Oil Slides on Prospect of Easing Geopolitical Risk, More Supply - Bloomberg:
Oil slid for a second day as the U.S. raised hopes of easing tensions with OPEC member Iran, while President Donald Trump’s threat of new tariffs on China rekindled fears about demand.
Futures declined 3.3% in New York on Tuesday, adding to Monday’s 1.1% drop. U.S. Secretary of State Mike Pompeo said Iran, which has been hit by American sanctions over its weapons program, had signaled an openness to talks. The Islamic Republic’s foreign minister made similar comments, offering the first hint of a diplomatic solution since the Trump announced plans in May 2019 to squeeze Iranian oil exports.
Meanwhile, in the U.S., the industry-funded American Petroleum Institute reported U.S. distillate stockpiles rose by 6.23 million barrels last week. That would be the largest build since January if Energy Information Administration data confirms it on Wednesday.
August West Texas Intermediate oil traded at $57.63 a barrel at 4:43 p.m. in New York after settling at $57.62 a barrel on the New York Mercantile Exchange, its steepest decline since July 2. Brent futures for September settlement declined $2.13 to $64.35 on the ICE Futures Europe Exchange in London. The global benchmark crude was at a premium of $6.61 to WTI for the same month.
Tuesday 16 July 2019
Oil Extends Loss as U.S. and Iran Signal Return to Negotiations - Bloomberg
Oil Extends Loss as U.S. and Iran Signal Return to Negotiations - Bloomberg:
Oil extended losses below $60 a barrel on the prospect of easing tensions between the U.S. and OPEC member Iran, and as Gulf of Mexico producers began resuming operations after a storm.
Futures fell as much as 3.2% in New York on Tuesday, after Secretary of State Mike Pompeo said Iran, which has been hit by American sanctions over its weapons program, had signaled an openness to talks. That followed similar comments from the Islamic Republic’s foreign minister, Mohammad Javad Zarif, the first signs of a possible diplomatic solution since the U.S. sought to curb the Middle East producer’s revenues by squeezing its oil exports.
Oil explorers and refiners along the Gulf coast, meanwhile, are returning employees after the former Hurricane Barry shuttered almost three-quarters of output over the weekend. That’s expected to be a factor in the latest tally of American stockpiles, which probably declined by 3 million barrels last week, according to a Bloomberg survey.
August West Texas Intermediate oil was down $1.91 at $57.67 a barrel on the New York Mercantile Exchange as of 1:25 p.m., after losing 1.1% on Monday. Brent futures for September settlement slipped $1.69 to $64.79 on the ICE Futures Europe Exchange in London. The global benchmark crude was at a premium of $6.80 to WTI for the same month.
Oil extended losses below $60 a barrel on the prospect of easing tensions between the U.S. and OPEC member Iran, and as Gulf of Mexico producers began resuming operations after a storm.
Futures fell as much as 3.2% in New York on Tuesday, after Secretary of State Mike Pompeo said Iran, which has been hit by American sanctions over its weapons program, had signaled an openness to talks. That followed similar comments from the Islamic Republic’s foreign minister, Mohammad Javad Zarif, the first signs of a possible diplomatic solution since the U.S. sought to curb the Middle East producer’s revenues by squeezing its oil exports.
Oil explorers and refiners along the Gulf coast, meanwhile, are returning employees after the former Hurricane Barry shuttered almost three-quarters of output over the weekend. That’s expected to be a factor in the latest tally of American stockpiles, which probably declined by 3 million barrels last week, according to a Bloomberg survey.
August West Texas Intermediate oil was down $1.91 at $57.67 a barrel on the New York Mercantile Exchange as of 1:25 p.m., after losing 1.1% on Monday. Brent futures for September settlement slipped $1.69 to $64.79 on the ICE Futures Europe Exchange in London. The global benchmark crude was at a premium of $6.80 to WTI for the same month.
PERMIAN WATCH: America’s Hottest Shale Play Is Slowing Down - Bloomberg
PERMIAN WATCH: America’s Hottest Shale Play Is Slowing Down - Bloomberg:
The engine of America’s shale boom is beginning to sputter.
Slowing Growth
The almost relentless thrust that has doubled crude output from the Permian Basin in three years is showing some signs of waning. Oil flows from the formation spanning West Texas and New Mexico are set to increase by less than 1% in August from July, data from the Energy Information Administration show. So far this year, the monthly rate has only exceeded 2% once, compared with six times in 2018.
Producers are dialing back growth plans due to a manifold of problems, including pipeline jams, slower flows from wells drilled too close together and higher costs for acreage. The dilemmas are killing returns and keeping investors at bay.
The engine of America’s shale boom is beginning to sputter.
Slowing Growth
The almost relentless thrust that has doubled crude output from the Permian Basin in three years is showing some signs of waning. Oil flows from the formation spanning West Texas and New Mexico are set to increase by less than 1% in August from July, data from the Energy Information Administration show. So far this year, the monthly rate has only exceeded 2% once, compared with six times in 2018.
Producers are dialing back growth plans due to a manifold of problems, including pipeline jams, slower flows from wells drilled too close together and higher costs for acreage. The dilemmas are killing returns and keeping investors at bay.
Mideast Stocks: Gulf markets up as risk sentiment improves, #Saudi hits 2-mth high | ZAWYA MENA Edition
Mideast Stocks: Gulf markets up as risk sentiment improves, Saudi hits 2-mth high | ZAWYA MENA Edition:
Most major Gulf stock markets posted broad gains on Tuesday, taking their cue from global markets that have been buoyed by expectations of an interest rate cut by the U.S. central bank, while the Saudi index hit a more than two-month high.
Saudi Arabia's main bourse added 0.4%, its seventh straight day of gains. The index has been rising since EFG Hermes forecast profit for the kingdom's financial sector to grow 7.6% in the second quarter.
Telecom giant Saudi Telecom jumped 2.6%, while National Commercial Bank was up 0.7%.
Most major Gulf stock markets posted broad gains on Tuesday, taking their cue from global markets that have been buoyed by expectations of an interest rate cut by the U.S. central bank, while the Saudi index hit a more than two-month high.
Saudi Arabia's main bourse added 0.4%, its seventh straight day of gains. The index has been rising since EFG Hermes forecast profit for the kingdom's financial sector to grow 7.6% in the second quarter.
Telecom giant Saudi Telecom jumped 2.6%, while National Commercial Bank was up 0.7%.
Jordan appoints new ambassador to #Qatar, two years after downgrading ties - Reuters
Jordan appoints new ambassador to Qatar, two years after downgrading ties - Reuters:
Jordan appointed a new ambassador to Qatar on Tuesday, a step toward restoring normal relations two years after it withdrew its ambassador in solidarity with Gulf Arab allies who severed ties with Doha.
Amman downgraded its diplomatic representation in June 2017, days after Saudi Arabia, the United Arab Emirates, Egypt and Bahrain severed all ties with Qatar, accusing it of supporting terrorism, which Doha denies.
Zeid al-Lawzi, a senior career diplomat and secretary general of the foreign ministry, was named as the new envoy, a royal decree said.
Jordan appointed a new ambassador to Qatar on Tuesday, a step toward restoring normal relations two years after it withdrew its ambassador in solidarity with Gulf Arab allies who severed ties with Doha.
Amman downgraded its diplomatic representation in June 2017, days after Saudi Arabia, the United Arab Emirates, Egypt and Bahrain severed all ties with Qatar, accusing it of supporting terrorism, which Doha denies.
Zeid al-Lawzi, a senior career diplomat and secretary general of the foreign ministry, was named as the new envoy, a royal decree said.
Exclusive: #UAE plans oil trade overhaul to boost Middle Eastern clout - Reuters
Exclusive: UAE plans oil trade overhaul to boost Middle Eastern clout - Reuters:
The United Arab Emirates’ state-run ADNOC, long seen as one of the most conservative oil firms in the Middle East, plans an overhaul for its trading operations as it seeks to emulate the success of rival oil majors and bolster its regional influence.
The company has splurged on hiring former employees of private-sector peers and wants to launch a regional oil benchmark, possibly this year, similar to international markers Brent and WTI, four sources familiar with the plans said.
The plan is not yet finalised and still has to be approved by UAE authorities, such as the Abu Dhabi Supreme Petroleum Council, the sources said.
The United Arab Emirates’ state-run ADNOC, long seen as one of the most conservative oil firms in the Middle East, plans an overhaul for its trading operations as it seeks to emulate the success of rival oil majors and bolster its regional influence.
The company has splurged on hiring former employees of private-sector peers and wants to launch a regional oil benchmark, possibly this year, similar to international markers Brent and WTI, four sources familiar with the plans said.
The plan is not yet finalised and still has to be approved by UAE authorities, such as the Abu Dhabi Supreme Petroleum Council, the sources said.
Oil Steady on Lower U.S. Stockpile Forecast While Storm Eases - Bloomberg
Oil Steady on Lower U.S. Stockpile Forecast While Storm Eases - Bloomberg:
Oil traded near $60 a barrel amid forecast U.S. crude inventories fell for a fifth week, while some production in the Gulf of Mexico is returning as a tropical storm eased.
Futures were up 0.2% in New York after sliding 1.1% on Monday. Oil producers and refiners along the coast are restoring operations after storm Barry was downgraded, with about 69% of crude output in the Gulf still shuttered, down from a peak of 73% on Sunday. American crude inventories probably declined by 2.75 million barrels, according to a Bloomberg survey.
August West Texas Intermediate rose by 13 cents to $59.71 on the New York Mercantile Exchange as of 10:46 a.m. in London. Brent for September settlement rose 13 cents to $66.61 a barrel on the ICE Futures Europe Exchange and traded at a premium of $6.80 to WTI for the same month.
Oil traded near $60 a barrel amid forecast U.S. crude inventories fell for a fifth week, while some production in the Gulf of Mexico is returning as a tropical storm eased.
Futures were up 0.2% in New York after sliding 1.1% on Monday. Oil producers and refiners along the coast are restoring operations after storm Barry was downgraded, with about 69% of crude output in the Gulf still shuttered, down from a peak of 73% on Sunday. American crude inventories probably declined by 2.75 million barrels, according to a Bloomberg survey.
August West Texas Intermediate rose by 13 cents to $59.71 on the New York Mercantile Exchange as of 10:46 a.m. in London. Brent for September settlement rose 13 cents to $66.61 a barrel on the ICE Futures Europe Exchange and traded at a premium of $6.80 to WTI for the same month.
FFA Private Bank’s Salem on #Saudi Market, #UAE Property, Shuaa-ADFG Merger – Bloomberg
FFA Private Bank’s Salem on Saudi Market, U.A.E. Property, Shuaa-ADFG Merger – Bloomberg:
Marie Salem, director of capital markets at FFA Private Bank, discusses her outlook for the Saudi market in the second half of the year, the U.A.E. property market, the Shuaa & ADFG merger, and Dana Gas share buybacks. She speaks on “Bloomberg Daybreak: Middle East.” (Source: Bloomberg)
Marie Salem, director of capital markets at FFA Private Bank, discusses her outlook for the Saudi market in the second half of the year, the U.A.E. property market, the Shuaa & ADFG merger, and Dana Gas share buybacks. She speaks on “Bloomberg Daybreak: Middle East.” (Source: Bloomberg)
#Saudi Wealth Fund Buys Stake in JV From Aramco and Jacobs - Bloomberg
Saudi Wealth Fund Buys Stake in JV From Aramco and Jacobs - Bloomberg:
Saudi Arabia’s sovereign wealth fund has acquired a 40% stake in a joint venture between state energy producer Aramco and Jacobs Engineering Group Inc., according to three people familiar with the matter.
The Public Investment Fund acquired 30% of Jasara Program Management Co. from Saudi Arabian Oil Co. and 10% of the joint venture from Jacobs, one of the people said, leaving Aramco with 20% and Jacobs with 40%. The venture was created in 2017 to provide management services for social infrastructure projects in the kingdom and across the Middle East and North Africa, according to a Jacobs statement from that year.
Jasara declined to comment, while Saudi Aramco and Dallas-based Jacobs didn’t immediately respond to requests for comment. None of the people disclosed the value of the deal.
Saudi Arabia’s sovereign wealth fund has acquired a 40% stake in a joint venture between state energy producer Aramco and Jacobs Engineering Group Inc., according to three people familiar with the matter.
The Public Investment Fund acquired 30% of Jasara Program Management Co. from Saudi Arabian Oil Co. and 10% of the joint venture from Jacobs, one of the people said, leaving Aramco with 20% and Jacobs with 40%. The venture was created in 2017 to provide management services for social infrastructure projects in the kingdom and across the Middle East and North Africa, according to a Jacobs statement from that year.
Jasara declined to comment, while Saudi Aramco and Dallas-based Jacobs didn’t immediately respond to requests for comment. None of the people disclosed the value of the deal.
#Oman's OCTAL secures $625 million in banking facilities - Reuters
Oman's OCTAL secures $625 million in banking facilities - Reuters:
Oman’s OCTAL, a supplier of rigid packaging materials, said on Tuesday it has secured $625 million in banking facilities.
The loans include a $225 million syndicated term loan and $400 million in working capital.
Bank Muscat, Bank Dhofar, National Bank of Oman, Standard Chartered, HSBC Bank Oman , National Bank of Bahrain and Bank ABC have provided the term loan, with Bank Muscat working as financial adviser, the company said in a statement.
Oman’s OCTAL, a supplier of rigid packaging materials, said on Tuesday it has secured $625 million in banking facilities.
The loans include a $225 million syndicated term loan and $400 million in working capital.
Bank Muscat, Bank Dhofar, National Bank of Oman, Standard Chartered, HSBC Bank Oman , National Bank of Bahrain and Bank ABC have provided the term loan, with Bank Muscat working as financial adviser, the company said in a statement.
Gulf conflict would see oil prices spike, ease, jump again: research - Reuters
Gulf conflict would see oil prices spike, ease, jump again: research - Reuters:
Oil would initially jump by $15-20 a barrel if Iran blocked the Strait of Hormuz, but prices would ease immediately once U.S. forces engaged, said U.S. consultancy Rapidan, which analyzed scenarios entailing oil flow disruption after a conflict.
Rapidan Energy Group said the oil price reaction would be “M” shaped – suggesting an initial and possibly premature relief sell-off would precede a second spike to higher levels.
Disruption in the strait would likely last longer than the market expected, Rapidan said, as Iran had the means to conduct intermittent but continuing attacks on shipping in the Gulf that could interrupt oil transit “for many weeks, if not longer”.
Oil would initially jump by $15-20 a barrel if Iran blocked the Strait of Hormuz, but prices would ease immediately once U.S. forces engaged, said U.S. consultancy Rapidan, which analyzed scenarios entailing oil flow disruption after a conflict.
Rapidan Energy Group said the oil price reaction would be “M” shaped – suggesting an initial and possibly premature relief sell-off would precede a second spike to higher levels.
Disruption in the strait would likely last longer than the market expected, Rapidan said, as Iran had the means to conduct intermittent but continuing attacks on shipping in the Gulf that could interrupt oil transit “for many weeks, if not longer”.
UPDATE 1-Actis takes on management of two #Abraaj funds - Reuters
UPDATE 1-Actis takes on management of two Abraaj funds - Reuters:
Private equity firm Actis said on Monday it had acquired the rights to manage two private equity funds previously managed by collapsed buyout firm Abraaj, in a deal aimed at strengthening its position in the Middle East and Africa.
Actis will take over the management rights to Abraaj Private Equity Fund IV and Abraaj Africa fund III, it said in a statement.
Abraaj, which filed for provisional liquidation in June 2018, was the largest buyout fund in the Middle East and North Africa until it collapsed last year in the aftermath of a row with investors over the use of money in a $1 billion healthcare fund.
Private equity firm Actis said on Monday it had acquired the rights to manage two private equity funds previously managed by collapsed buyout firm Abraaj, in a deal aimed at strengthening its position in the Middle East and Africa.
Actis will take over the management rights to Abraaj Private Equity Fund IV and Abraaj Africa fund III, it said in a statement.
Abraaj, which filed for provisional liquidation in June 2018, was the largest buyout fund in the Middle East and North Africa until it collapsed last year in the aftermath of a row with investors over the use of money in a $1 billion healthcare fund.
Oil falls as U.S. resumes Gulf of Mexico output, boosts shale supplies - Reuters
Oil falls as U.S. resumes Gulf of Mexico output, boosts shale supplies - Reuters:
Oil prices dipped on Tuesday, extending losses from the previous session, as output in the U.S. Gulf of Mexico resumed after Hurricane Barry and as U.S. shale production is set to rise to a record.
Brent crude futures LCOc1 were down 4 cents at $66.44 a barrel by 00642 GMT. They fell 0.4% overnight.
U.S. West Texas Intermediate crude futures CLc1 dropped by 13 cents, or 0.2%, to $59.45 a barrel. The U.S. benchmark fell about 1% in the previous session.
Oil prices dipped on Tuesday, extending losses from the previous session, as output in the U.S. Gulf of Mexico resumed after Hurricane Barry and as U.S. shale production is set to rise to a record.
Brent crude futures LCOc1 were down 4 cents at $66.44 a barrel by 00642 GMT. They fell 0.4% overnight.
U.S. West Texas Intermediate crude futures CLc1 dropped by 13 cents, or 0.2%, to $59.45 a barrel. The U.S. benchmark fell about 1% in the previous session.
MIDEAST STOCKS- #UAE, #Saudi rise on banks; Industries #Qatar weighs - Reuters
MIDEAST STOCKS-UAE, Saudi rise on banks; Industries Qatar weighs - Reuters:
Most major Gulf stock markets rose on Tuesday led by financial stocks, though Qatar was marginally lower, weighed down by heavyweight Industries Qatar.
Saudi Arabia’s main index lifted 0.4%, its seventh straight rise on the back of banks. The index has been up since EFG Hermes forecast the kingdom’s financial sector would see 7.6% growth in second-quarter profit, year-on-year .
Al Rajhi Bank gained 0.4%, while National Commercial Bank was up 0.7%.
Most major Gulf stock markets rose on Tuesday led by financial stocks, though Qatar was marginally lower, weighed down by heavyweight Industries Qatar.
Saudi Arabia’s main index lifted 0.4%, its seventh straight rise on the back of banks. The index has been up since EFG Hermes forecast the kingdom’s financial sector would see 7.6% growth in second-quarter profit, year-on-year .
Al Rajhi Bank gained 0.4%, while National Commercial Bank was up 0.7%.
Does investing in emerging markets still make sense? | Financial Times
Does investing in emerging markets still make sense? | Financial Times:
Two controversial departures of high-ranking technocrats in the space of three days, one in Ankara, the other in Mexico City, have served as reminders of the high-risk nature of investing in emerging markets.
The dead-of-night sacking last week by legally-dubious presidential decree of Murat Cetinkaya, governor of Turkey’s central bank, was followed by the shock resignation of Carlos Urzúa, Mexico’s finance minister, who slammed the door on his way out with complaints of cack-handed meddling by unqualified apparatchiks.
Markets were immediately roiled. The Turkish lira and Mexican peso fell more than 2 per cent against the US dollar and analysts warned of disarray ahead, jeopardising economic growth and the ability of borrowers in both countries to repay their debts.
Two controversial departures of high-ranking technocrats in the space of three days, one in Ankara, the other in Mexico City, have served as reminders of the high-risk nature of investing in emerging markets.
The dead-of-night sacking last week by legally-dubious presidential decree of Murat Cetinkaya, governor of Turkey’s central bank, was followed by the shock resignation of Carlos Urzúa, Mexico’s finance minister, who slammed the door on his way out with complaints of cack-handed meddling by unqualified apparatchiks.
Markets were immediately roiled. The Turkish lira and Mexican peso fell more than 2 per cent against the US dollar and analysts warned of disarray ahead, jeopardising economic growth and the ability of borrowers in both countries to repay their debts.
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