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Tuesday, 12 January 2016

Oil could crash to $10 a barrel, warn investment bank bears - Telegraph

Oil could crash to $10 a barrel, warn investment bank bears - Telegraph:

"Oil prices have crashed to below than $30-a -barrel amid warnings the price rout could reach as low as $10 and bring down petrol prices to levels last seen in 2009.
Standard Chartered became the latest major bank to downgrade its oil outlook to $10, joining the likes of Goldman Sachs, RBS and Morgan Stanley in making ultra-bearish calls as prices have collapsed by 15pc this year.
Brent crude has now slipped to a fresh 12-year low of $30.41 a barrel, while West Texas Intermediate - the US benchmark - is trading at $29.93. Analysts warn the oil market remains fundmentally out of balance as record over-supply and stagnant demand weighs on traders."



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Oil price tumble hits jobs and capital expenditure - FT.com

Oil price tumble hits jobs and capital expenditure - FT.com:

"Oil prices tumbled to within a whisker of $30 a barrel on Tuesday, extending a savage new year sell-off as BP axed thousands of jobs and Brazil’s Petrobras cut tens of billions of dollars in spending.
Signalling that it expects no let-up in a market downturn being likened to the slump of the 1980s, the UK-based energy major announced 4,000 job cuts across its exploration and production business, including hundreds in its hard-hit North Sea operations.

The cuts came as the price of internationally traded Brent crude on Tuesday sank to $30.34 a barrel, near 12-year lows, taking its decline since the summer of 2014 to more than 70 per cent."



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Russia to cut expenditure by 10% - FT.com

Russia to cut expenditure by 10% - FT.com:

"Russia is slashing budget expenditure by 10 per cent as it scrambles to cope with lower revenues following the latest big drop in oil prices.
Ministries and other government departments have until Friday to formulate plans for cuts that must total Rbs700bn ($9.1bn), according to three cabinet officials.

The amendments mark the second straight year that sliding crude prices have forced Russia to redraft its budget, underscoring the country’s dependency on commodity exports to keep its economy afloat."



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Oil sell off in 90 seconds | FT Markets - YouTube

Oil sell off in 90 seconds | FT Markets - YouTube: ""



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Iran prepares to open the oil pumps - BBC News

Iran prepares to open the oil pumps - BBC News:

"It is not the sexiest of titles. "Implementation day" refers to the date when Iran can start providing oil once again to the world markets.
But it is certainly one of the most important dates of the year for the global economy, alongside its major diplomatic and political significance.
Iran has the fourth-largest oil reserves in the world.
"



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Many new Dubai homes won’t be delivered on time in 2016, JLL says | The National

Many new Dubai homes won’t be delivered on time in 2016, JLL says | The National:

"The number of residential properties completed in Dubai last year was just 7,800 — considerably below the 25,000 units that had been forecasted by developers at the start of 2015, says JLL.

The property consultancy said in its annual UAE real estate market review that materialisation rates — ie the number of homes scheduled to be delivered that actually completed — has stood at just 30-50 per cent in recent years. As a result, it expects that much of the 26,000 units forecasted to be handed over this year will also not complete on time.

Sales of residential property across the UAE remained ‘subdued’ in 2015, JLL said, affected by the lower oil price, the strong dollar (to which the dirham is pegged) and geopolitical unrest."



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Oil price will recover, strategy is working, says UAE Minister of Energy | The National

Oil price will recover, strategy is working, says UAE Minister of Energy | The National:

"The UAE’s energy minister on tuesday rejected a call for an emergency Opec meeting over the latest slump in oil prices, saying that the strategy of letting market forces deal with the world oil glut was working.

Nigeria’s oil minister, Emmanuel Ibe Kachikwu, who is current president of Opec, had said earlier on Tuesday that “a couple of countries” in the group had requested an emergency meeting for February or March, ahead of the regularly scheduled ministers meeting in June, to deal with the oil price crisis.

Asked about those comments, Suhail Al Mazrouei said he didn’t see any point to such a meeting."



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Cladding used on Address Downtown Dubai hotel, which was damaged on New Year's Eve, 'does not meet fire safety standards' | The National

Cladding used on Address Downtown Dubai hotel, which was damaged on New Year's Eve, 'does not meet fire safety standards' | The National:

"Cladding used on the Address Downtown Dubai facade did not meet fire safety requirements, a preliminary on-site inspection has revealed.

Although the cause of the New Year’s Eve blaze is yet to be confirmed, a senior Civil Defence official said the cladding that lined the outside of the 63-storey hotel did not meet standards.

“The cause of the fire and the primary observations can only be confirmed when the final investigation is completed by the Dubai Police. Our primary on-site initial inspection on the fire at the Address hotel was that the cladding does not meet the required specifications,” said Lt Col Jamal Ahmed Ibrahim, director of the preventive safety department of the Dubai Civil Defence.

"



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Revealed: how Address Dubai hotel fire test was ‘meaningless’ | The National

Revealed: how Address Dubai hotel fire test was ‘meaningless’ | The National:

"A “successful” fire test in 2007 on the exterior wall panels to be used on The Address Hotel in Downtown Dubai was meaningless because it did not test flammability, according to the engineer who supervised it.

The National has obtained the original US fire test for the aluminium composite panels used on the building and interviewed the man who oversaw it.

He says that test measured fire containment and not flammability."



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New fire safety code to be out in March | GulfNews.com #UAE

New fire safety code to be out in March | GulfNews.com:

"A new federal fire safety code will be released in March to fix liabilities during emergencies, a senior official said on Tuesday, adding that up to 20 per cent of buildings in the UAE may have flammable cladding.

The announcement came days after a major fire at Address Downtown on December 31. Lt Col Jamal Ahmad Ebrahim, Head of the Preventive Safety Department at Dubai Civil Defence, said authorities are surveying all buildings in the UAE to ensure they have no flammable cladding, and if so to find specific solutions for each case.

Two days after the Address Downtown fire, teams were formed on orders from Lt Gen Shaikh Saif Bin Zayed Al Nahyan, Deputy Prime Minister and Minister of Interior, to check all buildings in the UAE especially for flammable cladding and also for any other discrepancies, whether inside or outside the building, that could be potential fire hazards or in conflict with the Fire and Life Safety code."



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Oil Market in State of Mass Disequilibrium: Norrish - Bloomberg Business

Oil Market in State of Mass Disequilibrium: Norrish - Bloomberg Business:

"Kevin Norrish, head of Commodities Research at Barclays, talks about the impact of low oil prices on producers and the factors that could drive the market into the $20 range. He speaks on "Bloomberg Surveillance." (Source: Bloomberg)"



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Oil Ignores Geopolitical Risks on Way to 12-Year Lows - Bloomberg Business

Oil Ignores Geopolitical Risks on Way to 12-Year Lows - Bloomberg Business:

"Andrew Sheets, cross-asset strategist at Morgan Stanley, and Robin Niblett, director at Chatham House, discuss the continued drop in oil prices, the market ignoring geopolitical risks and the potential implications for oil producing nations. They speak on "Bloomberg Surveillance." (Source: Bloomberg)"



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MIDEAST STOCKS-Petrochemicals drag Saudi to 4-yr low; other mkts slide | Reuters

MIDEAST STOCKS-Petrochemicals drag Saudi to 4-yr low; other mkts slide | Reuters:

"Middle East bourses slumped on Tuesday in a broad sell-off as investors cashed out, with petrochemicals the main drag on Saudi Arabia's index and blue-chips weighing elsewhere.

Brent crude had slipped towards $30 a barrel to a near 12-year low. It then rebounded above $32 after Middle East stock had closed. Oil prices have fallen by almost three-quarters since mid-2014 due to oversupply.

Saudi Arabia's benchmark fell to 1.8 percent to 6,069 points, its lowest close since late 2011 as Monday's rebound proved fleeting."



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Riyadh plans radical surgery to rejuvenate Saudi health sector - FT.com

Riyadh plans radical surgery to rejuvenate Saudi health sector - FT.com:

"At the busy emergency department of the King Saud Medical City in Riyadh, doctors are struggling to merge female- and male-only treatment rooms. The complex — which incorporates the capital’s oldest hospital, Shumaisi — is one of the few institutions to retain segregated facilities. Yet managers attempting to streamline its operations as part of a broader reorganisation of healthcare in Saudi Arabia are running up against the country’s deep social divisions: families dislike being separated in hospital, but attempts to end gender segregation have sparked resistance from social conservatives. “There are always problems one way or the other,” said one of its doctors.
But patients will soon face even more radical change as the kingdom embarks on an overhaul of its bloated and inefficient healthcare sector in a programme aimed at cutting costs, boosting productivity, improving public health and bringing more locals into the workforce."



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BP to axe one in five North Sea jobs as oil giant cuts 4,000 staff worldwide | Business | The Guardian

BP to axe one in five North Sea jobs as oil giant cuts 4,000 staff worldwide | Business | The Guardian:

"BP is to cut 4,000 jobs in its global exploration and production business over the next two years, including 600 in the North Sea, representing about a fifth of its 3,000-member workforce there.

Blaming low oil prices, BP said the majority of the jobs would be lost this year, with the rest to go by the end of 2017.

The cutbacks form part of a major reduction in BP’s global “upstream” workforce – those who work in oil exploration and production – from 24,000 to less than 20,000 by December 2017. They come a day after oil and gas services firm Petrofac warned it would cut up to 160 jobs in the UK as part of business restructuring."



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Sell everything ahead of stock market crash, say RBS economists | Business | The Guardian

Sell everything ahead of stock market crash, say RBS economists | Business | The Guardian:

"Investors face a “cataclysmic year” where stock markets could fall by up to 20% and oil could slump to $16 (£11) a barrel, economists at the Royal Bank of Scotland have warned.

In a note to its clients the bank said: “Sell everything except high quality bonds. This is about return of capital, not return on capital. In a crowded hall, exit doors are small.” It said the current situation was reminiscent of 2008, when the collapse of the Lehman Brothers investment bank led to the global financial crisis. This time China could be the crisis point. Stock markets have already come under severe pressure in 2016, with the FTSE 100 down more than 5% in its worst start since 2000. In the US, the Dow Jones industrial average has made its poorest ever start to a year."



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FirstFT - Brent slips, Obama’s last State of the Union - YouTube

FirstFT - Brent slips, Obama’s last State of the Union - YouTube: ""



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Saudi Arabia plays down riyal peg fears - FT.com

Saudi Arabia plays down riyal peg fears - FT.com:

"Saudi Arabia sought to cool talk about the future of its currency peg, saying movements in the forward market were the result of market “misperception” about the state of the kingdom’s economy.
Oil price declines and rising tensions between Saudi Arabia and Iran have pushed up the cost of riyal-dollar forward prices and questioned the validity of the 30-year-old peg."



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Saudi Arabia will make the bankers wait over Aramco - FT.com

Saudi Arabia will make the bankers wait over Aramco - FT.com:

"Some things are just Too Much, particularly in prospect. A pyramid of profiteroles. The new Tarantino movie. Or the flotation of Aramco, the Saudi oil company. “I dread the very thought of it — the deal will be a ton of work for no money,” says one banker, showing a keen appreciation of the efficient frontier between effort and reward.
The value of the business is described by an estimate wider than a deal getter’s smile at $100bn to $10tn. No one knows what assets the Saudis would shove into a float vehicle, as reserves and domestic businesses may be excluded. All they have said is that they are studying options."



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Face the strange I Authers Note - YouTube

Face the strange I Authers Note - YouTube: ""



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Investment banking's two tier structure | FT Business - YouTube

Investment banking's two tier structure | FT Business - YouTube: ""



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UAE bank profits will struggle, says S&P | The National

UAE bank profits will struggle, says S&P | The National:

"Profit growth at UAE banks is set to slow as deposits wither amid lower oil prices, says the ratings agency Standard & Poor’s.

That is likely to prompt less lending and more defaults as the cost of borrowing rises, putting pressure on earnings, it said in a report released on Monday.

The UAE is no stranger to boom-and-bust cycles but the rating agency says that unlike the 2009 financial crash, this slowdown may be made worse by a more prolonged period of lower oil prices, triggering less spending on infrastructure and dampening economic growth.

"



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Mall of the World to be scaled down | GulfNews.com

Mall of the World to be scaled down | GulfNews.com:

"Mall of the World, a new retail and hospitality project in Dubai announced by Dubai Holding nearly two years ago, is being scaled down, according to its chief operating officer.

The original plan for the $20 billion development located along Shaikh Zayed Road included an 8 million square foot mall connected to 100 hotels and serviced apartment buildings with 20,000 rooms, theatres, wellness facilities and a theme park to be covered by a dome that will open up to the natural weather during winter."



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MIDEAST STOCKS-Petrochemical stocks weigh on Saudi as oil dives towards $30 | Reuters

MIDEAST STOCKS-Petrochemical stocks weigh on Saudi as oil dives towards $30 | Reuters:

"Petrochemical stocks weighed on Saudi Arabia's bourse on Tuesday, erasing the previous day's gains as oil slumped towards $30, while Egypt's benchmark extended losses.

Brent crude was down 2.1 percent at $30.90 at 0825 GMT as analysts scrambled to cut their 2016 oil price forecasts and traders bet on further price falls.

Saudi Arabia's benchmark fell to 2.0 percent to 6,037 points, within about 70 points of a new four-year low and erasing Monday's brief rebound."



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MIDEAST STOCKS-Gulf sinks as oil falls towards $30; Abu Dhabi banks drop | Reuters

MIDEAST STOCKS-Gulf sinks as oil falls towards $30; Abu Dhabi banks drop | Reuters:

"Gulf bourses declined in early trade on Tuesday as Brent crude nose-dived towards $30 and weak Asian markets drained regional risk appetite.

Brent crude was down 3.2 percent at $30.53 at 0545 GMT as analysts scrambled to cut their 2016 oil price forecasts and traders bet on further price falls.

Dubai's bourse fell 1.7 percent, taking its 2016 losses to 8.2 percent, as investors sold off property-related stocks in early trade."



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Oil slides towards $30 per barrel - business live | Business | The Guardian

Oil slides towards $30 per barrel - business live | Business | The Guardian:

"OPEC members who don’t like the look of $30 per barrel oil should take a deep breath -- analysts at Standard Chartered think prices could hit $10(!) a barrel.

The bank argue that the strength of the US dollar, and pessimism in the stock market, could send oil down to levels not seen since 1999.

 “Given that no fundamental relationship is currently driving the oil market towards any equilibrium, prices are being moved almost entirely by financial flows caused by fluctuations in other asset prices, including the US dollar and equity markets.

“We think prices could fall as low as $10/bbl before most of the money managers in the market conceded that matters had gone too far.”"


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