business fiscal conservative, has struggled to win popular support for changes that could push back the retirement age for some, increase the cost of health insurance and weaken worker protections.

Support for the government will be further tested in five more regional elections next year that will impact his ability to get major legislation through the Bundesrat, the upper house of parliament filled by Germany’s 16 states.

Reporting by Andreas Rinke, additional reporting by Maria Martinez, writing by Ludwig Burger and James Mackenzie, editing by Ros Russell and Andrew Cawthorne

Rebounding from earlier losses, Brent crude futures were up $2.04, or 2%, to $106.76 a barrel at 11:07 a.m.

International News via Reuters:

Oil prices were up 2% at near two-week highs on Monday as attacks on Saudi Arabia overshadowed the prospect of increased supplies after US President Donald Trump hailed fresh Russian diesel exports and a Russia-Ukraine ceasefire on energy targets.

Rebounding from earlier losses, Brent crude futures were up $2.04, or 2%, to $106.76 a barrel at 11:07 a.m. EDT (1507 GMT), their highest since September 29. US West Texas Intermediate crude was at $93.69 a barrel, up $1.84, or 2%.

The Iran-aligned Houthis claimed responsibility for a Saturday strike on Riyadh’s international airport that killed 13 people and wounded more than 300. Further attacks happened on Sunday.

In addition, more attacks on tankers sailing through the Strait of Hormuz have been reported this month, threatening to dampen a recovery in Middle East crude exports seen in September.

A tanker was struck by a drone in the vicinity of Oman’s Sohar, while another was damaged transiting Hormuz, the ​United ​Kingdom Maritime Trade Operations reported.

“The sense of some kind of normality of exports from the Strait of Hormuz was shattered last week. Fresh attacks by the Houthis on Saudi Arabia added to this and helped to lift prices,” said SEB commodities analyst Bjarne Schieldrop.

“Hard choices over what to defend will increasingly have to be made: oil infrastructure, military installations, royal palaces, civilian airports or other.”

Goldman Sachs, in a note, raised its Brent price forecast for December to $90 a barrel from $85, estimating a risk premium of just over $20 a barrel.

“We forecast WTI prices, which are unusually low vs Brent because of high US-Europe shipping costs, to average $81 in December 2026 and $73 in 2027,” they added.

In the Gulf of Mexico, energy majors Shell, Chevron and BP were seeking to redeploy personnel and restore production at their platforms after Hurricane Isaias made landfall early on Saturday.

MORE RUSSIAN DIESEL

ICE gasoil futures fell 2.3% to $1,449 per metric ton after Trump said on Friday that Russia will immediately supply more than 300,000 metric tons (2.25 million barrels) of diesel to US and global markets, with more to come later.

“The release will be developing gradually through the rest of this year and the expected amounts during the coming month don’t appear capable of forcing much additional downside price pressure,” said analyst Jim Ritterbusch of Ritterbusch and Associates in Florida, who noted that he did not expect much of a price reduction by the time the US midterm elections take place three weeks from now.

“The immediate impact of the deal is questionable, as Russia’s refining capacity has been severely reduced,” PVM analyst Tamas Varga said. “However, Moscow has partially lifted its ban on diesel exports, allowing 500,000 tons (around 3.7 million barrels) to be released onto the international market — equivalent to roughly one day of US consumption and around 13% of global demand.”

Trump also unexpectedly announced on Sunday that Ukraine and Russia had agreed to a ceasefire covering energy infrastructure. Ukrainian leader Volodymyr Zelenskiy accused Russia of violating the energy ceasefire on Monday, while Russia did not comment.

The International Energy Agency’s Fatih Birol said all members should assess whether additional diesel releases are necessary and that countries which have not yet fully delivered pledged volumes should accelerate releases, prioritising diesel.

Additional reporting by Ahmad Ghaddar in London, Mohi Narayan in New Delhi and Florence Tan in Singapore. Editing by Susan Fenton and Mark Potter

The EU executive Commission secured agreement with Beijing on Friday to limit imports of hybrid cars from China to 350,000 vehicles a year, most likely from early December, with a 6% annual increase

International News via Reuters:

The European Commission is set to lay out potential trade defence measures in December designed to rein in its trade deficit with China and reduce its reliance on the world’s second-largest economy for critical supplies.

The EU executive Commission secured agreement with Beijing on Friday to limit imports of hybrid cars from China to 350,000 vehicles a year, most likely from early December, with a 6% annual increase. 

The safeguard, which will also apply to other EU trading partners, will last four years, cutting Chinese hybrid exports to the EU that are on course to reach 800,000 this year and reducing the market share of Chinese-built vehicles to around 6%, from 12% now.

EU leaders will discuss China as the first point of their summit starting on Thursday. Commission officials, providing details of the deal with China, said the leaders were likely to make an assessment of the agreement and determine if further action was required. 

“Dialogue needs to deliver and it has delivered results,” a senior Commission official said on Monday. “But dialogue alone looks unlikely to deal with this structural problem of unsustainable imbalances that we have with China.”

“That is why the question will be what more do we do in parallel to the dialogue,” the official added.

The Commission plans in December to propose an instrument to limit companies’ reliance on a single source for certain critical supplies, the official said.

Another new initiative would seek to offer support to industries or specific regions within the EU that were hit by trade measures imposed from outside.

Leaders will then discuss these and other potential measures at their end-of-year summit on December 17-18.

Reporting by Philip Blenkinsop, editing by Inti Landauro and Alex Richardson