Oil ends March with biggest monthly and quarterly losses ever - Reuters:
Crude oil benchmarks ended a volatile quarter with their biggest losses in history, as both U.S. and Brent futures were hammered throughout March on the global economic freeze due to the coronavirus pandemic and the eruption of a price war between Russia and Saudi Arabia.
Both benchmarks lost roughly two-thirds of their value in the quarter, with March’s declines of about 55% accounting for the lion’s share of the losses.
U.S. West Texas Intermediate crude salvaged the end of the month with a modest 2% gain on Tuesday, while Brent ended slightly lower.
Global fuel demand has been destroyed by travel restrictions due to the coronavirus pandemic. Forecasters at major merchants and banks see demand slumping by 20% to 30% in April, and for weak consumption to linger as economic activity is severely curtailed for the next several months.
WTI CLc1 settled 39 cents higher at $20.48 per barrel. The U.S. benchmark plunged 54% during March and 66% for the first quarter, the worst declines since the contract’s inception in 1983.
May Brent crude futures LCOc1 ended the session 2 cents lower at $22.74 a barrel ahead of expiration. The international benchmark fell 66% in the first quarter and 55% in March, the worst quarterly and monthly percentage declines on record.
The more-active June contract LCOM0 settled 7 cents lower at $26.35 a barrel.
Tuesday 31 March 2020
U.S.- #Saudi oil alliance idea born at White House, put on back burner for now - Reuters
U.S.-Saudi oil alliance idea born at White House, put on back burner for now - Reuters:
Top U.S. officials have for now put aside a proposal for an alliance with Saudi Arabia to manage the global oil market, according to three sources with knowledge of the matter, an idea one of them said came from White House national security advisers.
That the concept was even considered at high levels reflects both the depth of the crisis facing the global oil industry as well as its growing importance to the U.S. economy. A few weeks ago, proposals for Washington to work together with oil producers to curb supply to the global market would have been dismissed for violating U.S. antitrust laws.
But prices for oil LCOc1 have slumped to an 18-year low because of the twin hits of the coronavirus pandemic slashing energy demand and a price war between top producers Saudi Arabia and Russia, threatening higher-cost U.S. and global drillers with bankruptcy.
The idea of a U.S.-Saudi alternative to the Organization of the Petroleum Exporting Countries, of which Saudi Arabia is the de facto leader, “has been floated but not at the stage of something that is being seriously considered,” said one of the sources, who all spoke on condition of anonymity.
Top U.S. officials have for now put aside a proposal for an alliance with Saudi Arabia to manage the global oil market, according to three sources with knowledge of the matter, an idea one of them said came from White House national security advisers.
That the concept was even considered at high levels reflects both the depth of the crisis facing the global oil industry as well as its growing importance to the U.S. economy. A few weeks ago, proposals for Washington to work together with oil producers to curb supply to the global market would have been dismissed for violating U.S. antitrust laws.
But prices for oil LCOc1 have slumped to an 18-year low because of the twin hits of the coronavirus pandemic slashing energy demand and a price war between top producers Saudi Arabia and Russia, threatening higher-cost U.S. and global drillers with bankruptcy.
The idea of a U.S.-Saudi alternative to the Organization of the Petroleum Exporting Countries, of which Saudi Arabia is the de facto leader, “has been floated but not at the stage of something that is being seriously considered,” said one of the sources, who all spoke on condition of anonymity.
OPEC rift widens as group fails to set date for emergency talks - Reuters
OPEC rift widens as group fails to set date for emergency talks - Reuters:
A rift in the Organization of the Petroleum Exporting Countries (OPEC) has widened after members failed to agree unanimously on an emergency low-level meeting to discuss a market collapse that has seen global oil prices hit 18-year lows.
OPEC president Algeria, which has been instrumental in organizing the producer group’s efforts to support the market, had been among the members pushing for a gathering of OPEC’s Economic Commission Board (ECB) in April.
But at least four members, including OPEC’s de facto leader Saudi Arabia, the United Arab Emirates, Kuwait and Nigeria, have made clear they see no need for such a meeting, four sources with knowledge of the matter said on condition of anonymity.
One OPEC source said Kuwait had not received an official invitation to join the meeting, and does not consider a meeting necessary.
A rift in the Organization of the Petroleum Exporting Countries (OPEC) has widened after members failed to agree unanimously on an emergency low-level meeting to discuss a market collapse that has seen global oil prices hit 18-year lows.
OPEC president Algeria, which has been instrumental in organizing the producer group’s efforts to support the market, had been among the members pushing for a gathering of OPEC’s Economic Commission Board (ECB) in April.
But at least four members, including OPEC’s de facto leader Saudi Arabia, the United Arab Emirates, Kuwait and Nigeria, have made clear they see no need for such a meeting, four sources with knowledge of the matter said on condition of anonymity.
One OPEC source said Kuwait had not received an official invitation to join the meeting, and does not consider a meeting necessary.
Oil Price War: Saudis Start to Unleash Wave of Crude - Bloomberg
Oil Price War: Saudis Start to Unleash Wave of Crude - Bloomberg:
Saudi Arabia has made good on its pledge to ramp up oil exports in April, with a first wave of crude already on its way toward Europe and the U.S., a clear sign the price war remains in full swing.
The kingdom has loaded several of the supertankers it hired earlier this month to boost its ability to increase exports, according to ship-tracking data. In addition, Riyadh has used the last few weeks to shuttle large amounts of crude into storage in Egypt, a stepping stone to the European market.
The movements suggest that Riyadh is ramping up its oil production toward its target of supplying a record 12.3 million barrels a day in April, up from about 9.7 million in February, despite American pressure to end the price war.
Saudi Arabia earlier this month slashed its official selling prices and announced the output hike after Russia refused to join other nations inside the OPEC+ alliance to cut output. The announcement, interpreted in the market as an oil price war, sent Brent and West Texas Intermediate crudes tumbling. Since then, the collapse in oil demand due to lockdowns to stop the spread of the coronavirus has depressed prices even more.
Saudi Arabia has made good on its pledge to ramp up oil exports in April, with a first wave of crude already on its way toward Europe and the U.S., a clear sign the price war remains in full swing.
The kingdom has loaded several of the supertankers it hired earlier this month to boost its ability to increase exports, according to ship-tracking data. In addition, Riyadh has used the last few weeks to shuttle large amounts of crude into storage in Egypt, a stepping stone to the European market.
The movements suggest that Riyadh is ramping up its oil production toward its target of supplying a record 12.3 million barrels a day in April, up from about 9.7 million in February, despite American pressure to end the price war.
Saudi Arabia earlier this month slashed its official selling prices and announced the output hike after Russia refused to join other nations inside the OPEC+ alliance to cut output. The announcement, interpreted in the market as an oil price war, sent Brent and West Texas Intermediate crudes tumbling. Since then, the collapse in oil demand due to lockdowns to stop the spread of the coronavirus has depressed prices even more.
#UAE News: NMC Health Owes #AbuDhabi Commercial Bank $1 Billion - Bloomberg
UAE News: NMC Health Owes Abu Dhabi Commercial Bank $1 Billion - Bloomberg:
Abu Dhabi Commercial Bank PJSC has more than $1 billion of exposure to troubled hospital operator NMC Health Plc, potentially putting one of the Middle East’s biggest financial institutions on the hook for losses on the debt, people familiar with the matter said.
The state-owned lender is currently seen as one of the biggest creditors to NMC, according to the people, who asked not to be identified because the information is private. HSBC Holdings Plc, JPMorgan Chase & Co. and Standard Chartered Plc also have large outstanding loans to the Abu Dhabi-based company, the people said.
Some of the lenders are in talks to set up a committee to discuss ways to recover funds from NMC, according to the people. The company’s known debt pile has more than tripled in recent weeks to $6.6 billion, up from the $2.1 billion reported at the end of June, after it successively uncovered borrowings that hadn’t been disclosed to the board.
Shares of Abu Dhabi Commercial Bank fell 4.9% at 1:24 p.m. Tuesday local time, giving the lender a market value of about $8.8 billion. The benchmark ADX General Index fell 0.3%.
Abu Dhabi Commercial Bank PJSC has more than $1 billion of exposure to troubled hospital operator NMC Health Plc, potentially putting one of the Middle East’s biggest financial institutions on the hook for losses on the debt, people familiar with the matter said.
The state-owned lender is currently seen as one of the biggest creditors to NMC, according to the people, who asked not to be identified because the information is private. HSBC Holdings Plc, JPMorgan Chase & Co. and Standard Chartered Plc also have large outstanding loans to the Abu Dhabi-based company, the people said.
Some of the lenders are in talks to set up a committee to discuss ways to recover funds from NMC, according to the people. The company’s known debt pile has more than tripled in recent weeks to $6.6 billion, up from the $2.1 billion reported at the end of June, after it successively uncovered borrowings that hadn’t been disclosed to the board.
Shares of Abu Dhabi Commercial Bank fell 4.9% at 1:24 p.m. Tuesday local time, giving the lender a market value of about $8.8 billion. The benchmark ADX General Index fell 0.3%.
European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar
European, Middle Eastern & African Stocks - Bloomberg:
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
#Oman bonds weaken on Moody's review as other Gulf debt gains - Reuters
Oman bonds weaken on Moody's review as other Gulf debt gains - Reuters:
Oman’s debt weakened on Tuesday after Moody’s placed its rating under review for a downgrade, while other Gulf bonds gained.
The sultanate’s 30-year dollar bonds due in 2048 lost 1 cent to trade at around 65.3 cents on the dollar, Refinitiv data showed. Oman’s 10-year bonds maturing in 2028 lost 0.3 cents to trade at 71.7 cents on the dollar.
Oman’s bonds suffered sharper losses than other Gulf states on Monday after it was downgraded deeper into junk status by S&P.
Its Gulf neighbours posted gains on Tuesday, with Saudi Arabia’s 30-year bonds due in 2049 gaining 0.4 cents to trade at 107.3 cents on the dollar. Oil giant Saudi Aramco’s similar bonds gained 0.9 cents to trade at 98.9 cents.
Oman’s debt weakened on Tuesday after Moody’s placed its rating under review for a downgrade, while other Gulf bonds gained.
The sultanate’s 30-year dollar bonds due in 2048 lost 1 cent to trade at around 65.3 cents on the dollar, Refinitiv data showed. Oman’s 10-year bonds maturing in 2028 lost 0.3 cents to trade at 71.7 cents on the dollar.
Oman’s bonds suffered sharper losses than other Gulf states on Monday after it was downgraded deeper into junk status by S&P.
Its Gulf neighbours posted gains on Tuesday, with Saudi Arabia’s 30-year bonds due in 2049 gaining 0.4 cents to trade at 107.3 cents on the dollar. Oil giant Saudi Aramco’s similar bonds gained 0.9 cents to trade at 98.9 cents.
Mideast Stocks: Most Gulf stocks extend losses; #Saudi bucks the trend | ZAWYA MENA Edition
Mideast Stocks: Most Gulf stocks extend losses; Saudi bucks the trend | ZAWYA MENA Edition:
Most Gulf stock markets declined on Tuesday, as investors remained worried by the chronic weakness of oil prices and lockdowns across much of the world, while Saudi Arabia bucked the trend.
Brent crude was up 3.1% at $23.46 a barrel by 1206 GMT after closing on Monday at $22.76, its lowest finish since November 2002.
Global oil refiners, meanwhile, have cut their throughput because of the slump in demand for transportation fuel, with European refineries slashing output by at least 1.3 million barrels per day, sources told Reuters.
Dubai's main share index dropped 1%, with blue-chip developer Emaar Properties losing 4.7%, while sharia-compliant lender Dubai Islamic Bank was down 1.1%.
In Abu Dhbai, the index slipped 0.3%, hurt by a 4.9% fall in Abu Dhabi Commercial Bank .
Most Gulf stock markets declined on Tuesday, as investors remained worried by the chronic weakness of oil prices and lockdowns across much of the world, while Saudi Arabia bucked the trend.
Brent crude was up 3.1% at $23.46 a barrel by 1206 GMT after closing on Monday at $22.76, its lowest finish since November 2002.
Global oil refiners, meanwhile, have cut their throughput because of the slump in demand for transportation fuel, with European refineries slashing output by at least 1.3 million barrels per day, sources told Reuters.
Dubai's main share index dropped 1%, with blue-chip developer Emaar Properties losing 4.7%, while sharia-compliant lender Dubai Islamic Bank was down 1.1%.
In Abu Dhbai, the index slipped 0.3%, hurt by a 4.9% fall in Abu Dhabi Commercial Bank .
Azerbaijan says no plans to change 2020 oil output: RIA cites energy ministry - Reuters
Azerbaijan says no plans to change 2020 oil output: RIA cites energy ministry - Reuters:
Azerbaijan is not planning to change its oil production plans for 2020, despite the collapse of an OPEC+ output deal earlier this month, the RIA news agency cited the country’s energy ministry as saying on Tuesday.
Cooperation with OPEC+ oil producers will continue, the ministry said.
Azerbaijan is not planning to change its oil production plans for 2020, despite the collapse of an OPEC+ output deal earlier this month, the RIA news agency cited the country’s energy ministry as saying on Tuesday.
Cooperation with OPEC+ oil producers will continue, the ministry said.
Oil to stay below $40 in 2020 on virus shock, OPEC+ deal collapse: Reuters poll - Reuters
Oil to stay below $40 in 2020 on virus shock, OPEC+ deal collapse: Reuters poll - Reuters:
Oil prices will stay below $40 a barrel this year, as measures aimed at halting the rapid global spread of the coronavirus cripple demand and the collapse of an OPEC+ deal adds to a mounting supply glut, a Reuters poll showed on Tuesday.
The survey of 40 analysts forecast Brent crude prices would average $38.76 a barrel in 2020, 36% lower than the $60.63 forecast in a survey in February.
The 2020 outlook for West Texas Intermediate crude was slashed to $35.29 a barrel from last month’s forecast for $55.75.
Both Brent and WTI crude prices are now trading in the low $20s. Global benchmark Brent slumped nearly 70% from January highs as global virus-led lockdowns hammered demand and a Saudi-Russian price war flooded the market.
Oil prices will stay below $40 a barrel this year, as measures aimed at halting the rapid global spread of the coronavirus cripple demand and the collapse of an OPEC+ deal adds to a mounting supply glut, a Reuters poll showed on Tuesday.
The survey of 40 analysts forecast Brent crude prices would average $38.76 a barrel in 2020, 36% lower than the $60.63 forecast in a survey in February.
The 2020 outlook for West Texas Intermediate crude was slashed to $35.29 a barrel from last month’s forecast for $55.75.
Both Brent and WTI crude prices are now trading in the low $20s. Global benchmark Brent slumped nearly 70% from January highs as global virus-led lockdowns hammered demand and a Saudi-Russian price war flooded the market.
#UAE News: #Dubai Gets Flashback to Falling Property Prices - Bloomberg
UAE News: Dubai Gets Flashback to Falling Property Prices - Bloomberg:
A decade after the global financial crisis pushed Dubai’s real estate sector -- known for its outlandish projects such as man-made palm-shaped islands -- to the brink of collapse, the deadly coronavirus pandemic threatens to send it back there again.
S&P Global Ratings is warning that home prices could slump to 2010 levels as unemployment across key sectors such as tourism and retail eviscerates demand. Prices are currently about 5% to 10% above what they reached a year after the debt crisis in 2009, according to data from real estate services firm Asteco.
Developers are still wrestling with debt repayments that have already gone through a number of restructurings, while earnings for some companies linked to property have fallen through the floor. Emaar Properties PJSC on Monday said three of its listed companies will not pay dividends for 2019 in “view of the current circumstances.”
The Middle Eastern business and travel hub -- like many other cities around the world -- is in lockdown, with Emirates passenger flights grounded, the city’s cavernous malls and luxurious hotels shuttered. Dubai is especially vulnerable to the measures as it relies heavily on tourism and trade -- both of which are also essential to keep up demand for properties.
A decade after the global financial crisis pushed Dubai’s real estate sector -- known for its outlandish projects such as man-made palm-shaped islands -- to the brink of collapse, the deadly coronavirus pandemic threatens to send it back there again.
S&P Global Ratings is warning that home prices could slump to 2010 levels as unemployment across key sectors such as tourism and retail eviscerates demand. Prices are currently about 5% to 10% above what they reached a year after the debt crisis in 2009, according to data from real estate services firm Asteco.
Developers are still wrestling with debt repayments that have already gone through a number of restructurings, while earnings for some companies linked to property have fallen through the floor. Emaar Properties PJSC on Monday said three of its listed companies will not pay dividends for 2019 in “view of the current circumstances.”
The Middle Eastern business and travel hub -- like many other cities around the world -- is in lockdown, with Emirates passenger flights grounded, the city’s cavernous malls and luxurious hotels shuttered. Dubai is especially vulnerable to the measures as it relies heavily on tourism and trade -- both of which are also essential to keep up demand for properties.
Shareholders of #AbuDhabi-listed CBI decline board proposal for capital hike - Reuters
Shareholders of Abu Dhabi-listed CBI decline board proposal for capital hike - Reuters:
Shareholders of Abu Dhabi-listed Commercial Bank International, which is part owned by Qatar National Bank, have declined a proposed by the board to increase the capital of the company, according to a regulatory filing on Tuesday.
The filing did not state the reasons for the shareholders decision.
The shareholder meeting took place on Monday after CBI’s board on March 5 had invited shareholders to a meeting to approve a number of recommendations including a capital increase through an issuance of 430 million new shares, at one dirham ($0.2723) per share.
Shareholders of Abu Dhabi-listed Commercial Bank International, which is part owned by Qatar National Bank, have declined a proposed by the board to increase the capital of the company, according to a regulatory filing on Tuesday.
The filing did not state the reasons for the shareholders decision.
The shareholder meeting took place on Monday after CBI’s board on March 5 had invited shareholders to a meeting to approve a number of recommendations including a capital increase through an issuance of 430 million new shares, at one dirham ($0.2723) per share.
Oil Heads for Worst Quarter Ever as Real Crude Prices Plunge - Bloomberg
Oil Heads for Worst Quarter Ever as Real Crude Prices Plunge - Bloomberg:
Oil clawed back some losses as Chinese manufacturing data beat expectations, but futures were still heading for the worst quarter on record as the physical market showed further signs of collapse.
Futures in New York were higher on Tuesday but crude is still down 65% since the end of December. While Brent and West Texas Intermediate futures are holding up above $20 a barrel, in the world of physical crude, where traders buy and sell actual barrels, prices continue to be in freefall. The price difference between where the paper market trades and the physical market has widened to reach multi-decade highs in some cases, suggesting that financial flows are supporting the futures market.
With demand weakening by the day and producers refusing to cut output, Dated Brent, the benchmark to price about two-thirds of the world’s actual barrels in the physical market, was assessed at $17.79 a barrel on Monday, well below where Brent futures traded. In North America, WTI in Midland, the capital of the Permian region, traded at just $10.50 a barrel, and multiple key grades, including Canadian crude and Bakken crude from North Dakota, traded below $5 a barrel.
The broad market weakness come comes as refineries from South Africa to Canada have shuttered while others in major consuming countries, such as India, are cutting back. At the same time, Saudi Arabia is directing huge amounts of crude toward Egypt as the producer prepares to flood Europe with its barrels. The huge oversupply is collapsing the oil market’s structure, and there may be more weakness to come as the world quickly runs out of storage capacity.
Oil clawed back some losses as Chinese manufacturing data beat expectations, but futures were still heading for the worst quarter on record as the physical market showed further signs of collapse.
Futures in New York were higher on Tuesday but crude is still down 65% since the end of December. While Brent and West Texas Intermediate futures are holding up above $20 a barrel, in the world of physical crude, where traders buy and sell actual barrels, prices continue to be in freefall. The price difference between where the paper market trades and the physical market has widened to reach multi-decade highs in some cases, suggesting that financial flows are supporting the futures market.
With demand weakening by the day and producers refusing to cut output, Dated Brent, the benchmark to price about two-thirds of the world’s actual barrels in the physical market, was assessed at $17.79 a barrel on Monday, well below where Brent futures traded. In North America, WTI in Midland, the capital of the Permian region, traded at just $10.50 a barrel, and multiple key grades, including Canadian crude and Bakken crude from North Dakota, traded below $5 a barrel.
The broad market weakness come comes as refineries from South Africa to Canada have shuttered while others in major consuming countries, such as India, are cutting back. At the same time, Saudi Arabia is directing huge amounts of crude toward Egypt as the producer prepares to flood Europe with its barrels. The huge oversupply is collapsing the oil market’s structure, and there may be more weakness to come as the world quickly runs out of storage capacity.
Aramco Missing From Line Up of Star #Saudi First-Quarter Stocks - Bloomberg
Aramco Missing From Line Up of Star Saudi First-Quarter Stocks - Bloomberg:
Saudi Arabian equity investors reviewing outperformers in the market’s worst quarter since 2008 are left with a mixed bag of star stocks -- and the national oil champion isn’t even close to cracking the list.
The top five gainers in Riyadh this year include a small insurer, a supermarkets owner, a plastic producer, an education company and a hospital operator. They don’t exactly boast a track record of consistent success between them: the first four haven’t broken into the top five in any quarter since 2016, while the last has just made its market debut.
The diverse group of market leaders underscores how hard investors have had to look for bright spots among equities trading in the world’s biggest oil exporter. The local market has been battered by the global stocks slump caused by the coronavirus crisis, and a price war over crude between the kingdom and Russia that has weighed on Saudi Aramco, which accounts for 11% of the main index.
Saudi Arabian equity investors reviewing outperformers in the market’s worst quarter since 2008 are left with a mixed bag of star stocks -- and the national oil champion isn’t even close to cracking the list.
The top five gainers in Riyadh this year include a small insurer, a supermarkets owner, a plastic producer, an education company and a hospital operator. They don’t exactly boast a track record of consistent success between them: the first four haven’t broken into the top five in any quarter since 2016, while the last has just made its market debut.
The diverse group of market leaders underscores how hard investors have had to look for bright spots among equities trading in the world’s biggest oil exporter. The local market has been battered by the global stocks slump caused by the coronavirus crisis, and a price war over crude between the kingdom and Russia that has weighed on Saudi Aramco, which accounts for 11% of the main index.
#Oman State Companies Told to Pause Capital Outlays, Cut Expenses - Bloomberg
Oman State Companies Told to Pause Capital Outlays, Cut Expenses - Bloomberg:
Oman is extending austerity measures by telling government-owned companies to cut expenditure after the plunge in oil prices.
All state-run companies will reduce their operational and administrative expenses in 2020 by 10%, the Finance Ministry said in a statement. It also asked government-owned firms to stop the implementation of any new projects or capital spending for this year.
Oman, the Gulf country most exposed to the fallout from the oil-price war, already announced plans to reduce budget spending by 5% as the health emergency and much lower crude prices hammer revenue. Facing its seventh straight year in the red, Oman’s fiscal deficit is expected to average almost 8% of gross domestic product over 2021-2023, according to S&P Global Ratings.
“The sharp drop in oil prices in 2020 will intensify Oman’s fiscal and external pressures, leading to a faster deterioration in the government’s balance sheet, which has considerably weaker buffers than during the 2014-2015 oil price shock,” S&P said last week when it downgraded the government’s long-term credit rating one step to BB-.
Oman is extending austerity measures by telling government-owned companies to cut expenditure after the plunge in oil prices.
All state-run companies will reduce their operational and administrative expenses in 2020 by 10%, the Finance Ministry said in a statement. It also asked government-owned firms to stop the implementation of any new projects or capital spending for this year.
Oman, the Gulf country most exposed to the fallout from the oil-price war, already announced plans to reduce budget spending by 5% as the health emergency and much lower crude prices hammer revenue. Facing its seventh straight year in the red, Oman’s fiscal deficit is expected to average almost 8% of gross domestic product over 2021-2023, according to S&P Global Ratings.
“The sharp drop in oil prices in 2020 will intensify Oman’s fiscal and external pressures, leading to a faster deterioration in the government’s balance sheet, which has considerably weaker buffers than during the 2014-2015 oil price shock,” S&P said last week when it downgraded the government’s long-term credit rating one step to BB-.
Coronavirus: Flydubai staff to take three-month pay cut - Arabianbusiness
Coronavirus: Flydubai staff to take three-month pay cut - Arabianbusiness:
Staff at Flydubai are set to take a three-month pay cut from April.
The Dubai-based low-cost carrier grounded all passenger flights earlier this month following orders from the UAE Government aimed at preventing the spread of the deadly coronavirus.
The ban, enforced from March 24, is in place for 14 days, although it could be extended further.
A spokesperson for the airline said the impact of Covid-19 has had a “significant impact” on the company.
Staff at Flydubai are set to take a three-month pay cut from April.
The Dubai-based low-cost carrier grounded all passenger flights earlier this month following orders from the UAE Government aimed at preventing the spread of the deadly coronavirus.
The ban, enforced from March 24, is in place for 14 days, although it could be extended further.
A spokesperson for the airline said the impact of Covid-19 has had a “significant impact” on the company.
#UAE's Dana Gas explores spin-off and listing of upstream business - Reuters
UAE's Dana Gas explores spin-off and listing of upstream business - Reuters:
United Arab Emirates’ Dana Gas is considering spinning off its upstream business and listing the unit on the Abu Dhabi Securities Exchange, the Sharjah-based energy company said on Tuesday.
Dana Gas, which operates concessions Iraq’s Kurdish region and Egypt, said it was studying a potential demerger of the business into a new company, according to a statement to the stock exchange.
Should the transaction succeed, shareholders in Dana Gas will own shares in the two companies, the company said.
Spinning off businesses typically allows the parent company and the spin-off alike to focus better on their respective strategies, while investors tend to value both more highly due to greater transparency.
United Arab Emirates’ Dana Gas is considering spinning off its upstream business and listing the unit on the Abu Dhabi Securities Exchange, the Sharjah-based energy company said on Tuesday.
Dana Gas, which operates concessions Iraq’s Kurdish region and Egypt, said it was studying a potential demerger of the business into a new company, according to a statement to the stock exchange.
Should the transaction succeed, shareholders in Dana Gas will own shares in the two companies, the company said.
Spinning off businesses typically allows the parent company and the spin-off alike to focus better on their respective strategies, while investors tend to value both more highly due to greater transparency.
#Dubai to inject fresh capital in Emirates airline: crown prince - Reuters
Dubai to inject fresh capital in Emirates airline: crown prince - Reuters:
Dubai’s Crown Prince Sheikh Hamdan bin Mohammed said on Tuesday the emirate’s government was committed to fully support Emirates airline and will inject fresh equity into the company to help it overcome the coronavirus crisis.
Emirates has a “strategic importance to the Dubai and UAE economy and the airlines (have a) key role in positioning Dubai as a major international aviation hub”, Sheikh Hamdan said in a Twitter post.
“Further details in this regard will be announced at a later stage,” he added.
Dubai’s Crown Prince Sheikh Hamdan bin Mohammed said on Tuesday the emirate’s government was committed to fully support Emirates airline and will inject fresh equity into the company to help it overcome the coronavirus crisis.
Emirates has a “strategic importance to the Dubai and UAE economy and the airlines (have a) key role in positioning Dubai as a major international aviation hub”, Sheikh Hamdan said in a Twitter post.
“Further details in this regard will be announced at a later stage,” he added.
Oil rises after 18-year lows prompt U.S.-Russia talks plan - Reuters
Oil rises after 18-year lows prompt U.S.-Russia talks plan - Reuters:
Oil prices firmed on Tuesday after U.S. President Donald Trump and Russian President Vladimir Putin agreed to talks aimed at stabilising energy markets, with benchmarks climbing off 18-year lows hit as the coronavirus outbreak cut fuel demand worldwide.
Brent crude LCOc1 was up by 61 cents, or 2.7%, at $23.37 a barrel by 0833 GMT, after closing on Monday at $22.76, its lowest finish since November 2002.
U.S. crude Clc1 was up by $1.04, or 5.2%, at $21.13 a barrel, after settling in the previous session at $20.09, its lowest since February 2002.
Oil markets have faced a double whammy from the coronavirus outbreak and a race to win market share between Saudi Arabia and Russia after OPEC and other producers failed to agree on deeper cuts to support oil prices in early March.
Oil prices firmed on Tuesday after U.S. President Donald Trump and Russian President Vladimir Putin agreed to talks aimed at stabilising energy markets, with benchmarks climbing off 18-year lows hit as the coronavirus outbreak cut fuel demand worldwide.
Brent crude LCOc1 was up by 61 cents, or 2.7%, at $23.37 a barrel by 0833 GMT, after closing on Monday at $22.76, its lowest finish since November 2002.
U.S. crude Clc1 was up by $1.04, or 5.2%, at $21.13 a barrel, after settling in the previous session at $20.09, its lowest since February 2002.
Oil markets have faced a double whammy from the coronavirus outbreak and a race to win market share between Saudi Arabia and Russia after OPEC and other producers failed to agree on deeper cuts to support oil prices in early March.
European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar
European, Middle Eastern & African Stocks - Bloomberg:
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
StanChart widens oil demand loss forecasts citing lockdowns - Reuters
StanChart widens oil demand loss forecasts citing lockdowns - Reuters:
Standard Chartered expects oil demand in April to fall by 18.5 million barrels per day (bpd) year on year, deepening its previous forecast of a 10.5 million bpd fall, citing global lockdowns prompted by the coronavirus.
It now sees demand for 2020 falling by a record 5.43 million bpd on average.
“Tighter mobility restrictions as part of government coronavirus responses have worsened our outlook on the oil demand shock,” the bank’s analysts said in a note.
It expects a market surplus of 21.8 million bpd in April, one of 19.5 million bpd in May, and one of 13.7 million bpd in June.
Standard Chartered expects oil demand in April to fall by 18.5 million barrels per day (bpd) year on year, deepening its previous forecast of a 10.5 million bpd fall, citing global lockdowns prompted by the coronavirus.
It now sees demand for 2020 falling by a record 5.43 million bpd on average.
“Tighter mobility restrictions as part of government coronavirus responses have worsened our outlook on the oil demand shock,” the bank’s analysts said in a note.
It expects a market surplus of 21.8 million bpd in April, one of 19.5 million bpd in May, and one of 13.7 million bpd in June.
MIDEAST STOCKS-Most major Gulf markets extend losses; banks boost Saudi | Nasdaq
MIDEAST STOCKS-Most major Gulf markets extend losses; banks boost Saudi | Nasdaq:
Most major Gulf stocks indexes fell on Tuesday, extending losses from the previous session, as nervous investors continued to sell due to weak oil prices, while bargain buying supported Saudi equities.
Brent crude LCOc1 was up 42 cents, or 1.9%, at $23.18 a barrel at 0750 G5MT, after closing on Monday at $22.76, its lowest finish since November 2002.
Meanwhile, global oil refiners have cut their throughput because of the slump in demand for transportation fuel, with European refineries slashing output by at least 1.3 million barrels per day (bpd), sources told Reuters.
In Abu Dhabi, the index .ADI declined 1%. First Abu Dhabi Bank FAB.AD, the country's largest lender, traded 2.8% lower, while Abu Dhabi Commercial Bank ADCB.AD was down 2.5%.
Dubai's main share index .DFMGI retreated 0.8%, pressured by a 4.3% fall in blue-chip developer Emaar Properties EMAR.DU and a 4.8% drop in its unit Emaar Development EMAARDEV.DU.
Most major Gulf stocks indexes fell on Tuesday, extending losses from the previous session, as nervous investors continued to sell due to weak oil prices, while bargain buying supported Saudi equities.
Brent crude LCOc1 was up 42 cents, or 1.9%, at $23.18 a barrel at 0750 G5MT, after closing on Monday at $22.76, its lowest finish since November 2002.
Meanwhile, global oil refiners have cut their throughput because of the slump in demand for transportation fuel, with European refineries slashing output by at least 1.3 million barrels per day (bpd), sources told Reuters.
In Abu Dhabi, the index .ADI declined 1%. First Abu Dhabi Bank FAB.AD, the country's largest lender, traded 2.8% lower, while Abu Dhabi Commercial Bank ADCB.AD was down 2.5%.
Dubai's main share index .DFMGI retreated 0.8%, pressured by a 4.3% fall in blue-chip developer Emaar Properties EMAR.DU and a 4.8% drop in its unit Emaar Development EMAARDEV.DU.
Monday 30 March 2020
Aramco Weighs Pipeline Stake Sale to Raise Over $10 Billion - Bloomberg
Aramco Weighs Pipeline Stake Sale to Raise Over $10 Billion - Bloomberg:
Saudi Aramco, the world’s largest oil producer, is weighing the sale of a stake in its pipeline unit to raise money amid a slump in crude prices, according to people familiar with the matter.
Aramco may need to raise cash this year as it confronts a historic rout in oil prices and a burgeoning list of spending obligations. The company has reaffirmed its commitment to pay out $75 billion in dividends this year and also needs to make the first installment for its $70 billion acquisition of a stake in chemicals producer Saudi Basic Industries Corp.
Aramco, the world’s most valuable publicly traded company after selling shares on the Riyadh exchange last year, could raise more than $10 billion from the sale, the people said, asking not to be identified as the information is private. Aramco has already held some preliminary discussions with potential advisers on the deal, but talks are still at an early stage and Aramco may decide against a sale, the people said.
Saudi Aramco declined to comment.
Saudi Aramco, the world’s largest oil producer, is weighing the sale of a stake in its pipeline unit to raise money amid a slump in crude prices, according to people familiar with the matter.
Aramco may need to raise cash this year as it confronts a historic rout in oil prices and a burgeoning list of spending obligations. The company has reaffirmed its commitment to pay out $75 billion in dividends this year and also needs to make the first installment for its $70 billion acquisition of a stake in chemicals producer Saudi Basic Industries Corp.
Aramco, the world’s most valuable publicly traded company after selling shares on the Riyadh exchange last year, could raise more than $10 billion from the sale, the people said, asking not to be identified as the information is private. Aramco has already held some preliminary discussions with potential advisers on the deal, but talks are still at an early stage and Aramco may decide against a sale, the people said.
Saudi Aramco declined to comment.
Brent tumbles to lowest since 2002, U.S. crude dips below $20/bbl - Reuters
Brent tumbles to lowest since 2002, U.S. crude dips below $20/bbl - Reuters:
Global oil benchmark Brent crude plunged to its cheapest in almost 18 years on Monday and U.S. crude briefly tumbled below $20 per barrel on growing fears the global coronavirus shutdown could last months and demand for fuel will decline further.
With Saudi Arabia and Russia set to flood the market with oil next month, producers and shippers have been scrambling to lock oil up in storage as demand falls.
Meanwhile, the coronavirus pandemic is expected to cause at least a 20% drop in fuel demand worldwide as governments take steps to restrict the spread of the virus.
Brent futures fell $2.17, or 8.7%, to settle at $22.76 a barrel, their lowest close since November 2002, while U.S. West Texas Intermediate (WTI) crude fell $1.42, or 6.6%, to $20.09, the lowest close since February 2002.
Global oil benchmark Brent crude plunged to its cheapest in almost 18 years on Monday and U.S. crude briefly tumbled below $20 per barrel on growing fears the global coronavirus shutdown could last months and demand for fuel will decline further.
With Saudi Arabia and Russia set to flood the market with oil next month, producers and shippers have been scrambling to lock oil up in storage as demand falls.
Meanwhile, the coronavirus pandemic is expected to cause at least a 20% drop in fuel demand worldwide as governments take steps to restrict the spread of the virus.
Brent futures fell $2.17, or 8.7%, to settle at $22.76 a barrel, their lowest close since November 2002, while U.S. West Texas Intermediate (WTI) crude fell $1.42, or 6.6%, to $20.09, the lowest close since February 2002.
U.S., Russia agree to oil market talks as Trump calls price war 'crazy' - Reuters
U.S., Russia agree to oil market talks as Trump calls price war 'crazy' - Reuters:
U.S. President Donald Trump and Russian President Vladimir Putin agreed during a phone call on Monday to have their top energy officials meet to discuss slumping global oil markets, the Kremlin said, as Trump called Russia’s price war with Saudi Arabia “crazy.”
The agreement marks a new twist in global oil diplomacy since a failed deal by OPEC producers and Russia to cut production mingled with the fallout from the coronavirus pandemic to send oil prices into a historic tailspin. The falling prices have threatened higher-cost oil drillers in the United States and around the globe with bankruptcy.
“Opinions on the current state of global oil markets were exchanged. It was agreed there would be Russo-American consultations about this through the ministers of energy,” the Kremlin said in a readout of the call.
The Kremlin did not say what exactly the ministers would discuss, but Moscow has previously signaled it would like to see more countries joining efforts to balance global oil markets. The White House did not immediately respond to a request for comment.
U.S. President Donald Trump and Russian President Vladimir Putin agreed during a phone call on Monday to have their top energy officials meet to discuss slumping global oil markets, the Kremlin said, as Trump called Russia’s price war with Saudi Arabia “crazy.”
The agreement marks a new twist in global oil diplomacy since a failed deal by OPEC producers and Russia to cut production mingled with the fallout from the coronavirus pandemic to send oil prices into a historic tailspin. The falling prices have threatened higher-cost oil drillers in the United States and around the globe with bankruptcy.
“Opinions on the current state of global oil markets were exchanged. It was agreed there would be Russo-American consultations about this through the ministers of energy,” the Kremlin said in a readout of the call.
The Kremlin did not say what exactly the ministers would discuss, but Moscow has previously signaled it would like to see more countries joining efforts to balance global oil markets. The White House did not immediately respond to a request for comment.
Gulf countries set to face headwind from coronavirus, low oil prices, capital flight -S&P - Reuters
Gulf countries set to face headwind from coronavirus, low oil prices, capital flight -S&P - Reuters:
Gulf oil exporting countries are expected to face headwinds this year from lower oil prices, economic pressures due to the coronavirus outbreak, and capital flight from emerging markets, S&P Global Ratings said.
Saudi Arabia is likely to see a “sharp rise” in its fiscal deficit this year due to oil supply increases and a collapse in oil demand, S&P said in a webcast on Monday.
But financially weaker Gulf countries like Bahrain and Oman would be likely to receive support from their wealthier Gulf neighbours if their currency pegs to the U.S. dollar were to be under threat, the credit rating agency said.
Gulf oil exporting countries are expected to face headwinds this year from lower oil prices, economic pressures due to the coronavirus outbreak, and capital flight from emerging markets, S&P Global Ratings said.
Saudi Arabia is likely to see a “sharp rise” in its fiscal deficit this year due to oil supply increases and a collapse in oil demand, S&P said in a webcast on Monday.
But financially weaker Gulf countries like Bahrain and Oman would be likely to receive support from their wealthier Gulf neighbours if their currency pegs to the U.S. dollar were to be under threat, the credit rating agency said.
RPT-COLUMN-Coronavirus demand hit renders OPEC+, Trump manoeuvres irrelevant: Russell - Reuters
RPT-COLUMN-Coronavirus demand hit renders OPEC+, Trump manoeuvres irrelevant: Russell - Reuters:
Imagine for a moment that the Organization of the Petroleum Exporting Countries (OPEC) and Russia had agreed at the start of this month to extend and deepen their crude oil output cuts. It wouldn’t have made the blindest bit of difference.
While it was only three and half weeks ago, though it feels as long as a lifetime, the collapse of the deal between OPEC and allies, including Russia, to limit output is no longer relevant in a world devastated by coronavirus.
If OPEC and its allies, known as OPEC+, had agreed to extend the 2.1 million barrels per day (bpd) and add a further 1.5 million bpd, there is little doubt crude prices wouldn’t have crashed as they did in the wake of the breakdown of the talks, and the subsequent move by top exporter Saudi Arabia to flood the market.
But the rapid spread of the coronavirus beyond its origin in China to most of the populated world, including the major crude demand centres of Europe and North America, means that the current price slump was inevitable, as the scale of the loss of global demand would have simply overwhelmed the OPEC+ output deal, assuming it had been extended and increased.
Imagine for a moment that the Organization of the Petroleum Exporting Countries (OPEC) and Russia had agreed at the start of this month to extend and deepen their crude oil output cuts. It wouldn’t have made the blindest bit of difference.
While it was only three and half weeks ago, though it feels as long as a lifetime, the collapse of the deal between OPEC and allies, including Russia, to limit output is no longer relevant in a world devastated by coronavirus.
If OPEC and its allies, known as OPEC+, had agreed to extend the 2.1 million barrels per day (bpd) and add a further 1.5 million bpd, there is little doubt crude prices wouldn’t have crashed as they did in the wake of the breakdown of the talks, and the subsequent move by top exporter Saudi Arabia to flood the market.
But the rapid spread of the coronavirus beyond its origin in China to most of the populated world, including the major crude demand centres of Europe and North America, means that the current price slump was inevitable, as the scale of the loss of global demand would have simply overwhelmed the OPEC+ output deal, assuming it had been extended and increased.
Oil Plummets to 17-Year Low as Broken Market Drowns in Crude - Bloomberg
Oil Plummets to 17-Year Low as Broken Market Drowns in Crude - Bloomberg:
Oil tumbled to a 17-year low as coronavirus lockdowns cascaded through the world’s largest economies, leaving the market overwhelmed by cratering demand and a ballooning surplus.
Oil tumbled to a 17-year low as coronavirus lockdowns cascaded through the world’s largest economies, leaving the market overwhelmed by cratering demand and a ballooning surplus.
Finablr's auditors EY resign over list of 'concerns' - Arabianbusiness
Finablr's auditors EY resign over list of 'concerns' - Arabianbusiness:
Ernst & Young (EY) has resigned as auditor of Finablr, the embattled owner of foreign-exchange businesses including Travelex Holdings.
In a statement to the London Stock Exchange (LSE) on Monday, EY announced its resignation, citing concerns over corporate governance and the make-up of the board.
EY’s letter of resignation said there were “concerns arising out of recent events at the company and NMC Health plc…the composition of the board of the company, the adequacy of corporate governance concerns and the recent issues that have caused the company to commission an independent review of the company's financial arrangements, including of related party transactions and on and off- balance-sheet debt".
Prior to its resignation, EY had called for a number of changes to be made at board level.
Ernst & Young (EY) has resigned as auditor of Finablr, the embattled owner of foreign-exchange businesses including Travelex Holdings.
In a statement to the London Stock Exchange (LSE) on Monday, EY announced its resignation, citing concerns over corporate governance and the make-up of the board.
EY’s letter of resignation said there were “concerns arising out of recent events at the company and NMC Health plc…the composition of the board of the company, the adequacy of corporate governance concerns and the recent issues that have caused the company to commission an independent review of the company's financial arrangements, including of related party transactions and on and off- balance-sheet debt".
Prior to its resignation, EY had called for a number of changes to be made at board level.
Hedge funds trim short oil positions as prices hit crisis point: Kemp - Reuters
Hedge funds trim short oil positions as prices hit crisis point: Kemp - Reuters:
Hedge funds began trimming short positions in petroleum last week as crude oil prices fell to crisis levels for some producers and refiners and traders started to anticipate shutdowns at oilfields and refineries.
Extreme high and low prices are usually fleeting because they are dynamically unstable and contain the seeds of their own destruction, forcing large and accelerated adjustments from consumers and producers.
U.S. crude and distillate prices have been hit harder than Brent or gasoline, so fund managers seem to be anticipating they have the most potential for a short-term reversal.
Hedge funds and other money managers were net sellers of just 8 million barrels in the six major petroleum futures and options contracts in the week ending March 24.
Hedge funds began trimming short positions in petroleum last week as crude oil prices fell to crisis levels for some producers and refiners and traders started to anticipate shutdowns at oilfields and refineries.
Extreme high and low prices are usually fleeting because they are dynamically unstable and contain the seeds of their own destruction, forcing large and accelerated adjustments from consumers and producers.
U.S. crude and distillate prices have been hit harder than Brent or gasoline, so fund managers seem to be anticipating they have the most potential for a short-term reversal.
Hedge funds and other money managers were net sellers of just 8 million barrels in the six major petroleum futures and options contracts in the week ending March 24.
#Saudi, #UAE businesses battle cash crunch despite anti-coronavirus stimulus - Reuters
Saudi, UAE businesses battle cash crunch despite anti-coronavirus stimulus - Reuters:
Saudi Arabia and the United Arab Emirates are spending tens of billions to prop up their economies during the coronavirus crisis and oil price slump but the scaling back of state projects is blunting the impact.
The pain felt by the tourism, retail, hospitality and logistics sectors due to global travel disruptions and closure of most public venues is spreading to the contracting and oil services industries in the Arab world’s biggest economies.
Saudi Arabia last week announced suspension of work on the third phase of a $100 billion expansion of the Grand Mosque in Mecca over coronavirus fears. Two days earlier, construction giant Saudi Binladin Group said in an internal note, seen by Reuters, that two employees on the project had been infected.
Riyadh-based MOBCO Civil Construction sent a memo to staff in the Saudi cities of Riyadh, Mecca and Medina notifying them that it plans to cut wages between 25% to 50% due to “unforeseen circumstances of COVID-19”, according to the internal document dated March 25, which was seen by Reuters.
Saudi Arabia and the United Arab Emirates are spending tens of billions to prop up their economies during the coronavirus crisis and oil price slump but the scaling back of state projects is blunting the impact.
The pain felt by the tourism, retail, hospitality and logistics sectors due to global travel disruptions and closure of most public venues is spreading to the contracting and oil services industries in the Arab world’s biggest economies.
Saudi Arabia last week announced suspension of work on the third phase of a $100 billion expansion of the Grand Mosque in Mecca over coronavirus fears. Two days earlier, construction giant Saudi Binladin Group said in an internal note, seen by Reuters, that two employees on the project had been infected.
Riyadh-based MOBCO Civil Construction sent a memo to staff in the Saudi cities of Riyadh, Mecca and Medina notifying them that it plans to cut wages between 25% to 50% due to “unforeseen circumstances of COVID-19”, according to the internal document dated March 25, which was seen by Reuters.
U.S. crude dips below $20 as lockdowns wipe out demand - Reuters
U.S. crude dips below $20 as lockdowns wipe out demand - Reuters:
Oil prices fell sharply on Monday, with U.S. crude briefly dropping below $20 and Brent hitting its lowest level in 18 years, on heightened fears that the global coronavirus shutdown could last months and demand for fuel could decline further.
Brent crude, the international benchmark for oil prices, was down $2.08, or 8.3%, at $22.85 by 1127 GMT, after earlier dropping to $22.58, the lowest since November 2002.
U.S. West Texas Intermediate (WTI) crude fell $1.11, or 5.2%, to $20.40. Earlier in the session, WTI fell as low as $19.92.
The price of oil is now so low that it is becoming unprofitable for many oil firms to remain active, analysts said, and higher cost producers will have no choice but to shut production, especially since storage capacities are almost full.
Oil prices fell sharply on Monday, with U.S. crude briefly dropping below $20 and Brent hitting its lowest level in 18 years, on heightened fears that the global coronavirus shutdown could last months and demand for fuel could decline further.
Brent crude, the international benchmark for oil prices, was down $2.08, or 8.3%, at $22.85 by 1127 GMT, after earlier dropping to $22.58, the lowest since November 2002.
U.S. West Texas Intermediate (WTI) crude fell $1.11, or 5.2%, to $20.40. Earlier in the session, WTI fell as low as $19.92.
The price of oil is now so low that it is becoming unprofitable for many oil firms to remain active, analysts said, and higher cost producers will have no choice but to shut production, especially since storage capacities are almost full.
MIDEAST STOCKS-Weak oil, fears of prolonged lockdowns weigh on Mideast | Nasdaq
MIDEAST STOCKS-Weak oil, fears of prolonged lockdowns weigh on Mideast | Nasdaq:
Most bourses in the Middle East fell on Monday, weakened by a combination of lower oil prices and intensified fears that the global coronavirus shutdown could last for months.
Brent crude LCOc1, the international benchmark for oil prices, was down $1.92, or 7.7%, at $23.01 by 1027 GMT, after earlier dropping to $22.58, the lowest since November 2002.
In Abu Dhabi, the index .ADI sank 3.5%, with its top lender First Abu Dhabi Bank FAB.AD declining 5% and telecoms firm Etisalat ETISALAT.AD was down 3.1%.
Dubai's main share index .DFMGI eased 2.3%, led by a 4% fall in sharia Compliant lender Dubai Islamic Bank DISB.DU and a 4.1% drop in Emaar Properties EMAR.DU.
The United Arab Emirates on Saturday extended to April 5 a nightly curfew to combat the spread of coronavirus as neighbouring Qatar reported its first death from the disease.
The Qatari index .QSI was down 1.8%. Qatar Islamic Bank QISB.QA fell 3.3%, while Qatar National Bank QNBK.QA retreated 1.9%.
Most bourses in the Middle East fell on Monday, weakened by a combination of lower oil prices and intensified fears that the global coronavirus shutdown could last for months.
Brent crude LCOc1, the international benchmark for oil prices, was down $1.92, or 7.7%, at $23.01 by 1027 GMT, after earlier dropping to $22.58, the lowest since November 2002.
In Abu Dhabi, the index .ADI sank 3.5%, with its top lender First Abu Dhabi Bank FAB.AD declining 5% and telecoms firm Etisalat ETISALAT.AD was down 3.1%.
Dubai's main share index .DFMGI eased 2.3%, led by a 4% fall in sharia Compliant lender Dubai Islamic Bank DISB.DU and a 4.1% drop in Emaar Properties EMAR.DU.
The United Arab Emirates on Saturday extended to April 5 a nightly curfew to combat the spread of coronavirus as neighbouring Qatar reported its first death from the disease.
The Qatari index .QSI was down 1.8%. Qatar Islamic Bank QISB.QA fell 3.3%, while Qatar National Bank QNBK.QA retreated 1.9%.
Goldman Sees U.S., Russian Oil Most Vulnerable to Demand Crash - Bloomberg
Goldman Sees U.S., Russian Oil Most Vulnerable to Demand Crash - Bloomberg:
Oil demand is getting hammered at a faster pace than anyone had predicted and landlocked crude production in the U.S., Russia and Canada is most vulnerable, according to Goldman Sachs Group Inc.
Consumption will drop by 26 million barrels, or 25%, this week as social-distancing measures to contain the coronavirus now impact 92% of global GDP, analysts including Jeff Currie and Damien Courvalin said in a note. There’s been at least 900,000 barrels a day of announced shut-ins at the wellhead, with the true number likely higher and growing by the hour, they said.
“The ultimate magnitude of these shut-ins, which is still unknown, will likely permanently alter the energy industry and its geopolitics,” the analysts said. Landlocked crude prices are heading into negative territory and will eventually create an inflationary oil supply shock because so much production will have been halted, they said.
Brent crude will likely stay near cash costs of $20 a barrel with temporary downward spikes as waterborne varieties are better positioned compared with landlocked oil in the U.S., Canada and Russia that’s sitting behind pipelines, Goldman said. Shut-ins will be not be based upon where wells sit on the cost curve but rather on logistics and access, it said.
Oil demand is getting hammered at a faster pace than anyone had predicted and landlocked crude production in the U.S., Russia and Canada is most vulnerable, according to Goldman Sachs Group Inc.
Consumption will drop by 26 million barrels, or 25%, this week as social-distancing measures to contain the coronavirus now impact 92% of global GDP, analysts including Jeff Currie and Damien Courvalin said in a note. There’s been at least 900,000 barrels a day of announced shut-ins at the wellhead, with the true number likely higher and growing by the hour, they said.
“The ultimate magnitude of these shut-ins, which is still unknown, will likely permanently alter the energy industry and its geopolitics,” the analysts said. Landlocked crude prices are heading into negative territory and will eventually create an inflationary oil supply shock because so much production will have been halted, they said.
Brent crude will likely stay near cash costs of $20 a barrel with temporary downward spikes as waterborne varieties are better positioned compared with landlocked oil in the U.S., Canada and Russia that’s sitting behind pipelines, Goldman said. Shut-ins will be not be based upon where wells sit on the cost curve but rather on logistics and access, it said.
#SaudiArabia, Virus News: Banks Told to Support Businesses - Bloomberg
Saudi Arabia, Virus News: Banks Told to Support Businesses - Bloomberg:
Saudi Arabia’s central bank is ordering lenders to provide concessional loans to businesses grappling with the fallout of the coronavirus so companies won’t have to cut jobs.
The Saudi Arabian Monetary Authority wants banks to immediately put in place a lending program for at least six months to “assist in maintaining employment levels,” according to a document sent by the regulator to lenders and seen by Bloomberg. Banks should also provide relief on debt repayments for any customers that have already been dismissed, SAMA, as the central bank is known, said in the circular.
The measures “will come at a cost to shareholders as banks’ revenue will be put under more pressure by the waivers on fees and some interest charges,” Bloomberg Intelligence analyst Edmond Christou said in a note.
Saudi Arabia’s central bank is ordering lenders to provide concessional loans to businesses grappling with the fallout of the coronavirus so companies won’t have to cut jobs.
The Saudi Arabian Monetary Authority wants banks to immediately put in place a lending program for at least six months to “assist in maintaining employment levels,” according to a document sent by the regulator to lenders and seen by Bloomberg. Banks should also provide relief on debt repayments for any customers that have already been dismissed, SAMA, as the central bank is known, said in the circular.
The measures “will come at a cost to shareholders as banks’ revenue will be put under more pressure by the waivers on fees and some interest charges,” Bloomberg Intelligence analyst Edmond Christou said in a note.
MIDEAST STOCKS-Most Gulf stocks retreat on fears of prolonged shutdowns - Reuters
MIDEAST STOCKS-Most Gulf stocks retreat on fears of prolonged shutdowns - Reuters:
Most Gulf stock markets traded lower on Monday, driven down by banks, on heightened fears that the global coronavirus shutdown could last months.
More than 720,000 people have been infected by the coronavirus across the world and nearly 34,000 have died, according to a Reuters tally.
In Abu Dhabi, the index retreated 2%, as top lender First Abu Dhabi Bank slid 3.7%, while Abu Dhabi Commercial Bank declined 3.3%.
Dubai’s main share index dropped 1.1%, with its largest lender Emirates NBD losing 1.4% and Dubai Islamic Bank easing 0.8%.
Most Gulf stock markets traded lower on Monday, driven down by banks, on heightened fears that the global coronavirus shutdown could last months.
More than 720,000 people have been infected by the coronavirus across the world and nearly 34,000 have died, according to a Reuters tally.
In Abu Dhabi, the index retreated 2%, as top lender First Abu Dhabi Bank slid 3.7%, while Abu Dhabi Commercial Bank declined 3.3%.
Dubai’s main share index dropped 1.1%, with its largest lender Emirates NBD losing 1.4% and Dubai Islamic Bank easing 0.8%.
European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar
European, Middle Eastern & African Stocks - Bloomberg:
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
Oil futures slide as pandemic darkens demand outlook - Reuters
Oil futures slide as pandemic darkens demand outlook - Reuters:
Crude oil benchmarks fell sharply on Monday, with Brent hitting its lowest since November 2002, as fears grew over the coronavirus pandemic eroding demand and the Saudi Arabia-Russia price war threatened to overload the market.
Brent futures LCOc1 were down 5.8%, or $1.45, to $23.48 a barrel as of 0623 GMT, after earlier dropping to $23.03, the lowest since November 2002.
U.S. West Texas Intermediate (WTI) crude futures CLc1 fell as far as $19.92, near an 18-year low hit earlier this month, and was last trading down 3.8%, or $0.82, at $20.69 a barrel.
“Central banks have been easing (monetary policy) and governments have been offering stimulus packages, but they are only supportive measures, not radical treatments,” said Satoru Yoshida, a commodity analyst with Rakuten Securities.
Crude oil benchmarks fell sharply on Monday, with Brent hitting its lowest since November 2002, as fears grew over the coronavirus pandemic eroding demand and the Saudi Arabia-Russia price war threatened to overload the market.
Brent futures LCOc1 were down 5.8%, or $1.45, to $23.48 a barrel as of 0623 GMT, after earlier dropping to $23.03, the lowest since November 2002.
U.S. West Texas Intermediate (WTI) crude futures CLc1 fell as far as $19.92, near an 18-year low hit earlier this month, and was last trading down 3.8%, or $0.82, at $20.69 a barrel.
“Central banks have been easing (monetary policy) and governments have been offering stimulus packages, but they are only supportive measures, not radical treatments,” said Satoru Yoshida, a commodity analyst with Rakuten Securities.
Sunday 29 March 2020
BRIEF-QFC Regulatory Authority fines Horizon Crescent Wealth for Regulatory Violations - Reuters
BRIEF-QFC Regulatory Authority fines Horizon Crescent Wealth for Regulatory Violations - Reuters:
QATAR FINANCIAL CENTRE REGULATORY AUTHORITY:
* SAYS HAS TAKEN ENFORCEMENT ACTION AGAINST HORIZON CRESCENT WEALTH LLC (HCW)
* IMPOSED A FINE OF 30 MILLION RIYALS ON HCW AS A RESULT OF SERIOUS LEGAL AND REGULATORY BREACHES
* SAYS ENFORCEMENT ACTION TAKEN AFTER AN INVESTIGATION OF THE FIRM THAT IDENTIFIED SIGNIFICANT FAILINGS BY HCW IN ITS COMPLIANCE WITH THE ANTI-MONEY LAUNDERING AND COMBATING TERRORIST FINANCING RULES
* SAYS HCW HAD HELD ITSELF OUT AS CONDUCTING AN ASSET MANAGEMENT BUSINESS WITHOUT AUTHORISATION FROM THE QFCRA
#Kuwait Leads Drop in Mideast Stocks After Downgrade: Inside EM: Sunday March 29, 2020 - Bloomberg
Middle East Stock News: Sunday March 29, 2020 - Bloomberg:
Most Middle Eastern stock markets fell on Sunday, with Kuwait’s main index leading losses after S&P Global Ratings cut the government’s credit rating last week.
The Boursa Kuwait Premier Market Price index lost as much as 4.7% before finishing 3.4% lower, with Kuwait Finance House, National Bank of Kuwait and Ahli United Bank dropping more than 4%. Kuwait was downgraded one level to AA-, with S&P maintaining a stable outlook.
Lower oil prices in 2020 and 2021 will have negative economic and fiscal implications for Kuwait given its high reliance on exports, the ratings company said. On top of that, the country has lagged behind the reform momentum seen elsewhere in the region, the statement added.
Kuwait stocks will be added to MSCI Inc.’s emerging-markets benchmark in May. That is expected to trigger inflows from foreign investors. The benchmark tracking large caps in Kuwait is down 27% this year, contrasting with a 32% jump in 2019. It’s the second biggest drop in the Gulf this year after Dubai.
Most Middle Eastern stock markets fell on Sunday, with Kuwait’s main index leading losses after S&P Global Ratings cut the government’s credit rating last week.
The Boursa Kuwait Premier Market Price index lost as much as 4.7% before finishing 3.4% lower, with Kuwait Finance House, National Bank of Kuwait and Ahli United Bank dropping more than 4%. Kuwait was downgraded one level to AA-, with S&P maintaining a stable outlook.
Lower oil prices in 2020 and 2021 will have negative economic and fiscal implications for Kuwait given its high reliance on exports, the ratings company said. On top of that, the country has lagged behind the reform momentum seen elsewhere in the region, the statement added.
Kuwait stocks will be added to MSCI Inc.’s emerging-markets benchmark in May. That is expected to trigger inflows from foreign investors. The benchmark tracking large caps in Kuwait is down 27% this year, contrasting with a 32% jump in 2019. It’s the second biggest drop in the Gulf this year after Dubai.
#Dubai Real Estate, Property News: Limitless Restructuring Looms - Bloomberg
Dubai Real Estate, Property News: Limitless Restructuring Looms - Bloomberg:
Limitless World LLC is close to hiring financial and legal advisers for the Dubai-based developer’s third restructuring as the emirate’s on-going property slump is set to worsen.
The company told creditors that it’s in the “final stages” of engaging advisers to work on a restructuring plan as it’s “unable to pay accrued profit at the end of March,” according to a letter sent to banks and seen by Bloomberg.
Limitless’ board has recently been reorganized to comprise three members, who are being advised “on all matters” by a team from Dubai World, the letter said.
A spokeswoman for Limitless confirmed that the developer has written to creditors as a “first step toward finding a solution for all stakeholders,” without giving further details.
Limitless World LLC is close to hiring financial and legal advisers for the Dubai-based developer’s third restructuring as the emirate’s on-going property slump is set to worsen.
The company told creditors that it’s in the “final stages” of engaging advisers to work on a restructuring plan as it’s “unable to pay accrued profit at the end of March,” according to a letter sent to banks and seen by Bloomberg.
Limitless’ board has recently been reorganized to comprise three members, who are being advised “on all matters” by a team from Dubai World, the letter said.
A spokeswoman for Limitless confirmed that the developer has written to creditors as a “first step toward finding a solution for all stakeholders,” without giving further details.
S&P: Deteriorating conditions could put pressure on #UAE banks | ZAWYA MENA Edition
S&P: Deteriorating conditions could put pressure on UAE banks | ZAWYA MENA Edition:
S&P Global Ratings has revised its outlooks for five UAE banks from stable to negative, citing a deteriorating operating environment.
The ratings agency, which reviewed First Abu Dhabi Bank (FAB), Abu Dhabi Commercial Bank (ADCB), Mashreqbank, Sharjah Islamic Bank (SIB) and National Bank of Fujairah (NBF), warned that the weakening conditions could put pressure on banks’ profitability.
In its latest analysis, S&P expects that in 2020, the sharp drop in oil prices as well as reduced economic activity due to the coronavirus, will exert significant pressure on the UAE economy, especially the real estate, trade, retail, transportation and hospitality sectors.
“We expect loan quality will be tested and cost of risk will increase, weighing on banks' profitability in the next 12 to 24 months. In 2019, banks' asset quality indicators had already started to show signs of weakness,” S&P said in a note.
S&P Global Ratings has revised its outlooks for five UAE banks from stable to negative, citing a deteriorating operating environment.
The ratings agency, which reviewed First Abu Dhabi Bank (FAB), Abu Dhabi Commercial Bank (ADCB), Mashreqbank, Sharjah Islamic Bank (SIB) and National Bank of Fujairah (NBF), warned that the weakening conditions could put pressure on banks’ profitability.
In its latest analysis, S&P expects that in 2020, the sharp drop in oil prices as well as reduced economic activity due to the coronavirus, will exert significant pressure on the UAE economy, especially the real estate, trade, retail, transportation and hospitality sectors.
“We expect loan quality will be tested and cost of risk will increase, weighing on banks' profitability in the next 12 to 24 months. In 2019, banks' asset quality indicators had already started to show signs of weakness,” S&P said in a note.
Prolonged low oil prices, coronavirus crisis could hurt #Saudi | ZAWYA MENA Edition
Prolonged low oil prices, coronavirus crisis could hurt Saudi | ZAWYA MENA Edition:
Saudi Arabia continues to show resilience despite the current challenges posed by the coronavirus outbreak, but it could face some downside if oil prices will remain low for a longer period, analysts have suggested.
US-based international credit ratings agency Standard & Poor’s (S&P) has said it is affirming its A-/A-2 long- and short-term sovereign credit ratings on Saudi Arabia, with a stable outlook.
The latest positive review is due to analysts’ expectation that the current low oil price environment, although affecting fiscal flows, will be counterbalanced by the country’s strong government and external balance sheets.
“But prolonged low oil prices will erode [Saudi Arabia’s] net asset stock and begin to put pressure on the ratings,” S&P said.
Saudi Arabia continues to show resilience despite the current challenges posed by the coronavirus outbreak, but it could face some downside if oil prices will remain low for a longer period, analysts have suggested.
US-based international credit ratings agency Standard & Poor’s (S&P) has said it is affirming its A-/A-2 long- and short-term sovereign credit ratings on Saudi Arabia, with a stable outlook.
The latest positive review is due to analysts’ expectation that the current low oil price environment, although affecting fiscal flows, will be counterbalanced by the country’s strong government and external balance sheets.
“But prolonged low oil prices will erode [Saudi Arabia’s] net asset stock and begin to put pressure on the ratings,” S&P said.
#Saudi central bank asks banks to restructure financing without extra fees - Reuters
Saudi central bank asks banks to restructure financing without extra fees - Reuters:
Saudi Arabia’s central bank said banks should agree to restructure financing for customers without extra fees and asked banks to provide financing needed by private sector customers who lost their jobs.
The Saudi Arabian Monetary Authority said banks should review interest and other fees levied on credit cards in line with the recent drop in interest rates.
The guidelines are part of measures aimed at stemming the impact of the coronavirus outbreak, it said.
Saudi Arabia’s central bank said banks should agree to restructure financing for customers without extra fees and asked banks to provide financing needed by private sector customers who lost their jobs.
The Saudi Arabian Monetary Authority said banks should review interest and other fees levied on credit cards in line with the recent drop in interest rates.
The guidelines are part of measures aimed at stemming the impact of the coronavirus outbreak, it said.
European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar
European, Middle Eastern & African Stocks - Bloomberg:
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
The Coronavirus Means It's A Truly Free Market For Oil - Bloomberg
The Coronavirus Means It's A Truly Free Market For Oil - Bloomberg:
At the point we’re now at, postponing the oil-price war won’t make a lot of difference for an industry that’s already breaking down under the weight of demand destruction. It’s too late to use diplomacy and artful negotiations to share the burden of output cuts that are now inevitable.
The pumping free-for-all unleashed by Saudi Arabia and Russia is important for the long-term shape of the oil industry, but, as my colleague Javier Blas pointed out here, it’s a sideshow to the havoc being wrought by the lockdowns crippling economies worldwide in response to the coronavirus pandemic. Forecasts of a catastrophic drop in oil demand abound, with estimates of a whopping 20% year-on-year reduction in global consumption in April becoming more common. That’s 20 million barrels a day, equivalent to the entire consumption of the United States.
It would be impossible for any small group of producers to mitigate that kind of impact by reducing output, unless Saudi Arabia and Russia were both to slash their production to almost zero. And that’s not going to happen.
On Wednesday, U.S. Secretary of State Mike Pompeo called on Saudi Arabia’s Crown Prince Mohammed bin Salman to take the lead as his country prepared to host a meeting of the Group of 20 nations. Pompeo urged the kingdom “to rise to the occasion and reassure global energy and financial markets.” That’s a reasonable request. Somebody has to show leadership and it doesn’t look like it’s going to be President Donald Trump.
At the point we’re now at, postponing the oil-price war won’t make a lot of difference for an industry that’s already breaking down under the weight of demand destruction. It’s too late to use diplomacy and artful negotiations to share the burden of output cuts that are now inevitable.
The pumping free-for-all unleashed by Saudi Arabia and Russia is important for the long-term shape of the oil industry, but, as my colleague Javier Blas pointed out here, it’s a sideshow to the havoc being wrought by the lockdowns crippling economies worldwide in response to the coronavirus pandemic. Forecasts of a catastrophic drop in oil demand abound, with estimates of a whopping 20% year-on-year reduction in global consumption in April becoming more common. That’s 20 million barrels a day, equivalent to the entire consumption of the United States.
It would be impossible for any small group of producers to mitigate that kind of impact by reducing output, unless Saudi Arabia and Russia were both to slash their production to almost zero. And that’s not going to happen.
On Wednesday, U.S. Secretary of State Mike Pompeo called on Saudi Arabia’s Crown Prince Mohammed bin Salman to take the lead as his country prepared to host a meeting of the Group of 20 nations. Pompeo urged the kingdom “to rise to the occasion and reassure global energy and financial markets.” That’s a reasonable request. Somebody has to show leadership and it doesn’t look like it’s going to be President Donald Trump.
UPDATE 1-S&P cuts DAMAC's rating, puts Emaar Properties, Emaar Malls on creditwatch - Reuters
UPDATE 1-S&P cuts DAMAC's rating, puts Emaar Properties, Emaar Malls on creditwatch - Reuters:
S&P Global Ratings has downgraded Dubai’s DAMAC Properties to B from B+ and placed the BBB-(minus) ratings of Emaar Properties and Emaar Malls on creditwatch with negative implications, the ratings agency said in a statement.
It also lowered its outlook on DIFC Investments, a unit of the company running Dubai’s financial free zone, to ‘negative’ from ‘stable’.
S&P cited economic pressures from the coronavirus outbreak for the changes and said the ability of the government of Dubai to provide financial support for government related entities may weaken over the next one or two years.
The Dubai real estate sector has been struggling for years due to oversupply and sluggish economic growth.
S&P Global Ratings has downgraded Dubai’s DAMAC Properties to B from B+ and placed the BBB-(minus) ratings of Emaar Properties and Emaar Malls on creditwatch with negative implications, the ratings agency said in a statement.
It also lowered its outlook on DIFC Investments, a unit of the company running Dubai’s financial free zone, to ‘negative’ from ‘stable’.
S&P cited economic pressures from the coronavirus outbreak for the changes and said the ability of the government of Dubai to provide financial support for government related entities may weaken over the next one or two years.
The Dubai real estate sector has been struggling for years due to oversupply and sluggish economic growth.
S&P Sees #Dubai Property Prices Dropping to Levels Seen in 2010 - Bloomberg
Dubai Property Prices, Middle East Coronaviru News: Latest Update - Bloomberg:
The widening coronavirus pandemic could see Dubai property prices falling to levels last seen 10 years ago, according to S&P Global Ratings.
“We believe real estate prices are approaching levels seen at the bottom of the last cycle in 2010, and are even lower on an inflation-adjusted basis and considering sales incentives for off-plan property,” S&P Global Ratings said in a report.
“We also expect negative employment trends across some key sectors such as tourism and retail, as well as for certain small and midsize enterprises, which could weigh on demand for new properties.”
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Residential properties stand in the Al Satwa area of Dubai.
Photographer: Christopher Pike/Bloomberg |
The widening coronavirus pandemic could see Dubai property prices falling to levels last seen 10 years ago, according to S&P Global Ratings.
“We believe real estate prices are approaching levels seen at the bottom of the last cycle in 2010, and are even lower on an inflation-adjusted basis and considering sales incentives for off-plan property,” S&P Global Ratings said in a report.
“We also expect negative employment trends across some key sectors such as tourism and retail, as well as for certain small and midsize enterprises, which could weigh on demand for new properties.”
S&P rating action:
- Emaar Properties and Emaar Malls’ BBB- ratings on creditWatch with negative implications.
- Emaar Properties shares -43%; Emaar Malls -41%
- Damac Real Estate lowered to B from B+; outlook remains negative.
- Damac shares -35%
- Unlisted DIFC Investments’ revised to negative outlook from stable; affirms BBB- ratings.
The Global Oil Market Is Broken, Drowning in Crude Nobody Needs - Bloomberg
The Global Oil Market Is Broken, Drowning in Crude Nobody Needs - Bloomberg:
The global oil market is broken, overwhelmed by an unmanageable surplus as virus lockdowns cascade through the world’s largest economies.
Onshore tanks in many markets are full, forcing traders to store excess oil in idle supertankers. Refineries are starting to shut down because nobody needs the fuels they produce. In physical oil markets, barrels are already changing hands for less than $10, and in a few landlocked markets producers are paying consumers to take away their crude.
“The physical oil market has seized up,” said Gary Ross, an influential oil watcher and chief investment officer of Black Gold Investors LLC. “The logistics are struggling to cope because we are facing a catastrophic loss of demand.”
Oil traders say it’s likely to get worse this week.
The global oil market is broken, overwhelmed by an unmanageable surplus as virus lockdowns cascade through the world’s largest economies.
Onshore tanks in many markets are full, forcing traders to store excess oil in idle supertankers. Refineries are starting to shut down because nobody needs the fuels they produce. In physical oil markets, barrels are already changing hands for less than $10, and in a few landlocked markets producers are paying consumers to take away their crude.
“The physical oil market has seized up,” said Gary Ross, an influential oil watcher and chief investment officer of Black Gold Investors LLC. “The logistics are struggling to cope because we are facing a catastrophic loss of demand.”
Oil traders say it’s likely to get worse this week.
#Dubai firm tied to Trump posts loss as virus downturn looms
Dubai firm tied to Trump posts loss as virus downturn looms:
Dubai’s largest, fully private real estate developer posted on Sunday its first yearly loss since becoming a publicly traded company, a worrying sign for the sheikhdom’s already-reeling vital property market that’s been hit with the fallout from the coronavirus pandemic.
DAMAC Properties, which has business ties to U.S. President Donald Trump and hosts the Mideast’s only Trump-branded golf course, reported a loss of 36.8 million dirhams ($10 million) in 2019 off revenues of nearly 4.4 billion dirhams ($1.19 billion).
That’s compared to a 1.15 billion dirham ($313 million) profit in 2018 off revenues of 6.13 billion dirhams ($1.16 billion). The company became publicly traded in 2013.
In a statement posted to the Dubai Financial Market stock exchange, DAMAC chairman Hussain Sajwani praised Emirati leaders for working toward stabilizing the economy.
Dubai’s largest, fully private real estate developer posted on Sunday its first yearly loss since becoming a publicly traded company, a worrying sign for the sheikhdom’s already-reeling vital property market that’s been hit with the fallout from the coronavirus pandemic.
DAMAC Properties, which has business ties to U.S. President Donald Trump and hosts the Mideast’s only Trump-branded golf course, reported a loss of 36.8 million dirhams ($10 million) in 2019 off revenues of nearly 4.4 billion dirhams ($1.19 billion).
That’s compared to a 1.15 billion dirham ($313 million) profit in 2018 off revenues of 6.13 billion dirhams ($1.16 billion). The company became publicly traded in 2013.
In a statement posted to the Dubai Financial Market stock exchange, DAMAC chairman Hussain Sajwani praised Emirati leaders for working toward stabilizing the economy.
#Qatar Airways CEO says will keep flying but warns cash is running out - Reuters
Qatar Airways CEO says will keep flying but warns cash is running out - Reuters:
Qatar Airways will continue to operate flights as long as necessary to get stranded travelers home, Chief Executive Akbar al-Baker told Reuters on Sunday, but warned that the carrier could soon run out of cash.
“We have enough cash to take us through a very short period of time,” he said in a phone interview.
He said the airline would eventually have to seek support from its owner, the Qatar government.
The Middle East carrier is one of few global airlines to continue operate after the coronavirus decimated travel demand almost overnight.
Qatar Airways will continue to operate flights as long as necessary to get stranded travelers home, Chief Executive Akbar al-Baker told Reuters on Sunday, but warned that the carrier could soon run out of cash.
“We have enough cash to take us through a very short period of time,” he said in a phone interview.
He said the airline would eventually have to seek support from its owner, the Qatar government.
The Middle East carrier is one of few global airlines to continue operate after the coronavirus decimated travel demand almost overnight.
Oil-rich wealth funds seen shedding upto $225 billion in stocks - Reuters
Oil-rich wealth funds seen shedding upto $225 billion in stocks - Reuters:
Sovereign wealth funds from oil-producing countries mainly in the Middle East and Africa are on course to dump up to $225 billion in equities, a senior banker estimates, as plummeting oil prices and the coronavirus pandemic hit state finances.
The rapid spread of the virus has ravaged the global economy, sending markets into a tailspin and costing both oil and non-oil based sovereign wealth funds around $1 trillion in equity losses, according to JPMorgan strategist Nikolaos Panigirtzoglou.
His estimates are based on data from sovereign wealth funds and figures from the Sovereign Wealth Fund Institute, a research group.
Sticking with equity investments and risking more losses is not an option for some funds from oil producing nations. Their governments are facing a financial double-whammy – falling revenues due to the spiraling oil price and rocketing spending as administrations rush out emergency budgets.
Sovereign wealth funds from oil-producing countries mainly in the Middle East and Africa are on course to dump up to $225 billion in equities, a senior banker estimates, as plummeting oil prices and the coronavirus pandemic hit state finances.
The rapid spread of the virus has ravaged the global economy, sending markets into a tailspin and costing both oil and non-oil based sovereign wealth funds around $1 trillion in equity losses, according to JPMorgan strategist Nikolaos Panigirtzoglou.
His estimates are based on data from sovereign wealth funds and figures from the Sovereign Wealth Fund Institute, a research group.
Sticking with equity investments and risking more losses is not an option for some funds from oil producing nations. Their governments are facing a financial double-whammy – falling revenues due to the spiraling oil price and rocketing spending as administrations rush out emergency budgets.
European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar
European, Middle Eastern & African Stocks - Bloomberg:
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
MIDEAST STOCKS-Stocks in Middle East fall on coronavirus impact - Reuters
MIDEAST STOCKS-Stocks in Middle East fall on coronavirus impact - Reuters:
Middle Eastern stocks declined on Sunday in early trade, as the economies across the globe remained pressured from the coronavirus outbreak as the cases continued to surge.
More than 615,600 people have been infected by the coronavirus across the world and 28,316 have died, according to a Reuters tally.
In Qatar, which on Saturday recorded its first death from the coronavirus, the index lost 1.3%, dragged down by a 2.8% fall in Qatar National Bank and 2.1% fall in petrochemical maker Industries Qatar.
The Gulf state was latest to report its first virus-related death, a Bangladeshi resident. The majority of the 590 cases in Qatar are among migrant labourers, where foreigners make up most of the work force.
Middle Eastern stocks declined on Sunday in early trade, as the economies across the globe remained pressured from the coronavirus outbreak as the cases continued to surge.
More than 615,600 people have been infected by the coronavirus across the world and 28,316 have died, according to a Reuters tally.
In Qatar, which on Saturday recorded its first death from the coronavirus, the index lost 1.3%, dragged down by a 2.8% fall in Qatar National Bank and 2.1% fall in petrochemical maker Industries Qatar.
The Gulf state was latest to report its first virus-related death, a Bangladeshi resident. The majority of the 590 cases in Qatar are among migrant labourers, where foreigners make up most of the work force.
Coronavirus to drive steeper decline in property prices, more rent freezes in #Dubai: S&P | ZAWYA MENA Edition
Coronavirus to drive steeper decline in property prices, more rent freezes in Dubai: S&P | ZAWYA MENA Edition:
As the coronavirus crisis continues to ravage economies worldwide, home prices in Dubai will decline more steeply and landlords will be forced to freeze rents, according to the latest analysis.
S&P has also lowered its ratings on some major Dubai-based real estate firms, citing that the current health pandemic is likely to reduce international and local demand for property in the emirate.
Dubai’s real estate has been struggling to cope with excess residential supply, which has caused prices and rents to decline. In 2019, more than 35,000 homes were still completed, the highest number delivered in a single year in the emirate. There were expectations that that high supply could be absorbed by the increase in demand during the Expo 2020 later this year.
However, with business activity and non-essential services now grinding to a halt due to the outbreak, it is not clear yet if the global event will push through as scheduled or boost demand.
As the coronavirus crisis continues to ravage economies worldwide, home prices in Dubai will decline more steeply and landlords will be forced to freeze rents, according to the latest analysis.
S&P has also lowered its ratings on some major Dubai-based real estate firms, citing that the current health pandemic is likely to reduce international and local demand for property in the emirate.
Dubai’s real estate has been struggling to cope with excess residential supply, which has caused prices and rents to decline. In 2019, more than 35,000 homes were still completed, the highest number delivered in a single year in the emirate. There were expectations that that high supply could be absorbed by the increase in demand during the Expo 2020 later this year.
However, with business activity and non-essential services now grinding to a halt due to the outbreak, it is not clear yet if the global event will push through as scheduled or boost demand.
Saturday 28 March 2020
#SaudiArabia extends suspension of flights, work indefinitely - Reuters
Saudi Arabia extends suspension of flights, work indefinitely - Reuters:
Saudi Arabia said on Sunday it was extending indefinitely the suspension of international passenger flights and workplace attendance in both public and private sectors among efforts to contain the spread of the coronavirus.
Domestic flights, trains, buses and taxis also remain suspended, the Interior Ministry said in a statement.
Saudi Arabia said on Sunday it was extending indefinitely the suspension of international passenger flights and workplace attendance in both public and private sectors among efforts to contain the spread of the coronavirus.
Domestic flights, trains, buses and taxis also remain suspended, the Interior Ministry said in a statement.
#Dubai Announces Economic Incentive Package for its Free Zones - Bloomberg
Dubai Announces Economic Incentive Package for its Free Zones - Bloomberg:
Dubai announced an economic incentive package for its free zones on Saturday in the light of “exceptional circumstances” related to the coronavirus pandemic.
The measure consists of five parts, including postponing rent payments for six months and cancellation of some fines for companies and individuals, the state-run Emirates News Agency reported. The city is home to a number of free zones, including the Dubai International Financial Center.
The United Arab Emirates previously rolled out a $34 billion stimulus package to fend off the impact of the coronavirus. The Gulf nation has reported 468 virus cases so far, including two fatalities.
Dubai announced an economic incentive package for its free zones on Saturday in the light of “exceptional circumstances” related to the coronavirus pandemic.
The measure consists of five parts, including postponing rent payments for six months and cancellation of some fines for companies and individuals, the state-run Emirates News Agency reported. The city is home to a number of free zones, including the Dubai International Financial Center.
The United Arab Emirates previously rolled out a $34 billion stimulus package to fend off the impact of the coronavirus. The Gulf nation has reported 468 virus cases so far, including two fatalities.
S&P lowers #Kuwait rating to AA-, outlook stable | ZAWYA MENA Edition
S&P lowers Kuwait rating to AA-, outlook stable | ZAWYA MENA Edition:
Standard and Poor's (S&P) has lowered Kuwait's long-term foreign and local-currency sovereign credit ratings to (AA-) from (AA), Kuwait News Agency (KUNA) reported
"The oil price drop is happening alongside Kuwait's slow reform momentum, which has generally lagged that of other regional countries in recent years," the rating agency said in a report, projecting a stable economic outlook.
The stable outlook is due to “Kuwait's sizable fiscal and balance-of-payments buffers provide the government with headroom for policy measures over the next two years.”
On the other hand, S&P affirmed Kuwait’s (A-1+) short-term foreign and local currency sovereign credit ratings.
Standard and Poor's (S&P) has lowered Kuwait's long-term foreign and local-currency sovereign credit ratings to (AA-) from (AA), Kuwait News Agency (KUNA) reported
"The oil price drop is happening alongside Kuwait's slow reform momentum, which has generally lagged that of other regional countries in recent years," the rating agency said in a report, projecting a stable economic outlook.
The stable outlook is due to “Kuwait's sizable fiscal and balance-of-payments buffers provide the government with headroom for policy measures over the next two years.”
On the other hand, S&P affirmed Kuwait’s (A-1+) short-term foreign and local currency sovereign credit ratings.
Petrostates Hammered by Oil Price Plunge and Pandemic’s Spread - Bloomberg
Petrostates Hammered by Oil Price Plunge and Pandemic’s Spread - Bloomberg:
Kazakhstan’s long-standing leader calls it a “perfect storm.” Venezuela’s government is shutting fuel stations across the country. Chad is paying its sovereign debts using cattle.
Across the oil-rich states of Africa, the Middle East, Latin America and the former Soviet Union, leaders accustomed to a steady flow of petrodollars see trouble ahead as the oil price war promises to destabilize their economies -- and perhaps their hold on power.
Of course, it’s not just oil-producing countries that are suffering a dramatic economic shock as the coronavirus pandemic sweeps across the world, but for the world’s petrostates, the collapse in oil prices adds another layer of pain. The plunge in export income is putting pressure on currencies and pushing up bond yields just as the virus is ramping up the call on social spending.
“There’s no sugar coating: It’s going to be very difficult for producers,” said Russell Hardy, CEO of oil trader Vitol Group. “With the exception of a few countries with deep pockets, everyone is suffering. All oil producing countries will have to trim budgets and may have to look at financing.”
Kazakhstan’s long-standing leader calls it a “perfect storm.” Venezuela’s government is shutting fuel stations across the country. Chad is paying its sovereign debts using cattle.
Across the oil-rich states of Africa, the Middle East, Latin America and the former Soviet Union, leaders accustomed to a steady flow of petrodollars see trouble ahead as the oil price war promises to destabilize their economies -- and perhaps their hold on power.
Of course, it’s not just oil-producing countries that are suffering a dramatic economic shock as the coronavirus pandemic sweeps across the world, but for the world’s petrostates, the collapse in oil prices adds another layer of pain. The plunge in export income is putting pressure on currencies and pushing up bond yields just as the virus is ramping up the call on social spending.
“There’s no sugar coating: It’s going to be very difficult for producers,” said Russell Hardy, CEO of oil trader Vitol Group. “With the exception of a few countries with deep pockets, everyone is suffering. All oil producing countries will have to trim budgets and may have to look at financing.”
London Ritz Sale Said to Fetch Less Than 800 Million Pounds - Bloomberg #Qatar
London Ritz Sale Said to Fetch Less Than 800 Million Pounds - Bloomberg:
The sale of London’s Ritz Hotel by the U.K.’s billionaire Barclay twins fetched less than 800 million pounds ($997 million), according to a person familiar with the matter who asked not to be identified.
Law firm Macfarlanes said in a statement that it advised one of its private Qatari investor clients on the acquisition of the hotel that opened in London’s Mayfair in 1906.
“It is a privilege to become the owner of the iconic Ritz Hotel and have the opportunity to build on its innate style and grand traditions,” a spokesperson for the new owner said in the statement Friday.
The Ritz, which occupies a prime frontage in London’s St James’ district, is at the heart of a spat among the heirs of David and Frederick Barclay. The dispute became public last month after a court hearing that revealed Frederick was being secretly recorded by a nephew at the hotel.
The sale of London’s Ritz Hotel by the U.K.’s billionaire Barclay twins fetched less than 800 million pounds ($997 million), according to a person familiar with the matter who asked not to be identified.
Law firm Macfarlanes said in a statement that it advised one of its private Qatari investor clients on the acquisition of the hotel that opened in London’s Mayfair in 1906.
“It is a privilege to become the owner of the iconic Ritz Hotel and have the opportunity to build on its innate style and grand traditions,” a spokesperson for the new owner said in the statement Friday.
The Ritz, which occupies a prime frontage in London’s St James’ district, is at the heart of a spat among the heirs of David and Frederick Barclay. The dispute became public last month after a court hearing that revealed Frederick was being secretly recorded by a nephew at the hotel.
Oil News, OPEC: OPEC Members Aren’t Backing Request for Urgent Consultations - Bloomberg
Oil News, OPEC: Latest on Crude Prices in Energy War - Bloomberg:
OPEC nations aren’t giving support to a request from the group’s president for emergency consultations over tanking oil prices, according to a delegate.
Algeria, which holds the cartel’s rotating presidency, urged the secretariat this week to convene a panel that assesses market conditions as oil slumps amid the coronavirus crisis and a price war launched by OPEC’s biggest member, Saudi Arabia.
However, the request has failed to gather the majority backing necessary to go ahead, said the delegate, who declined to be identified as the group’s discussions are private. Riyadh is among those opposing the idea.
The kingdom remains locked in a bitter fight for market dominance with Russia after the two exporters -- who had led an alliance between OPEC and non-members -- clashed this month over how to deal with the coronavirus crisis.
OPEC nations aren’t giving support to a request from the group’s president for emergency consultations over tanking oil prices, according to a delegate.
Algeria, which holds the cartel’s rotating presidency, urged the secretariat this week to convene a panel that assesses market conditions as oil slumps amid the coronavirus crisis and a price war launched by OPEC’s biggest member, Saudi Arabia.
However, the request has failed to gather the majority backing necessary to go ahead, said the delegate, who declined to be identified as the group’s discussions are private. Riyadh is among those opposing the idea.
The kingdom remains locked in a bitter fight for market dominance with Russia after the two exporters -- who had led an alliance between OPEC and non-members -- clashed this month over how to deal with the coronavirus crisis.
#Dubai braces for financial hit as coronavirus batters vital tourism - Reuters
Dubai braces for financial hit as coronavirus batters vital tourism - Reuters:
The sundecks on Dubai’s beaches lie empty, and red flags warn visitors away from the waterfront to protect the Middle East’s tourism hub against coronavirus.
The infection is starting to deliver a painful blow to Dubai, one of the most visited cities globally, with some hotels closed and occupancy rates falling to less than 10% in others.
Hotels are working to protect remaining staff and guests, taking their temperature and giving them hand sanitizer. Restaurants have been reconfigured to space out dining tables.
But hotel workers worry this slowdown is only the start of something more damaging, and while authorities have said beaches and pools will be closed for just two weeks, officials have indicated those restrictions could be renewed.
The sundecks on Dubai’s beaches lie empty, and red flags warn visitors away from the waterfront to protect the Middle East’s tourism hub against coronavirus.
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| Aerial view of the Sheikh Zayed Road, following the outbreak of coronavirus disease (COVID-19), in Dubai, United Arab Emirates, March 26, 2020. REUTERS/Satish Kumar |
The infection is starting to deliver a painful blow to Dubai, one of the most visited cities globally, with some hotels closed and occupancy rates falling to less than 10% in others.
Hotels are working to protect remaining staff and guests, taking their temperature and giving them hand sanitizer. Restaurants have been reconfigured to space out dining tables.
But hotel workers worry this slowdown is only the start of something more damaging, and while authorities have said beaches and pools will be closed for just two weeks, officials have indicated those restrictions could be renewed.
UPDATE 1-S&P cuts #Oman rating deeper into junk, trims Bahrain's outlook - Reuters
UPDATE 1-S&P cuts Oman rating deeper into junk, trims Bahrain's outlook - Reuters:
Rating agency S&P has lowered crude producer Oman’s sovereign ratings deeper into junk territory, citing external challenges, and changed the outlook for Bahrain’s ratings to stable from positive due to the country’s dependence on oil revenue.
The changes came after S&P recently cut its forecast the Brent crude oil benchmark to an average of $30 a barrel in 2020, $50 per barrel in 2021, and $55 a barrel from 2022.
S&P cut Oman’s long-term foreign and local currency sovereign ratings to ‘BB-‘ from ‘BB’, citing higher external risks and indebtedness.
Rating agency S&P has lowered crude producer Oman’s sovereign ratings deeper into junk territory, citing external challenges, and changed the outlook for Bahrain’s ratings to stable from positive due to the country’s dependence on oil revenue.
The changes came after S&P recently cut its forecast the Brent crude oil benchmark to an average of $30 a barrel in 2020, $50 per barrel in 2021, and $55 a barrel from 2022.
S&P cut Oman’s long-term foreign and local currency sovereign ratings to ‘BB-‘ from ‘BB’, citing higher external risks and indebtedness.
Friday 27 March 2020
Energy Closing oil prices - Bloomberg
Energy - Bloomberg:
Get updated commodity futures prices. Find information about commodity prices and trading, and find the latest commodity index comparison charts.
Get updated commodity futures prices. Find information about commodity prices and trading, and find the latest commodity index comparison charts.
Ithmar Capital boss becomes NMC Health chairman after it acquires 9% stake - The National
Ithmar Capital boss becomes NMC Health chairman after it acquires 9% stake - The National:
NMC Health said its non-executive chairman, Mark Tompkins, stepped down from the board with “immediate effect”.
It has appointed Ithmar Capital’s managing partner, Faisal Belhoul, executive chairman after the private equity company based in Dubai took a 9 per cent stake in NMC.
Mr Tompkins had been joint non-executive chairman of NMC Health since 2012 alongside the company’s founder, BR Shetty.
Mr Shetty stepped down from his position as joint non-executive chairman of the struggling company last month after disclosures about its governance.
“The board confirms that following a period of ill health over the last few weeks, which has prevented him from participation in board activities, Mr HJ Mark Tompkins has left the board and ceased to be chairman and a director of the company with immediate effect,” NMC Health said after markets closed on Thursday.
NMC Health said its non-executive chairman, Mark Tompkins, stepped down from the board with “immediate effect”.
It has appointed Ithmar Capital’s managing partner, Faisal Belhoul, executive chairman after the private equity company based in Dubai took a 9 per cent stake in NMC.
Mr Tompkins had been joint non-executive chairman of NMC Health since 2012 alongside the company’s founder, BR Shetty.
Mr Shetty stepped down from his position as joint non-executive chairman of the struggling company last month after disclosures about its governance.
“The board confirms that following a period of ill health over the last few weeks, which has prevented him from participation in board activities, Mr HJ Mark Tompkins has left the board and ceased to be chairman and a director of the company with immediate effect,” NMC Health said after markets closed on Thursday.
Trump Didn’t Calm Oil Markets -- and Now It May Be Too Late - Bloomberg
Trump Didn’t Calm Oil Markets -- and Now It May Be Too Late - Bloomberg:
When Saudi Arabia kicked off its oil-price war and triggered the worst crude crash in a generation, U.S. President Donald Trump lauded the ensuing decline in pump prices, saying it would be “like a tax cut” for Americans.
Weeks later, the crisis remains a low priority for the president, who has continually expressed his satisfaction with cheap gasoline and whose agenda has been consumed by the coronavirus pandemic itself, according to people familiar with the situation.
While Secretary of State Mike Pompeo on Wednesday took the strongest action yet to calm the market -- pressing Saudi Arabia to dial back its production surge -- the kingdom has shown no signs of slowing down.
Now, with thousands of oil jobs hanging in the balance and the U.S. shale industry in upheaval, any action by Trump himself may be too little, too late. Oil’s downturn has rapidly devolved from a simple case of too much supply to a worst-case scenario of total demand destruction -- a problem far harder to solve from the Oval Office.
When Saudi Arabia kicked off its oil-price war and triggered the worst crude crash in a generation, U.S. President Donald Trump lauded the ensuing decline in pump prices, saying it would be “like a tax cut” for Americans.
Weeks later, the crisis remains a low priority for the president, who has continually expressed his satisfaction with cheap gasoline and whose agenda has been consumed by the coronavirus pandemic itself, according to people familiar with the situation.
While Secretary of State Mike Pompeo on Wednesday took the strongest action yet to calm the market -- pressing Saudi Arabia to dial back its production surge -- the kingdom has shown no signs of slowing down.
Now, with thousands of oil jobs hanging in the balance and the U.S. shale industry in upheaval, any action by Trump himself may be too little, too late. Oil’s downturn has rapidly devolved from a simple case of too much supply to a worst-case scenario of total demand destruction -- a problem far harder to solve from the Oval Office.
OPEC Nations Howl for Mercy as #Saudi-Russia Oil War Deepens - Bloomberg
OPEC Nations Howl for Mercy as Saudi-Russia Oil War Deepens - Bloomberg:
With no end in sight to the oil-price war between Saudi Arabia and Russia, their former OPEC+ partners are pleading for mercy as the economic damage worsens.
Algeria and Iraq have urged the Organization of Petroleum Exporting Countries to hold emergency consultations as the market buckles under a flood of crude. Nigeria is openly wondering how much of the brutal worldwide contest for market share it can stand.
There’s little sign that their howls will be heeded in Moscow and Riyadh, where political leaders are digging in for a long conflict. It’s also questionable whether the cartel -- even if its two leaders managed to resolve their differences -- could staunch oil’s losses as demand goes into free fall.
“It’s in our interests, collective interests, to ensure that we are able to stabilize the market,” Nigeria’s Oil Minister Timipre Sylva said in an interview. “I cannot say for now if there’s any truce in sight.”
With no end in sight to the oil-price war between Saudi Arabia and Russia, their former OPEC+ partners are pleading for mercy as the economic damage worsens.
Algeria and Iraq have urged the Organization of Petroleum Exporting Countries to hold emergency consultations as the market buckles under a flood of crude. Nigeria is openly wondering how much of the brutal worldwide contest for market share it can stand.
There’s little sign that their howls will be heeded in Moscow and Riyadh, where political leaders are digging in for a long conflict. It’s also questionable whether the cartel -- even if its two leaders managed to resolve their differences -- could staunch oil’s losses as demand goes into free fall.
“It’s in our interests, collective interests, to ensure that we are able to stabilize the market,” Nigeria’s Oil Minister Timipre Sylva said in an interview. “I cannot say for now if there’s any truce in sight.”
Oil Tankers Fill at Record Pace as Glut Overwhelms Storage - Bloomberg
Oil Tankers Fill at Record Pace as Glut Overwhelms Storage - Bloomberg:
The world’s oil tankers are being filled with crude at a record pace as the options to store a glut on land rapidly diminish, one of the industry’s largest owners said.
A combination of surging production from key producers worldwide and capitulating demand in the face of the coronavirus outbreak means that land storage is being overwhelmed, said Robert Hvide Macleod, Chief Executive Officer of Frontline Management AS. The world is likely overproducing by about 20 million barrels a day, or 20% of normal consumption, he said, echoing wider industry views.
“Oil is going on ships at a speed never seen before,” he said, noting that the tanker fleet is filling up at five times the pace of the last oil glut in 2015.
The oil market’s structure has fallen into a so-called super contango, which means it is now profitable for traders to buy oil today, store it, and reap the profits by selling it at a higher price months or even years down the line. International Seaways Inc., another owner, said on Thursday that the total volume of oil in floating storage may top 100 million barrels during this glut.
The world’s oil tankers are being filled with crude at a record pace as the options to store a glut on land rapidly diminish, one of the industry’s largest owners said.
A combination of surging production from key producers worldwide and capitulating demand in the face of the coronavirus outbreak means that land storage is being overwhelmed, said Robert Hvide Macleod, Chief Executive Officer of Frontline Management AS. The world is likely overproducing by about 20 million barrels a day, or 20% of normal consumption, he said, echoing wider industry views.
“Oil is going on ships at a speed never seen before,” he said, noting that the tanker fleet is filling up at five times the pace of the last oil glut in 2015.
The oil market’s structure has fallen into a so-called super contango, which means it is now profitable for traders to buy oil today, store it, and reap the profits by selling it at a higher price months or even years down the line. International Seaways Inc., another owner, said on Thursday that the total volume of oil in floating storage may top 100 million barrels during this glut.
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