Oil Giants Pledge Even Deeper Spending Cuts Amid Prolonged Slump - Bloomberg Business:
"Some of the biggest oil explorers in the Western Hemisphere are cutting budgets yet again to conserve cash as a plunge in energy markets shows no signs of abating.
ConocoPhillips will reduce capital spending by 25 percent next year to $7.7 billion to protect the highest dividend yield among major U.S. oil producers, the Houston-based company said Thursday. That came a day after Chevron Corp. disclosed a 2016 budget 24 percent smaller than this year’s plan. Together, the cuts by both companies totaled $10.9 billion, enough to rent 10 deepwater drilling rigs every day for more than half a decade.
Petroleo Brasileiro SA, battered by a corruption probe and the market collapse that have led the oil industry’s most ambitious investment plan to unravel, probably will scale back its $119 billion, five-year capital budget as soon as next month, Chief Executive Officer Aldemir Bendine said in an interview. Petrobras, as the Brazilian state-controlled company is known, will start 2016 with $20 billion in cash, he said. The company currently has a $128 billion debt load."
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Thursday, 10 December 2015
MIDEAST STOCKS-Risk-averse traders push Gulf mkts lower; Egypt stabilises | Reuters
MIDEAST STOCKS-Risk-averse traders push Gulf mkts lower; Egypt stabilises | Reuters:
"Gulf markets stumbled on Thursday as investors cut their exposure while they await signs that oil prices have found a floor and for state budget announcements.
Crude prices fell below $40 at 1325 GMT. Global oversupply has gripped oil markets despite lower U.S. crude inventories this week.
The sustained slump in oil prices has hurt state finances in the Gulf and soured sentiment among both regional and foreign traders, with government spending a major factor in determining private sector profitability."
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"Gulf markets stumbled on Thursday as investors cut their exposure while they await signs that oil prices have found a floor and for state budget announcements.
Crude prices fell below $40 at 1325 GMT. Global oversupply has gripped oil markets despite lower U.S. crude inventories this week.
The sustained slump in oil prices has hurt state finances in the Gulf and soured sentiment among both regional and foreign traders, with government spending a major factor in determining private sector profitability."
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MIDEAST STOCKS-Saudi remains weak; Egypt up for second day | Reuters
MIDEAST STOCKS-Saudi remains weak; Egypt up for second day | Reuters:
"Egypt's market rose slightly on Thursday, while Saudi Arabia's index again slipped back below a psychological support level, with investors wary ahead of the release of the kingdom's 2016 annual budget later this month.
Riyadh's bourse dipped 0.3 percent to just below 7,000 points and within 120 points of November's 35-month low.
"Investors are holding off on entering the markets," said a Riyadh-based portfolio manager. "The budget announcement will be the decisive factor (for deciding) trade positions.""
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"Egypt's market rose slightly on Thursday, while Saudi Arabia's index again slipped back below a psychological support level, with investors wary ahead of the release of the kingdom's 2016 annual budget later this month.
Riyadh's bourse dipped 0.3 percent to just below 7,000 points and within 120 points of November's 35-month low.
"Investors are holding off on entering the markets," said a Riyadh-based portfolio manager. "The budget announcement will be the decisive factor (for deciding) trade positions.""
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Accor buys Raffles owner for $2.9bn - FT.com
Accor buys Raffles owner for $2.9bn - FT.com:
"Accor, Europe’s largest hotel group, has bought the owner of the Fairmont, Raffles and Swissotel hotel chains for $2.9bn in cash and shares, in the second major hotel takeover in a month.
Accor, which announced the deal for FRHI Hotels & Resorts on Wednesday, said that the purchase of 115 luxury hotels and resorts and a further 40 under development would create a “worldwide leader in the luxury segment”."
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"Accor, Europe’s largest hotel group, has bought the owner of the Fairmont, Raffles and Swissotel hotel chains for $2.9bn in cash and shares, in the second major hotel takeover in a month.
Accor, which announced the deal for FRHI Hotels & Resorts on Wednesday, said that the purchase of 115 luxury hotels and resorts and a further 40 under development would create a “worldwide leader in the luxury segment”."
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Trump’s anti-Muslim remarks spark outrage in the Gulf - FT.com
Trump’s anti-Muslim remarks spark outrage in the Gulf - FT.com:
"A string of hostile comments towards Muslims by US Republican hopeful Donald Trump have done little to dent his runaway popularity among his American supporters — but they may yet damage the billionaire’s business interests around the world, particularly in Muslim countries.
“It is unacceptable in my country, the UAE. Our system cannot accept an insult to our religion like this,” said Dubai businessman and columnist Khalaf al-Habtoor, who heads a conglomerate in the emirate."
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"A string of hostile comments towards Muslims by US Republican hopeful Donald Trump have done little to dent his runaway popularity among his American supporters — but they may yet damage the billionaire’s business interests around the world, particularly in Muslim countries.
“It is unacceptable in my country, the UAE. Our system cannot accept an insult to our religion like this,” said Dubai businessman and columnist Khalaf al-Habtoor, who heads a conglomerate in the emirate."
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Saudi Mall Builders Ignore Oil Rout as Young Shoppers Want More - Bloomberg Business
Saudi Mall Builders Ignore Oil Rout as Young Shoppers Want More - Bloomberg Business:
"The highway that cuts through the middle of Riyadh, the Saudi Arabian capital, takes drivers past two shopping malls and another one under construction, each rising up soon after the last fades in the rear view mirror.
The outlets are emblematic of a retail building boom in Saudi Arabia that continues apace even as oil, the kingdom’s dominant source of revenue, slumps. Foreign and domestic companies are betting shopping demand will rise for years, bolstered by one of the world’s youngest populations and modern retail space that’s only a fraction of that in the U.S. on a per capita basis.
Riyadh is expected to add 565,000 square meters (6.1 million square feet) of gross leasable area through 2017, while the coastal city of Jeddah is set to complete 383,000 square meters, according to broker Jones Lang LaSalle Inc. Arabian Centres Co. Ltd., the kingdom’s largest mall owner, plans 19 new shopping centers in the next five years to add to the 17 it already has, according to chief executive officer Simon Wilcock."
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"The highway that cuts through the middle of Riyadh, the Saudi Arabian capital, takes drivers past two shopping malls and another one under construction, each rising up soon after the last fades in the rear view mirror.
The outlets are emblematic of a retail building boom in Saudi Arabia that continues apace even as oil, the kingdom’s dominant source of revenue, slumps. Foreign and domestic companies are betting shopping demand will rise for years, bolstered by one of the world’s youngest populations and modern retail space that’s only a fraction of that in the U.S. on a per capita basis.
Riyadh is expected to add 565,000 square meters (6.1 million square feet) of gross leasable area through 2017, while the coastal city of Jeddah is set to complete 383,000 square meters, according to broker Jones Lang LaSalle Inc. Arabian Centres Co. Ltd., the kingdom’s largest mall owner, plans 19 new shopping centers in the next five years to add to the 17 it already has, according to chief executive officer Simon Wilcock."
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Gulf Bonds Under Stress as Lower-for-Longer Oil Outlook Sets In - Bloomberg Business
Gulf Bonds Under Stress as Lower-for-Longer Oil Outlook Sets In - Bloomberg Business:
"The prospects of an extended decline in oil prices and higher U.S. interest rates are putting fresh strain on debt markets in the energy-rich Persian Gulf.
Bond losses in the Middle East accelerated in November, with prices dropping the most in two years, according to JPMorgan Chase indexes. The decrease came more than 16 months after crude began sliding from $115 a barrel to about $40 on Thursday. The yield on Qatar’s 2017 bond is up 41 basis points over the past month, while Bahrain’s 2023 paper rose 53 points. Fitch Ratings Ltd. downgraded Bahrain’s outlook to negative on Dec. 4, affirming the island kingdom’s BBB- credit rating at one level above junk. "
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"The prospects of an extended decline in oil prices and higher U.S. interest rates are putting fresh strain on debt markets in the energy-rich Persian Gulf.
Bond losses in the Middle East accelerated in November, with prices dropping the most in two years, according to JPMorgan Chase indexes. The decrease came more than 16 months after crude began sliding from $115 a barrel to about $40 on Thursday. The yield on Qatar’s 2017 bond is up 41 basis points over the past month, while Bahrain’s 2023 paper rose 53 points. Fitch Ratings Ltd. downgraded Bahrain’s outlook to negative on Dec. 4, affirming the island kingdom’s BBB- credit rating at one level above junk. "
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MIDEAST STOCKS-Dubai, Qatar slip; Abu Dhabi more resilient | Reuters
MIDEAST STOCKS-Dubai, Qatar slip; Abu Dhabi more resilient | Reuters:
"Abu Dhabi's index rose slightly while Qatar and Dubai again fell in thin trade on Thursday as foreign investors reduced their exposure to Gulf markets.
The sustained slump in oil prices has hurt state finances in the Gulf and soured sentiment among both regional and foreign traders, with government spending a major factor in determining private sector profitability.
Qatar's bourse slid 0.2 percent to 10,003 points, extending losses after slumping to its lowest close in 25 months on Wednesday."
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"Abu Dhabi's index rose slightly while Qatar and Dubai again fell in thin trade on Thursday as foreign investors reduced their exposure to Gulf markets.
The sustained slump in oil prices has hurt state finances in the Gulf and soured sentiment among both regional and foreign traders, with government spending a major factor in determining private sector profitability.
Qatar's bourse slid 0.2 percent to 10,003 points, extending losses after slumping to its lowest close in 25 months on Wednesday."
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Dubai Financial Market falls under 3,000 for first time in two years | The National
Dubai Financial Market falls under 3,000 for first time in two years | The National:
"Dubai’s headline share index fell below the 3,000 mark for the first time in two years, while Abu Dhabi hit a new low for the year, as investors continued to trim their positions amid weakening global equities.
The Dubai Financial Market General Index fell to a low of 2,967.59 at about lunchtime before recovering to finish 0.3 per cent lower at 3,000.95.
The index has ended lower eight out of the past 10 trading days, shedding 6.3 per cent of its value since the start of the month."
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"Dubai’s headline share index fell below the 3,000 mark for the first time in two years, while Abu Dhabi hit a new low for the year, as investors continued to trim their positions amid weakening global equities.
The Dubai Financial Market General Index fell to a low of 2,967.59 at about lunchtime before recovering to finish 0.3 per cent lower at 3,000.95.
The index has ended lower eight out of the past 10 trading days, shedding 6.3 per cent of its value since the start of the month."
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