Oil Market Is Desperate for Saudi Arabia to Flatten the Curve - Bloomberg:
It is entirely fitting that the one of best performing energy stock on Friday morning was recently bankrupt Whiting Petroleum Corp. As President Donald Trump’s initial tweet-heard-round-the-(oil)-world has snowballed into a seething mass of optimistic rumor, so the more — how to put this? — speculative stocks have floated to the top. Just as crude oil recorded a 25% gain Thursday by moving all of $5 a barrel, Whiting was near the top of the leaderboard on the back of a 4-cent rally.
Saudi Arabia’s call for an emergency Zoom session on Monday, along with reports that Russia may be coming around to the idea of supply cuts, lend credence to the idea that, even if Trump wildly jumped the gun, cuts are coming. Cue mass celebration in the oil market.
To which, one can only say this: Supply. Cuts. Were. Coming. Anyway. As I wrote here, the collapse in demand means we will quickly run out of places to stash surplus oil. Which means refiners stop buying (almost regardless of price) and production gets shut in (some is already). Saudi Arabia and Russia would love to get the U.S. to sign up as a willing partner in making this look like market management rather than managed retreat — and Trump may be of a similar mind.
Getting cuts of anywhere near the 10 million barrels (a day, we think) cut that Trump touted looks very unlikely given the time pressure. On Thursday, I quoted Kevin Book of ClearView Energy Partners as saying, “Tweets travel at the speed of light; barrels move at 10 knots.” To which we can add that the novel coronavirus moves at an exponential pace. Distancing measures mean demand in April could be down by 20 million or 30 million barrels a day. Hence, a cut of 10 million barrels a day would only extend the timeline for storage filling up and, in order to work, would have to happen very quickly.
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Friday 3 April 2020
#UAE Hires Adviser to Fix Top Middle East Remittance House - Bloomberg
U.A.E. Hires Adviser to Fix Top Middle East Remittance House - Bloomberg:
The United Arab Emirates central bank has hired an adviser to help sort out debt and operational issues at one of the Middle East’s largest remittance businesses, according to people with knowledge of the matter.
Alvarez & Marsal Holdings LLC is advising the central bank on the management of UAE Exchange, the people said, asking not to be identified because the information is private. The regulator last month took the rare step of assuming control over the firm’s operations in the country as its London-listed parent company, Finablr Plc, prepares for potential insolvency.
UAE Exchange plays a key role in the oil-rich nation, as it’s the biggest money-transfer business in an economy hosting millions of expatriate workers who send their salaries back home. It has branches across popular malls and business centers and is one of the largest employers in the United Arab Emirates with thousands of staff.
The company, set up by embattled Indian entrepreneur Bavaguthu Raghuram Shetty, has defaulted on about $300 million of foreign-exchange loans, people with knowledge of the matter said earlier this week. Lenders that arranged the facility -- including Barclays Plc, Goldman Sachs Group., JPMorgan Chase & Co. and Commercial Bank of Dubai PSC -- haven’t been repaid due the mounting problems surrounding Finablr, the people said.
The United Arab Emirates central bank has hired an adviser to help sort out debt and operational issues at one of the Middle East’s largest remittance businesses, according to people with knowledge of the matter.
Alvarez & Marsal Holdings LLC is advising the central bank on the management of UAE Exchange, the people said, asking not to be identified because the information is private. The regulator last month took the rare step of assuming control over the firm’s operations in the country as its London-listed parent company, Finablr Plc, prepares for potential insolvency.
UAE Exchange plays a key role in the oil-rich nation, as it’s the biggest money-transfer business in an economy hosting millions of expatriate workers who send their salaries back home. It has branches across popular malls and business centers and is one of the largest employers in the United Arab Emirates with thousands of staff.
The company, set up by embattled Indian entrepreneur Bavaguthu Raghuram Shetty, has defaulted on about $300 million of foreign-exchange loans, people with knowledge of the matter said earlier this week. Lenders that arranged the facility -- including Barclays Plc, Goldman Sachs Group., JPMorgan Chase & Co. and Commercial Bank of Dubai PSC -- haven’t been repaid due the mounting problems surrounding Finablr, the people said.
#Saudi king earmarks $2.4 billion to pay private-sector workers - Reuters
Saudi king earmarks $2.4 billion to pay private-sector workers - Reuters:
Saudi Arabia’s King Salman has ordered up to 9 billion riyals ($2.4 billion) to be disbursed to pay part of the wages of private-sector workers to deter companies from laying off staff, the state-run Saudi Press Agency reported on Friday.
The latest measure to tackle the fallout from the coronavirus outbreak followed an emergency stimulus package announced last month to shore up the economy.
“Instead of terminating the employment of a Saudi citizen, the employer has the right to ask social insurance to disburse as compensation 60 percent of his salary over a period of three months, with a maximum limit of nine thousand riyals (per employee) and with a total value of up to 9 billion riyals,” the SPA reported, citing a royal order.
The stimulus announced last month by Finance Minister Mohammed al-Jadaan included 70 billion riyals to be set aside to help businesses, with measures including exemptions and postponements of some government fees and taxes.
Saudi Arabia’s King Salman has ordered up to 9 billion riyals ($2.4 billion) to be disbursed to pay part of the wages of private-sector workers to deter companies from laying off staff, the state-run Saudi Press Agency reported on Friday.
The latest measure to tackle the fallout from the coronavirus outbreak followed an emergency stimulus package announced last month to shore up the economy.
“Instead of terminating the employment of a Saudi citizen, the employer has the right to ask social insurance to disburse as compensation 60 percent of his salary over a period of three months, with a maximum limit of nine thousand riyals (per employee) and with a total value of up to 9 billion riyals,” the SPA reported, citing a royal order.
The stimulus announced last month by Finance Minister Mohammed al-Jadaan included 70 billion riyals to be set aside to help businesses, with measures including exemptions and postponements of some government fees and taxes.
Deep oil output cuts won't offset unprecedented demand loss: IEA - Reuters
Deep oil output cuts won't offset unprecedented demand loss: IEA - Reuters:
Deep output cuts by OPEC and other oil producing nations will not prevent a huge build up of crude, the head of the IEA said on Friday, urging the world’s richest economies to discuss broader ways to stabilise oil markets.
Fatih Birol, executive director of the International Energy Agency, told Reuters that measures to contain the spread of the coronavirus had lead to an “unprecedented” demand loss that could reach as much as a quarter of global consumption.
Birol spoke to Reuters after speaking to Saudi Arabian Energy Minister Prince Abdulaziz bin Salman ahead of a meeting of OPEC and its allies, known as OPEC+, on Monday to discuss cutting output to reverse the collapse in oil prices.
Deep output cuts by OPEC and other oil producing nations will not prevent a huge build up of crude, the head of the IEA said on Friday, urging the world’s richest economies to discuss broader ways to stabilise oil markets.
Fatih Birol, executive director of the International Energy Agency, told Reuters that measures to contain the spread of the coronavirus had lead to an “unprecedented” demand loss that could reach as much as a quarter of global consumption.
Birol spoke to Reuters after speaking to Saudi Arabian Energy Minister Prince Abdulaziz bin Salman ahead of a meeting of OPEC and its allies, known as OPEC+, on Monday to discuss cutting output to reverse the collapse in oil prices.
Oil surges more than 13% on hopes of output deal - Reuters
Oil surges more than 13% on hopes of output deal - Reuters:
Crude futures surged for a second day on Friday, with both U.S. and Brent contracts posting their largest weekly percentage gains on record due to hopes that a global deal to cut crude supply worldwide will emerge early next week.
On Thursday, oil staged its largest one-day rally in history on prospects for a cut in supply equivalent to anywhere from 10% to 15% of world demand. The sharp rebound from weeks of losses came after U.S. President Donald Trump said Russia and Saudi Arabia will negotiate to end a price war that slashed prices last month by more than half. Trump said the United States has not agreed to cut its output.
The rally continued Friday, with Brent crude LCOc1 futures jumping 13.9%, or $4.17 a barrel to settle at $34.11. Brent soared as much as 47% on Thursday for its highest intraday percentage gain on record, closing up 21%. The contract ended the week 36.8% higher, the largest weekly percentage gain in the contract’s history.
U.S. West Texas Intermediate (WTI) crude CLc1 rose $3.02, or 11.93% to settle at $28.34 a barrel. The contract posted a 31.8% gain on the week, also its largest on record.
Crude futures surged for a second day on Friday, with both U.S. and Brent contracts posting their largest weekly percentage gains on record due to hopes that a global deal to cut crude supply worldwide will emerge early next week.
On Thursday, oil staged its largest one-day rally in history on prospects for a cut in supply equivalent to anywhere from 10% to 15% of world demand. The sharp rebound from weeks of losses came after U.S. President Donald Trump said Russia and Saudi Arabia will negotiate to end a price war that slashed prices last month by more than half. Trump said the United States has not agreed to cut its output.
The rally continued Friday, with Brent crude LCOc1 futures jumping 13.9%, or $4.17 a barrel to settle at $34.11. Brent soared as much as 47% on Thursday for its highest intraday percentage gain on record, closing up 21%. The contract ended the week 36.8% higher, the largest weekly percentage gain in the contract’s history.
U.S. West Texas Intermediate (WTI) crude CLc1 rose $3.02, or 11.93% to settle at $28.34 a barrel. The contract posted a 31.8% gain on the week, also its largest on record.
Brent crude rises above $32 on hopes of oil output deal - Reuters
Brent crude rises above $32 on hopes of oil output deal - Reuters:
Benchmark Brent crude oil futures rose as high as $33.37 a barrel on Friday on rising hopes of a new global deal to cut global crude supply.
Brent crude LCOc1 futures were up 8.9%, or $2.67, at $32.61 a barrel by 1134 GMT. Brent soared as much as 47% on Thursday for its highest intraday percentage gain on record. It closed 21% up, still about half the $66 at which it was trading at the end of 2019.
U.S. West Texas Intermediate (WTI) crude CLc1 also returned to positive territory, rising 4.4%, or $1.11, to $26.43 after advancing by 24.7% on Thursday.
OPEC and its allies are working on a deal for an unprecedented production cut equivalent to about 10% of global supply, an OPEC source said after U.S. President Donald Trump called on oil-producing nations to stop the price slide.
Benchmark Brent crude oil futures rose as high as $33.37 a barrel on Friday on rising hopes of a new global deal to cut global crude supply.
Brent crude LCOc1 futures were up 8.9%, or $2.67, at $32.61 a barrel by 1134 GMT. Brent soared as much as 47% on Thursday for its highest intraday percentage gain on record. It closed 21% up, still about half the $66 at which it was trading at the end of 2019.
U.S. West Texas Intermediate (WTI) crude CLc1 also returned to positive territory, rising 4.4%, or $1.11, to $26.43 after advancing by 24.7% on Thursday.
OPEC and its allies are working on a deal for an unprecedented production cut equivalent to about 10% of global supply, an OPEC source said after U.S. President Donald Trump called on oil-producing nations to stop the price slide.
Oil Surges as OPEC+ Prepares for Urgent Meeting on Monday - Bloomberg
Oil Surges as OPEC+ Prepares for Urgent Meeting on Monday - Bloomberg:
Oil advanced back above $31 a barrel in London, reversing earlier declines, as OPEC+ scheduled an urgent meeting next week after a historic slump in prices that has crippled the energy sector.
The coalition will hold a meeting by video conference on Monday, though it’s still not clear who will attend, according to delegates. News of the plan came just hours after U.S. President Donald Trump said he expected global producers including Saudi Arabia and Russia to cut more than 10 million barrels of production, triggering the biggest ever jump in prices on Thursday.
Oil advanced back above $31 a barrel in London, reversing earlier declines, as OPEC+ scheduled an urgent meeting next week after a historic slump in prices that has crippled the energy sector.
The coalition will hold a meeting by video conference on Monday, though it’s still not clear who will attend, according to delegates. News of the plan came just hours after U.S. President Donald Trump said he expected global producers including Saudi Arabia and Russia to cut more than 10 million barrels of production, triggering the biggest ever jump in prices on Thursday.
#SaudiArabia News: Oil War in Second Month With Prices for May - Bloomberg
Saudi Arabia News: Oil War in Second Month With Prices for May - Bloomberg:
Vanishing demand and alternative grades at never-seen-before prices are fueling expectations that Saudi Aramco will need to price its crude at aggressively low levels this month to keep its customers satisfied.
The world’s biggest oil exporter is due to announce its official selling prices for May shipments this Sunday. It comes a month after the kingdom discounted April supplies by the most in at least 20 years as it embarked on a price war with Russia that sent oil markets into a tailspin.
Where to pitch prices will be a tricky balancing act for Saudi Arabia. Set them too high and customers will buy as little as their term contracts allow against a backdrop of weak demand and rapidly filling storage tanks. If they’re too low, however, the self-inflicted pain of the price war could become intolerable.
Asian refiners are being spoiled for choice due a flood of cheap crude from the U.S. and Russia. Varieties such as West Texas Intermediate, Mars and Urals are being offered and sold at sharp discounts, according to six officials and traders from processors across the region. The relative strength of Middl
Vanishing demand and alternative grades at never-seen-before prices are fueling expectations that Saudi Aramco will need to price its crude at aggressively low levels this month to keep its customers satisfied.
The world’s biggest oil exporter is due to announce its official selling prices for May shipments this Sunday. It comes a month after the kingdom discounted April supplies by the most in at least 20 years as it embarked on a price war with Russia that sent oil markets into a tailspin.
Where to pitch prices will be a tricky balancing act for Saudi Arabia. Set them too high and customers will buy as little as their term contracts allow against a backdrop of weak demand and rapidly filling storage tanks. If they’re too low, however, the self-inflicted pain of the price war could become intolerable.
Asian refiners are being spoiled for choice due a flood of cheap crude from the U.S. and Russia. Varieties such as West Texas Intermediate, Mars and Urals are being offered and sold at sharp discounts, according to six officials and traders from processors across the region. The relative strength of Middl
New members may join OPEC+ alliance: RIA quotes source - Reuters
New members may join OPEC+ alliance: RIA quotes source - Reuters:
A number of countries want to join an existing alliance between the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC members, RIA news agency said on Friday, citing a source.
Adding new members as well as a massive production cut by 10 million barrels of oil per day could be discussed at a meeting on April 6, the source told RIA. There are no cut allocations yet, RIA added.
A number of countries want to join an existing alliance between the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC members, RIA news agency said on Friday, citing a source.
Adding new members as well as a massive production cut by 10 million barrels of oil per day could be discussed at a meeting on April 6, the source told RIA. There are no cut allocations yet, RIA added.
OPEC+ producers debate possible oil cuts of 10 million bpd: OPEC source - Reuters
OPEC+ producers debate possible oil cuts of 10 million bpd: OPEC source - Reuters:
The OPEC+ crude oil exporter group is debating cutting global supply by 10 million barrels per day (bpd), an OPEC source said on Friday, adding that any further cuts must include producers from outside the alliance.
U.S. President Donald Trump on Thursday said he had brokered a deal that could result in Russia and Saudi Arabia cutting output by 10 million to 15 million bpd, representing 10-15% of global supply. Trump said he made no offer to cut U.S. output.
The source added that OPEC+ is watching the outcome of a meeting between Trump and the oil companies later on Friday and that a final figure on cuts depends on participation by all oil producers.
Saudi Arabia on Thursday called for an emergency meeting of OPEC and non-OPEC producers, saying it aimed to reach a fair agreement to stabilise oil markets that have crashed on the demand impact from the coronavirus pandemic.
The OPEC+ crude oil exporter group is debating cutting global supply by 10 million barrels per day (bpd), an OPEC source said on Friday, adding that any further cuts must include producers from outside the alliance.
U.S. President Donald Trump on Thursday said he had brokered a deal that could result in Russia and Saudi Arabia cutting output by 10 million to 15 million bpd, representing 10-15% of global supply. Trump said he made no offer to cut U.S. output.
The source added that OPEC+ is watching the outcome of a meeting between Trump and the oil companies later on Friday and that a final figure on cuts depends on participation by all oil producers.
Saudi Arabia on Thursday called for an emergency meeting of OPEC and non-OPEC producers, saying it aimed to reach a fair agreement to stabilise oil markets that have crashed on the demand impact from the coronavirus pandemic.
Brent reverses losses to rise above $30/bbl in early European trading - Reuters
Brent reverses losses to rise above $30/bbl in early European trading - Reuters:
Benchmark Brent crude oil futures reversed losses incurred during Asian hours in early European trading on Friday to rise above $30 a barrel, with hopes of a huge global supply cut deal to support prices still alive.
Brent crude LCOc1 futures were up 7%, or $2.10, at $32.04 per barrel by 0748 GMT. Brent soared as much as 47% during Thursday’s session, its highest intraday percentage gain ever, before closing 21% higher, but still at less than half the $66 it was trading at at the end of 2019.
U.S. West Texas Intermediate (WTI) crude CLc1 also moved back into positive territory, rising 1%, or 28 cents, to $25.6 a barrel, after surging 24.7% on Thursday.
U.S. President Donald Trump said on Thursday he had brokered a deal which could see Russia and Saudi Arabia cutting output by 10 to 15 million barrels per day (bpd) - an unprecedented amount representing 10% to 15% of global supply. Trump said he had made no offer to cut U.S. output.
Benchmark Brent crude oil futures reversed losses incurred during Asian hours in early European trading on Friday to rise above $30 a barrel, with hopes of a huge global supply cut deal to support prices still alive.
Brent crude LCOc1 futures were up 7%, or $2.10, at $32.04 per barrel by 0748 GMT. Brent soared as much as 47% during Thursday’s session, its highest intraday percentage gain ever, before closing 21% higher, but still at less than half the $66 it was trading at at the end of 2019.
U.S. West Texas Intermediate (WTI) crude CLc1 also moved back into positive territory, rising 1%, or 28 cents, to $25.6 a barrel, after surging 24.7% on Thursday.
U.S. President Donald Trump said on Thursday he had brokered a deal which could see Russia and Saudi Arabia cutting output by 10 to 15 million barrels per day (bpd) - an unprecedented amount representing 10% to 15% of global supply. Trump said he had made no offer to cut U.S. output.