Oil slumps on worries that supply cuts are playing catch-up to falling demand - Reuters:
Oil prices dropped sharply on Tuesday, with U.S. prices sliding back toward $20 a barrel, as investors bet that fuel demand destruction caused by the coronavirus pandemic would be too much for producers embarking on record global output cuts to offset.
Global oil-producing nations are expected to reduce production by as much as 19.5 million barrels per day, but those cuts are being implemented slowly and in some cases will not start for weeks. By contrast, demand plunged by roughly 30% worldwide several weeks ago, causing refiners and producers suddenly stuck with oil to stick it into rapidly filling storage.
U.S. West Texas Intermediate (WTI) crude CLc1 settled at $20.11 a barrel, down $2.30 or 10.3%, as one prominent pipeline executive told Texas regulators that storage would be filled by mid-May.
WTI is not far from where markets traded prior to a rally founded on hopes for the OPEC+ production deal inked over the weekend.
Brent crude futures LCOc1 fell $2.14, or 6.7%, to settle at $29.60 a barrel.
Both benchmarks are down more than 50% down this year.
Tuesday 14 April 2020
Saudis Set to Pump at Will Until May as Oil Inventories Swell - Bloomberg
Saudis Set to Pump at Will Until May as Oil Inventories Swell - Bloomberg:
Saudi Arabia and other Gulf suppliers may have agreed to cut oil production again starting next month, but by all indications the taps are set to remain wide open until then -- swelling crude stockpiles for at least a few more weeks.
The kingdom’s crude exports so far in April stand at 9.3 million barrels a day, according to tanker-tracking data compiled by Bloomberg. That compares with 6.8 million barrels a day through the first two weeks of March. What’s more, there are at least 10 supertankers with the capacity to haul a combined 20 million barrels of oil waiting to load at the Saudi port of Ras Tanura in the coming days.
State-owned oil company Saudi Aramco pledged to boost output to 12.3 million barrels a day in April as it slashed prices in a battle for market share, following the collapse of the three-year old OPEC+ pact in March. As the coronavirus spread across the globe, governments imposed restrictions on movement and demand collapsed further, as did prices.
Saudi Arabia and other Gulf suppliers may have agreed to cut oil production again starting next month, but by all indications the taps are set to remain wide open until then -- swelling crude stockpiles for at least a few more weeks.
The kingdom’s crude exports so far in April stand at 9.3 million barrels a day, according to tanker-tracking data compiled by Bloomberg. That compares with 6.8 million barrels a day through the first two weeks of March. What’s more, there are at least 10 supertankers with the capacity to haul a combined 20 million barrels of oil waiting to load at the Saudi port of Ras Tanura in the coming days.
State-owned oil company Saudi Aramco pledged to boost output to 12.3 million barrels a day in April as it slashed prices in a battle for market share, following the collapse of the three-year old OPEC+ pact in March. As the coronavirus spread across the globe, governments imposed restrictions on movement and demand collapsed further, as did prices.
Exclusive: #Saudi Aramco in talks with banks to borrow about $10 billion - sources - Reuters
Exclusive: Saudi Aramco in talks with banks to borrow about $10 billion - sources - Reuters:
Saudi Aramco, the world’s largest oil producer, is in early talks with banks for a loan of about $10 billion to help finance its acquisition of a 70% stake in Saudi Basic Industries Corp (SABIC), according to three banking sources.
Aramco (2222.SE) agreed last year to buy the controlling stake in SABIC from the kingdom’s wealth fund for $69.1 billion, sealing one of the biggest-ever deals in the global chemical industry.
“The financing would be for the SABIC deal, but the borrower is Aramco,” said one of the sources, adding that the discussions were at an initial stage, with the company sounding out banks.
“Ten billion dollars is where they want to get to, (it’s) not clear if, in this market, they’ll manage to reach that.”
Saudi Aramco, the world’s largest oil producer, is in early talks with banks for a loan of about $10 billion to help finance its acquisition of a 70% stake in Saudi Basic Industries Corp (SABIC), according to three banking sources.
Aramco (2222.SE) agreed last year to buy the controlling stake in SABIC from the kingdom’s wealth fund for $69.1 billion, sealing one of the biggest-ever deals in the global chemical industry.
“The financing would be for the SABIC deal, but the borrower is Aramco,” said one of the sources, adding that the discussions were at an initial stage, with the company sounding out banks.
“Ten billion dollars is where they want to get to, (it’s) not clear if, in this market, they’ll manage to reach that.”
Oil slides 6% as producer cuts fail to banish demand fears - Reuters
Oil slides 6% as producer cuts fail to banish demand fears - Reuters:
Oil prices fell around 6% on Tuesday as investors doubted that record OPEC+ supply cuts would soon balance markets as demand plunges due to the coronavirus pandemic.
Brent crude futures LCOc1 fell $1.74, or 5.5%, to $30.00 a barrel by 12:57 p.m. EDT (1657 GMT). U.S. West Texas Intermediate (WTI) crude CLc1 was down $1.51, or 6.7%, at $20.90 a barrel.
Global oil producers worldwide are expected to cut overall output by roughly 19.5 million barrels per day, or nearly 20% of world supply.
However, those commitments - which include voluntary cuts that will happen gradually in places like the United States - will not be enough to reduce the growing worldwide supply glut. Oil prices remain more than 50% down this year.
Oil prices fell around 6% on Tuesday as investors doubted that record OPEC+ supply cuts would soon balance markets as demand plunges due to the coronavirus pandemic.
Brent crude futures LCOc1 fell $1.74, or 5.5%, to $30.00 a barrel by 12:57 p.m. EDT (1657 GMT). U.S. West Texas Intermediate (WTI) crude CLc1 was down $1.51, or 6.7%, at $20.90 a barrel.
Global oil producers worldwide are expected to cut overall output by roughly 19.5 million barrels per day, or nearly 20% of world supply.
However, those commitments - which include voluntary cuts that will happen gradually in places like the United States - will not be enough to reduce the growing worldwide supply glut. Oil prices remain more than 50% down this year.
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.
Saudis Slashing Oil Prices to Asia Shows Supply War Isn’t Over - Bloomberg
Saudis Slashing Oil Prices to Asia Shows Supply War Isn’t Over - Bloomberg:
Saudi Arabia might have just signed off on one of the most notable oil output deals in history, but challenges lie ahead as the kingdom faces keen competition from rival suppliers to the prized Asian market.
That perhaps explains why the de-facto leader of OPEC slashed its official selling prices to Asian customers for May by larger-than-expected margins this week. Eight of eleven refiners across the region surveyed by Bloomberg welcomed Saudi Aramco’s aggressive marketing strategy, while the remaining three said they had expected even steeper discounts.
Despite the price war being defused over the weekend, there’s no reason to think that the deluge of cheap crude washing over Asia will ebb quickly as the coronavirus continues to depress demand. Varieties such as Russia’s Urals, Mars from the U.S. and several Abu Dhabi grades crude were being offered in recent weeks to buyers on a delivered basis with flexible arrival dates as traders moved supertankers filled with unsold oil toward Asia.
Aramco cut the May official selling price of its flagship Arab Light crude to Asian customers by $4.20 a barrel from the previous month, exceeding estimates for a reduction of $3.63. That was even after it signed a deal with other producers to cut global output by around 10% to try and support prices.
Saudi Arabia might have just signed off on one of the most notable oil output deals in history, but challenges lie ahead as the kingdom faces keen competition from rival suppliers to the prized Asian market.
That perhaps explains why the de-facto leader of OPEC slashed its official selling prices to Asian customers for May by larger-than-expected margins this week. Eight of eleven refiners across the region surveyed by Bloomberg welcomed Saudi Aramco’s aggressive marketing strategy, while the remaining three said they had expected even steeper discounts.
Despite the price war being defused over the weekend, there’s no reason to think that the deluge of cheap crude washing over Asia will ebb quickly as the coronavirus continues to depress demand. Varieties such as Russia’s Urals, Mars from the U.S. and several Abu Dhabi grades crude were being offered in recent weeks to buyers on a delivered basis with flexible arrival dates as traders moved supertankers filled with unsold oil toward Asia.
Aramco cut the May official selling price of its flagship Arab Light crude to Asian customers by $4.20 a barrel from the previous month, exceeding estimates for a reduction of $3.63. That was even after it signed a deal with other producers to cut global output by around 10% to try and support prices.
Air Arabia Is Said to Seek State Aid and Delay New Venture - Bloomberg
Air Arabia Is Said to Seek State Aid and Delay New Venture - Bloomberg:
Air Arabia PJSC has joined airlines globally in seeking state support and plans to delay the launch of a new low-cost carrier as the Covid-19 outbreak continues to wreak havoc on the aviation industry, according to people familiar with the matter.
The airline has asked the United Arab Emirates government for financial assistance, said the people, who asked not to be identified as the matter hasn’t been made public. Details of the magnitude of the package haven’t been disclosed.
Air Arabia Abu Dhabi, a joint venture with Etihad Airways slated to start flying by the end of June, has been put on hold, said the people. The two airlines intend to revive the plan when demand for global travel recovers from the impact of the pandemic, they said.
In a statement, Air Arabia called the report “baseless and speculative.” It said that preparatory work for the launch of the low-cost carrier “remains in motion and will progress as the market situation improves.”
Air Arabia PJSC has joined airlines globally in seeking state support and plans to delay the launch of a new low-cost carrier as the Covid-19 outbreak continues to wreak havoc on the aviation industry, according to people familiar with the matter.
The airline has asked the United Arab Emirates government for financial assistance, said the people, who asked not to be identified as the matter hasn’t been made public. Details of the magnitude of the package haven’t been disclosed.
Air Arabia Abu Dhabi, a joint venture with Etihad Airways slated to start flying by the end of June, has been put on hold, said the people. The two airlines intend to revive the plan when demand for global travel recovers from the impact of the pandemic, they said.
In a statement, Air Arabia called the report “baseless and speculative.” It said that preparatory work for the launch of the low-cost carrier “remains in motion and will progress as the market situation improves.”
#Kuwait Stock Exchange Delays Trading Debut on Coronavirus - Bloomberg
Kuwait Stock Exchange Delays Trading Debut on Coronavirus - Bloomberg:
The Kuwait Stock Exchange is delaying the listing of its shares due to restrictions on work triggered by the coronavirus pandemic.
The listing, scheduled for April 19, has been postponed until further notice “due to exceptional circumstances that are imposed by the spread of the coronavirus pandemic,” the bourse said in a statement. Kuwait’s would have been the second stock exchange in the Gulf region to list its shares after Dubai.
The coronavirus outbreak has disrupted business in the region, with countries imposing varying degrees of lockdowns. Among the major deals delayed are Kuwait Finance House KSCP’s $8.8 billion merger with Bahrain’s Ahli United Bank BSC and Saudi Telecom’s plan to acquire a stake in Vodafone Egypt.
The initial public offering of half of the Kuwait bourse to citizens last year followed a 44% sale to a consortium of domestic and international investors. It was more than 8.5 times oversubscribed.
The Kuwait Stock Exchange is delaying the listing of its shares due to restrictions on work triggered by the coronavirus pandemic.
The listing, scheduled for April 19, has been postponed until further notice “due to exceptional circumstances that are imposed by the spread of the coronavirus pandemic,” the bourse said in a statement. Kuwait’s would have been the second stock exchange in the Gulf region to list its shares after Dubai.
The coronavirus outbreak has disrupted business in the region, with countries imposing varying degrees of lockdowns. Among the major deals delayed are Kuwait Finance House KSCP’s $8.8 billion merger with Bahrain’s Ahli United Bank BSC and Saudi Telecom’s plan to acquire a stake in Vodafone Egypt.
The initial public offering of half of the Kuwait bourse to citizens last year followed a 44% sale to a consortium of domestic and international investors. It was more than 8.5 times oversubscribed.
#Oman tells all government agencies to cut spending by at least 10% - Reuters
Oman tells all government agencies to cut spending by at least 10% - Reuters:
Oman’s finance ministry told all government agencies to cut their operating budgets this year by at least 10% and stressed they should reduce them by as much as possible, including by reviewing salaries and benefits.
The ministry said all exceptional bonuses for state employees would be halted, state media reported. It said the decisions applied to all ministries, agencies and public entities, as well as security and military bodies.
Oman’s finance ministry told all government agencies to cut their operating budgets this year by at least 10% and stressed they should reduce them by as much as possible, including by reviewing salaries and benefits.
The ministry said all exceptional bonuses for state employees would be halted, state media reported. It said the decisions applied to all ministries, agencies and public entities, as well as security and military bodies.
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.
Air Arabia says market conditions to influence new airline launch but no delays yet - Reuters
Air Arabia says market conditions to influence new airline launch but no delays yet - Reuters:
Air Arabia AIRA.DU and Etihad have no plans to delay the launch of a low-cost Abu Dhabi-based airline in a joint venture but the timing will depend on market conditions, an Air Arabia spokesman said on Tuesday.
Air Arabia Chief Executive Adel Ali said in November that the airline would be operational in the second quarter of 2020. However, the new coronavirus outbreak has since brought international travel to a near halt.
“There are no plans to delay or postpone,” the spokesman for Air Arabia, the UAE’s only listed airline, said.
“Preparatory work for the launch remains in motion and will progress as the market situation improves.”
Air Arabia AIRA.DU and Etihad have no plans to delay the launch of a low-cost Abu Dhabi-based airline in a joint venture but the timing will depend on market conditions, an Air Arabia spokesman said on Tuesday.
Air Arabia Chief Executive Adel Ali said in November that the airline would be operational in the second quarter of 2020. However, the new coronavirus outbreak has since brought international travel to a near halt.
“There are no plans to delay or postpone,” the spokesman for Air Arabia, the UAE’s only listed airline, said.
“Preparatory work for the launch remains in motion and will progress as the market situation improves.”
Oil slips as producer cuts fail to banish demand fears - Reuters
Oil slips as producer cuts fail to banish demand fears - Reuters:
Oil prices edged lower on Tuesday, with investors apparently unconvinced that record supply cuts could soon balance markets pummeled by the coronavirus pandemic, though a predicted plunge in U.S. shale output provided some support.
Brent LCOc1 futures fell 25 cents, or 0.8%, to $31.49 a barrel by 0825 GMT after settling 0.8% higher on Monday. U.S. West Texas Intermediate (WTI) crude CLc1 was down 22 cents, or 1%, at $22.19, having dropped 1.5% in the previous session.
The Organization of the Petroleum Exporting Countries (OPEC), along with Russia and other producing countries - a grouping known as OPEC+ - agreed over Easter to cut output by 9.7 million barrels per day (bpd) in May and June, equating to about 10% of global supply before the coronavirus outbreak.
Additional output cuts by the United States, the world’s biggest producer, and other nations outside the OPEC+ group will take the estimated total reduction to about 19.5 million bpd.
Oil prices edged lower on Tuesday, with investors apparently unconvinced that record supply cuts could soon balance markets pummeled by the coronavirus pandemic, though a predicted plunge in U.S. shale output provided some support.
Brent LCOc1 futures fell 25 cents, or 0.8%, to $31.49 a barrel by 0825 GMT after settling 0.8% higher on Monday. U.S. West Texas Intermediate (WTI) crude CLc1 was down 22 cents, or 1%, at $22.19, having dropped 1.5% in the previous session.
The Organization of the Petroleum Exporting Countries (OPEC), along with Russia and other producing countries - a grouping known as OPEC+ - agreed over Easter to cut output by 9.7 million barrels per day (bpd) in May and June, equating to about 10% of global supply before the coronavirus outbreak.
Additional output cuts by the United States, the world’s biggest producer, and other nations outside the OPEC+ group will take the estimated total reduction to about 19.5 million bpd.
New board appointed at NMC to implement changes | ZAWYA MENA Edition
New board appointed at NMC to implement changes | ZAWYA MENA Edition:
NMC Health, which has been placed under a UK court-appointed administration, announced on Monday the formation of a new board of directors that has been entrusted with the immediate priority of implementing corporate governance changes in the group.
Richard Fleming, Mark Firmin and Ben Cairns of Alvarez & Marsal Europe, the joint administrators, have appointed four new non-executive directors with broad international restructuring experience to provide more robust governance and oversee the work with the management teams in the individual NMC businesses.
"The previous board of directors ceased to have decision-making powers with the appointment of the administrators and have now all been removed from the board," joint administrators said in a statement.
Consequent to the new move, Faisal Belhoul, Ayesha Mohammed, Jonathan Bomford, Patrick James Meade, Salma Ali Saif bin Hareb and Tarek Alnabulsi were removed from the board that was formed only weeks ago.
NMC Health, which has been placed under a UK court-appointed administration, announced on Monday the formation of a new board of directors that has been entrusted with the immediate priority of implementing corporate governance changes in the group.
Richard Fleming, Mark Firmin and Ben Cairns of Alvarez & Marsal Europe, the joint administrators, have appointed four new non-executive directors with broad international restructuring experience to provide more robust governance and oversee the work with the management teams in the individual NMC businesses.
"The previous board of directors ceased to have decision-making powers with the appointment of the administrators and have now all been removed from the board," joint administrators said in a statement.
Consequent to the new move, Faisal Belhoul, Ayesha Mohammed, Jonathan Bomford, Patrick James Meade, Salma Ali Saif bin Hareb and Tarek Alnabulsi were removed from the board that was formed only weeks ago.
Air Arabia Is Said to Seek State Aid, Delay Low-Cost Carrier - Bloomberg #UAE
Air Arabia Is Said to Seek State Aid, Delay Low-Cost Carrier - Bloomberg:
Air Arabia PJSC has joined airlines globally in seeking state support and plans to delay the launch of a new low-cost carrier as the Covid-19 outbreak continues to wreak havoc on the aviation industry, according to people familiar with the matter.
The airline has asked the United Arab Emirates government for financial assistance, said the people, who asked not to be identified as the matter hasn’t been made public. Details of the magnitude of the package haven’t been disclosed.
Air Arabia Abu Dhabi, a joint venture with Etihad Airways slated to start flying by the end of June, has been put on hold, said the people. The two airlines intend to revive the plan when demand for global travel recovers from the impact of the pandemic, they said.
Air Arabia declined to comment, while Etihad didn’t immediately respond to a request for comment. The U.A.E government referred questions to authorities in the city of Sharjah, where Air Arabia is based. They couldn’t be reached outside business hours.
Air Arabia PJSC has joined airlines globally in seeking state support and plans to delay the launch of a new low-cost carrier as the Covid-19 outbreak continues to wreak havoc on the aviation industry, according to people familiar with the matter.
The airline has asked the United Arab Emirates government for financial assistance, said the people, who asked not to be identified as the matter hasn’t been made public. Details of the magnitude of the package haven’t been disclosed.
Air Arabia Abu Dhabi, a joint venture with Etihad Airways slated to start flying by the end of June, has been put on hold, said the people. The two airlines intend to revive the plan when demand for global travel recovers from the impact of the pandemic, they said.
Air Arabia declined to comment, while Etihad didn’t immediately respond to a request for comment. The U.A.E government referred questions to authorities in the city of Sharjah, where Air Arabia is based. They couldn’t be reached outside business hours.
#SaudiArabia may tap debt market as oil output cuts hit revenues: sources - Reuters
Saudi Arabia may tap debt market as oil output cuts hit revenues: sources - Reuters:
Saudi Arabia is likely to sell new international bonds soon as Sunday’s historic deal to cut oil output among major producers puts further pressure on revenues already hurt by the collapse in crude prices, four banking sources said.
Riyadh increased its debt ceiling to 50% of GDP from a previous 30% in March. Neighbours Qatar and Abu Dhabi emirate successfully sold a combined $17 billion of bonds last week.
“It’s the logical next step (for Saudi to issue after Qatar and Abu Dhabi) ... they may wait a bit for the oil market to react to the cuts as their name is more closely associated with oil,” said a debt banker.
A spokesman for the Saudi finance ministry did not immediately respond to a Reuters query on debt issuance plans.
Saudi Arabia is likely to sell new international bonds soon as Sunday’s historic deal to cut oil output among major producers puts further pressure on revenues already hurt by the collapse in crude prices, four banking sources said.
Riyadh increased its debt ceiling to 50% of GDP from a previous 30% in March. Neighbours Qatar and Abu Dhabi emirate successfully sold a combined $17 billion of bonds last week.
“It’s the logical next step (for Saudi to issue after Qatar and Abu Dhabi) ... they may wait a bit for the oil market to react to the cuts as their name is more closely associated with oil,” said a debt banker.
A spokesman for the Saudi finance ministry did not immediately respond to a Reuters query on debt issuance plans.
Oil mixed as demand worries offset gains from output cut deal - Reuters
Oil mixed as demand worries offset gains from output cut deal - Reuters:
Oil prices were mixed on Monday, as the historic production-cut deal inked by major global oil producers was not enough to assuage existing worries about the demand destruction brought on by the coronavirus pandemic.
Brent LCOc1 futures rose 26 cents, or 0.8%, to settle at $31.74 a barrel, while U.S. West Texas Intermediate (WTI) crude CLc1 slipped 35 cents, or 1.5%, to settle at $22.41, its lowest since April 1. Earlier in the day WTI was up over 5%.
The Organization of the Petroleum Exporting Countries, along with Russia and other countries - known as OPEC+ - agreed over the weekend to cut output by 9.7 million barrels per day (bpd) in May and June, representing about 10% of global supply.
Oil prices were mixed on Monday, as the historic production-cut deal inked by major global oil producers was not enough to assuage existing worries about the demand destruction brought on by the coronavirus pandemic.
Brent LCOc1 futures rose 26 cents, or 0.8%, to settle at $31.74 a barrel, while U.S. West Texas Intermediate (WTI) crude CLc1 slipped 35 cents, or 1.5%, to settle at $22.41, its lowest since April 1. Earlier in the day WTI was up over 5%.
The Organization of the Petroleum Exporting Countries, along with Russia and other countries - known as OPEC+ - agreed over the weekend to cut output by 9.7 million barrels per day (bpd) in May and June, representing about 10% of global supply.
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