Crude Oil Latest: WTI, Brent Sink Again When Glut Overflows Tanks - Bloomberg

Crude Oil Latest: WTI, Brent Sink Again When Glut Overflows Tanks - Bloomberg:

Oil’s collapse is deepening.

Just a day after U.S. crude futures for May delivery plunged below zero for the first time ever, June futures plummeted 43% to close below $12 a barrel in New York. A massive supply glut brought on by the pandemic and a worldwide shortage of storage space have touched off a relentless rout that has shifted the entire forward curve for oil.

The meltdown spreading across global oil markets has already wiped out tens of thousands of jobs and frozen billions of dollars in capital spending. Its deflationary effect threatens to further cripple economies around the world already reeling from coronavirus-fueled lockdowns. Storage tanks, pipelines and tankers have become overwhelmed by a vast oversupply brought on by an unprecedented plunge in global fuel demand.

Oil is a “dangerous market to trade in right now,” said Pierre Andurand, founder of Andurand Capital Management LLP, in a Bloomberg TV interview. The market needs oil production to fall immediately for prices to recover, he said.

Brent oil futures plunge as growing glut feeds market panic - Reuters

Brent oil futures plunge as growing glut feeds market panic - Reuters:

Brent oil futures prices plunged again on Tuesday as oil market panic extended into a second day with no end in sight to a swelling global crude glut as the coronavirus pandemic has obliterated demand for fuel.

The most-actively traded U.S. contract, which expires in June, briefly sank into single-digits a day after traders had to pay $37.63 to get rid each barrel of oil at settlement of the expiring May contract. Facing a dearth of storage space and a dramatic 30% plunge in worldwide fuel demand, funds kept selling oil aggressively.

With supply looking like it will far exceed demand for weeks, Brent LCOc1 futures for June delivery fell $6.24, or 24%, to settle at $19.33 a barrel, while U.S. West Texas Intermediate (WTI) crude CLc2 for June, the front-month contract as of Wednesday, fell $8.86, or 43%, to $11.57.

U.S.

June futures traded a record of more than 2 million contracts on Tuesday.

At their session lows, the Brent front-month fell to $17.51 a barrel, its lowest since November 2001, while the WTI second-month fell to a record low of $6.50 for that contract.

WTI for May delivery CLc1 rebounded from negative territory and expired at $10.01 a barrel, as most open positions coming into this week were settled on Monday.

Oil giveaway spells doom, brings out market bears - Reuters

Oil giveaway spells doom, brings out market bears - Reuters:

The crash in U.S. crude prices has turned a reliable commodity less than worthless and given fresh urgency to bearish voices, who say it sounds alarm bells for global growth and are bracing for a catastrophic collapse in asset prices.

Markets are already unnerved at the specter of traders paying to get rid of May futures contracts for West Texas Intermediate crude CLc1, as storage tanks at the delivery point in Oklahoma quickly fill with unused fuel.

But some market participants believe the transformation of “black gold” into a liability is more than a bet gone wrong, and rather heralds a new round of deflation and financial destruction as the COVID-19 pandemic wrecks the world economy.

“This is part of the deflation process,” said Murray Gunn, head of global research at market forecasting firm Elliott Wave International.

Mideast News: #Qatar Airways to Defer Salary Pay for Some Staff - Bloomberg

Mideast News: Qatar Airways to Defer Salary Pay for Some Staff - Bloomberg:

State-owned Qatar Airways is planning to defer salary payments for mid-level and above staff in Doha for three months starting April.

The basic monthly salary of those employees will be subject to a 50% deferral, according to a statement. This “position will be kept under review depending on the economic situation,” the airline added.

“The company will credit salaries back as soon as possible when circumstances allow,” the Gulf carrier said.

#SaudiArabia News: Economy Heads for Worst Contraction in Decades - Bloomberg

Saudi Arabia News: Economy Heads for Worst Contraction in Decades - Bloomberg:

The meltdown in oil markets is turning back the economic clock for Saudi Arabia, putting it on track for the deepest contraction in two decades.

Already under lockdown to contain the spread of the coronavirus pandemic, the world’s largest crude exporter is bracing for a second impact from the oil rout and unprecedented production cuts negotiated by OPEC and its allies. Both will slash government revenue, and in turn derail a fragile economic recovery. Brent crude traded at under $19 a barrel on Tuesday -- a quarter of the level Saudi Arabia needs to balance its budget -- leaving officials with limited options to offset economic pain without crippling public finances.

“This has changed everything,” said Monica Malik, chief economist at Abu Dhabi Commercial Bank. “So much of the recent recovery was based on the fact that the oil price had been above $50-$60, providing support to economic activity, and that’s just been decimated.”

The setback presents difficult choices for Crown Prince Mohammed bin Salman. After the last oil price slump, from 2014 to 2016, he announced a major economic transformation plan. While officials have made significant progress -- developing fledging sectors like entertainment and lifting non-oil revenue with taxes and fees -- the economy still hinges on crude. Now the price shock is threatening many of the government’s gains, making it difficult to fund projects and investments when over 60% of revenue this year was meant to come from oil.

#UAE News: #AbuDhabi's NMC Health Investor May Revamp Debt - Bloomberg

UAE News: Abu Dhabi's NMC Health Investor May Revamp Debt - Bloomberg:

Abu Dhabi-based KBBO Group, once one of NMC Health Plc’s biggest shareholders, plans to restructure its debt and is weighing strategic options for the business, people familiar with the matter said.

KPMG LLP is advising the privately-held investment firm on the asset review along with ways to address the company’s debt load, according to the people, who asked not to be identified because the information is private.

The company plans to negotiate with its creditors under a process supervised by the United Arab Emirates’ Financial Restructuring Committee, which was set up in 2018 to oversee out-of-court financial restructurings, one of the people said. It’s not immediately clear how much debt KBBO is looking to restructure. 


KBBO Chairman Khalifa Bin Butti Omeir Al Muhairi stepped down as vice-chairman of embattled NMC in February amid confusion over the exact size of his stake in the hospital operator, which is being run by administrators Alvarez & Marsal Inc. after it succumbed to creditor demands.

#UAE telco Du reports 4.8% drop in year-on-year revenues for Q1 - Arabianbusiness

UAE telco Du reports 4.8% drop in year-on-year revenues for Q1 - Arabianbusiness:

Emirates Integrated Telecommunications Company (EITC), Du, has announced a 4.8 percent drop in revenues to AED2.99 billion for the first quarter of 2020 compared to the same period last year (AED3.14bn), which has been blamed on a contraction in mobile and other revenues.

According to a company statement released on Tuesday, mobile revenues for Q1 declined by 9.3 percent year-on-year (yoy) to AED1.5bn “impacted by lower voice revenues and a reduction in the prepaid customer base”.

It added that mobile revenues were particularly under pressure due to movement restrictions put in place across the country amid the Covid-19 outbreak and subsequent efforts to contain the virus, which led to “a shift toward fixed usage that affected particularly the company due to the importance of prepaid in its revenue mix”.

#Dubai real estate fund weighs debt options amid downturn -sources - Reuters

Dubai real estate fund weighs debt options amid downturn -sources - Reuters:

Emirates REIT, a Dubai-based sharia-compliant real estate investment trust, is considering buying back some of its roughly $400 million in outstanding Islamic bonds to improve its balance sheet, three sources told Reuters.

The idea is one of a number the company is considering in the face of the economic pressures caused by the coronavirus pandemic, which are weakening an already sluggish property market in Dubai.

The company is also considering refinancing the Islamic bonds, or sukuk, two of the sources said, with one of them adding that talks with local banks had faltered partly because of their exposure to troubled hospital operator NMC Health , which is in restructuring talks with lenders.

Emirates REIT Chief Executive Sylvain Vieujot said a potential sukuk buyback was discussed briefly on a recent earnings call.

Brent oil drops 25%, near two-decade lows on scant demand, storage - Reuters

Brent oil drops 25%, near two-decade lows on scant demand, storage - Reuters:

Brent crude futures plunged 25% on Tuesday to the lowest in nearly two decades, a day after panicked traders sent U.S. oil below minus $40 per barrel on fears of a historic glut due to the destruction of fuel demand by the coronavirus pandemic.

Monday’s historic crash in U.S. crude futures saw the front-month May contract, which expires Tuesday, settling at negative $37.63 a barrel as traders facing a dearth of storage space and customers scrambled to avoid taking delivery of barrels.

While that trade was anomalous, the steep decline in Brent and U.S. futures expiring in June showed the market remained worried that the overwhelming supply and weak demand will persist for weeks.

Brent LCOc1 futures for June delivery fell $6.52, or 25.5%, to $19.05 a barrel by 12:46 p.m. EDT (1646 GMT), while U.S. West Texas Intermediate (WTI) crude CLc2 for June fell $9.09, or 44.5%, to $9.09.

Trump calls for U.S. oil industry bailout as prices plunge - Reuters

Trump calls for U.S. oil industry bailout as prices plunge - Reuters:

U.S. President Donald Trump said on Tuesday he has asked his cabinet to devise a plan to inject cash into the ailing U.S. oil-drilling industry to help it survive a historic collapse in crude prices.

“We will never let the great U.S. Oil & Gas Industry down. I have instructed the Secretary of Energy and Secretary of the Treasury to formulate a plan which will make funds available so that these very important companies and jobs will be secured long into the future!” Trump said on Twitter.

U.S. oil and gas companies from Texas to Wyoming have struggled to stave off bankruptcy amid worldwide stay-at-home orders and business stoppages spurred by the coronavirus outbreak that have obliterated global demand for fuel.

U.S. crude oil futures collapsed to trade in negative territory for the first time in history on Monday, as desperate traders paid to get rid of barrels amid a dearth of storage space.

#SaudiArabia News: ACWA Power Plans Up to $1 Billion Bond Sale - Bloomberg

Saudi Arabia News: ACWA Power Plans Up to $1 Billion Bond Sale - Bloomberg:

Saudi Arabia’s ACWA Power International plans to raise as much as 3.75 billion riyals ($1 billion) from an Islamic bond sale, according to people familiar with the matter.

The company, which develops and operates power and water plants across the Middle East, Africa and Asia, is in talks with local banks about the potential deal that would be denominated in Saudi riyals, the people said asking not to be identified as the information is private. The funds would be used for general corporate purposes, they said.

A representative for ACWA declined to comment.

Saudi Arabia’s sovereign wealth fund was set to increase its stake in ACWA to 45% by the end of March, the power company’s Chief Executive Officer Paddy Padmanathan said in February. That deal is expected to be a precursor to the company’s initial public offering on the Saudi stock exchange.

#Saudi stocks lead Gulf bourses down after oil slump - Arabianbusiness

Saudi stocks lead Gulf bourses down after oil slump - Arabianbusiness:

The Saudi stock market led Gulf bourses down on Tuesday, a day after US oil prices slumped to historic lows over sluggish demand, a supply glut and a lack of storage.

The Saudi Tadawul stock market, the largest in the Arab world, was 1.6 percent lower at the close.

Energy giant Saudi Aramco dropped 2.0 percent to stay well below its listing price of 32 riyals ($8.5) per share.

The Dubai Financial Market dipped 3.3 percent, while its sister bourse in Abu Dhabi was down 2.7 percent. Qatar's bourse lost 1.4 percent.

In Kuwait, the Premier index slumped 2.6 percent while the All-Shares index was down 1.9 percent at the close. 


The small Muscat bourse shed 1.2 percent while Bahrain stocks finished 0.4 percent lower.

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 under pressure after sub-zero plunge | Financial Times

Oil prices under pressure after sub-zero plunge | Financial Times:

Global oil markets remained under intense pressure on Tuesday, with Brent crude dropping below $20 per barrel for the first time in 18 years while other major benchmarks across the world tumbled. 

Brent, the international marker, slipped as low as $18.10. The fall suggests markets see no immediate let-up to the collapse in oil demand that sent some US oil benchmarks plunging below $0 for the first time on Monday, leaving producers paying for buyers to take their oil away while available storage is scarce.

“The weakness we’re seeing in Brent today is more of a reflection of fundamentals — the fact that demand today is so weak,” said Christopher Haines, an analyst at Energy Aspects. 

Coronavirus has sent the oil sector into a state of crisis, with lockdowns implemented by authorities to contain the outbreak slashing demand for crude by as much as a third.

#Dubai developer Deyaar to proceed with capital restructuring plans | ZAWYA MENA Edition

Dubai developer Deyaar to proceed with capital restructuring plans | ZAWYA MENA Edition:

Dubai-listed developer Deyaar will reduce capital from 5.78 billion dirhams ($1.57 billion) to 4.55 billion dirhams, following shareholder approvals for restructuring.

“The plan for capital restructuring proposed by our Board of Directors will enable Deyaar to write off all accumulated losses stemming largely from more than a decade ago, enabling us to further improve financial ratios and increasing our company’s attractiveness to investors and future financing,” Saeed Al Qatami, CEO of Deyaar said.

“We anticipate this to also have a positive impact on share price and demand, as well as the possibility of dividends distribution in case of accumulated profits and depending on availability of excess cash,” Al Qatami said.

The capital restructuring will see the cancellation of 21.3 percent of the developer’s shares. The company expects the process to be reflected in the market by end of May 2020, it said in a statement to Dubai Financial Market.

Gulf dollar bonds slip after historic U.S. oil crash below $0 - Reuters

Gulf dollar bonds slip after historic U.S. oil crash below $0 - Reuters:

Gulf dollar bonds slipped on Tuesday after U.S. oil traded below $0 for the first time in history on Monday, Refinitiv data showed. 


Saudi Arabia’s 30-year dollar bonds due in 2049 shed 0.5 cents to trade around 107 cents on the dollar, while similar bonds issued by its oil giant Aramco fell 0.8 cents to trade around 100.4 cents on the dollar.

Oman’s 30-year bonds due in 2048 slid 2.1 cents to trade around 64.9 cents on the dollar and Bahrain’s bonds due in 2047 lost 1.7 cents to trade at 91.3 cents on the dollar.

Explainer: Here's What Oil Falling Below $0 Really Means - Bloomberg

Explainer: Here's What Oil Falling Below $0 Really Means - Bloomberg:

Stores never pay shoppers to take their goods away, but in extreme circumstances some businesses do, though generally in a very limited way. What’s happened in the oil market, however, was a massive and unprecedented negative swing, as the price on some futures contracts for West Texas crude fell to minus $37.63 a barrel. A collapse in petroleum demand from pandemic-driven lockdowns, a price war among the world’s largest producers that flooded the market, storage facilities nearing their capacities and the monthly rhythms of the futures market all played a role in the jaw-dropping development.

1. Why would a seller pay a buyer to take their oil? 

For some producers, it may be cheaper in the long run than shutting down production or finding a place to store the supply bubbling out of the ground. Many worry that shutting their wells might damage them permanently, rendering them uneconomical in the future. There are also traders who buy oil futures contracts as a way of betting on price movements who have no intention of taking delivery of barrels. They can get caught by sharp price drops and face the choice of finding storage or selling at a loss. And the escalating glut of oil has made storage space scarce, and increasingly expensive.

Etihad-backed Virgin Australia collapses as virus wipes out global air travel - Arabianbusiness

Etihad-backed Virgin Australia collapses as virus wipes out global air travel - Arabianbusiness:

Virgin Australia Holdings Ltd. became Asia’s first airline to fall to the coronavirus after the outbreak deprived the debt-burdened company of almost all income.

Administrators at Deloitte, who have taken control of the Brisbane-based carrier, aim to restructure the business and find new owners within months. More than 10 parties have expressed an interest, Deloitte said Tuesday.

Virgin Australia joins FlyBe - the UK’s biggest domestic airline before it collapsed last month - among the industry’s corporate casualties of the virus. Airlines have been pummeled by domestic and international travel bans that forced them to seek government aid.

Gulf markets falls on oil slump, Saudi riyal down in forwards market - Reuters

Gulf markets falls on oil slump, Saudi riyal down in forwards market - Reuters:

Gulf stock markets fell on Tuesday and the Saudi currency dropped in the forwards market, after U.S. crude oil futures collapsed below $0 on a coronavirus-induced supply glut.

The Saudi stock index .TASI dropped 1.5% at the market open with oil company Aramco (2222.SE) down 1.7%.

Shares in the Dubai market .DFMGI fell 1.4% while the Abu Dhabi index .ADI lost 0.5% and the Kuwaiti premier index .BKP declined 2%. 


The cost of insuring against a potential debt default of Saudi Arabia - the world’s biggest oil exporter - increased slightly to 168 basis points from 166 on Monday, according to data from IHS Markit. It is up 13 bps in the past week.

U.S. crude oil futures fell below $0 on Monday for the first time in history as demand cratered. Brent crude, the international benchmark, also slumped, though that contract was nowhere near as weak.

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

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.

Analyst View: After U.S. oil futures crash, what next? - Reuters

Analyst View: After U.S. oil futures crash, what next? - Reuters:

A historic rout in oil markets sent U.S. crude prices plummeting to as much as minus $40 a barrel as traders rushed to get rid of unwanted stocks with storage capacity already overflowing amid a coronavirus-induced demand collapse.

U.S. West Texas Intermediate (WTI) crude for May delivery CLc1 recouped some losses on Tuesday to be just in positive territory, leaving market participants to assess the wider implications.

Here is what analysts expect in terms of market response:

 Goldman Sachs

* “Such a price dynamic could play out again tomorrow (April 21), the last trading day of the May contract. After that, the physical reality of a still massively oversupplied oil market will likely exert downward pressure on the June WTI contract.”

U.S. crude futures turn positive after historic plunge, Brent falls - Reuters

U.S. crude futures turn positive after historic plunge, Brent falls - Reuters:

U.S. oil prices hobbled back into positive territory on Tuesday after sinking below $0 for the first time ever, but international benchmark Brent dipped as the global coronavirus crisis severely reduces demand for crude.

U.S. West Texas Intermediate (WTI) crude for May delivery CLc1 was up $38.99 in thin trade at $1.36 a barrel by 0622 GMT after settling down at a discount of $37.63 a barrel in the previous session. 


The May contract expires on Tuesday and the more-active June contract CLc2 rose 94 cents, or 4.6%, to $21.37 a barrel.

Global benchmark Brent crude for June delivery LCo1 was down 48 cents, or 1.9%, at $25.09 per barrel.