Oil Plunges Below Zero for First Time in Unprecedented Wipeout - Bloomberg

Oil Plunges Below Zero for First Time in Unprecedented Wipeout - Bloomberg:

Of all the wild, unprecedented swings in financial markets since the coronavirus pandemic broke out, none has been more jaw-dropping than Monday’s collapse in a key segment of U.S. oil trading.

The price on the futures contract for West Texas crude that is due to expire Tuesday fell into negative territory -- minus $37.63 a barrel. The reason: with the pandemic bringing the economy to a standstill, there is so much unused oil sloshing around that American energy companies have run out of room to store it. And if there’s no place to put the oil, no one wants a crude contract that is about to come due.

Underscoring just how acute the concern is over the lack of immediate storage space, the price on the futures contract due a month later settled at $20.43 per barrel. That gap between the two contracts is by far the biggest ever.

“The May crude oil contract is going out not with a whimper, but a primal scream,” said Daniel Yergin, a Pulitzer Prize-winning oil historian and vice chairman of IHS Markit Ltd.

#UAE Coronavirus News: Testing Planned for All Citizens, Residents - Bloomberg

UAE Coronavirus News: Testing Planned for All Citizens, Residents - Bloomberg:

The United Arab Emirates is widening the scope of coronavirus testing to cover all citizens and residents across the Gulf nation.

The country performed 25,795 tests and confirmed 484 new infections in the past 24 hours, Farida Al Hosani, the official spokesperson for the U.A.E. health sector, said on TV on Monday. Total coronavirus cases are now at 7,265, including 43 deaths.

The U.A.E. has imposed movement restrictions across its emirates and has shut malls, limited restaurants to delivery only and halted the majority of its flights.

#Kuwait expands curfew, extends public sector work suspension - Reuters

Kuwait expands curfew, extends public sector work suspension - Reuters:

Kuwait will extend the suspension of work in the public sector including at government ministries until May 31 and expand a nationwide curfew to 16 hours as part of efforts to combat the coronavirus, a government spokesman said on Monday.

He said in televised remarks that the 4 pm to 8 am curfew would go into effect at the start of the holy fasting month of Ramadan, which could fall on Thursday or later this week depending on the sighting of the new crescent moon.

Elsewhere in the Gulf region, Qatar said it would on Wednesday start to gradually lift a lockdown imposed since March 17 on a large section of an industrial zone, where many low-income migrant workers live and work and which had emerged as a hot spot for the virus.

Oil crashes, ends negative for the first time in history - Reuters

Oil crashes, ends negative for the first time in history - Reuters:

U.S. crude oil futures turned negative on Monday for the first time in history, ending the day at a stunning minus $37.63 a barrel as traders sold heavily because of rapidly filling storage space at the key Cushing, Oklahoma, delivery point.

Brent crude, the international benchmark, also slumped, but that contract was nowhere near as weak because more storage is available worldwide.

The May U.S. WTI contract fell $55.9, or 306%, to settle at a discount of $37.63 a barrel after touching an all-time low of -$40.32 a barrel. Brent was down $2.51, or 9%, to settle at $25.57 a barrel.

“The storage is too full for speculators to buy this contract, and the refiners are running at low levels because we haven’t lifted stay-at-home orders in most states,” said Phil Flynn, an analyst at Price Futures Group in Chicago. “There’s not a lot of hope that things are going to change in 24 hours.”

US oil price crashes to record low as coronavirus hits demand | Financial Times

US oil price crashes to record low as coronavirus hits demand | Financial Times:

Benchmark US oil prices crashed towards $1 a barrel on Monday, as the collapse in demand caused by the coronavirus pandemic leaves the world awash with so much crude, and so little available storage capacity, that producers may soon be paying for buyers to take it off their hands.

West Texas Intermediate, the US marker, lost 92 per cent on Monday, with the price of oil for delivery next month sinking to a low of $1.02 a barrel, on warnings that traders were struggling to access storage capacity at the refinery hub of Cushing, Oklahoma, which is expected to be maxed out within weeks.

CME Group, the exchange operator where WTI trades, took the extraordinary measure on Monday of saying prices could even turn negative for the current contract, which expires tomorrow. That means producers would be paying buyers to take their oil to try and forestall the shutdown of fields ahead of their rivals.

The price crash is the latest indication of the depth of the crisis hitting the oil sector. Lockdowns imposed in many of the world’s major economies have sent crude demand tumbling by as much as a third, leaving the industry facing what Jefferies analyst Jason Gammel called perhaps “the bleakest oil macro outlook” he had ever seen.

UPDATE 1- #Bahrain to cut government agencies' spending by 30% amid coronavirus - Reuters

UPDATE 1-Bahrain to cut government agencies' spending by 30% amid coronavirus - Reuters:

Bahrain will slash spending by ministries and government agencies by 30% to help the country weather the coronavirus outbreak, a cabinet statement said on Monday after meeting.

The Gulf island state’s government will also reschedule some construction and consulting projects in order to keep spending within the 2020 budget and make room for other spending needs emerging as a result of the disease’s spread.

The move comes as other states in the Gulf seek to cut spending as they face fiscal pressure from virus containment measures that have brought to a near halt vital economic sectors such as tourism and transport.

Plunging oil prices and an agreement on production cuts are also expected to weigh on regional budgets this year.

Exclusive: Russia orders companies to cut oil output by 20% from February levels - sources - Reuters

Exclusive: Russia orders companies to cut oil output by 20% from February levels - sources - Reuters:

The Russian energy ministry has told domestic oil producers to reduce oil output by around 20% from their average February levels, two industry sources told Reuters on Monday, which would bring Moscow in line with its commitment under a global deal.

The Organization of the Petroleum Exporting Countries and other large oil producers led by Russia, a group known as OPEC+, agreed to cut their combined oil output by 9.7 million barrels per day (bpd) in May and June in order to combat oversupply triggered by the coronavirus crisis.

With other countries, such as the United States and Norway, which are not a party to the OPEC+ deal, the reduction in total global oil output could be 20 million bpd, or a fifth of the world’s oil production.

Under the deal, Moscow has to cut its oil production by 2.5 million bpd from May and using the reference level of 11 million bpd - the figure which includes crude oil only and exempts gas condensate, a type of light oil.

#SaudiArabia gets physical with Russia in underground oil bout - Reuters

Saudi Arabia gets physical with Russia in underground oil bout - Reuters:

Behind a Saudi-Russian truce to stabilise oil markets with a record output cut, market players are seeing the two production heavyweights still trading blows in the physical market.

It is here, rather than in the world of futures prices, that a long-standing battle for market share carries on, particularly in Asia, shipping data analysed on Monday by Reuters shows.

The rivals said last week they were ready to take measures if necessary to balance the market by cutting combined output with other OPEC+ members from May.

“Beyond the cooperative statements the fight is still going on,” a source at a trading firm told Reuters, adding that Saudi Arabia’s official selling prices (OSPs) signalled that the kingdom was targeting the Asian market, where demand remains relatively resilient during a global slowdown.

Oil falls on concerns over storage, weakening economies - Reuters

Oil falls on concerns over storage, weakening economies - Reuters:

Oil prices fell on Monday, with a U.S. crude futures contract hitting its lowest level since 1998, as concerns that U.S. crude storage will soon be full and bleak economic data hit sentiment.

Brent LCOc1 was down $1.18, or 4.2%, at $26.90 a barrel by 1321 GMT, while the front-month May WTI contract CLc1 fell $5.88, or 32%, to $12.39.

At one point, the contract hit a low of $10.77 a barrel, the lowest since 1998. However, analysts said the sell-off was exaggerated by the contract’s imminent expiry.

“The May contract is set to expire tomorrow and the bulk of the open interest and volume is already in the June contract,” said ING’s head of commodities strategy, Warren Patterson.

GIP Consortium Is Said to Seek $8 Billion Loan for Adnoc Deal - Bloomberg

GIP Consortium Is Said to Seek $8 Billion Loan for Adnoc Deal - Bloomberg:

An ADNOC employee performs maintenance duties at the Borouge 3 petrochemical plant, at the company's Ruwais refinery.

 Photographer: Christophe Viseux/Bloomberg

An investor group backed by Global Infrastructure Partners and Brookfield Asset Management Inc. is seeking a loan of about $8 billion to finance the potential purchase of a stake in Abu Dhabi National Oil Co.’s natural gas pipelines, according to people with knowledge of the matter.

The consortium -- which also includes Italian infrastructure operator Snam SpA, Ontario Teachers Pension Plan and Singapore sovereign fund GIC Pte -- has reached out to banks to gauge their interest in participating, according to the people, who asked not to be identified because the information is private.

No final agreements have been reached, and details of the financing could change, the people said. Representatives for Snam and GIC declined to comment, while representatives for the other consortium members didn’t immediately respond to requests for comment.

Column: Hedge funds sense crude at turning point but not fuels - Kemp - Reuters

Column: Hedge funds sense crude at turning point but not fuels - Kemp - Reuters:

Hedge funds were net purchasers of petroleum futures and options for the third week running last week as managers gambled that the market has already hit its trough.

Hedge funds and other money managers purchased the equivalent of 29 million barrels in the six most important petroleum futures and options contracts in the week ending April 14.

Purchases over the last three weeks have totalled 83 million barrels, after portfolio managers sold 688 million barrels over the previous 11 weeks (reut.rs/34NMSVE).

Last week’s adjustment came entirely from the creation of new long positions, after the previous week’s short-covering faded and short positions were unchanged.

Oil falls on concern over storage and earnings - Reuters

Oil falls on concern over storage and earnings - Reuters:

Oil prices fell on Monday, with a U.S. crude futures contract hitting its lowest level since 1999, depressed by concern that U.S. crude storage will soon be full while companies prepare to report the worst quarterly earnings since the financial crisis.

Brent LCOc1 was down $1.12, or 4%, at $26.96 a barrel by 1008 GMT.

The front-month May WTI contract CLc1 fell $4.79, or 26.2%, to its lowest since March 1999 at $13.48, though the sell-off was exaggerated by the contract’s imminent expiry.

“The May contract is set to expire tomorrow and the bulk of the open interest and volume is already in the June contract,” said ING’s head of commodities strategy, Warren Patterson.

The June contract CLc2, which is more actively traded, fell $2.18, or 8.7%, to $22.85 a barrel.

Middle East Crude-Benchmarks edge up; ESPO's spot discount widens | ZAWYA MENA Edition

Middle East Crude-Benchmarks edge up; ESPO's spot discount widens | ZAWYA MENA Edition:

Middle East crude benchmarks Oman and Dubai edged up on Monday, while spot differentials for Russian ESPO Blend crude fell to a record low in Asia as abundant supplies and low demand weighed on oil markets.

Russia's Surgutneftegaz sold three June-loading 740,000-barrel ESPO Blend crude cargoes to trading firm Gunvor in a spot tender awarded on Friday at wide discounts estimated from $4.60 a barrel to $5.00 a barrel to Dubai quotes, traders said. 

Vietnam's PV Oil awarded June-loading Ruby, Chim Sao and Bach Ho Light crude to domestic Binh Son refinery, traders said.

Binh Son refinery has issued a tender seeking up to 7.5 million barrels of sweet crude for delivery over July-December, traders said.

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 in New York Plunges Below $15 as Storage Sites Fill - Bloomberg

Oil in New York Plunges Below $15 as Storage Sites Fill - Bloomberg:

Oil plunged below $15 a barrel in New York, a fresh 21-year low, as inventories soar because of the supply-demand mismatch that’s been created by the coronavirus.

The most immediate West Texas Intermediate contract fell as much as 22% to $14.19 a barrel. While a major part of the slump is because the May futures contract expires on Tuesday, the collapse nonetheless reflects a fast-growing glut of oil, and rapidly expanding stockpiles in Cushing, Oklahoma, the American pricing hub.

As WTI futures have tumbled, it has opened up a discount of almost $9 a barrel to the June contract, to which most trading has now transferred. Buyers in Texas are offering as little as $2 a barrel for some oil streams, raising the possibility that American producers may soon have to pay customers to take crude off their hands, particularly as landlocked producers struggle to find homes for their oil.

Crude stockpiles at Cushing, Oklahoma -- the key U.S. storage hub -- have jumped 48% to almost 55 million barrels since the end of February, Energy Information Administration data show. The hub had working storage capacity of 76 million as of Sept. 30, according to the EIA.

PRICES:
WTI for May plummeted 22% to $14.24 a barrel as of 9:33 a.m. in London after falling 20% last week  The June contact declined 7.1% to $23.25 Brent for June fell 3.8% to $26.99 a barrel

#UAE clears 100% ownership rules | ZAWYA MENA Edition

UAE clears 100% ownership rules | ZAWYA MENA Edition:

The UAE has released the full list of 122 categories for 100 per cent ownership in the mainland under the Foreign Direct Investment (FDI) Law.

Cabinet Resolution No.(16) of 2020 determines the 'Positive List' of sectors and economic activities in which foreign direct investment is permissible and the percentage of ownership is 100 per cent.

In 2019, the UAE Cabinet had approved a Positive List of activities under which 100 per cent foreign ownership in companies outside free zones was permitted. However, this remained subject to certain criteria being satisfied.

The list covers key sectors - agriculture; manufacturing; transport and storage; hospitality and food services; information and communications; science and technology; healthcare; education; art and entertainment; and construction.

#UAE banks use 30% of Covid-19 central bank support fund - Arabianbusiness

UAE banks use 30% of Covid-19 central bank support fund - Arabianbusiness:

Banks in the UAE have availed 30 percent of the AED50 billion ($13bn) Targeted Economic Support Scheme (TESS), according to the Central Bank of the UAE (CBUAE).

The scheme was launched on March 15 to help individuals, SMEs and other private businesses impacted by the current coronavirus crisis.

Abdulhamid Saeed, governor of the CBUAE said: “Banks have already utilised over 30 percent of allocated funds from the TESS facility and are actively passing on these funds to their customers affected by the COVID-19 pandemic.”

The package of support was launched in March as part of an AED100bn scheme, which included the AED50bn liquidity relief tool through banks to eligible customers who wish to apply for a deferment until December 31.

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.

MIDEAST STOCKS-Financial stocks weigh on Gulf amid low oil prices - Reuters

MIDEAST STOCKS-Financial stocks weigh on Gulf amid low oil prices - Reuters:

Major stock markets in the Gulf traded lower on Monday, pressured by banking shares, in response to a fresh drop in oil prices as demand shrinks due to the coronavirus pandemic.

Brent was down 90 cents, or 3.2%, to $27.18 a barrel.

In Dubai, the index declined 2.1%, with its largest lender Emirates NBD losing 2.4%. The bank posted a net profit of 2.08 billion dirhams ($566.29 million) in first quarter, down from 2.74 billion dirhams in the same period a year earlier. On a quarterly basis, however, net profit improved by 3%.

The drop in net profit was due to higher provisions the bank took in anticipation of the impact of the new coronavirus outbreak on credit conditions.

Emirates NBD first-quarter profit dives 24% as coronavirus-led impairments surge - Reuters

Emirates NBD first-quarter profit dives 24% as coronavirus-led impairments surge - Reuters:

Dubai’s largest lender Emirates NBD (ENBD.DU) said on Monday its first-quarter net profit declined 24% on-year due to higher provisions the bank took in anticipation of the impact of the coronavirus outbreak on credit conditions.

The bank posted a net profit of 2.08 billion dirhams ($566 million) in the quarter, down from 2.74 billion dirhams in the same period a year earlier. On a quarterly basis, however, the lender’s net profit improved by 3%. 

“Net operating profit declined 24% y-o-y as the group took additional impairment allowances to increase coverage in anticipation of a deterioration in credit quality in subsequent quarters,” Patrick Sullivan, the group chief financial officer, said in a statement.

Banks in the United Arab Emirates are feeling the impact of tough containment measures aimed at tackling the pandemic, which also brought parts of the economy to a near halt.