After Aramco’s Record IPO, Traders Now Ask How to Short Shares - Bloomberg:
Shares of Saudi Aramco have shot up 10% since its record-setting $25.6 billion initial public offering earlier this month. That’s got bearish traders wondering whether they can short shares of the Gulf oil giant.
The answer: Not easily.
Normally, you wouldn’t even need to ask the question. Short sales -- when an investor borrows shares, sells them and then tries to buy them back at a lower price and profit from the difference -- are an established feature of exchanges across the world and practically a requirement for inclusion in MSCI indexes.
But when the company is Saudi Arabia’s crown jewel and when shares are listed on the kingdom’s Tadawul exchange, the answer is anything but obvious.
The Tadawul exchange does, on paper, permit short-selling, introducing it in 2017. But in practice the market for borrowing and lending shares in Saudi Arabia is illiquid, according to Marie Salem, head of institutions at Daman Securities in Dubai.
Friday, 27 December 2019
Hedge Funds Stay Bullish on Oil Amid Trade Truce, OPEC+ Cuts - Bloomberg
Hedge Funds Stay Bullish on Oil Amid Trade Truce, OPEC+ Cuts - Bloomberg:
Hedge funds are approaching the end of the year more optimistic on global oil prices than they’ve been since May.
Their net-bullish wagers on Brent crude climbed for the ninth week in 10, reaching a seven-month high, data released Friday show. The U.S.-China trade truce and OPEC’s commitment to deeper cuts have pushed futures to their highest since an attack on Saudi facilities in September. But skepticism is also creeping in, with short-selling increasing the most since October.
“It’s a disaster waiting to happen,” said Bob Yawger at Mizuho Securities USA. “We’re seeing the largest net-long speculative position” in both West Texas Intermediate and Brent in seven months, he said.
Money managers’ Brent net-long position, or the difference between bullish and bearish bets, climbed 1% to 402,455 futures and options, the highest level since May, according to ICE Futures Europe data for the week ended Dec. 24. Long-only wagers rose 2.4%, while shorts increased 11%.
Hedge funds are approaching the end of the year more optimistic on global oil prices than they’ve been since May.
Their net-bullish wagers on Brent crude climbed for the ninth week in 10, reaching a seven-month high, data released Friday show. The U.S.-China trade truce and OPEC’s commitment to deeper cuts have pushed futures to their highest since an attack on Saudi facilities in September. But skepticism is also creeping in, with short-selling increasing the most since October.
“It’s a disaster waiting to happen,” said Bob Yawger at Mizuho Securities USA. “We’re seeing the largest net-long speculative position” in both West Texas Intermediate and Brent in seven months, he said.
Money managers’ Brent net-long position, or the difference between bullish and bearish bets, climbed 1% to 402,455 futures and options, the highest level since May, according to ICE Futures Europe data for the week ended Dec. 24. Long-only wagers rose 2.4%, while shorts increased 11%.
Oil hits three-month high on falling oil stocks, investor optimism - Reuters
Oil hits three-month high on falling oil stocks, investor optimism - Reuters:
Oil prices rose to the fourth consecutive weekly gain on Friday, steadying at three-month highs after new data showed U.S. crude inventories fell far more than expected, while upbeat economic data and optimism over a U.S.-China trade deal fueled a year-end stock market rally.
Brent crude LCOc1 rose 24 cents to settle at $68.16 a barrel, the highest since mid-September. The international benchmark has climbed nearly 27% since the end of 2018.
West Texas Intermediate CLc1 rose 4 cents to settle at $61.72 a barrel, another three-month high. The U.S. benchmark has risen 36% so far this year.
U.S. crude stocks fell by 5.5 million barrels in the week to Dec. 20 to 441.4 million barrels, according to the Energy Information Administration, far exceeding analysts’ expectations of a 1.7 million-barrel drop.
Oil prices rose to the fourth consecutive weekly gain on Friday, steadying at three-month highs after new data showed U.S. crude inventories fell far more than expected, while upbeat economic data and optimism over a U.S.-China trade deal fueled a year-end stock market rally.
Brent crude LCOc1 rose 24 cents to settle at $68.16 a barrel, the highest since mid-September. The international benchmark has climbed nearly 27% since the end of 2018.
West Texas Intermediate CLc1 rose 4 cents to settle at $61.72 a barrel, another three-month high. The U.S. benchmark has risen 36% so far this year.
U.S. crude stocks fell by 5.5 million barrels in the week to Dec. 20 to 441.4 million barrels, according to the Energy Information Administration, far exceeding analysts’ expectations of a 1.7 million-barrel drop.
US Oil Rig Count Falls In Last Week Of 2019 | OilPrice.com
US Oil Rig Count Falls In Last Week Of 2019 | OilPrice.com:
The final US oil and gas rig count for the year decreased this week, according to Baker Hughes, reaching 805 rigs after decreasing by 8 for the week, according to Baker Hughes. The total oil and gas rig count is now 278 down from this time last year—a nearly 26% drop.
For oil rigs, this week saw an decrease of 8 rigs, according to Baker Hughes data. The total number of active gas rigs in the United States held steady for the week according to the report, at 125 This compares to 198 a year ago.
The number of oil rigs have declined by 207 this year alone, but production has grown from 11.7 million bpd at the beginning of the year to 12.8 million bpd, for week ending Dec 20—just 100,000 bpd off the all-time high from a few weeks ago.
Oil prices were down on Friday ahead of the data on rumors that OPEC and allies may decide to quit its agreement to curb production at some point next year, and may ease the existing cuts as early as March.
The final US oil and gas rig count for the year decreased this week, according to Baker Hughes, reaching 805 rigs after decreasing by 8 for the week, according to Baker Hughes. The total oil and gas rig count is now 278 down from this time last year—a nearly 26% drop.
For oil rigs, this week saw an decrease of 8 rigs, according to Baker Hughes data. The total number of active gas rigs in the United States held steady for the week according to the report, at 125 This compares to 198 a year ago.
The number of oil rigs have declined by 207 this year alone, but production has grown from 11.7 million bpd at the beginning of the year to 12.8 million bpd, for week ending Dec 20—just 100,000 bpd off the all-time high from a few weeks ago.
Oil prices were down on Friday ahead of the data on rumors that OPEC and allies may decide to quit its agreement to curb production at some point next year, and may ease the existing cuts as early as March.
OPEC+ Cuts Can’t Last Forever, Russia’s Energy Minister Says - Bloomberg
OPEC+ Cuts Can’t Last Forever, Russia’s Energy Minister Says - Bloomberg:
OPEC+ output cuts have stabilized the global oil market but can’t last forever, Russia said as uncertainty persists over the future of the agreement beyond March.
“Oil-production cuts can’t be eternal; we will gradually need to make a decision on exiting” the accord, Energy Minister Alexander Novak said in an interview with state television channel Rossiya24. As one of the architects of the OPEC+ deal, Russia’s view is key, though the nation’s oil producers have long pushed for a relaxation of output curbs.
Russia needs to defend its market share and let its oil companies develop new projects, Novak said. The minister didn’t specify when the country may decide to withdraw from the agreement, but said he expects to discuss the matter with his OPEC+ counterparts next year. Global oil demand may surge as soon as next summer, he said.
Russia, which helped to cement the original deal between the Organization of Petroleum Exporting Countries and its partners back in 2016, has shown this year that it’s getting weary of limiting supply. The nation has consistently failed to comply with its quota, overshooting its target for eight months so far in 2019, according to Bloomb
OPEC+ output cuts have stabilized the global oil market but can’t last forever, Russia said as uncertainty persists over the future of the agreement beyond March.
“Oil-production cuts can’t be eternal; we will gradually need to make a decision on exiting” the accord, Energy Minister Alexander Novak said in an interview with state television channel Rossiya24. As one of the architects of the OPEC+ deal, Russia’s view is key, though the nation’s oil producers have long pushed for a relaxation of output curbs.
Russia needs to defend its market share and let its oil companies develop new projects, Novak said. The minister didn’t specify when the country may decide to withdraw from the agreement, but said he expects to discuss the matter with his OPEC+ counterparts next year. Global oil demand may surge as soon as next summer, he said.
Russia, which helped to cement the original deal between the Organization of Petroleum Exporting Countries and its partners back in 2016, has shown this year that it’s getting weary of limiting supply. The nation has consistently failed to comply with its quota, overshooting its target for eight months so far in 2019, according to Bloomb
Oil hits three-month highs on upbeat U.S. and Chinese economic data - Reuters
Oil hits three-month highs on upbeat U.S. and Chinese economic data - Reuters:
Oil prices rose on Friday, hitting three-month highs, as upbeat economic data from China and the United States indicated an end to the trade war between Washington and Beijing has restored confidence in the global growth.
Brent crude was up 29 cents, or 0.4%, at $68.21 a barrel at 0903 GMT.
The West Texas Intermediate CLc1 was up 24 cents, or 0.4%, at $61.92 a barrel.
Volume of oil trade remained thin in the Christmas holidays and New Year breaks.
Data on Friday showed profits at China’s industrial firms rose at the fastest pace in eight months in November.
Oil prices rose on Friday, hitting three-month highs, as upbeat economic data from China and the United States indicated an end to the trade war between Washington and Beijing has restored confidence in the global growth.
Brent crude was up 29 cents, or 0.4%, at $68.21 a barrel at 0903 GMT.
The West Texas Intermediate CLc1 was up 24 cents, or 0.4%, at $61.92 a barrel.
Volume of oil trade remained thin in the Christmas holidays and New Year breaks.
Data on Friday showed profits at China’s industrial firms rose at the fastest pace in eight months in November.
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