Wirecard’s Dubai business partner enters liquidation | Financial Times:
Wirecard’s most significant business partner of recent years, a Dubai business central to whistleblower allegations that the German payments group fraudulently inflated sales and profits, has announced its liquidation.
The liquidation of payment processor Al Alam Solution Provider comes after KPMG said late last month that it could not verify that large portions of Wirecard revenues and profits were genuine.
Shares in Wirecard plunged as much as 16 per cent on Friday, to €73, after the short seller MCA Mathematik drew attention to the liquidation on Twitter, and Deutsche Bank separately suspended its investment rating on Wirecard.
Al Alam was a Dubai payment processor to which Wirecard referred customers, according to KPMG’s special audit of the German group.
Friday, 15 May 2020
Oil slump puts pressure on Gulf states’ currency pegs | Financial Times
Oil slump puts pressure on Gulf states’ currency pegs | Financial Times:
The slump in oil prices this year has prompted some investors to rekindle bets against Gulf nations’ currencies, putting longstanding pegs to the dollar under pressure.
Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates — together, the Gulf Cooperation Council — have kept their currencies glued to the dollar since the 1970s. That has meant mirroring US interest rates and tweaking reserves regularly to keep the pegs in place as a cornerstone of their economies. Previous efforts by hedge funds to bet on a potentially calamitous break have failed, as GCC countries have always shown they have sufficiently huge reserves of dollars to keep the pegs in place.
But some believe this time may be different.
“The precipitous decline in oil prices has reignited apprehensions surrounding the sustainability of FX pegs in the GCC region,” said Ehsan Khoman, head of Middle East and North Africa research and strategy at MUFG Bank in Dubai.
The slump in oil prices this year has prompted some investors to rekindle bets against Gulf nations’ currencies, putting longstanding pegs to the dollar under pressure.
Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates — together, the Gulf Cooperation Council — have kept their currencies glued to the dollar since the 1970s. That has meant mirroring US interest rates and tweaking reserves regularly to keep the pegs in place as a cornerstone of their economies. Previous efforts by hedge funds to bet on a potentially calamitous break have failed, as GCC countries have always shown they have sufficiently huge reserves of dollars to keep the pegs in place.
But some believe this time may be different.
“The precipitous decline in oil prices has reignited apprehensions surrounding the sustainability of FX pegs in the GCC region,” said Ehsan Khoman, head of Middle East and North Africa research and strategy at MUFG Bank in Dubai.
Wirecard shares plunge as #Dubai-based partner shuts shop - Reuters
Wirecard shares plunge as Dubai-based partner shuts shop - Reuters:
Shares in Wirecard (WDIG.DE) fell to more than two-year lows on Friday after a Dubai-based business partner closed its doors even as the German payments company played down the impact on operations.
The shares dropped after a tweet pointed to a May 11 liquidation notice in the newspaper Gulf Today by Al Alam Solution Provider FZ based in Dubai. A newspaper employee confirmed the publication of the notice in its print edition.
Al Alam was one of Wirecard's routing partners for payment transactions. bit.ly/368ZOpR
A Wirecard spokeswoman said the company was aware of the company’s closure and said it would not affect its ability to handle transactions as it has reduced its reliance on third-party partners.
Shares in Wirecard (WDIG.DE) fell to more than two-year lows on Friday after a Dubai-based business partner closed its doors even as the German payments company played down the impact on operations.
The shares dropped after a tweet pointed to a May 11 liquidation notice in the newspaper Gulf Today by Al Alam Solution Provider FZ based in Dubai. A newspaper employee confirmed the publication of the notice in its print edition.
Al Alam was one of Wirecard's routing partners for payment transactions. bit.ly/368ZOpR
A Wirecard spokeswoman said the company was aware of the company’s closure and said it would not affect its ability to handle transactions as it has reduced its reliance on third-party partners.
Oil prices jump as demand shows signs of picking up - Reuters
Oil prices jump as demand shows signs of picking up - Reuters:
U.S. crude prices jumped 7% on Friday to their highest since March, on strengthening fuel demand as countries around the world eased travel restrictions they had imposed to curb the spread of the coronavirus.
U.S. crude gained 19.7% in the week and Brent crude rose 5.2% after a week of bullish news. Both contracts gained for the third consecutive week.
West Texas Intermediate (WTI) oil settled up $1.87, or 6.8% at $29.43 a barrel, just off the session peak of $29.92, its highest since mid-March. WTI soared 9% in the previous session.
Brent crude settled up $1.37, or 4.4% a barrel at $32.50. Brent rose nearly 7% on Thursday.
The second-month contract for U.S. crude traded at a discount to the first month for the first time since late February, implying market tightness, said Bob Yawger, director of energy futures at Mizuho in New York.
U.S. crude prices jumped 7% on Friday to their highest since March, on strengthening fuel demand as countries around the world eased travel restrictions they had imposed to curb the spread of the coronavirus.
U.S. crude gained 19.7% in the week and Brent crude rose 5.2% after a week of bullish news. Both contracts gained for the third consecutive week.
West Texas Intermediate (WTI) oil settled up $1.87, or 6.8% at $29.43 a barrel, just off the session peak of $29.92, its highest since mid-March. WTI soared 9% in the previous session.
Brent crude settled up $1.37, or 4.4% a barrel at $32.50. Brent rose nearly 7% on Thursday.
The second-month contract for U.S. crude traded at a discount to the first month for the first time since late February, implying market tightness, said Bob Yawger, director of energy futures at Mizuho in New York.
Exclsuive: #AbuDhabi in talks with #Dubai for support through state fund Mubadala - sources - Reuters
Exclsuive: Abu Dhabi in talks with Dubai for support through state fund Mubadala - sources - Reuters:
The governments of Abu Dhabi and Dubai are discussing ways to prop up Dubai’s economy by linking up assets in the two emirates, with Abu Dhabi’s state fund Mubadala likely to play a key role in any deal, three sources familiar with the matter said.
Some economic sectors have come to a near standstill in Dubai during the coronavirus outbreak, and it faces its most severe downturn since a 2009 debt crisis. It lacks the oil wealth of Abu Dhabi to cushion the blow.
Abu Dhabi bailed out Dubai after the 2009 crisis with a $10 billion government loan, which was subsequently rolled over, and $10 billion in bonds that Dubai issued to the central bank.
One of the sources said any support from Abu Dhabi agreed now would be “orchestrated through mergers of assets where Abu Dhabi and Dubai compete directly or where they have joint ownerships”.
The governments of Abu Dhabi and Dubai are discussing ways to prop up Dubai’s economy by linking up assets in the two emirates, with Abu Dhabi’s state fund Mubadala likely to play a key role in any deal, three sources familiar with the matter said.
Some economic sectors have come to a near standstill in Dubai during the coronavirus outbreak, and it faces its most severe downturn since a 2009 debt crisis. It lacks the oil wealth of Abu Dhabi to cushion the blow.
Abu Dhabi bailed out Dubai after the 2009 crisis with a $10 billion government loan, which was subsequently rolled over, and $10 billion in bonds that Dubai issued to the central bank.
One of the sources said any support from Abu Dhabi agreed now would be “orchestrated through mergers of assets where Abu Dhabi and Dubai compete directly or where they have joint ownerships”.
#Dubai contemplates a downsized future after the pandemic | Financial Times
Dubai contemplates a downsized future after the pandemic | Financial Times:
Dubai’s leaders headed into 2020 brimming with confidence. After four years of tepid growth, that had fuelled questions about the durability of the Gulf trade hub’s business model, the optimism was inspired by the emirate’s hosting of Expo 2020, which was predicted to draw 25m visitors and reassert Dubai’s position on the international stage.
On January 29, Sheikh Mohammed bin Rashid al-Maktoum, Dubai’s leader, said the expo would mark the start of a 50-year phase of “achievements” for the United Arab Emirates and “offer new hope for creating a better tomorrow”. But just as he was inaugurating Al-Wasl plaza, at the heart of the expo site, the UAE was making a separate announcement — a portent for the grim reality ahead — the seven-member federation had recorded the Middle East’s first case of Covid-19.
The economic consequences of the coronavirus pandemic, coupled with the spectacular collapse of crude prices, have wrought havoc across the oil-rich Gulf as lockdowns strangle businesses and finance ministers cut state spending. Few in the region are as exposed to the crisis as Dubai; the strengths that have long made the city stand out — and put the UAE on the map — make it more vulnerable.
Dubai’s leaders headed into 2020 brimming with confidence. After four years of tepid growth, that had fuelled questions about the durability of the Gulf trade hub’s business model, the optimism was inspired by the emirate’s hosting of Expo 2020, which was predicted to draw 25m visitors and reassert Dubai’s position on the international stage.
On January 29, Sheikh Mohammed bin Rashid al-Maktoum, Dubai’s leader, said the expo would mark the start of a 50-year phase of “achievements” for the United Arab Emirates and “offer new hope for creating a better tomorrow”. But just as he was inaugurating Al-Wasl plaza, at the heart of the expo site, the UAE was making a separate announcement — a portent for the grim reality ahead — the seven-member federation had recorded the Middle East’s first case of Covid-19.
The economic consequences of the coronavirus pandemic, coupled with the spectacular collapse of crude prices, have wrought havoc across the oil-rich Gulf as lockdowns strangle businesses and finance ministers cut state spending. Few in the region are as exposed to the crisis as Dubai; the strengths that have long made the city stand out — and put the UAE on the map — make it more vulnerable.
#Saudi Oil Rush Threatens to Disrupt Stabilizing U.S. Oil Market - Bloomberg
Saudi Oil Rush Threatens to Disrupt Stabilizing U.S. Oil Market - Bloomberg:
An armada of tankers filled with Saudi crude heading to American shores is raising concern that tanks may fill again just as a U.S. glut shows signs of easing.
Over 30 tankers laden are set to arrive in the U.S. Gulf Coast and West Coast during May and June, according to ship tracking data compiled by Bloomberg. The more-than 50 million barrels of Saudi crude on the water threaten to disrupt a positive supply development: U.S. crude stockpiles declined for the first time since January and inventories at the Cushing, Oklahoma storage hub contracted by the most in months.
“The expected Saudi deliveries could push U.S. inventories back to builds depending on their timing,” said Sandy Fielden, director of oil and products research at Morningstar Inc. “If the shipments land at a rate that isn’t balanced by falling production or an uptick in exports, then we’ll see a domestic build.”
The oil industry has been on edge for months with onshore and offshore storage capacity levels tested worldwide due to ballooning oil inventories spurred by the Covid-19 demand slowdown. On the U.S. West Coast, crude stockpiles are less than 5 million barrels short of reaching the region’s storage capaci
An armada of tankers filled with Saudi crude heading to American shores is raising concern that tanks may fill again just as a U.S. glut shows signs of easing.
Over 30 tankers laden are set to arrive in the U.S. Gulf Coast and West Coast during May and June, according to ship tracking data compiled by Bloomberg. The more-than 50 million barrels of Saudi crude on the water threaten to disrupt a positive supply development: U.S. crude stockpiles declined for the first time since January and inventories at the Cushing, Oklahoma storage hub contracted by the most in months.
“The expected Saudi deliveries could push U.S. inventories back to builds depending on their timing,” said Sandy Fielden, director of oil and products research at Morningstar Inc. “If the shipments land at a rate that isn’t balanced by falling production or an uptick in exports, then we’ll see a domestic build.”
The oil industry has been on edge for months with onshore and offshore storage capacity levels tested worldwide due to ballooning oil inventories spurred by the Covid-19 demand slowdown. On the U.S. West Coast, crude stockpiles are less than 5 million barrels short of reaching the region’s storage capaci
ADNOC CEO reveals 'cautious optimism' in oil markets - Arabianbusiness
ADNOC CEO reveals 'cautious optimism' in oil markets - Arabianbusiness:
Dr. Sultan Ahmed Al Jaber, UAE Minister of State and group CEO of the Abu Dhabi National Oil Company (ADNOC) believes there are signs that oil markets have tightened in recent weeks and will rebalance over time.
Speaking on ADNOC’s "Virtual Majlis" with Helima Croft, managing director and global head of commodity strategy at RBC Capital Markets, Dr. Al Jaber said that while the outlook remains unpredictable, there are reasons for cautious optimism in oil markets.
"When it comes to oil, there are signs that the market has tightened in recent weeks. The OPEC+ agreement, voluntary cuts outside OPEC-++, and production shut-ins are working together to start to rebalance the market. This will take time. As economies begin to open up, demand will follow, but the path to the next normal is not a straight line," he said.
Dr. Al Jaber continued by highlighting how ADNOC is reaping the benefits of its transformation over the past four years as it navigates this period of uncertainty.
Dr. Sultan Ahmed Al Jaber, UAE Minister of State and group CEO of the Abu Dhabi National Oil Company (ADNOC) believes there are signs that oil markets have tightened in recent weeks and will rebalance over time.
Speaking on ADNOC’s "Virtual Majlis" with Helima Croft, managing director and global head of commodity strategy at RBC Capital Markets, Dr. Al Jaber said that while the outlook remains unpredictable, there are reasons for cautious optimism in oil markets.
"When it comes to oil, there are signs that the market has tightened in recent weeks. The OPEC+ agreement, voluntary cuts outside OPEC-++, and production shut-ins are working together to start to rebalance the market. This will take time. As economies begin to open up, demand will follow, but the path to the next normal is not a straight line," he said.
Dr. Al Jaber continued by highlighting how ADNOC is reaping the benefits of its transformation over the past four years as it navigates this period of uncertainty.
Russia's Rosneft incurs $2.1 billion first-quarter loss, cuts output - Reuters
Russia's Rosneft incurs $2.1 billion first-quarter loss, cuts output - Reuters:
Russia’s largest oil producer, Rosneft (ROSN.MM), on Friday reported a first-quarter loss of 156 billion roubles ($2.1 billion) hurt by the spread of the coronavirus and a weaker rouble.
Rosneft, which accounts for around 40% of Russia’s total oil production, also said it cut its oil and gas condensate output in the first three months of the year by 2.2% from the year-earlier period to 4.64 million barrels per day (bpd) due to a global pact to curb output.
The global oil industry has been hit by weak oil prices, which declined by around two-thirds in January-March due to a supply glut and the economic fallout from the spread of the novel coronavirus.
To tackle the impact of the spread of the virus and overproduction, a group of leading oil producers including Russia, known as OPEC+, agreed last month to boost their combined oil output cuts to almost 10 million bpd, or 10% of global demand in May-Jun
Russia’s largest oil producer, Rosneft (ROSN.MM), on Friday reported a first-quarter loss of 156 billion roubles ($2.1 billion) hurt by the spread of the coronavirus and a weaker rouble.
Rosneft, which accounts for around 40% of Russia’s total oil production, also said it cut its oil and gas condensate output in the first three months of the year by 2.2% from the year-earlier period to 4.64 million barrels per day (bpd) due to a global pact to curb output.
The global oil industry has been hit by weak oil prices, which declined by around two-thirds in January-March due to a supply glut and the economic fallout from the spread of the novel coronavirus.
To tackle the impact of the spread of the virus and overproduction, a group of leading oil producers including Russia, known as OPEC+, agreed last month to boost their combined oil output cuts to almost 10 million bpd, or 10% of global demand in May-Jun
Oil hits one-month high as signs of demand emerge amid coronavirus crisis - Reuters
Oil hits one-month high as signs of demand emerge amid coronavirus crisis - Reuters:
Oil prices jumped more than 3% on Friday, touching more than one-month highs amid signs that demand for crude was picking up with China reporting increased refinery runs, and rounding out a week of bullish news on the supply front.
Brent crude was up $1.21 cents, or 3.9% at $32.34 a barrel by 0707 GMT, after touching $32.44 the highest since April 14. Brent rose nearly 7% on Thursday and is heading for a 3% gain for the week after rising the previous two weeks.
West Texas Intermediate (WTI) oil was up 92 cents, or 3.3%, at $28.48 a barrel after reaching $28.54, the highest since early April. WTI jumped 9% in the previous session and is also heading for a third weekly increase, up about 15%.
Oil prices jumped more than 3% on Friday, touching more than one-month highs amid signs that demand for crude was picking up with China reporting increased refinery runs, and rounding out a week of bullish news on the supply front.
Brent crude was up $1.21 cents, or 3.9% at $32.34 a barrel by 0707 GMT, after touching $32.44 the highest since April 14. Brent rose nearly 7% on Thursday and is heading for a 3% gain for the week after rising the previous two weeks.
West Texas Intermediate (WTI) oil was up 92 cents, or 3.3%, at $28.48 a barrel after reaching $28.54, the highest since early April. WTI jumped 9% in the previous session and is also heading for a third weekly increase, up about 15%.
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