Gone Are the Days of Easy Money in Global Natural Gas Trades - Bloomberg

Gone Are the Days of Easy Money in Global Natural Gas Trades - Bloomberg:

An LNG tanker sails past a container terminal as it arrives in Yokohama.

 Photographer: Tomohiro Ohsumi/Bloomberg

The golden age of trading in the world’s natural gas market has ended, and it was bound to happen even before the coronavirus struck.

Two warm winters in a row in addition to the health crisis have gutted demand for the fuel used for everything from home heating to power generation. That’s left inventories brimming during a season when they’re usually drained.

A decade ago, the industry was still developing. That kept hefty premiums for shipping liquefied natural gas by tanker to places such as Asia far from pipeline networks. These days, LNG has grown into a global industry allowing gas to flow freely around the world. That and the demand slump is gutting the margins on once-lucrative shipping routes.

“I joined LNG when there was a $3 dollar margin” on every million British thermal unit of gas shipped, Sarah Behbehani, a senior vice president of LNG at Jera Global Markets who has two decades of experience in energy trading, said in February when she predicted the worst year ever for the fuel. “Now we scramble for 2 cents.”

Oil rallies on faster output cuts to offset virus-induced falloff in demand - Reuters

Oil rallies on faster output cuts to offset virus-induced falloff in demand - Reuters:

Oil soared on Thursday, extending its rebound after major oil-producing nations said they would accelerate planned production cuts to combat the dramatic slump in demand due to the COVID-19 pandemic.

Crude prices have had one of their most tumultuous weeks ever. U.S. West Texas Intermediate crude futures (WTI) CLc1 closed at negative $37.63 a barrel on Monday, in the worst sell-off for that contract in history. Global benchmark Brent crude LCOc1 was slammed on Tuesday, hitting a two-decade low before rebounding.

Since the start of the year both benchmarks have lost more than two-thirds of their value. Fuel demand is down about 30% worldwide in April and supply will outstrip demand for months to come due to the pandemic.

Brent rose 96 cents, or 4.7%, to settle at $21.33 a barrel, while WTI jumped $2.72, or 19.7%, to settle at $16.50.

Crude Oil, Russia, OPEC+: Anguish Grows for Small Producers - Bloomberg

Crude Oil, Russia, OPEC+: Anguish Grows for Small Producers - Bloomberg:

As Russia’s small oil producers struggle to survive a historic price crash, some say in private they wish they could just set their crude ablaze.

The sentiment, though wishful thinking, lays bare the scale of the issue for Russia during the global pandemic -- there is too much crude and nowhere to store it. While Saudi Arabia and the U.S. have more places to keep it, Russia is getting increasingly desperate. Even turning off the taps is expensive.

About 90% of Russian oil output requires complex, expensive technologies like hydraulic fracturing, according to Marina Mosoyan, consultant at Moscow-based Vygon Consulting. That makes turning wells off and on more complicated for Russian producers compared with their competitors in the Persian Gulf.

Shutting an average well in West Siberia, Russia’s main oil province, would cost around 400,000 rubles (around $5,370), and bringing it back online around three times as much, Mosoyan estimated. That’s big money, even for Russian oil majors, as their average lifting costs recently came to less than $4 per barrel, with their wells producing between 50 and 300 barrels per day, according to data from Oxford Energy. For smaller Russian independents, it may be financially unviable.

Oil rallies on acceleration of output cuts from OPEC nations - Reuters

Oil rallies on acceleration of output cuts from OPEC nations - Reuters:

Oil soared on Thursday, extending its rebound after major oil-producing nations said they would accelerate planned production cuts to combat the dramatic slump in demand due to the COVID-19 pandemic.

Crude prices have had one of their most tumultuous weeks ever. U.S. West Texas Intermediate crude futures (WTI) CLc1 closed at negative $37.63 on Monday, in the worst sell-off for that contract in history. Global benchmark Brent crude LCOc1 was slammed on Tuesday, hitting a two-decade low before rebounding.

Since the start of the year both benchmarks have lost more than two-thirds of their value. Fuel demand is down about 30% worldwide in April and supply will outstrip demand for months to come due to the pandemic.

Brent rose $1.19, or 5.8%, to $21.56 a barrel by 1:52 p.m. EDT (1752 GMT), while WTI jumped $3.01, or 22%, to $16.78.

#Kuwait to review KFH's acquisition of Bahrain's Ahli United - Arabianbusiness

Kuwait to review KFH's acquisition of Bahrain's Ahli United - Arabianbusiness:

Kuwait’s finance minister has tasked the country’s sovereign wealth fund study the feasibility of Kuwait Finance House taking over Bahrain’s Ahli United Bank, the state-run KUNA news agency has reported.

The decision is a result of the impact of the coronavirus pandemic and the possibility of a global recession in its aftermath.

Earlier in April, Kuwait Finance House said that it would postpone the acquisition of Ahli United as a result of Covid-19.

#UAE banks have used $8 bln stimulus liquidity - central bank - Reuters

UAE banks have used $8 bln stimulus liquidity - central bank - Reuters:

The United Arab Emirates central bank (CBUAE) said commercial banks have used 30 billion dirhams ($8.17 billion) of a 50-billion-dirham “liquidity facility” the regulator introduced to stem the impact of the coronavirus outbreak.

The CBUAE has launched $70 billion worth of capital and liquidity measures as part of a Targeted Economic Support Scheme (TESS) aimed at providing economic stimulus during the coronavirus pandemic.

“The CBUAE welcomes banks’ active utilisation of allocated funds, which have doubled in a one-week period, reaching over 60% of the TESS AED 50 billion liquidity facility which is equivalent to AED 30 billion total consumption of allocated funds,” it said in a statement on Thursday.

Bankruptcy looms over U.S. energy industry, from oil fields to pipelines - Reuters

Bankruptcy looms over U.S. energy industry, from oil fields to pipelines - Reuters:

U.S. shale producers, refiners and pipeline companies are scrambling for cash and face likely restructuring as they struggle under heavy debt loads while engulfed in the worst crisis the oil industry has faced.

Fuel demand has tumbled roughly 30% worldwide as the coronavirus pandemic destroys demand for transport, provoking a massive glut of oil that has hammered global prices and left energy companies with no choice but to pump hundreds of millions of barrels into storage.

Just as demand plummeted, Saudi Arabia and Russia started an oil price war, and Riyadh flooded the market with even more crude. That left the oil industry facing the prospect of a long period with prices below their production costs. 


Shale producers came into the crisis with already high debt levels, namely from big investments to increase production across the United States in a bet on higher prices.

#Saudi sovereign fund sees opportunities after coronavirus, PIF head says - Reuters

Saudi sovereign fund sees opportunities after coronavirus, PIF head says - Reuters:

The head of Saudi Arabia’s sovereign wealth fund Yassir al-Rumayyan said there will be a lot of potential for investment opportunities once the coronavirus crisis passes.

Rumayyan said the Public Investment Fund (PIF) was looking into investment opportunities in areas such as aviation, oil and gas and entertainment.

He was speaking at an online investment forum on Thursday.

“There will be economies up and running, we will see a lot of potential,” he said.

#Saudi Response to Fiscal Shock Takes Shape With Record Debt Plan - Bloomberg

Saudi Response to Fiscal Shock Takes Shape With Record Debt Plan - Bloomberg:

Saudi Arabia will rely on the biggest debt program since its debut in international bond markets in 2016 to absorb the shock to the budget from collapsing energy prices and cuts in oil output.

The kingdom could borrow 220 billion riyals ($58 billion) this year while keeping its drawdown from reserves at up to 120 billion riyals, as originally planned in the budget, Finance Minister Mohammed Al-Jadaan said at a news conference late Wednesday. The government is looking at additional spending cuts and may issue as much as an extra 100 billion riyals of debt on top of 120 billion riyals already announced.

NMC Health Plc (NMC LN) News: Which Hedge Funds in Debt Talks - Bloomberg

NMC Health Plc (NMC LN) News: Which Hedge Funds in Debt Talks - Bloomberg:

A pedestrian passes the NMC Royal Hospital in Dubai.

 Photographer: Christopher Pike/Bloomberg

Sculptor Capital Management Inc. and Farallon Capital Management LLC are among top distressed debt investors preparing for restructuring talks involving NMC Health Plc, the hospital operator whose collapse has entangled global and regional banks.

Redwood Capital Management LLC and Silver Point Capital LP are also among bondholders, according to people with knowledge of the matter. Distressed investors typically buy the debt of troubled companies at a discount, with the aim of making a return from its turnaround.

NMC started unraveling in December, when short seller Muddy Waters Capital LLC alleged it overpaid for assets and understated debt. The company has since had its shares suspended on the London Stock Exchange, fired its chief executive officer, sought a debt standstill, and uncovered evidence of fraud. Its demise has roped in lenders including Barclays Plc, Standard Chartered Plc and the biggest banks in the United Arab Emirates.

Investors in the company’s convertible bonds and sukuk have formed a committee to negotiate with the administrators of NMC and are being advised by law firm Weil Gotshal & Manges LLP, the people said, asking not to be identified because the information is private. Bank lenders have already formed a coordinating committee to restructure NMC’s $6.6 billion of debt.

MIDEAST STOCKS-Oil recovery, corporate earnings lift most of Gulf - Agricultural Commodities - Reuters

MIDEAST STOCKS-Oil recovery, corporate earnings lift most of Gulf - Agricultural Commodities - Reuters:

Most stock markets in the Middle East ended higher on Thursday, buoyed by a recovery in oil prices
from historic lows and a slew of better-than expected first-quarter earnings.

Brent crude was up $1.55, or 7.61%, at $21.92 a barrel by 1200 GMT, a day after it touched $15.98 a barrel, its lowest since June 1999.
Saudi Arabia's benchmark index rose 1%. Oil giant Saudi Aramco gained 1% and Dr Sulaiman Al-Habib Medical Services advanced 3.9%. 

Saudi British Bank (SABB) slipped 0.6% as it traded ex-dividend.
In Dubai, the index ended up 1.6%, driven by a 6.3% surge in shopping centres operator Emaar Malls and a 1.2% gain in sharia-compliant lender Dubai Islamic Bank.
But Emirates Integrated Telecommunication (du) dropped 3.2% as it traded ex-dividend.

The Abu Dhabi index gained 1.9%, led by a 2.8% rise in First Abu Dhabi Bank FAB.AD. The United Arab Emirates' largest bank called a board meeting on April 27, where it will approve first-quarter earnings.

Dana Gas leapt 6.5%. The energy firm announced plans to use the proceeds from its Egyptian assets, which has been trying to sell, to pay down its sukuk, an Islamic bond which is due in October.

The Qatari index gave up early gains to close 0.3% lower. Masraf Al Rayan fell 2.6% before its

first-quarter earnings announcement.
However, the index's fall was cushioned by a 6.8% surge in Qatar Gas Transport Company (Nakilat).

The energy shipping and transport company on Monday posted net profit of 279.2 million riyals ($76.70 million) for the first quarter of 2020, up from 235.9 million riyals in the same quarter a year ago.
Among other stocks, Doha Bank gained 0.7% and Vodafone Qatar climbed 4.5% after the duo reported higher quarterly net profits.

#Saudi's APICORP hires Citi, Goldman, StanChart for dollar bonds - sources - Reuters

Saudi's APICORP hires Citi, Goldman, StanChart for dollar bonds - sources - Reuters:

The Arab Petroleum Investments Corporation (APICORP), a Saudi-headquartered multilateral development bank, has hired banks to arrange investor meetings ahead of a potential dollar bond issue, two sources said. 


APICORP has hired Citi, Goldman Sachs and Standard Chartered for the potential issue, which would have a maturity of three or five years and could be launched in the second quarter of this year, subject to market conditions.

A company spokesman did not immediately respond to a request for comment.

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.

Etihad, Air Arabia joint venture secures operating license - Reuters

Etihad, Air Arabia joint venture secures operating license - Reuters:

Air Arabia Abu Dhabi, a joint venture between United Arab Emirates carriers Etihad Airways and Air Arabia (AIRA.DU), has received its air operating license, it said on Thursday.

The launch of operations, which had been planned for this quarter, will depend on market conditions, it said in a statement.

Coronavirus: 3 Things #SaudiArabia Can Do to Lead Again on Oil - Bloomberg

Coronavirus: 3 Things Saudi Arabia Can Do to Lead Again on Oil - Bloomberg:

In the wake of Monday’s historic plunge in crude-oil futures, Saudi Arabia issued a press release stating that it will “endeavor to achieve stability” in a market currently suffering from a disintegration of demand. For the kingdom, it is vital not only to raise the price of oil, but also to be a leader in the effort to do so.

With a struggling, one-dimensional economy, the Saudi monarchy needs higher prices to keep its political future secure. Moreover, the kingdom has long valued its image as the most influential force in oil, and it wants to return to a leadership position within OPEC and the markets. Riyadh cannot increase oil demand, but it can take steps to fix oil prices, protect the monarchy and return Saudi Arabia to a position of stabilizing leadership. This would require some tough decisions and sacrifices — perhaps more than the government is willing to make, and there’s a chance they could backfire. Nevertheless, here’s what Saudi Arabia could do:

Energy Shake-Up?

The current energy minister, Prince Abdulaziz bin Salman, lost the confidence of the markets when Saudi Arabia recklessly announced a plan for extreme oversupply last month and then followed through with the policy even when it was clear that global demand had collapsed. It was Saudi Arabia’s announcement, not Russia’s refusal to cut more oil, that led directly to the initial descent of oil prices on March 9. Even the Easter OPEC+ production cut was credited by many to President Donald Trump, not Saudi Arabia’s energy minister. Replacing Abdulaziz with an oil figure within the ranks of Saudi Aramco’s base in Dhahran might help build trust in the market. While removing King Salman’s son from his position would be a major step, it wouldn’t be without precedent. Another of the king’s sons, Khalid bin Salman, was ambassador to the U.S. before Salman recalled him after the backlash that followed the 2018 murder of Saudi journalist Jamal Khashoggi.

#SaudiArabia News: Aramco Hires JPMorgan for Pipeline Stake Sale - Bloomberg

Saudi Arabia News: Aramco Hires JPMorgan for Pipeline Stake Sale - Bloomberg:

Saudi Aramco, the world’s largest oil producer, has hired advisers to review a potential multi-billion dollar stake sale in its pipeline business, people with knowledge of the matter said.

The energy giant is working with JPMorgan Chase & Co. as it makes early preparations for the potential deal, according to the people, who asked not to to be identified because the information is private. Mitsubishi UFJ Financial Group Inc. also has a role on the transaction, the people said.

Aramco hasn’t yet started a formal sale process, the people said. It may wait until market turmoil caused by plunging oil prices and the impact of measures to halt the spread of the coronavirus eases before it begins soliciting interest in the asset, they said.

Chairman Yasir Al-Rumayyan is looking for ways to raise money from assets that are not central to the company’s operations. A sale could raise more than $10 billion, people familiar with the matter said last month.

GCC banks to navigate COVID-19, oil shock on strong earning capacity: S&P | ZAWYA MENA Edition

GCC banks to navigate COVID-19, oil shock on strong earning capacity: S&P | ZAWYA MENA Edition:

The GCC banks' strong earning capacity will help them navigate the shocks related to COVID-19 and oil price drops, S&P Global Ratings said in a note.

"Most rated GCC banks have relatively strong profitability and a conservative approach to calculating and setting aside loan-loss provisions," S&P Global Ratings credit analyst Mohamed Damak said.

"Overall, we estimate that rated GCC banks could absorb up to a $36 billion shock before starting to deplete their capital base. This corresponds to about 3x our calculated normalized losses, which implies a substantial level of stress in our view," Damak added.

S&P’s study was based on a sample of 23 rated commercial banks in the GCC with exposures predominantly concentrated in GCC countries. At year-end 2019, these banks' total assets reached $1.5 trillion.

DP World warns unclear when global trade will recover from coronavirus - Reuters

DP World warns unclear when global trade will recover from coronavirus - Reuters:

The timing of a trade recovery from the economic crisis caused by the new coronavirus pandemic is uncertain, global ports operator DP World warned on Thursday.

The Dubai state-controlled company just last month said it was seeing demand bounce back as Chinese factories restarted, though the global spread of the virus has since drastically worsened, forcing many industries to a near halt.

“The timing of any recovery is uncertain with trade expected to pick up as and when global economic activity normalizes,” Chief Executive Sultan Ahmed bin Sulayem said in a bourse statement.

DP World, which is returning to full state ownership, is for now focused on protecting profits and preserving cash flow by limiting costs and managing capital expenditure, he said.

Standard Chartered expects #Saudi GDP to shrink by 4.5% on oil production cuts - Reuters

Standard Chartered expects Saudi GDP to shrink by 4.5% on oil production cuts - Reuters:

Standard Chartered said it expects Saudi Arabia’s gross domestic product to contract by 4.5% year on year in 2020 against a previous expectation of a 5% growth, mainly because of oil production cuts agreed among international crude producers.

The United Arab Emirates will see its GDP drop by 4.6% this year against a previous 1.4% growth estimate, the bank said in a statement.

Kuwait’s GDP is expected to contract by 6.3%, against a previous 1% growth forecast, it said.

Embattled Finablr-owned Travelex goes up for sale - Arabianbusiness

Embattled Finablr-owned Travelex goes up for sale - Arabianbusiness:

The board of Finablr-owned Travelex has decided to seek offers for the forex firm, the company said in a statement to the London Stock Exchange.

In the statement, Travelex said that “parties with a potential interest in making a proposal should contact PwC in order to entertain a customary non-disclosure agreement, following which they will receive certain information on the Travelex group, and will be invited to submit their indicative proposals to PwC on that basis.”

Travelex is one of a number of currency exchange and payment firms within the embattled Finablr Group, which in January reported than over 50 percent of its shares had been pledged as security against loans that BRS investments – owned by BR Shetty – had used to purchase Travelex in 2014.

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.

#UAE's Dana Gas says to use proceeds of sale of Egypt assets to pay down sukuk | ZAWYA MENA Edition

UAE's Dana Gas says to use proceeds of sale of Egypt assets to pay down sukuk | ZAWYA MENA Edition:

United Arab Emirates-based Dana Gas DANA.AD said on Thursday it plans to use proceeds from the sale of its Egyptian assets to pay down its sukuk, also known as an Islamic bond.

"If a sale of these assets were to go ahead the proceeds of the sale would be used to pay down the sukuk as required by the terms of the sukuk," Dana Gas, which is listed in Abu Dhabi, said in a bourse statement.

The company, which operates concessions in Iraq's Kurdish region and Egypt, had earlier said it would finalise the sale by the end of March.

But it then delayed a decision on whether to sell its Egyptian assets because of the market turmoil caused by the coronavirus outbreak, two sources close to the talks told Reuters earlier this month.

Boeing is sued for $336 million over canceled 737 MAX order - Reuters

Boeing is sued for $336 million over canceled 737 MAX order - Reuters:

Boeing Co (BA.N) was sued for $336 million on Wednesday by a Kuwaiti leasing company that accused it of wrongly refusing to return advance payments on a now-canceled order for 40 of its troubled 737 MAX planes.

In a complaint filed in Chicago federal court, ALAFCO Aviation Lease and Finance Co (ALAF.KW) accused Boeing of breach of contract for keeping the payments despite being unable to deliver the planes or provide a revised delivery schedule.

ALAFCO said it canceled its order on March 6 after Boeing failed to deliver nine aircraft on time. It said Boeing has resisted its claim that the problems amounted to a “non-excusable delay” that would justify repayment.

Oil surges as producers trim output to respond to demand loss - Reuters

Oil surges as producers trim output to respond to demand loss - Reuters:

Oil surged on Thursday amid signs that producers are cutting production to weather a collapse in demand as the coronavirus outbreak ravages world economies, while the U.S. state of Oklahoma also moved to help oil firms pump less.

Analysts warned the rise could be temporary as storage tanks fill around the world, but prices recovered ground as investors reassessed the resiliance of the world’s economy amid the global health emergency. 

Brent crude LCOc1 was up 99 cents, or 15%, at $21.36 a barrel by 0506 GMT after rising more than 5% on Wednesday.

U.S. West Texas Intermediate (WTI) futures were up 98 cents, or more than 7%, at $14.76 a barrel, having risen around a fifth in the previous session. U.S. crude futures fell to below minus $40 on Monday on concerns that buyers were running out of storage space to take deliveries.

MIDEAST STOCKS-Major Gulf markets gain on oil recovery, strong earnings - Agricultural Commodities - Reuters

MIDEAST STOCKS-Major Gulf markets gain on oil recovery, strong earnings - Agricultural Commodities - Reuters:

Major bourses in the Gulf gained on Thursday after crude prices recovered from historic lows and a few high-profile companies in the region posted better-than-expected first-quarter earnings.

Oil surged amid signs that producers are cutting production to weather a collapse in demand as the coronavirus outbreak ravages world economies, while the U.S. state of Oklahoma also moved to help oil firms pump less.

Brent crude was up $1.18, or 6.04%, at $21.60 a barrel by 0749 GMT, a day after it touched $15.98 a barrel, its lowest since June 1999.

Saudi Arabia’s benchmark index traded 1.5% higher, with Al Rajhi Bank rising 1.2% and petrochemical firm Saudi Basic Industries was up 2.3%.

Umm Al Qura Cement advanced 4.4% after reporting a nearly 80% surge in first-quarter profit.

Dubai’s main share index advanced 1.6%. Blue-chip developer Emaar Properties added 2.1%, while its unit Emaar Malls soared 7.1%.

However, the index’s gains were capped by losses at Emirates Integrated Telecommunication, which was down 2.9% on trading ex-dividend.

The Abu Dhabi index was also up 1.6%, led by a 2.2% rise in the United Arab Emirates largest lender First Abu Dhabi Bank.

Dana Gas gained 2.6% after the energy firm’s shareholders approved cash dividend of 5.5 Fils per share for 2019. The shareholders also gave their nod to a feasibility study to separate the company’s upstream and midstream businesses in a emerged.

The Qatari index rose 0.7%, with Qatar National Bank adding 1.4%, whereas Qatar Gas Transport Company leapt 4.6%.