Oil Closes Under $20 for Second Day Amid Historic Demand Loss - Bloomberg

Oil Closes Under $20 for Second Day Amid Historic Demand Loss - Bloomberg:

Oil closed under $20 a barrel for a second day as projections that demand will fall to a 30-year low outweighed an agreement by the world’s biggest producers to curb supply.

Futures in New York ended the day unchanged from the 18-year low set Wednesday. OPEC said it expects demand for its crude to fall to the lowest in three decades as the coronavirus outbreak freezes the global economy, underscoring the urgency of the group’s promised production cuts. OPEC and its allies have agreed to curb output by 10% next month. But even with full compliance, the group would still be pumping more than the market requires in the second quarter.

The cuts “certainly aren’t going to be near enough to balance the market,” said Bart Melek, head of commodity strategy at TD Securities. “There is a good chance, that over the short run, we might even be lower here.”

Inventories from America to Europe and Singapore have all ballooned this week, sending some localized crude prices below $10 a barrel. The glut is looking so severe that the Trump administration is considering paying American companies to leave crude in the ground.

PRICES:
West Texas Intermediate futures settled unchanged at $19.87 a barrel in New York, the same as yesterday’s lowest close since 2002 Brent for June delivery rose 13 cents to $27.82

Mideast Stocks: IMF's dire economic warning, oil demand shrinkage weigh on Gulf | ZAWYA MENA Edition

Mideast Stocks: IMF's dire economic warning, oil demand shrinkage weigh on Gulf | ZAWYA MENA Edition:

Most Middle East indexes fell for a second day on Thursday, after the International Monetary Fund (IMF) warned of the worst economic downturn since 1930s while an expected drop in global oil demand to quarter-century lows added to the woes.

The global economy is expected to shrink by 3.0% during 2020 in a coronavirus-driven collapse that would be the steepest since the Great Depression of the 1930s, the IMF said.

The International Energy Agency (IEA) on Wednesday forecast a 29 million barrel per day (bpd) dive in April oil demand to levels not seen in 25 years and warned no output cut by producers could fully offset the near-term falls. 

Saudi Arabia's benchmark index slid 2.7%, with state -owned oil giant Saudi Aramco dropping 2.3% and Al Rajhi Bank down 1.3%.

European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar close

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.

Oil prices rise after sharp losses caused by U.S. stockpile surge - Reuters

Oil prices rise after sharp losses caused by U.S. stockpile surge - Reuters:

Oil prices rose on Thursday after sharp losses in the previous session, with investors hoping that a big build-up in U.S. inventories may mean producers have little option but to deepen output cuts as the coronavirus pandemic ravages demand.

With official data showing U.S. inventories surging the most on record, U.S. West Texas Intermediate (WTI) fell on Wednesday to its lowest since February 2002, while Brent fell by more than 6%. [EIA/S]

Brent crude LCOc1 was up $1.15, or 4.2%, at $28.84 a barrel by 1225 GMT. WTI was up 33 cents, or 1.7%, at $20.20.

Brent is headed for a weekly fall of around 8% and WTI of 11%.

OPEC cuts oil demand view again as market faces 'historic shock' - Reuters

OPEC cuts oil demand view again as market faces 'historic shock' - Reuters:

OPEC on Thursday again cut its forecast for 2020 global oil demand due to the “historic shock” delivered by the coronavirus outbreak, and said the reduction may not be the last.

The Organization of the Petroleum Exporting Countries now expects global demand to contract by 6.9 million barrels per day, or 6.9%, in 2020, it said in a monthly report. Last month, OPEC expected a small increase in demand of 60,000 bpd.

“The oil market is currently undergoing historic shock that is abrupt, extreme and at global scale,” OPEC said in the report.

“Downward risks remain significant, suggesting the possibility of further adjustments, especially in the second quarter,” OPEC said of the demand forecast.

Real Oil Market Is Sinking and OPEC+ Deal Can’t Rescue It - Bloomberg

Real Oil Market Is Sinking and OPEC+ Deal Can’t Rescue It - Bloomberg:

The physical oil market, where millions of barrels of real cargoes are traded each day, needed OPEC+’s historic cuts to global crude production months ago.

On Sunday, producer nations pledged to limit output by an unprecedented 10% of global supply. While there’s skepticism the cuts will prove deep enough -- demand has plunged by far more -- a more pressing issue is one of timing: the real market, the one that underpins headline prices, has a huge glut and the output curbs won’t even begin until May. Before then, it’s pump at will so the curbs won’t really affect physical oil supply for months.

Signs of weakness abound. Key North Sea crude swaps are trading more than $6 a barrel below the headline Brent futures price of about $28 -- the biggest discount in almost a decade. The critically important Dated Brent benchmark that shapes the price of millions of barrels of crude was assessed by S&P Global Platts at $18.08 on Wednesday. At the same time, a gauge of U.S. supply is at its weakest since 2009 as the market tries to force supplies into storage.

“In the short-term, the market remains very overwhelmed with misplaced oil,” said Torbjorn Tornqvist, co-founder and chief executive officer of Gunvor Group Ltd., a top oil trader. “Prompt time spreads will continue to be very weak, along with deep discounts for physical oil.”

Top LNG Buyers Seek Cargo Delays as Virus Slashes Demand - Bloomberg

Top LNG Buyers Seek Cargo Delays as Virus Slashes Demand - Bloomberg:

The world’s top buyers of liquefied natural gas are seeking to defer shipments as the coronavirus pandemic cripples demand and forces more of the heating and power fuel into storage that is nearing capacity.

The move signals that efforts to contain the spread of the virus may impact energy consumption far into this year and possibly 2021, worsening an oversupply of natural gas and oil that’s punished prices.

Buyers in South Korea and Japan, including Korea Gas Corp. and Tokyo Gas Co., are in discussions with term suppliers to postpone cargoes slated for delivery as far out as October, according to people with knowledge of the matter. The delay requests vary from just a few days to as late as next year, said the people, who asked not to be identified as the discussions are private.

The virus has already disrupted LNG deliveries across Asia. Indian importers this week requested further delays to shipments after the government extended a nationwide lockdown until May 3. Meanwhile, several buyers in North Asia have exercised so-called “downward quantity tolerance” clauses in their long-term contracts, which allow them to take up to 10% less volume than originally agreed. Earlier t

#SaudiArabia Joins Middle East Bond Binge to Boost Finances - Bloomberg

Saudi Arabia Joins Middle East Bond Binge to Boost Finances - Bloomberg:

Saudi Arabia sold $7 billion of bonds on Wednesday as it followed other Middle Eastern states that have issued foreign debt to bolster their finances in the face of the coronavirus pandemic and plunging energy prices.

The offering marked the second time this year the world’s largest oil exporter has turned to international capital markets, as Crown Prince Mohammed bin Salman pushes ahead with plans to open up the economy and wean it off crude. In December, the government sold a $29 billion stake in energy giant Saudi Aramco through the largest initial public offering in history.

“It doesn’t have a choice but to borrow from the bond market,” said Richard Segal, a senior analyst at Manulife Investment in London. “With oil prices lower and soon production lower, and an economic support package recently in place, the government’s deficit and financing requirements have jumped.”


The deal was heavily oversubscribed, with investors placing around $54 billion of orders, according to a person familiar with the matter. The kingdom sold $2.5 billion of bonds maturing in 5.5 years, $1.5 billion of debt due in 10.5 years and $3 billion of 40-year notes.

Russia’s Oil Pain Deepens as OPEC+ Prepares to Cut Output - Bloomberg

Russia’s Oil Pain Deepens as OPEC+ Prepares to Cut Output - Bloomberg:

The Kremlin may have succeeded in ending its oil war with Saudi Arabia, yet the pain of crude’s crash is only just starting to hit Russia’s budget.

Next month, the nation’s coffers will get less than $1 for each exported barrel of oil, according to Bloomberg calculations based on the data from the Russian Finance Ministry. Oil export duty in May is set to tumble by 87%, compared to April, reflecting crude’s biggest crash in a generation.

“This duty level is the lowest since 2002 when the new export duty mechanism was introduced,” a representative from Russia’s Finance Ministry told Bloomberg.

Russia’s oil-export tax level is recalculated monthly, based on the average price for Urals, the nation’s main export blend, over a mid-month to mid-month period. The system cushions the budget from any immediate impacts of low prices. Between March 15 and April 14, Urals crude averaged just over $19 a barrel, according to the Finance Ministry.

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.

#Dubai extends closure of restaurants, hotels and events until further notice - Arabianbusiness

Dubai extends closure of restaurants, hotels and events until further notice - Arabianbusiness:

All inbound tour operators, hotels, restaurants, venues and event organisers in Dubai are to remain closed until further notice, according to Dubai’s Department of Tourism and Commerce Marketing (DTCM).

The authority said in a circular this week that the precautionary measures taken to curb the spread of Covid-19 will be extended indefinitely.

“In line with Dubai Government Precautionary measures to ensure the health and safety of its residents and visitors, we extend all the Precautionary Circulars on the website until further notice.

Petrofac says #AbuDhabi National Oil Co ends $1.65 bln Dalma gas contracts - Reuters

Petrofac says Abu Dhabi National Oil Co ends $1.65 bln Dalma gas contracts - Reuters:

Oilfield services provider Petrofac said on Thursday Abu Dhabi National Oil Company (ADNOC) has terminated the $1.65-billion worth of contracts it had awarded to its Emirati unit for the Dalma gas development project.

The contract was awarded to Petrofac Emirates two months ago and Petrofac said on Thursday it was “committed to working” with state-owned ADNOC in the coming weeks to explore alternative options. 


ADNOC had earlier said it would cut output as part of the OPEC+ deal.

Shares of the company, which have been battered since a bribery probe into dealings in Saudi Arabia and Iraq, were down 11% in morning trade.

#Qatar sets May crude prices at wide discounts - price document | ZAWYA MENA Edition

Qatar sets May crude prices at wide discounts - price document | ZAWYA MENA Edition:

Qatar has set the official selling prices (OSP) for its crude in May at wide discounts, according to a price document seen by Reuters on Thursday.

Qatar Petroleum set the Marine crude OSP at $7.10 a barrel below the monthly average of Platts Oman and Dubai quotes.

The May OSP for Qatar Land crude was set at minus $7.30 a barrel to the same benchmark.

MIDEAST STOCKS-Gulf stocks extend losses on economic warnings, oil demand concerns - Reuters

MIDEAST STOCKS-Gulf stocks extend losses on economic warnings, oil demand concerns - Reuters:

Major Gulf stock exchanges fell further on Thursday on fears that the world is in its worst recession since the 1930s while reports of persistent crude oil oversupply and collapsing demand added to the worries. 


The global economy is expected to shrink by 3.0% during 2020 in a stunning coronavirus-driven collapse of activity that will mark the steepest downturn since the Great Depression, the IMF said on Tuesday. 


Oil prices sank on Wednesday after the International Energy Agency forecast a 29-million-barrel per day dive in April crude demand to levels not seen in 25 years and said no output cut could fully offset the near-term decline facing the market.

Saudi Arabia’s benchmark index declined 1.5%, with oil giant Saudi Aramco shedding 1.3%, while Al Rajhi Bank was down 0.9%.

Brent erases tentative gains, WTI ticks up after U.S. stockpile surge - Reuters

Brent erases tentative gains, WTI ticks up after U.S. stockpile surge - Reuters:

Oil prices were broadly stable on Thursday after sharp losses in the previous session, with investors hoping that a big build-up in U.S. inventories may mean producers have little option but to deepen output cuts as the coronavirus pandemic ravages demand.

With official data showing U.S. inventories surging the most on record, U.S. West Texas Intermediate (WTI) fell on Wednesday to its lowest since February 2002, with Brent losing more than 6%.

Brent crude LCOc1 was down 19 cents, or 0.7%, at $27.50 a barrel by 0754 GMT. WTI was up 7 cents, or 0.4%, at $19.94.

Brent was heading for its third straight session of losses, while WTI eeked out its first tentative gains after falling for four sessions.