UAE may create body to monitor FX peg, no policy change likely | Reuters:
"An advisory body to the United Arab Emirates government has suggested that the central bank review the country's currency peg to the U.S. dollar, but local bankers said any change to the peg remained very unlikely for the foreseeable future.
An economic committee of the Federal National Council recommended that the central bank establish a department to oversee the peg, Ali Eissa al-Nuaimi, the committee's rapporteur, told Reuters on Thursday.
The department would review the peg periodically and provide information to the central bank's board to help it make decisions, he added. Since 1997, the UAE dirham has been fixed at a rate of 3.6725 to $1."
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Friday, 28 November 2014
Dubai World moves to restructure debt mountain - FT.com
Dubai World moves to restructure debt mountain - FT.com:
"Dubai will next week present proposals to extend restructured loans at one of its largest conglomerates, taking advantage of the revived economy to manage its debt mountain, people aware of the matter say.
Government-owned Dubai World, which signed a $25bn restructuring deal in 2011, hopes to extend a $10.5bn maturity scheduled for 2018 as the emirate considers large-scale infrastructure investment in the aviation sector ahead of its planned hosting of the World Expo in 2020.
The company, which declined to comment, will present this “restructuring of a restructuring” to creditors at meetings in London on December 1 and in Dubai on December 8."
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"Dubai will next week present proposals to extend restructured loans at one of its largest conglomerates, taking advantage of the revived economy to manage its debt mountain, people aware of the matter say.
Government-owned Dubai World, which signed a $25bn restructuring deal in 2011, hopes to extend a $10.5bn maturity scheduled for 2018 as the emirate considers large-scale infrastructure investment in the aviation sector ahead of its planned hosting of the World Expo in 2020.
The company, which declined to comment, will present this “restructuring of a restructuring” to creditors at meetings in London on December 1 and in Dubai on December 8."
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Yatsenyuk Needs Year-End Dash to Secure Cash, Steady Ukraine - Bloomberg
Yatsenyuk Needs Year-End Dash to Secure Cash, Steady Ukraine - Bloomberg:
"Ukrainian Prime Minister Arseniy Yatsenyuk has little time to pass a 2015 budget, secure a new aid tranche and negotiate an expansion of a bailout that’s keeping the country afloat as it fights pro-Russian separatists.
Yatsenyuk won confirmation in parliament yesterday after a month of wrangling over forming a government following Oct. 26 snap elections. His five-party coalition will announce a new cabinet that will face a Dec. 2 vote before embarking on a list of tasks it needs to fulfill to get $2.8 billion from a $17-billion International Monetary Fund program.
Ukraine needs the cash to redeem bonds, pay for heating fuel and bolster Ukraine’s currency. The one-month delay in forming a government has deepened a crisis that includes an economic contraction, a 48 percent dive in the hryvnia against the dollar, plunging foreign-exchange reserves and the need for the central bank to support the financial industry."
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"Ukrainian Prime Minister Arseniy Yatsenyuk has little time to pass a 2015 budget, secure a new aid tranche and negotiate an expansion of a bailout that’s keeping the country afloat as it fights pro-Russian separatists.
Yatsenyuk won confirmation in parliament yesterday after a month of wrangling over forming a government following Oct. 26 snap elections. His five-party coalition will announce a new cabinet that will face a Dec. 2 vote before embarking on a list of tasks it needs to fulfill to get $2.8 billion from a $17-billion International Monetary Fund program.
Ukraine needs the cash to redeem bonds, pay for heating fuel and bolster Ukraine’s currency. The one-month delay in forming a government has deepened a crisis that includes an economic contraction, a 48 percent dive in the hryvnia against the dollar, plunging foreign-exchange reserves and the need for the central bank to support the financial industry."
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Dana Gas aims for higher prices in Egypt | The National
Dana Gas aims for higher prices in Egypt | The National:
"Sharjah-based Dana Gas is negotiating a higher price for natural gas extracts in Egypt ahead of drilling its first offshore well in the country.
“What we do need right now is a clear mechanism for a payment method going forward,” the chief executive Patrick Allman-Ward said yesterday.
Egypt needs to increase its natural gas production, which has remained stagnant since the early 2000s. But the price the government pays producers is fixed at US$2.65 per 1,000 cubic feet. Mr Allman-Ward said that while Dana Gas appreciates the willingness of the government to revise prices, the company would like a market-based gas system in Egypt. “While the increase[d] flexibility is extremely welcome, it’s difficult to do a discounted cash flow on the basis of a promise.”"
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"Sharjah-based Dana Gas is negotiating a higher price for natural gas extracts in Egypt ahead of drilling its first offshore well in the country.
“What we do need right now is a clear mechanism for a payment method going forward,” the chief executive Patrick Allman-Ward said yesterday.
Egypt needs to increase its natural gas production, which has remained stagnant since the early 2000s. But the price the government pays producers is fixed at US$2.65 per 1,000 cubic feet. Mr Allman-Ward said that while Dana Gas appreciates the willingness of the government to revise prices, the company would like a market-based gas system in Egypt. “While the increase[d] flexibility is extremely welcome, it’s difficult to do a discounted cash flow on the basis of a promise.”"
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Dubai Parks IPO already oversubscribed by 60 times | The National
Dubai Parks IPO already oversubscribed by 60 times | The National:
"Investing institutions have shown a big appetite for shares in the Dh2.5 billion initial public offering of Dubai Parks and Resorts, with bankers suggesting it was about 60 times oversubscribed at the close yesterday.
The share sale – which was fully subscribed within hours of opening this month – could generate even more investor demand, with the retail offering open until Sunday. One adviser, who did not want to be identified, said that the total final level of oversubscription could be more than 75 times.
That level of investor appetite would make Dubai Parks, being partially sold by the Dubai government-owned developer Meraas Holding, by far the most in-demand of the current batch of IPOs. Emaar Malls’ offering attracted 30 times oversubscription from institutions, and 20 times from retail."
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"Investing institutions have shown a big appetite for shares in the Dh2.5 billion initial public offering of Dubai Parks and Resorts, with bankers suggesting it was about 60 times oversubscribed at the close yesterday.
The share sale – which was fully subscribed within hours of opening this month – could generate even more investor demand, with the retail offering open until Sunday. One adviser, who did not want to be identified, said that the total final level of oversubscription could be more than 75 times.
That level of investor appetite would make Dubai Parks, being partially sold by the Dubai government-owned developer Meraas Holding, by far the most in-demand of the current batch of IPOs. Emaar Malls’ offering attracted 30 times oversubscription from institutions, and 20 times from retail."
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UAE’s non-oil economic growth resilient to oil slide | GulfNews.com
UAE’s non-oil economic growth resilient to oil slide | GulfNews.com:
"The UAE’s non-oil economic growth remains strong despite the sharp fall in global oil prices from the second half of this year according to economic forecast by two leading banks such as Abu Dhabi Commercial Bank (ADCB) and Emirates NBD.
“The UAE’s economic outlook remains compelling, in both a Middle East and North Africa and emerging market context, despite the sharp fall in the oil price from mid-2014. Our view remains that the non-oil economy is in the process of a cyclical upswing marked by broad-based growth,” said Monica Malik, Chief Economist of Abu Dhabi Commercial Bank.
ADCB has forecast the real non-oil GDP above 5 per cent in 2015 and 2016. The progress of key investment projects will be a particularly important driver of real growth and is expected further spur private consumption and external growth with population growth and the expansion of economic capacity."
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"The UAE’s non-oil economic growth remains strong despite the sharp fall in global oil prices from the second half of this year according to economic forecast by two leading banks such as Abu Dhabi Commercial Bank (ADCB) and Emirates NBD.
“The UAE’s economic outlook remains compelling, in both a Middle East and North Africa and emerging market context, despite the sharp fall in the oil price from mid-2014. Our view remains that the non-oil economy is in the process of a cyclical upswing marked by broad-based growth,” said Monica Malik, Chief Economist of Abu Dhabi Commercial Bank.
ADCB has forecast the real non-oil GDP above 5 per cent in 2015 and 2016. The progress of key investment projects will be a particularly important driver of real growth and is expected further spur private consumption and external growth with population growth and the expansion of economic capacity."
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Russia’s Oil Giant Battles Debt After $55 Billion Deal - Bloomberg
Russia’s Oil Giant Battles Debt After $55 Billion Deal - Bloomberg:
"Igor Sechin spent $55 billion in 2013 to buy competitor TNK-BP and create a Russian oil colossus, pumping about 5 percent of the world’s crude.
Almost two years later and investors have written off the deal. Battered by sanctions and a tumbling oil price, OAO Rosneft (ROSN) has lost 32 percent of its market value this year in dollar terms and today the whole company, TNK-BP and all, is worth $51 billion.
And buying TNK-BP has left Sechin, Rosneft’s chief executive officer and a long-time ally of Russian President Vladimir Putin, with a lot of debt to repay. State-controlled Rosneft owes about $60 billion to banks and bondholders, making it more indebted relative to earnings than any large oil producer apart from Brazil’s Petroleo Brasileiro SA."
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"Igor Sechin spent $55 billion in 2013 to buy competitor TNK-BP and create a Russian oil colossus, pumping about 5 percent of the world’s crude.
Almost two years later and investors have written off the deal. Battered by sanctions and a tumbling oil price, OAO Rosneft (ROSN) has lost 32 percent of its market value this year in dollar terms and today the whole company, TNK-BP and all, is worth $51 billion.
And buying TNK-BP has left Sechin, Rosneft’s chief executive officer and a long-time ally of Russian President Vladimir Putin, with a lot of debt to repay. State-controlled Rosneft owes about $60 billion to banks and bondholders, making it more indebted relative to earnings than any large oil producer apart from Brazil’s Petroleo Brasileiro SA."
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Oil in New Era as OPEC Refuses to Yield to U.S. Shale - Bloomberg
Oil in New Era as OPEC Refuses to Yield to U.S. Shale - Bloomberg:
"OPEC’s decision to cede no ground to rival producers underscored the price war in the crude market and the challenge to U.S. shale drillers.
The 12-nation Organization of Petroleum Exporting Countries kept its output target unchanged even after the steepest slump in oil prices since the global recession, prompting speculation it has abandoned its role as a swing producer. Yesterday’s decision in Vienna propelled futures to the lowest since 2010, a level that means some shale projects may lose money.
“We are entering a new era for oil prices, where the market itself will manage supply, no longer Saudi Arabia and OPEC,” said Mike Wittner, the head of oil research at Societe Generale SA in New York. “It’s huge. This is a signal that they’re throwing in the towel. The markets have changed for many years to come.”"
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"OPEC’s decision to cede no ground to rival producers underscored the price war in the crude market and the challenge to U.S. shale drillers.
The 12-nation Organization of Petroleum Exporting Countries kept its output target unchanged even after the steepest slump in oil prices since the global recession, prompting speculation it has abandoned its role as a swing producer. Yesterday’s decision in Vienna propelled futures to the lowest since 2010, a level that means some shale projects may lose money.
“We are entering a new era for oil prices, where the market itself will manage supply, no longer Saudi Arabia and OPEC,” said Mike Wittner, the head of oil research at Societe Generale SA in New York. “It’s huge. This is a signal that they’re throwing in the towel. The markets have changed for many years to come.”"
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