Mideast set to emerge as major oil product exporters - The Peninsula Qatar:
The Middle East has been actively building refineries, not only to displace product imports, but to become a net refined product exporter.
In the Middle East, the willingness to increase the vertical integration of national oil companies (NOCs) and to diversify oil revenue streams are important factors in the drive to increase refining capacity. Several Middle Eastern NOCs are also involved in overseas projects, predominantly in the growing Asian markets.
International Energy Agency (IEA) noted in its “World Energy Investment 2018” report that global investments in oil refining rebounded by 10 percent in 2017 and are set to rise by another 40 percent in 2018 to about $90bn, driven by rising demand in the emerging economies and improved profitability. The bulk of investments continue to go to construction of new units in these regions either with strong demand growth perspective or oil industry diversification objectives.
Saturday 28 July 2018
Crude Posts Weekly Drop as Trade Tensions Take Center Stage - Bloomberg
Crude Posts Weekly Drop as Trade Tensions Take Center Stage - Bloomberg:
Crude posted a fourth straight weekly drop amid concerns over how significantly U.S.-China trade tensions will affect demand.
Futures closed 1.3 percent lower Friday amid low-volume trading. Concerns over global trade continue to weigh on investor sentiment, with U.S. Federal Reserve Chairman Jerome Powell saying earlier this month that trade barriers threaten productivity and wages, while BlackRock Inc. boss Larry Fink warned intensifying tensions could spur a broad market downturn.
We’re seeing “an underlying concern especially about demand growth and worries about what could happen on the global trade issue," said Gene McGillian, manager of market research at Tradition Energy. "Now, with the uncertainty coming from our president’s administration and his trade policy, part of the demand growth picture is being brought under the spotlight."
Crude posted a fourth straight weekly drop amid concerns over how significantly U.S.-China trade tensions will affect demand.
Futures closed 1.3 percent lower Friday amid low-volume trading. Concerns over global trade continue to weigh on investor sentiment, with U.S. Federal Reserve Chairman Jerome Powell saying earlier this month that trade barriers threaten productivity and wages, while BlackRock Inc. boss Larry Fink warned intensifying tensions could spur a broad market downturn.
We’re seeing “an underlying concern especially about demand growth and worries about what could happen on the global trade issue," said Gene McGillian, manager of market research at Tradition Energy. "Now, with the uncertainty coming from our president’s administration and his trade policy, part of the demand growth picture is being brought under the spotlight."
GCC Equities Review: Foreign buyers underpin Qatar market's continued growth | ZAWYA MENA Edition
GCC Equities Review: Foreign buyers underpin Qatar market's continued growth | ZAWYA MENA Edition:
Qatar appears to be coping well with the economic fallout from blockade imposed on it just over a year ago by a quartet of neighbouring countries including Bahrain, Egypt, Saudi Arabia and the United Arab Emirates. The quartet began the blockade in June last year accusing Qatar of sponsoring terrorism, a claim the state has denied.
On July 15, ratings agency Moody’s lifted its outlook on Qatar’s sovereign outlook to ‘stable’ from ‘negative’, citing the state’s ability to withstand the impact from the blockade “for an extended period of time without a material deterioration of the sovereign's credit profile”.
The country’s stockmarket has proved equally resilient. The Qatar Exchange All Share Index gained in value by 6.9 percent in the first half of the year, making it the region’s second-best performing market behind Saudi Arabia.
Qatar appears to be coping well with the economic fallout from blockade imposed on it just over a year ago by a quartet of neighbouring countries including Bahrain, Egypt, Saudi Arabia and the United Arab Emirates. The quartet began the blockade in June last year accusing Qatar of sponsoring terrorism, a claim the state has denied.
On July 15, ratings agency Moody’s lifted its outlook on Qatar’s sovereign outlook to ‘stable’ from ‘negative’, citing the state’s ability to withstand the impact from the blockade “for an extended period of time without a material deterioration of the sovereign's credit profile”.
The country’s stockmarket has proved equally resilient. The Qatar Exchange All Share Index gained in value by 6.9 percent in the first half of the year, making it the region’s second-best performing market behind Saudi Arabia.
GCC Equities Review: Investors pile into Saudi stocks after upgrades, but does the market still offer value? | ZAWYA MENA Edition
GCC Equities Review: Investors pile into Saudi stocks after upgrades, but does the market still offer value? | ZAWYA MENA Edition:
The 15.1 percent gain made by the Tadawul All Share Index in the first half of 2018 meant that the market not only outperformed its regional peers, but was one of the top-performers globally.
“It’s one of the three best markets in the world in terms of performance in the first six months,” Mazen Al Sudairi, the head of research at Riyadh-based Al Rajhi Capital, told Zawya in a telephone interview.
Al-Sudairi attributed the gains to two main factors – the 19.3 percent increase in oil prices experienced over the first six months, and the twin boosts that exchange bosses received from index compilers FTSE Russell and MSCI – both of whom have announced that they will upgrade Tadawul to emerging market status next year.
The 15.1 percent gain made by the Tadawul All Share Index in the first half of 2018 meant that the market not only outperformed its regional peers, but was one of the top-performers globally.
“It’s one of the three best markets in the world in terms of performance in the first six months,” Mazen Al Sudairi, the head of research at Riyadh-based Al Rajhi Capital, told Zawya in a telephone interview.
Al-Sudairi attributed the gains to two main factors – the 19.3 percent increase in oil prices experienced over the first six months, and the twin boosts that exchange bosses received from index compilers FTSE Russell and MSCI – both of whom have announced that they will upgrade Tadawul to emerging market status next year.
GCC Equities Review: Dubai the worst performer as property shares slide | ZAWYA MENA Edition
GCC Equities Review: Dubai the worst performer as property shares slide | ZAWYA MENA Edition:
Trading in stocks listed both in Dubai and Abu Dhabi slumped during the first half of the year as investors who would normally be buying its shares opted for potentially more lucrative returns elsewhere. Data from Thomson Reuters Eikon showed that trading volumes in both of the equity markets in the United Arab Emirates remained weak, with the Dubai Financial Market down 55 percent in volume terms in the first half of the year, while volumes of trades on the Abu Dhabi Securities Exchange dropped by 49 percent.
Mohamad Al-Hajj, vice-president and head of MENA strategy at EFG Hermes, said the decline in volumes was mainly a result of “a lack of catalysts” spurring investment.
“If we look at the macroeconomic fundamentals and even the valuation, the UAE is the most attractive from a valuation perspective. Dubai is trading at 7x forward earnings and a 6 percent dividend yield, and that is a valuation it was trading at when oil was around $27 a barrel,” he said in a telephone interview.
Trading in stocks listed both in Dubai and Abu Dhabi slumped during the first half of the year as investors who would normally be buying its shares opted for potentially more lucrative returns elsewhere. Data from Thomson Reuters Eikon showed that trading volumes in both of the equity markets in the United Arab Emirates remained weak, with the Dubai Financial Market down 55 percent in volume terms in the first half of the year, while volumes of trades on the Abu Dhabi Securities Exchange dropped by 49 percent.
Mohamad Al-Hajj, vice-president and head of MENA strategy at EFG Hermes, said the decline in volumes was mainly a result of “a lack of catalysts” spurring investment.
“If we look at the macroeconomic fundamentals and even the valuation, the UAE is the most attractive from a valuation perspective. Dubai is trading at 7x forward earnings and a 6 percent dividend yield, and that is a valuation it was trading at when oil was around $27 a barrel,” he said in a telephone interview.
GCC Equities Review: Bahrain banks feel the pressure as investors focus on sovereign debt | ZAWYA MENA Edition
GCC Equities Review: Bahrain banks feel the pressure as investors focus on sovereign debt | ZAWYA MENA Edition:
The Bahrain All-Share Index declined in value during the first six months of 2018, but the decline – at 1.6 percent – was not particularly dramatic.
A sovereign debt scare in May, when spreads on credit default swaps ballooned due to fears over the scale of the country’s debt, before receding after neighbouring countries, including Saudi Arabia, the United Arab Emirates and Kuwait all pledged financial support to the kingdom, if required, impacted on the performance of many of Bahrain’s financial firms.
Unsurprisingly, given concerns over the government’s ability to repay its debt, a number of the country’s banks found that their shares came under pressure, with Ithmaar Bank and Khaleeji Bank both witnessing a 31 percent decline in their share price.
The Bahrain All-Share Index declined in value during the first six months of 2018, but the decline – at 1.6 percent – was not particularly dramatic.
A sovereign debt scare in May, when spreads on credit default swaps ballooned due to fears over the scale of the country’s debt, before receding after neighbouring countries, including Saudi Arabia, the United Arab Emirates and Kuwait all pledged financial support to the kingdom, if required, impacted on the performance of many of Bahrain’s financial firms.
Unsurprisingly, given concerns over the government’s ability to repay its debt, a number of the country’s banks found that their shares came under pressure, with Ithmaar Bank and Khaleeji Bank both witnessing a 31 percent decline in their share price.
Bankers weigh giant Saudi Aramco-Sabic debt financing | ZAWYA MENA Edition
Bankers weigh giant Saudi Aramco-Sabic debt financing | ZAWYA MENA Edition:
Bankers are discussing a potential jumbo financing of up to US$70bn to back oil giant Saudi Aramco’s acquisition of a majority stake in Saudi Arabia Basic Industries Corp (Sabic).
Aramco is aiming to buy a controlling stake in petrochemical outfit Sabic, and could buy all of the 70% stake owned by the Public Investment Fund, Saudi Arabia's top sovereign wealth fund.
Riyadh-listed Sabic, the world's fourth-biggest petrochemicals company, has a market capitalisation of SR385.2bn (US$103bn) and a 70% stake would cost roughly US$70bn.
Bankers are discussing a potential jumbo financing of up to US$70bn to back oil giant Saudi Aramco’s acquisition of a majority stake in Saudi Arabia Basic Industries Corp (Sabic).
Aramco is aiming to buy a controlling stake in petrochemical outfit Sabic, and could buy all of the 70% stake owned by the Public Investment Fund, Saudi Arabia's top sovereign wealth fund.
Riyadh-listed Sabic, the world's fourth-biggest petrochemicals company, has a market capitalisation of SR385.2bn (US$103bn) and a 70% stake would cost roughly US$70bn.
Saudi Aramco bond makes sense in Kingdom’s changing circumstances
Saudi Aramco bond makes sense in Kingdom’s changing circumstances:
Reports that Saudi Aramco is to tap the international bond markets for the first time were met with the customary official tight lips from the company and its spokespeople, but from the reaction of “people familiar with the situation” it is at least an option being considered by the world’s biggest oil company in a fast-changing global environment for energy and finance.
If the detail of the reports is true, Aramco will this week ask the Saudi Capital Markets Authority for approval for a $2 billion tranche of Islamic debt in the form of sukuk, to be followed soon after by an international bond issue of maybe four times that size.
Aramco has raised debt on local markets before, as have various joint ventures in which it is a partmer, but this would be the first time this debt is traded, showing the increasingly sophistication of the Kingdom’s capital markets.
Reports that Saudi Aramco is to tap the international bond markets for the first time were met with the customary official tight lips from the company and its spokespeople, but from the reaction of “people familiar with the situation” it is at least an option being considered by the world’s biggest oil company in a fast-changing global environment for energy and finance.
If the detail of the reports is true, Aramco will this week ask the Saudi Capital Markets Authority for approval for a $2 billion tranche of Islamic debt in the form of sukuk, to be followed soon after by an international bond issue of maybe four times that size.
Aramco has raised debt on local markets before, as have various joint ventures in which it is a partmer, but this would be the first time this debt is traded, showing the increasingly sophistication of the Kingdom’s capital markets.
U.S. not pursuing regime change, collapse in Iran: Mattis | Reuters
U.S. not pursuing regime change, collapse in Iran: Mattis | Reuters:
The United States has not instituted a policy of regime change or collapse in Iran, U.S. Defense Secretary Jim Mattis said on Friday, saying the goal was still to curb what Washington sees as Iran’s threatening behavior in the Middle East.
Mattis made his comments after days of back-and-forth bellicose rhetoric between Iranian and U.S. officials, with President Donald Trump promising dire consequences for Iran if it continues to make threats toward the United States.
Asked at the Pentagon whether the Trump administration had instituted a policy of regime change or collapse toward Iran, Mattis said, “There’s none that’s been instituted.”
The United States has not instituted a policy of regime change or collapse in Iran, U.S. Defense Secretary Jim Mattis said on Friday, saying the goal was still to curb what Washington sees as Iran’s threatening behavior in the Middle East.
Mattis made his comments after days of back-and-forth bellicose rhetoric between Iranian and U.S. officials, with President Donald Trump promising dire consequences for Iran if it continues to make threats toward the United States.
Asked at the Pentagon whether the Trump administration had instituted a policy of regime change or collapse toward Iran, Mattis said, “There’s none that’s been instituted.”
Exxon Mobil, Chevron earnings miss Wall Street expectations | Reuters
Exxon Mobil, Chevron earnings miss Wall Street expectations | Reuters:
Exxon Mobil Corp and Chevron Corp, two of the world’s largest oil producers, reported quarterly profit on Friday that fell far short of Wall Street’s expectations.
The disappointing results come as much of the U.S. oil industry has been recovering from a three-year downturn in the energy sector, bolstered by higher production and crude prices.
Exxon’s troubles highlight ongoing issues the company has been having to boost operations, whereas Chevron’s miss was fueled by a slight rise in expenses that likely will not be repeated, analysts said.
Exxon Mobil Corp and Chevron Corp, two of the world’s largest oil producers, reported quarterly profit on Friday that fell far short of Wall Street’s expectations.
The disappointing results come as much of the U.S. oil industry has been recovering from a three-year downturn in the energy sector, bolstered by higher production and crude prices.
Exxon’s troubles highlight ongoing issues the company has been having to boost operations, whereas Chevron’s miss was fueled by a slight rise in expenses that likely will not be repeated, analysts said.
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