BUSINESS BRIEFS
OPEC blames U.S. 'mismanagement' for oil price rise
Associated Press
VIENNA, Austria — OPEC yesterday accused the U.S. of economic "mismanagement" that it said is pushing oil prices record highs and rebuffed calls to boost output, laying the blame on the Bush administration.
The 13-nation Organization of Petroleum Exporting Countries said it would maintain current production levels because crude supplies are plentiful and demand is expected to weaken in the second quarter.
OPEC President Chakib Khelil told reporters the global market is being affected by what he called "the mismanagement of the U.S. economy," and that America's problems were a key factor in the cartel's decision to hold off on any action.
Khelil's comments came one day after President Bush lashed out at the organization. White House spokeswoman Dana Perino said yesterday that Bush was "disappointed" OPEC didn't do more to rein in prices, which some say are pushing the U.S. economy into recession.
Meanwhile, oil surged yesterday, rising a remarkable $5 a barrel to a record over $104 after the government reported a surprise drop in crude oil stockpiles and OPEC held production levels steady.
Most analysts had expected the Energy Department's Energy Information Administration to report oil supplies rose last week for the eighth straight time. Instead, they fell by 3.1 million barrels.
MERRILL MAY DUMP HOME LENDING UNIT
NEW YORK — Merrill Lynch & Co. said yesterday it will stop funding loans at its troubled First Franklin home lending unit and explore selling the company it bought for $1.3 billion at the real estate market's peak.
The world's largest brokerage suffered an $11.5 billion loss during the fourth quarter linked to the subprime mortgage market's collapse. It will spend $60 million in 2008 to pay for severance and other real estate costs linked to unwinding First Franklin's operations.
Some 650 people will be affected by the closure, and it has already reduced the head count at First Franklin by 70 percent since July. The closure won't affect mortgage origination from its global wealth management group or international business.
The company will try to sell First Franklin's home loan services business, which collects and processes payments. The company will seek bids in the next few weeks.
A spokesman for Merrill Lynch was not available to comment.
DESPITE LOSS, FORD WILL PAY BONUSES
DETROIT — Even though it lost $2.7 billion last year, Ford Motor Co. will pay performance bonuses to all hourly and salaried workers in the U.S. and Canada and to its management team around the globe, the automaker's chief executive announced yesterday.
In an e-mail message to workers sent yesterday morning, Chief Executive Alan Mulally said the bonuses will come in paychecks this month because the company is making significant progress toward becoming profitable again.
Although the Dearborn-based Ford fell short of its market share goals in North and South America and Asia, the company met objectives in all other categories, including cost performance, quality, automotive cash flow and financial results in these regions, the message said. It also met market share and all other goals in every other region worldwide.
But Mulally wrote that to meet cost objectives this year, Ford will delay payment of merit raises for salaried workers in the U.S. and Canada from April 1 to July 1. And he warned of tough times ahead this year.
DOLLAR HITS NEW LOW AGAINST EURO
NEW YORK — The dollar sank to another record low against the euro yesterday, with a growing list of economic reports pointing to a worsening U.S. climate.
The euro rose to $1.5302 before dropping back slightly to $1.5262 in late New York trading. The new low for the dollar broke through the previous record set Monday at $1.5275.
The euro had bought $1.5208 in New York late Tuesday.
The British pound was up to $1.9916 from $1.9859 the previous night.
