Oil steadies as market ponders Iran's next move - Reuters:
Oil prices steadied on Monday after Brent touched above $70 a barrel on rhetoric from the United States, Iran and Iraq that fanned tensions in the Middle East after a U.S. air strike killed a top Iranian military commander.
Prices pared gains during the session on growing doubts that Iran would strike back in a way that would disrupt oil supplies.
Brent crude futures LCOc1 settled at $68.91 a barrel, up 31 cents, after soaring to a high of $70.74 a barrel from Friday’s settlement.
U.S. West Texas Intermediate CLc1 crude was up 22 cents at $63.27 a barrel after hitting $64.72, its highest since April.
Monday 6 January 2020
Oil inches up as #Iran and United States trade threats - Reuters
Oil inches up as Iran and United States trade threats - Reuters:
Oil prices edged up on Monday, after Brent touched above $70 a barrel, as rhetoric from the United States, Iran and Iraq fanned tensions in the Middle East after a U.S. air strike killed a top Iranian military commander.
Brent crude futures LCOc1 gained 35 cents to $68.95 a barrel by 2:14 p.m. EST (1914 GMT), after soaring to a high of $70.74 a barrel from Friday’s settlement.
U.S. West Texas Intermediate CLc1 crude was up 24 cents at $63.29 a barrel after hitting $64.72, its highest since April.
Oil pared gains during the session on rising doubts that Iran would strike back in a way that would disrupt oil supplies.
“There seems to be an emerging dialogue along the lines that it’s not in the Iranians’ interest to lash out and attack oil infrastructure,” said Bob Yawger, director of futures at Mizuho in New York. “Because any attack on the oil infrastructure would most likely rally the barrel and that would, in turn, most likely shut down Iranian exports.”
Oil prices edged up on Monday, after Brent touched above $70 a barrel, as rhetoric from the United States, Iran and Iraq fanned tensions in the Middle East after a U.S. air strike killed a top Iranian military commander.
Brent crude futures LCOc1 gained 35 cents to $68.95 a barrel by 2:14 p.m. EST (1914 GMT), after soaring to a high of $70.74 a barrel from Friday’s settlement.
U.S. West Texas Intermediate CLc1 crude was up 24 cents at $63.29 a barrel after hitting $64.72, its highest since April.
Oil pared gains during the session on rising doubts that Iran would strike back in a way that would disrupt oil supplies.
“There seems to be an emerging dialogue along the lines that it’s not in the Iranians’ interest to lash out and attack oil infrastructure,” said Bob Yawger, director of futures at Mizuho in New York. “Because any attack on the oil infrastructure would most likely rally the barrel and that would, in turn, most likely shut down Iranian exports.”
New identity unveiled following $13.7bn Kamco-Global merger - Arabianbusiness
New identity unveiled following $13.7bn Kamco-Global merger - Arabianbusiness:
Kuwait-based Kamco Investment Company has unveiled its new identity, Kamco Invest, after completing a merger with Global Investment House.
The new company’s assets under management stands at about $13.7 billion, ranked as the fifth largest asset manager in the Gulf region.
Faisal Mansour Sarkhou, CEO, said the merger comes at a crucial phase in Kamco’s implementation of its growth and expansion strategy which was initiated back in 2014.
He said: “Today we are in the second phase of implementing our strategy as we become a more competitive investment company in the local and regional markets. Kamco Invest will offer clients an integrated set of investment solutions, a wealth of expertise and advanced systems that are inline with the best international standards within this sector.”
Kuwait-based Kamco Investment Company has unveiled its new identity, Kamco Invest, after completing a merger with Global Investment House.
The new company’s assets under management stands at about $13.7 billion, ranked as the fifth largest asset manager in the Gulf region.
Faisal Mansour Sarkhou, CEO, said the merger comes at a crucial phase in Kamco’s implementation of its growth and expansion strategy which was initiated back in 2014.
He said: “Today we are in the second phase of implementing our strategy as we become a more competitive investment company in the local and regional markets. Kamco Invest will offer clients an integrated set of investment solutions, a wealth of expertise and advanced systems that are inline with the best international standards within this sector.”
#Iran's Soleimani killing has rapidly escalated Gulf event risks: S&P Global - Reuters
Iran's Soleimani killing has rapidly escalated Gulf event risks: S&P Global - Reuters:
Bahrain, Qatar and Oman’s sovereign ratings would be the most vulnerable to a protracted and wider conflict in the Gulf region following the killing of Iran’s top military commander Qassem Soleimani, S&P Global said on Monday.
If tensions continued to escalate, the fiscal boost that could come from higher oil prices would likely be offset by capital outflows and weaker economic growth, a group of S&P’s analysts said in a report.
“We view Bahrain and Qatar as more vulnerable to outflows given their high external financing needs, relating to their respective banking sectors,” they said.
“Oman’s reliance on external debt is a key contributor to our negative outlook on the ‘BB/B’ sovereign rating; a higher risk premium in the event of escalating conflict could further pressure already-rising debt-servicing costs.”
Bahrain, Qatar and Oman’s sovereign ratings would be the most vulnerable to a protracted and wider conflict in the Gulf region following the killing of Iran’s top military commander Qassem Soleimani, S&P Global said on Monday.
If tensions continued to escalate, the fiscal boost that could come from higher oil prices would likely be offset by capital outflows and weaker economic growth, a group of S&P’s analysts said in a report.
“We view Bahrain and Qatar as more vulnerable to outflows given their high external financing needs, relating to their respective banking sectors,” they said.
“Oman’s reliance on external debt is a key contributor to our negative outlook on the ‘BB/B’ sovereign rating; a higher risk premium in the event of escalating conflict could further pressure already-rising debt-servicing costs.”
#Iran's Retaliation Could Cause A Middle East Oil Shock | OilPrice.com
Iran's Retaliation Could Cause A Middle East Oil Shock | OilPrice.com:
Iran’s clerical leadership, under “Supreme Leader” Ayatollah Ali HoseiniKhamene‘i, is expected to make rapid, significant, and symbolic responses to the targeted killing in Baghdad on January 3, 2019, of Iranian Revolutionary Guard Corps Quds Force commander Maj.-Gen. Qasem Soleimani.
It seems unlikely that the Iranian response would initially be to launch a military assault on Israel, which it has been planning, but, rather, something which could target the oil production and exports of the US’ key allies in the region: Saudi Arabia, the United Arab Emirates, and Bahrain, in particular (but not exclusively). The event was not only decisive for the US-Iranian dynamic, but it will also have long-term structural effects on the supply of oil and gas.
This will particularly impact (negatively) the People’s Republic of China (PRC) and, positively in the short-term, Russia. This comes at a time when the PRC economy is already suffering severe degradation, so the net effect of a significant rise in oil prices would be to accelerate the PRC recession, which would, in turn, significantly impact the global economy as 2020 progressed.
This could, then, have an impact on the US November 2020 Presidential and Congressional elections, although the decline in the PRC economy was always going to have an impact on the US during the year in any event. The pivotal event of the killing of Soleimani seems likely, therefore, to ensure that the US and the PRC will now work to cement a trade resolution as quickly as possible.
Iran’s clerical leadership, under “Supreme Leader” Ayatollah Ali HoseiniKhamene‘i, is expected to make rapid, significant, and symbolic responses to the targeted killing in Baghdad on January 3, 2019, of Iranian Revolutionary Guard Corps Quds Force commander Maj.-Gen. Qasem Soleimani.
It seems unlikely that the Iranian response would initially be to launch a military assault on Israel, which it has been planning, but, rather, something which could target the oil production and exports of the US’ key allies in the region: Saudi Arabia, the United Arab Emirates, and Bahrain, in particular (but not exclusively). The event was not only decisive for the US-Iranian dynamic, but it will also have long-term structural effects on the supply of oil and gas.
This will particularly impact (negatively) the People’s Republic of China (PRC) and, positively in the short-term, Russia. This comes at a time when the PRC economy is already suffering severe degradation, so the net effect of a significant rise in oil prices would be to accelerate the PRC recession, which would, in turn, significantly impact the global economy as 2020 progressed.
This could, then, have an impact on the US November 2020 Presidential and Congressional elections, although the decline in the PRC economy was always going to have an impact on the US during the year in any event. The pivotal event of the killing of Soleimani seems likely, therefore, to ensure that the US and the PRC will now work to cement a trade resolution as quickly as possible.
MIDEAST STOCKS-Most Gulf markets stabilise after steep falls over Iran - Reuters
MIDEAST STOCKS-Most Gulf markets stabilise after steep falls over Iran - Reuters:
Most major markets in the Middle East
stabilised on Monday after steep declines in the previous
session on U.S.-Iran tensions, with some eking out small gains
on the day.
Tehran promised vengeance after a U.S. air strike in Baghdad
on Friday killed Iranian military commander Qassem Soleimani.
U.S. President Donald Trump said the United States would
retaliate if Tehran struck back after the killing.
"Escalation encourages money to leave the region and reduces
investment inflows, as an actual war would be devastating for
regional economies," said Firas Modad, Middle East and North
Africa director at IHS Markit.
"It also raises the price of oil, but not enough to plug the
hole in the Saudi budget."
Saudi Arabia's benchmark index had fallen 2.4% on
Sunday - the first day of trading after the attack in Baghdad -
but edged back up 0.2% on Monday. Samba Financial Group
increased 2.6% and Saudi British Bank
climbed 2.8%.
Most major markets in the Middle East
stabilised on Monday after steep declines in the previous
session on U.S.-Iran tensions, with some eking out small gains
on the day.
Tehran promised vengeance after a U.S. air strike in Baghdad
on Friday killed Iranian military commander Qassem Soleimani.
U.S. President Donald Trump said the United States would
retaliate if Tehran struck back after the killing.
"Escalation encourages money to leave the region and reduces
investment inflows, as an actual war would be devastating for
regional economies," said Firas Modad, Middle East and North
Africa director at IHS Markit.
"It also raises the price of oil, but not enough to plug the
hole in the Saudi budget."
Saudi Arabia's benchmark index had fallen 2.4% on
Sunday - the first day of trading after the attack in Baghdad -
but edged back up 0.2% on Monday. Samba Financial Group
increased 2.6% and Saudi British Bank
climbed 2.8%.
#Saudi Aramco slumps 10% from peak on mounting Mideast jitters | Financial Times
Saudi Aramco slumps 10% from peak on mounting Mideast jitters | Financial Times:
Saudi Aramco shares have dropped more than 10 per cent from their peak as the Kingdom’s markets have been hit by growing jitters over the deteriorating situation in the Middle East following the US assassination of a top Iranian military commander.
The state oil company’s shares fell 1 per cent on Monday following a 1.7 per cent fall on Sunday. The slump has left Aramco’s shares trading at 34.2 riyal, the lowest level since the group floated on Saudi Arabia’s stock bourse last month.
Saudi Aramco shares popped as high at 38.7 riyal on December 12, its second day of trading, briefly giving the sprawling energy group a valuation above the $2tn mark that had been sought by Crown Prince Mohammed bin Salman. While the shares remain above the 32 riyal flotation price, they are off 12 per cent from their mid-December high. This gives the company a valuation of $1.8tn.
Saudi Aramco shares have dropped more than 10 per cent from their peak as the Kingdom’s markets have been hit by growing jitters over the deteriorating situation in the Middle East following the US assassination of a top Iranian military commander.
The state oil company’s shares fell 1 per cent on Monday following a 1.7 per cent fall on Sunday. The slump has left Aramco’s shares trading at 34.2 riyal, the lowest level since the group floated on Saudi Arabia’s stock bourse last month.
Saudi Aramco shares popped as high at 38.7 riyal on December 12, its second day of trading, briefly giving the sprawling energy group a valuation above the $2tn mark that had been sought by Crown Prince Mohammed bin Salman. While the shares remain above the 32 riyal flotation price, they are off 12 per cent from their mid-December high. This gives the company a valuation of $1.8tn.
Aramco’s war-risk snake trumps oil-price ladder - War and fleece ht @gfhay
Saudi Aramco has been handed a curse disguised as a blessing. The fallout from the U.S. strikes that killed top Iranian general Qassem Soleimani, plus bellicose talk by President Donald Trump about sanctions on Iraq, pushed oil prices above $70 a barrel on Monday morning. Yet shares in the Saudi oil giant slipped to 34 riyals ($9.1) – their lowest level since last month’s initial public offering, and 11% below their post-listing peak.
That’s weird. European oil and gas stocks are up 2% since Thursday, according to Refinitiv data. Traders are betting that Iran will retaliate for the killing of such a key figure, raising the prospect of disruption to shipping in the Strait of Hormuz, through which 20% of oil consumed globally flows. If Iraq expels the 5,000 U.S. troops on its soil and Trump follows up by imposing sanctions, an oil producer responsible for around 5% of annual global supply could be muzzled.
All this should, in isolation, be good for Aramco’s worth. Were oil prices to stay at the current $70 a barrel or above, the group should move closer to the $2 trillion market value target set by Crown Prince Mohammed bin Salman. As the world’s biggest oil producer with the largest spare capacity, Aramco might be in a sweet spot of having to pump more, at higher prices.
The group’s shareholders are right to be wary, though. One of the risk factors spelled out in the group’s November prospectus was the danger of armed Middle East conflict. Given that half of Saudi oil supply was temporarily knocked out in September after a strike that Reuters reported was planned by Iran, there is a real danger of further attacks.
NMC says review of books to first focus on cash position | Business – Gulf News
NMC says review of books to first focus on cash position | Business – Gulf News:
NMC Health said on Monday a review of its books, prompted by a recent short-seller attack, will initially focus on its cash balances as of December 15.
NMC has been embroiled in a bitter battle with US short seller Muddy Waters, after the latter produced a report on Dec. 11 questioning the company’s accounting practices. The research firm highlighted “red flags” in the company’s reported cash balances, suggesting margins were “too good to be true.”
Abu Dhabi-based NMC, which has been has been undergoing a review of its accounts since then, saw its London-listed shares more than halve in mid-December after the activist hedge fund led by Carson Block announced that it had a bet against the stock.
NMC formed a board comprising of independent non-executive directors that will oversee the third-party review. The board will be chaired by Jonathan Bomford, an Ernst & Young veteran who has been advising the firm on matters of corporate governance and has held positions in NMC’s audit and remuneration committees, the company said on Monday.
NMC Health said on Monday a review of its books, prompted by a recent short-seller attack, will initially focus on its cash balances as of December 15.
NMC has been embroiled in a bitter battle with US short seller Muddy Waters, after the latter produced a report on Dec. 11 questioning the company’s accounting practices. The research firm highlighted “red flags” in the company’s reported cash balances, suggesting margins were “too good to be true.”
Abu Dhabi-based NMC, which has been has been undergoing a review of its accounts since then, saw its London-listed shares more than halve in mid-December after the activist hedge fund led by Carson Block announced that it had a bet against the stock.
NMC formed a board comprising of independent non-executive directors that will oversee the third-party review. The board will be chaired by Jonathan Bomford, an Ernst & Young veteran who has been advising the firm on matters of corporate governance and has held positions in NMC’s audit and remuneration committees, the company said on Monday.
Now is the time to buy properties in #Dubai | ZAWYA MENA Edition
Now is the time to buy properties in Dubai | ZAWYA MENA Edition:
The best time to invest in the Dubai property sector is now, according to Fidu Properties, a Chinese real estate broker in the UAE property market.
The brokerage said in a statement that Dubai is a buyer’s market considering the current price levels and the lucrative options on offer to investors and end-users alike.
It observed that prices have bottomed out and are at par or have become more affordable than even in 2005, when the freehold market started in Dubai.
Developers are offering heavy incentives to attract property buyers with convenient long-term payment plans of 5 to 10 and even 15 years for a ready property; on the other hand, they can expect a yield between 7 to 9 percent in the mid-market segment and despite correction, rentals are still high, according to FIDU.
The best time to invest in the Dubai property sector is now, according to Fidu Properties, a Chinese real estate broker in the UAE property market.
The brokerage said in a statement that Dubai is a buyer’s market considering the current price levels and the lucrative options on offer to investors and end-users alike.
It observed that prices have bottomed out and are at par or have become more affordable than even in 2005, when the freehold market started in Dubai.
Developers are offering heavy incentives to attract property buyers with convenient long-term payment plans of 5 to 10 and even 15 years for a ready property; on the other hand, they can expect a yield between 7 to 9 percent in the mid-market segment and despite correction, rentals are still high, according to FIDU.
#UAE's non-oil private sector posts slowest growth in 8 years in December | ZAWYA MENA Edition
UAE's non-oil private sector posts slowest growth in 8 years in December | ZAWYA MENA Edition:
Conditions in the UAE’s non-oil private sector have remained subdued, as businesses struggle to keep sales up and stimulate demand amid stiff competition, according to new data.
The latest IHS Markit UAE Purchasing Managers’ Index (PMI) released on Monday showed that the non-oil private sector ended 2019 on a downbeat note, with output growth the weakest in over eight years and new work rising only marginally after November’s downturn.
However, entrepreneurs and analysts are still optimistic about the year ahead, citing that the upcoming World Expo 2020 in Dubai, which is expected to attract tourists and stimulate hiring activity, will prop up the domestic economy.
The PMI for December dropped to 50.2 compared to 50.3 in November signaling that the rate of improvement in business conditions was only fractional.
Conditions in the UAE’s non-oil private sector have remained subdued, as businesses struggle to keep sales up and stimulate demand amid stiff competition, according to new data.
The latest IHS Markit UAE Purchasing Managers’ Index (PMI) released on Monday showed that the non-oil private sector ended 2019 on a downbeat note, with output growth the weakest in over eight years and new work rising only marginally after November’s downturn.
However, entrepreneurs and analysts are still optimistic about the year ahead, citing that the upcoming World Expo 2020 in Dubai, which is expected to attract tourists and stimulate hiring activity, will prop up the domestic economy.
The PMI for December dropped to 50.2 compared to 50.3 in November signaling that the rate of improvement in business conditions was only fractional.
#Saudi credit default swaps soar on U.S.-Iran crisis - Reuters
Saudi credit default swaps soar on U.S.-Iran crisis - Reuters:
The cost of insuring against a potential debt default by Saudi Arabia has soared by a sixth since Friday’s killing by a U.S. drone of Iranian commander Qassem Soleimani, bearing the brunt of a broader reaction in Middle Eastern markets.
Conventional spreads on five-year Saudi credit default swaps (CDS) were at 64 basis points on Monday, up from 55 bps on Jan. 2, according to IHS Markit.
Saudi Arabia is Iran’s arch enemy in the region, and that jump was slightly higher than in September last year after an attack on the kingdom’s oil facilities that in its initial phases halved its oil output.
Tehran has called the U.S. strike at Baghdad airport an act of war and Iranian commanders have issued a range of retaliation threats since, though they have not offered specifics about how they will respond.
The cost of insuring against a potential debt default by Saudi Arabia has soared by a sixth since Friday’s killing by a U.S. drone of Iranian commander Qassem Soleimani, bearing the brunt of a broader reaction in Middle Eastern markets.
Conventional spreads on five-year Saudi credit default swaps (CDS) were at 64 basis points on Monday, up from 55 bps on Jan. 2, according to IHS Markit.
Saudi Arabia is Iran’s arch enemy in the region, and that jump was slightly higher than in September last year after an attack on the kingdom’s oil facilities that in its initial phases halved its oil output.
Tehran has called the U.S. strike at Baghdad airport an act of war and Iranian commanders have issued a range of retaliation threats since, though they have not offered specifics about how they will respond.
Oil tops $70 as Iran, Trump trade threats - Reuters
Oil tops $70 as Iran, Trump trade threats - Reuters:
Oil prices rose over 1% on Monday, pushing Brent above $70 a barrel, as rhetoric from the United States, Iran and Iraq fanned tensions in the Middle East after a U.S. air strike which killed a top Iranian military commander.
Brent crude futures LCOc1 soared to a high of $70.74 a barrel and was at $69.55 at 1150 GMT, up 95 cents, or 1.38%, from Friday’s settlement.
U.S. West Texas Intermediate CLc1 crude was at $63.77 a barrel, up 72 cents, or 1.14%, after touching $64.72, the highest since April.
The gains extended Friday’s more than 3% surge after a U.S. air strike in Iraq killed Iranian military commander Qassem Soleimani on Friday, heightening concerns about an escalation in conflict in the Middle East and the possible impact on oil supplies.
Oil prices rose over 1% on Monday, pushing Brent above $70 a barrel, as rhetoric from the United States, Iran and Iraq fanned tensions in the Middle East after a U.S. air strike which killed a top Iranian military commander.
Brent crude futures LCOc1 soared to a high of $70.74 a barrel and was at $69.55 at 1150 GMT, up 95 cents, or 1.38%, from Friday’s settlement.
U.S. West Texas Intermediate CLc1 crude was at $63.77 a barrel, up 72 cents, or 1.14%, after touching $64.72, the highest since April.
The gains extended Friday’s more than 3% surge after a U.S. air strike in Iraq killed Iranian military commander Qassem Soleimani on Friday, heightening concerns about an escalation in conflict in the Middle East and the possible impact on oil supplies.
MIDEAST STOCKS-Most of Gulf little changed; #Kuwait extends losses - Agricultural Commodities - Reuters
MIDEAST STOCKS-Most of Gulf little changed; Kuwait extends losses - Agricultural Commodities - Reuters:
Major Gulf bourses were little changed on Monday, a day after shares in the region fell steeply due to alarm over increasing hostility between the United Sates and Iran, while Kuwait extended losses.
Tehran promised vengeance after a U.S. air strike in Baghdad on Friday killed Qassem Soleimani, an Iranian top military commander and architect of its growing influence in the Middle East.
Trump also said that the United States will retaliate against Iran if Tehran were to strike back after the killing.
“Escalation encourages money to leave the region and reduces investment inflows, as an actual war would be devastating for regional economies,” said Firas Modad, Middle East and North Africa director at IHS Markit. “It also raises the price of oil, but not enough to plug the hole in the Saudi budget.”
Major Gulf bourses were little changed on Monday, a day after shares in the region fell steeply due to alarm over increasing hostility between the United Sates and Iran, while Kuwait extended losses.
Tehran promised vengeance after a U.S. air strike in Baghdad on Friday killed Qassem Soleimani, an Iranian top military commander and architect of its growing influence in the Middle East.
Trump also said that the United States will retaliate against Iran if Tehran were to strike back after the killing.
“Escalation encourages money to leave the region and reduces investment inflows, as an actual war would be devastating for regional economies,” said Firas Modad, Middle East and North Africa director at IHS Markit. “It also raises the price of oil, but not enough to plug the hole in the Saudi budget.”
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