Latest From Business & Global Economy [10.28.14]

Oil

• Saudi Arabia's Risky Oil-Price Play (BusinessWeek) 

"With the U.S. on track to become the world’s largest oil producer by next year, it’s become popular in Washington and on Wall Street to call America the new Saudi Arabia. Yet the real Saudi Arabia hasn’t relinquished its role as the producer with the most influence over oil prices. Its reserves of 266 billion barrels, ability to pump as many as 12.5 million barrels a day, and, most important, its low cost of extracting crude still make it a formidable rival to the U.S., whose shale wells are hard to exploit.  

The Saudis are also the most powerful member of OPEC, the 12-member group that’s increasingly facing off against Russian, U.S., and Canadian production.

Oil exports account for 85 percent of the Saudi government’s revenue.

The Saudi policy of waging a price war has already hurt weaker members of OPEC. Venezuela has called for an emergency OPEC meeting to organize price hikes."

Aircraft Manufacturing

• Mitsubishi Spreads Its Wings (BusinessWeek) 

"In a hangar near Mitsubishi Aircraft’s plant there, the Japanese manufacturer rolled out its 92-passenger Mitsubishi Regional Jet (MRJ) in a bid to elbow its way into the tight club of global airplane makers—a club Western companies have long dominated." 

Culture

• Meet Xi JinPing, China's No. 1 Art Critic (BusinessWeek) 

Smartphone in Emerging Market

• Samsung's China Problems Come to India (BusinessWeek) 

"on Oct. 14, Xiaomi put 100,000 of its Redmi 1S smartphones up for sale in India, using local e-commerce site Flipkart to sell them, unsubsidized, for 5,999 rupees ($98) apiece. Within four seconds the phones sold out.

Samsung finished 2013 with 34 percent of the Indian smartphone market, well ahead of local brands Micromax and Karbonn, according to market-research group IDC. Six months later, Samsung’s share was down to 29 percent as cheaper Chinese brands and other manufacturers chipped away at its lead. The low-cost Chinese phones selling out on Flipkart aren’t top of the line, but they’re better than the prices suggest: 3G-capable, solid processor, decent camera, and barely adequate but expandable memory."