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Monday, 28 November 2016

Crude oil rebounds with Opec meeting on the horizon

Crude oil rebounds with Opec meeting on the horizon:
"Crude oil prices recovered from earlier losses in the trading day ahead of Wednesday’s crucial Opec meeting in Vienna, as investors weighed the chances of the production cartel’s ability to reach an agreement to curb output.

Brent crude oil, the international benchmark, gained 1.8 per cent to hit $48.09 per barrel by midday trading, after falling 2.0 per cent earlier on Monday. West Texas Intermediate, the US benchmark, also rose 1.7 per cent to $46.83 per barrel.

The rebound came after Iraq oil minister Jabar Ali al-Luaibi said he was “optimistic” about reaching a deal in Vienna."

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Bankruptcy law to improve credit dynamics in the UAE | GulfNews.com

Bankruptcy law to improve credit dynamics in the UAE | GulfNews.com:
"The UAE Bankruptcy Law or Federal Law 9 of 2016 is one crucial part of the comprehensive insolvency law reforms that will go a long way in improving the credit dynamics and investor confidence in the UAE, according to economists.
“The law comes at a critical time in the UAE’s economic development road map, especially given the vital role the law will play in incentivising private sector and entrepreneurial activity,” said Shady Shaher Elborno, Head of Macro Strategy at Emirates NBD.
The existing insolvency regime was broadly spread across three pieces of legislation, the commercial companies law, the commercial transactions law, and the civil law. While providing a formal court supervised process for settling creditor claims, the lack of clarity and inconsistency around the laws meant they have been largely untested."

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Saudi Aramco and Adnoc Expanding Into Chemicals Amid Asia Growth - Bloomberg

Saudi Aramco and Adnoc Expanding Into Chemicals Amid Asia Growth - Bloomberg:
"Saudi Arabia and the emirate of Abu Dhabi plan to more than double their production of petrochemicals to cash in on growing demand.
Both Persian Gulf oil producers are prioritizing a more diverse output of petrochemicals to help wean their economies away from crude. They want to produce chemicals that are used in plastics to tap growing consumer-goods markets, particularly in Asia, and to make plastics themselves.  
“By 2030, Asia will become the main driver of global economic growth and will also represent the world’s largest market for consumer goods,” Sultan Ahmed Al Jaber, chief executive officer of Abu Dhabi National Oil Co., said Monday at a conference in Dubai. “Demand for petrochemicals by 2030 will in fact double, representing an unprecedented market opportunity.”"

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BRIEF-Fitch says UAE Islamic banking faces growing operating challenges | Reuters

BRIEF-Fitch says UAE Islamic banking faces growing operating challenges | Reuters:
"* Fitch says UAE Islamic banking faces growing operating challenges

* Fitch says Islamic financing growth in UAE slowed in 2016, but remained above conventional banks"

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MIDEAST STOCKS-Second-tier stocks boost Saudi, foreign money supports Egypt | Reuters

MIDEAST STOCKS-Second-tier stocks boost Saudi, foreign money supports Egypt | Reuters:
"Strength in second-tier stocks favoured by local retail investors boosted Saudi Arabia's stock market on Monday, while foreign buying helped Egypt partially rebound from a drop on Sunday and most other Middle East bourses fell.

Saudi Arabia's index climbed 0.9 percent to 6,904 points, rising above major technical resistance on its April peak of 6,876 points. A second consecutive close above that level would be very bullish technically and point to the index reaching around 8,400 points in the long term.

The Saudi market has been strong since the kingdom's $17.5 billion international bond issue in late October partly eased concern about Riyadh's ability to cope with an era of cheap oil."

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The Saudis are playing with fire if they raise oil output further

The Saudis are playing with fire if they raise oil output further:
"Does Saudi Arabia in its pursuit of a secure share of the world oil market have the nerve to take on its principal supporter and patron? Will those in power in Riyadh take the risk of challenging US economic interests as a new president comes into power in Washington?

The Opec states meet on Wednesday to discuss a co-ordinated cut in production designed to rebalance an oversupplied market. In advance of that meeting, the gamesmanship goes on. The Saudis are producing at record levels while Iran continues to increase output — opening three new fields in the past few weeks alone. There is little sign that the promised cuts will be delivered when the cartel meets and, unsurprisingly, prices have fallen back to around $45 a barrel.

The Saudi response to this stalemate has been to threaten a further increase in production to 11mbd or more. The assumption is that other producers can be pressured into cutting back to give the Saudis a bigger market share. That starts with Iran but extends to the US. In the new world order after the US presidential election the approach looks risky at best and potentially an act of serious self-harm."

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Oil Extends Slide Below $46 on Skepticism Over OPEC Output Deal - Bloomberg

Oil Extends Slide Below $46 on Skepticism Over OPEC Output Deal - Bloomberg:
"Oil extended declines to slip below $46 a barrel amid skepticism over OPEC’s ability to reach an agreement to cut output as representatives prepare to meet Monday amid last-minute negotiations over the deal the group aims to formalize Wednesday.

Futures fell as much as 2 percent in New York after dropping 4 percent on Friday. Saudi Arabia for the first time on Sunday suggested OPEC doesn’t necessarily need to curb output and pulled out of a scheduled meeting with non-member producers, including Russia. OPEC will hold an internal meeting in Vienna Monday to resolve its differences and, as part of the final push to reach an agreement, oil ministers from Algeria and Venezuela are heading to Moscow to get the group’s biggest rival on board."

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Saudis Temper Call for Cuts and Russia Digs In - Bloomberg

Saudis Temper Call for Cuts and Russia Digs In - Bloomberg:
"OPEC surprised the market in September with a preliminary agreement to reduce supply to 32.5 million to 33 million barrels a day, breaking a two-year policy to pump at full throttle. The news pushed prices above$50 a barrel in New York for the first time since June, but optimism faded as subsequent meetings failed to decide cuts for individual members.

Ministers gather in Vienna Wednesday for final talks to hammer out a deal with several obstacles remaining. There’s still no agreed mechanism for Iran and Iraq to participate in a deal, although Baghdad last week appeared to reverse its opposition to making cuts. Libya and Nigeria, both exempt from any supply reductions, are boosting output, increasing the burden on other members. OPEC supply had already swelled to a record 33.6 million barrels a day last month.
OPEC’s own estimates show that the September agreement would barely drain a record oil surplus next year without the cooperation of producers outside the group. Several members are said to be adamant that Russia, the biggest non-OPEC supplier, should shoulder some of the cuts. So far Russia has offered no more than to freeze at current record levels.
"

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MIDEAST STOCKS-Gulf markets move sideways in early trade | Reuters

MIDEAST STOCKS-Gulf markets move sideways in early trade | Reuters:
"Gulf stock markets moved sideways in early trade on Monday with little fresh corporate news to spur buying, while uncertainty over oil prices also deterred some investors.

Saudi Arabia's index was flat after 70 minutes of trade with most petrochemical companies little changed and the banking sector index edging down.

Real estate developer Jabal Omar gained 1.4 percent after saying it had ended a contract with builder Saudi Binladin Group, settling an outstanding 196 million riyal ($52.3 million) debt to Binladin by transferring to it ownership of units in a project."

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