Oil Price War News: Saudi Aramco Cuts Barrel Costs U.S., Asia - Bloomberg:
Saudi Arabia kick started an all-out oil war on Saturday, slashing official pricing for its crude and making the deepest cuts in at least 20 years on its main grades, in an effort to push as many barrels into the market as possible.
The cuts in monthly pricing by state producer Saudi Aramco are the first indication of how the Saudis will respond to the break up of the alliance between OPEC and partners like Russia. Talks in Vienna ended in dramatic failure on Friday as Saudi Arabia’s gamble to get Russia to agree to a prolonged and deeper cut failed to pay off.
In the first major marketing decision since the meeting, the state producer lowered April pricing for crude sales to Asia by $4-$6 a barrel and to the U.S. by $7 a barrel, according to a copy of the announcement seen by Bloomberg.
“Saudi Arabia is now really going into a full price war,” said Iman Nasseri, managing director for the Middle East at oil consultant FGE.
Saturday, 7 March 2020
Shale Oil, OPEC+ Fight: Putin, MBS and U.S. Fracking Industry - Bloomberg
Shale Oil, OPEC+ Fight: Putin, MBS and U.S. Fracking Industry - Bloomberg:
At 10:16 a.m. on a wet and dreary Friday morning, Russia’s energy minister walked into OPEC’s headquarters in central Vienna knowing his boss was ready to turn the global oil market upside down.
Alexander Novak told his Saudi Arabian counterpart Prince Abdulaziz bin Salman that Russia was unwilling to cut oil production further. The Kremlin had decided that propping up prices as the coronavirus ravaged energy demand would be a gift to the U.S. shale industry. The frackers had added millions of barrels of oil to the global market while Russian companies kept wells idle. Now it was time to squeeze the Americans.
After five hours of polite but fruitless negotiation, in which Russia clearly laid out its strategy, the talks broke down. Oil prices fell more than 10%. It wasn’t just traders who were caught out: Ministers were so shocked, they didn’t know what to say, according to a person in the room. The gathering suddenly had the atmosphere of a wake, said another.
For over three years, President Vladimir Putin had kept Russia inside the OPEC+ coalition, allying with Saudi Arabia and the other members of the Organization of Petroleum Exporting Countries to curb oil production and support prices. On top of helping Russia’s treasury – energy exports are the largest source of state revenue – the alliance brought foreign policy gains, creating a bond with Saudi Arabia’s new leader, Crown Prince Mohammed bin Salman.
At 10:16 a.m. on a wet and dreary Friday morning, Russia’s energy minister walked into OPEC’s headquarters in central Vienna knowing his boss was ready to turn the global oil market upside down.
Alexander Novak told his Saudi Arabian counterpart Prince Abdulaziz bin Salman that Russia was unwilling to cut oil production further. The Kremlin had decided that propping up prices as the coronavirus ravaged energy demand would be a gift to the U.S. shale industry. The frackers had added millions of barrels of oil to the global market while Russian companies kept wells idle. Now it was time to squeeze the Americans.
After five hours of polite but fruitless negotiation, in which Russia clearly laid out its strategy, the talks broke down. Oil prices fell more than 10%. It wasn’t just traders who were caught out: Ministers were so shocked, they didn’t know what to say, according to a person in the room. The gathering suddenly had the atmosphere of a wake, said another.
For over three years, President Vladimir Putin had kept Russia inside the OPEC+ coalition, allying with Saudi Arabia and the other members of the Organization of Petroleum Exporting Countries to curb oil production and support prices. On top of helping Russia’s treasury – energy exports are the largest source of state revenue – the alliance brought foreign policy gains, creating a bond with Saudi Arabia’s new leader, Crown Prince Mohammed bin Salman.
Crisis-hit #Lebanon to default on $1.2 billion loan payment
Crisis-hit Lebanon to default on $1.2 billion loan payment:
Lebanon’s prime minister said Saturday the government will suspend payment of $1.2 billion in loans, marking the crisis-hit country’s first-ever default on its sovereign debt amid ongoing popular unrest.
Hassan Diab made the announcement in a televised address to the Lebanese people, saying the country will seek to restructure its massive debt. The $1.2 billion Eurobond matures on Monday.
The default marks a new chapter in the crisis and could have severe repercussions on the tiny country, risking legal action by lenders that could further aggravate and push Lebanon’s economy toward financial collapse. The currency has already lost up to 60% of its value on the dollar on the black market and banks have imposed crippling capital controls on cash withdrawals and transfers.
Diab said Lebanon’s debt reached $90 billion or 170% of GDP, making it one of the highest in the world. He added that the total debt and interest Lebanon had to pay back in 2020 is at $4.6 billion.
Lebanon’s prime minister said Saturday the government will suspend payment of $1.2 billion in loans, marking the crisis-hit country’s first-ever default on its sovereign debt amid ongoing popular unrest.
Hassan Diab made the announcement in a televised address to the Lebanese people, saying the country will seek to restructure its massive debt. The $1.2 billion Eurobond matures on Monday.
The default marks a new chapter in the crisis and could have severe repercussions on the tiny country, risking legal action by lenders that could further aggravate and push Lebanon’s economy toward financial collapse. The currency has already lost up to 60% of its value on the dollar on the black market and banks have imposed crippling capital controls on cash withdrawals and transfers.
Diab said Lebanon’s debt reached $90 billion or 170% of GDP, making it one of the highest in the world. He added that the total debt and interest Lebanon had to pay back in 2020 is at $4.6 billion.
Finablr Jumps as Currency-Exchange Firm Is Said to Weigh Options - Bloomberg
Finablr Jumps as Currency-Exchange Firm Is Said to Weigh Options - Bloomberg:
Finablr Plc, the owner of currency-exchange businesses including Travelex Holdings Ltd., jumped the most in three weeks after people familiar with the matter said the company is considering strategic options.
Shares of Finablr rose as much as 10.8% in Friday morning trading, bucking four days of declines. They were up 6% at 9:26 a.m. in London, giving the company a market value of 306 million pounds ($397 million). Finablr’s board plans to meet in the next few days to discuss alternatives for the company including bringing in new investors, according to the people.
Another possibility that could be considered is whether to pursue a take-private transaction, the people said, asking not to be identified because the information is private. Finablr’s stock has been battered because of its ties to troubled hospital operator NMC Health Plc.
Finablr founder Bavaguthu Raghuram Shetty and other executives are seeking to restore confidence after the company’s shares plunged almost 80% through Thursday. Its market value has fallen from a peak of about 1.5 billion pounds in December.
Finablr Plc, the owner of currency-exchange businesses including Travelex Holdings Ltd., jumped the most in three weeks after people familiar with the matter said the company is considering strategic options.
Shares of Finablr rose as much as 10.8% in Friday morning trading, bucking four days of declines. They were up 6% at 9:26 a.m. in London, giving the company a market value of 306 million pounds ($397 million). Finablr’s board plans to meet in the next few days to discuss alternatives for the company including bringing in new investors, according to the people.
Another possibility that could be considered is whether to pursue a take-private transaction, the people said, asking not to be identified because the information is private. Finablr’s stock has been battered because of its ties to troubled hospital operator NMC Health Plc.
Finablr founder Bavaguthu Raghuram Shetty and other executives are seeking to restore confidence after the company’s shares plunged almost 80% through Thursday. Its market value has fallen from a peak of about 1.5 billion pounds in December.
Canada’s LNG Dreams Fade as Blockades Add New Costs to Industry - Bloomberg
Canada’s LNG Dreams Fade as Blockades Add New Costs to Industry - Bloomberg:
Hopes that Canada could turn into a gas export powerhouse seem to be waning fast.
The current climate for energy investments in the country and the global market for liquefied natural gas are a far cry from October 2018, when a Royal Dutch Shell Plc-led group announced plans to build a massive LNG terminal on British Columbia’s coast and Prime Minister Justin Trudeau hailed the project as “a vote of confidence” in Canada.
The latest sign of disenchantment came this week as a C$9 billion ($6.7 billion) LNG project in Quebec lost a large potential investor, which the Canadian Broadcasting Corp. identified as Warren Buffett’s Berkshire Hathaway Inc. That follows announcements last year that Chevron Corp. is planning to sell its 50% stake in an LNG project in British Columbia, and its partner in the venture is seeking to trim its stake as well.
While LNG projects across the globe grapple with the outlook for an oversupplied market in the coming years, growing environmentalist opposition is adding insult to injury in Canada. An indigenous protest against a pipeline that will supply Shell’s LNG project not only delayed construction of the conduit but also spiraled into nationwide blockades of key economic infrastructure that have hampered the country’s economy.
Hopes that Canada could turn into a gas export powerhouse seem to be waning fast.
The current climate for energy investments in the country and the global market for liquefied natural gas are a far cry from October 2018, when a Royal Dutch Shell Plc-led group announced plans to build a massive LNG terminal on British Columbia’s coast and Prime Minister Justin Trudeau hailed the project as “a vote of confidence” in Canada.
The latest sign of disenchantment came this week as a C$9 billion ($6.7 billion) LNG project in Quebec lost a large potential investor, which the Canadian Broadcasting Corp. identified as Warren Buffett’s Berkshire Hathaway Inc. That follows announcements last year that Chevron Corp. is planning to sell its 50% stake in an LNG project in British Columbia, and its partner in the venture is seeking to trim its stake as well.
While LNG projects across the globe grapple with the outlook for an oversupplied market in the coming years, growing environmentalist opposition is adding insult to injury in Canada. An indigenous protest against a pipeline that will supply Shell’s LNG project not only delayed construction of the conduit but also spiraled into nationwide blockades of key economic infrastructure that have hampered the country’s economy.
Oil takes biggest daily dive in over a decade as Russia, OPEC split - Reuters
Oil takes biggest daily dive in over a decade as Russia, OPEC split - Reuters:
Brent slid to its biggest daily loss in more than 11 years on Friday after Russia balked at OPEC’s proposed steep production cuts to stabilize prices hit by economic fallout from the coronavirus, and OPEC responded by removing limits on its own production.
More than 1 million U.S. crude contracts changed hands during the session, as the three-year pact between OPEC and Russia ended in acrimony.
“Prices plunged because the OPEC confab ended up being an epic fail on the part of all involved. Russia has clearly decided to employ a scorched earth approach to the oil market: every country for itself,” said John Kilduff, partner at Again Capital LLC in New York.
Brent futures had their its biggest daily percentage fall since December 2008, down $4.72, or 9.4%, to settle at $45.27 a barrel. It was Brent’s lowest closing price since June 2017.
U.S. West Texas Intermediate crude dropped $4.62, or 10.1%, to $41.28, its lowest close since August 2016 and the largest daily percentage loss since November 2014.
More than 4.58 million U.S. front-month crude contracts changed hands this week, the busiest week ever for that contract.
Brent slid to its biggest daily loss in more than 11 years on Friday after Russia balked at OPEC’s proposed steep production cuts to stabilize prices hit by economic fallout from the coronavirus, and OPEC responded by removing limits on its own production.
More than 1 million U.S. crude contracts changed hands during the session, as the three-year pact between OPEC and Russia ended in acrimony.
“Prices plunged because the OPEC confab ended up being an epic fail on the part of all involved. Russia has clearly decided to employ a scorched earth approach to the oil market: every country for itself,” said John Kilduff, partner at Again Capital LLC in New York.
Brent futures had their its biggest daily percentage fall since December 2008, down $4.72, or 9.4%, to settle at $45.27 a barrel. It was Brent’s lowest closing price since June 2017.
U.S. West Texas Intermediate crude dropped $4.62, or 10.1%, to $41.28, its lowest close since August 2016 and the largest daily percentage loss since November 2014.
More than 4.58 million U.S. front-month crude contracts changed hands this week, the busiest week ever for that contract.
#SaudiArabia detains two senior royals, including king's brother: sources - Reuters
Saudi Arabia detains two senior royals, including king's brother: sources - Reuters:
Saudi Arabia has detained two senior members of the Saudi royal family - Prince Ahmed bin Abdulaziz, the younger brother of King Salman, and Mohammed bin Nayef, the king’s nephew, two sources with knowledge of the matter said.
Crown Prince Mohammed bin Salman, King Salman’s son and the de facto ruler of the world’s top oil exporter and key U.S. ally, has moved to consolidate power since ousting his cousin, Mohammed bin Nayef, as heir to the throne in a palace coup in 2017. He arrested several royals in an anti-corruption campaign later that year.
One source said the detentions took place on Friday. Reuters could not immediately determine the reasons behind the detentions.
The Wall Street Journal reported the detentions of the two royals earlier on Friday, and said they related to an alleged coup attempt.
Saudi officials could not be immediately reached for comment early on Saturday. The Saudi government media office did not immediately respond to a Reuters request for comment.
Saudi Arabia has detained two senior members of the Saudi royal family - Prince Ahmed bin Abdulaziz, the younger brother of King Salman, and Mohammed bin Nayef, the king’s nephew, two sources with knowledge of the matter said.
Crown Prince Mohammed bin Salman, King Salman’s son and the de facto ruler of the world’s top oil exporter and key U.S. ally, has moved to consolidate power since ousting his cousin, Mohammed bin Nayef, as heir to the throne in a palace coup in 2017. He arrested several royals in an anti-corruption campaign later that year.
One source said the detentions took place on Friday. Reuters could not immediately determine the reasons behind the detentions.
The Wall Street Journal reported the detentions of the two royals earlier on Friday, and said they related to an alleged coup attempt.
Saudi officials could not be immediately reached for comment early on Saturday. The Saudi government media office did not immediately respond to a Reuters request for comment.
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