Oil climbs 2% on U.S. stock draw but gains capped as OPEC+ set to ease cuts - Reuters:
Oil prices rose 2% on Wednesday, supported by a sharp drop in U.S. crude inventories, but further gains were limited as OPEC and its allies are set to ease supply curbs from August as the global economy gradually recovers from the coronavirus pandemic.
Brent crude LCOc1 settled up 89 cents, or 2.1%, at $43.79 a barrel, and U.S. West Texas Intermediate (WTI) crude CLc1 rose 91 cents, or 2.3%, to $41.20 a barrel.
Prices were boosted after data from the Energy Information Administration showed U.S. crude inventories fell 7.5 million barrels last week, compared with analysts’ expectations in a Reuters poll for a 2.1 million-barrel drop.
Wednesday 15 July 2020
Reliance's $15 billion stake sale deal with Aramco delayed - Reuters
Reliance's $15 billion stake sale deal with Aramco delayed - Reuters:
Reliance Industries’ plans to sell 20% stake in its oil-to-chemical business to Saudi Aramco is delayed, chairman of the Indian conglomerate said on Wednesday.
Reliance, operator of the world’s biggest refining complex, last year announced a $15 billion deal with the world’s top oil exporter Aramco as part of the Indian company’s efforts to cut its debts.
“Due to unforeseen circumstances in the energy market and the Covid-19 situation, the deal (with Saudi Aramco) has not progressed as per the original timeline,” Mukesh Ambani told shareholders on Wednesday.
The Aramco deal was initially expected to be completed by March 2020.
Reliance Industries’ plans to sell 20% stake in its oil-to-chemical business to Saudi Aramco is delayed, chairman of the Indian conglomerate said on Wednesday.
Reliance, operator of the world’s biggest refining complex, last year announced a $15 billion deal with the world’s top oil exporter Aramco as part of the Indian company’s efforts to cut its debts.
“Due to unforeseen circumstances in the energy market and the Covid-19 situation, the deal (with Saudi Aramco) has not progressed as per the original timeline,” Mukesh Ambani told shareholders on Wednesday.
The Aramco deal was initially expected to be completed by March 2020.
MIDEAST DEBT-Real estate giant's downgrade may increase #Dubai financing cost - Reuters
MIDEAST DEBT-Real estate giant's downgrade may increase Dubai financing cost - Reuters:
A downgrade last week of Dubai’s flagship real estate company will likely push up the emirate’s borrowing costs if it decides to refinance $750 million in bonds due in October, bankers and analysts said.
The credit ratings of government-related entities are often seen by investors as a proxy for Dubai, which is not rated by any of the major ratings agencies.
S&P Global Ratings downgraded Emaar Properties, builder of the world’s tallest building, Dubai’s Burj Khalifa, to a BB+ “junk” rating from an investment grade BBB- score, saying it expected a 30%-40% slump in the firm’s earnings this year.
Emaar Malls and DIFC Investments, a unit of the company running Dubai International Financial Centre, the Middle East’s major finance hub, also saw the same rating actions.
A downgrade last week of Dubai’s flagship real estate company will likely push up the emirate’s borrowing costs if it decides to refinance $750 million in bonds due in October, bankers and analysts said.
The credit ratings of government-related entities are often seen by investors as a proxy for Dubai, which is not rated by any of the major ratings agencies.
S&P Global Ratings downgraded Emaar Properties, builder of the world’s tallest building, Dubai’s Burj Khalifa, to a BB+ “junk” rating from an investment grade BBB- score, saying it expected a 30%-40% slump in the firm’s earnings this year.
Emaar Malls and DIFC Investments, a unit of the company running Dubai International Financial Centre, the Middle East’s major finance hub, also saw the same rating actions.
Oil climbs on U.S. stock draw but gains capped as OPEC+ set to ease cuts - Reuters
Oil climbs on U.S. stock draw but gains capped as OPEC+ set to ease cuts - Reuters:
Oil prices rose 1% on Wednesday, supported by a sharp drop in U.S. crude inventories, but further gains were limited as OPEC and its allies are set to ease supply curbs from August as the global economy gradually recovers from the coronavirus pandemic.
Brent crude was up 64 cents, or 1.5%, at $43.54 a barrel at 10:59 a.m. ET (1459 GMT), and U.S. West Texas Intermediate (WTI) crude rose 53 cents, or 1.3%, to $40.82 a barrel.
Prices were boosted after data from the Energy Information Administration showed U.S. crude inventories fell 7.5 million barrels last week, compared with analysts’ expectations in a Reuters poll for a 2.1 million-barrel drop.
Oil prices rose 1% on Wednesday, supported by a sharp drop in U.S. crude inventories, but further gains were limited as OPEC and its allies are set to ease supply curbs from August as the global economy gradually recovers from the coronavirus pandemic.
Brent crude was up 64 cents, or 1.5%, at $43.54 a barrel at 10:59 a.m. ET (1459 GMT), and U.S. West Texas Intermediate (WTI) crude rose 53 cents, or 1.3%, to $40.82 a barrel.
Prices were boosted after data from the Energy Information Administration showed U.S. crude inventories fell 7.5 million barrels last week, compared with analysts’ expectations in a Reuters poll for a 2.1 million-barrel drop.
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.
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-Banks lift #Saudi index; blue-chip sell-off dents Egypt - Reuters
MIDEAST STOCKS-Banks lift Saudi index; blue-chip sell-off dents Egypt - Reuters:
The Saudi Arabian stock market ended
higher on Wednesday, as the Organization of the Petroleum
Exporting Countries (OPEC) and its allies meet to discuss future
oil output cuts, but Egypt saw a sharp decline as all its
blue-chip stocks fell except one.
Key members of OPEC and allies including Russia,
collectively known as OPEC+, are set to decide whether to extend
output cuts of 9.7 million barrels per day (bpd) that end in
July or ease them to 7.7 million bpd.
The benchmark index in Saudi Arabia, the de facto
leader of OPEC, gained 0.5%. Al Rajhi Bank added 0.4%,
whereas lender Samba Financial Group ended 1.1% up.
Outside the Gulf, Egypt's blue-chip index declined
2.4%, with Commercial International Bank losing 3.4%
and investment bank EFG Hermes sliding 7.3%.
The Saudi Arabian stock market ended
higher on Wednesday, as the Organization of the Petroleum
Exporting Countries (OPEC) and its allies meet to discuss future
oil output cuts, but Egypt saw a sharp decline as all its
blue-chip stocks fell except one.
Key members of OPEC and allies including Russia,
collectively known as OPEC+, are set to decide whether to extend
output cuts of 9.7 million barrels per day (bpd) that end in
July or ease them to 7.7 million bpd.
The benchmark index in Saudi Arabia, the de facto
leader of OPEC, gained 0.5%. Al Rajhi Bank added 0.4%,
whereas lender Samba Financial Group ended 1.1% up.
Outside the Gulf, Egypt's blue-chip index declined
2.4%, with Commercial International Bank losing 3.4%
and investment bank EFG Hermes sliding 7.3%.
#UAE corporate scandals require a clean up | Analysis – Gulf News
UAE corporate scandals require a clean up | Analysis – Gulf News:
Two years ago, the spectacular fall from grace of Dubai-based private equity titan, Abraaj, concentrated minds on the importance of developing a strong corporate governance culture in the region.
The UAE had been proactive in its response to the Abraaj scandal - on April 28, new corporate governance rules for public companies came into force, which are in line with international best practice and aim to promote accountability, fairness, gender diversity and transparency.
The legislation includes a mandate for a female board representation of not less than 20 per cent and a requirement that the majority of board members should be independent, non-executive directors. These are pragmatic, sensible measures and will help to maintain the UAE’s standing in the international capital markets.
Rot endures
However, recent scandals at NMC Health and Al Masah Capital have reignited longstanding concerns over corporate governance standards in the UAE. NMC Health collapsed into administration in March after more than $4 billion of hidden debt came to light following suspected fraud by senior executives within the firm. As with Abraaj, numerous conflicts of interest existed, including family members occupying senior positions within the company and former partners of the firm’s auditor, EY, sitting on its board.
Two years ago, the spectacular fall from grace of Dubai-based private equity titan, Abraaj, concentrated minds on the importance of developing a strong corporate governance culture in the region.
The UAE had been proactive in its response to the Abraaj scandal - on April 28, new corporate governance rules for public companies came into force, which are in line with international best practice and aim to promote accountability, fairness, gender diversity and transparency.
The legislation includes a mandate for a female board representation of not less than 20 per cent and a requirement that the majority of board members should be independent, non-executive directors. These are pragmatic, sensible measures and will help to maintain the UAE’s standing in the international capital markets.
Rot endures
However, recent scandals at NMC Health and Al Masah Capital have reignited longstanding concerns over corporate governance standards in the UAE. NMC Health collapsed into administration in March after more than $4 billion of hidden debt came to light following suspected fraud by senior executives within the firm. As with Abraaj, numerous conflicts of interest existed, including family members occupying senior positions within the company and former partners of the firm’s auditor, EY, sitting on its board.
Google buys 7.7% of Reliance’s digital unit Jio for $4.5b | Business – Gulf News
Google buys 7.7% of Reliance’s digital unit Jio for $4.5b | Business – Gulf News:
India’s Reliance Industries on Wednesday said Alphabet Inc’s Google will buy a 7.7% stake in its digital unit for $4.5 billion, winning the backing of another U.S. tech giant after Facebook Inc in late April.
With Google’s investment, strategic and financial investors have committed a total of 1.52 trillion rupees ($20.22 billion) in the last few months, Reliance chairman and billionaire tycoon Mukesh Ambani said at the company’s annual shareholders meeting hosted via a webcast.
Reliance’s digital unit Jio Platforms houses music and movie apps but its mainstay is telecoms firm Jio Infocomm - India’s largest mobile carrier with more than 387 million users.
India’s Reliance Industries on Wednesday said Alphabet Inc’s Google will buy a 7.7% stake in its digital unit for $4.5 billion, winning the backing of another U.S. tech giant after Facebook Inc in late April.
With Google’s investment, strategic and financial investors have committed a total of 1.52 trillion rupees ($20.22 billion) in the last few months, Reliance chairman and billionaire tycoon Mukesh Ambani said at the company’s annual shareholders meeting hosted via a webcast.
Reliance’s digital unit Jio Platforms houses music and movie apps but its mainstay is telecoms firm Jio Infocomm - India’s largest mobile carrier with more than 387 million users.
OPEC+ May Temper Output Rise With Extra Oil Cuts From Cheats - Bloomberg
OPEC+ May Temper Output Rise With Extra Oil Cuts From Cheats - Bloomberg:
OPEC+ is seeking extra production cuts from members that have missed their targets again in June, potentially tempering the impact of the supply resumption planned by the wider coalition next month.
A technical committee that met online on Tuesday outlined plans for countries including Iraq, Nigeria and Kazakhstan to make an additional 842,000 barrels a day of compensatory cuts in August and September, according to delegates.
The proposal will be discussed on Wednesday by a ministerial monitoring committee led by Saudi Arabia and Russia, the delegates said, asking not to be named because the information isn’t public. They’re expected to announce that the group’s overall curbs of 9.6 million barrels a day -- about 10% of global supplies -- will be relaxed in August as global fuel demand recovers.
To prevent the supply increase destabilizing a still-fragile market, Riyadh and Moscow are keen for the cartel’s laggards to make up for earlier cheating. On paper, full delivery of the compensation cuts could shrink the scheduled 2 million-barrel-a-day supply increase by almost half.
OPEC+ is seeking extra production cuts from members that have missed their targets again in June, potentially tempering the impact of the supply resumption planned by the wider coalition next month.
A technical committee that met online on Tuesday outlined plans for countries including Iraq, Nigeria and Kazakhstan to make an additional 842,000 barrels a day of compensatory cuts in August and September, according to delegates.
The proposal will be discussed on Wednesday by a ministerial monitoring committee led by Saudi Arabia and Russia, the delegates said, asking not to be named because the information isn’t public. They’re expected to announce that the group’s overall curbs of 9.6 million barrels a day -- about 10% of global supplies -- will be relaxed in August as global fuel demand recovers.
To prevent the supply increase destabilizing a still-fragile market, Riyadh and Moscow are keen for the cartel’s laggards to make up for earlier cheating. On paper, full delivery of the compensation cuts could shrink the scheduled 2 million-barrel-a-day supply increase by almost half.
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.
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.
Two Million Saudis Lose Cash Aid When They Can Least Afford It - Bloomberg
Two Million Saudis Lose Cash Aid When They Can Least Afford It - Bloomberg:
Saudi Arabia has removed two million people from an assistance program meant to soften the blow of its economic overhaul, stirring frustration among some during the worst downturn in decades.
Officials began to scale back the so-called “Citizen’s Account” program in April, when they suspended new applications, set an upper limit for payouts and tweaked eligibility rules. The number of beneficiaries began to fall and the drop has accelerated. In July alone, 1.3 million people lost payments.
The government said the changes to the program would help direct support to those who need it most, and weren’t linked to the two-pronged crisis of oil-market turmoil and the Covid-19 pandemic roiling the kingdom. However their impact hit at the same time officials were rolling out new austerity measures, including tax increases.
“It feels like death,” said Bandar Awad, a 34-year-old courier told by text message he’s no longer entitled to the 300 riyals ($80) to 400 riyals he’d received monthly. “Even recharging my cell-phone credit has become difficult.”
Saudi Arabia has removed two million people from an assistance program meant to soften the blow of its economic overhaul, stirring frustration among some during the worst downturn in decades.
Officials began to scale back the so-called “Citizen’s Account” program in April, when they suspended new applications, set an upper limit for payouts and tweaked eligibility rules. The number of beneficiaries began to fall and the drop has accelerated. In July alone, 1.3 million people lost payments.
“It feels like death,” said Bandar Awad, a 34-year-old courier told by text message he’s no longer entitled to the 300 riyals ($80) to 400 riyals he’d received monthly. “Even recharging my cell-phone credit has become difficult.”
#Dubai rents drop by almost 15% in Q2, further declines expected, say Chestertons - Arabianbusiness
Dubai rents drop by almost 15% in Q2, further declines expected, say Chestertons - Arabianbusiness:
Average annual rents in some areas of Dubai declined by almost 15 percent in Q2, with real estate firm Chestertons forecasting further drops in the second half of the year.
According to the latest ‘Observer: Dubai Residential Report Q2 2020’, average apartment rents across Motor City and The Views saw the highest average declines of 14.8 percent and 13.2 percent, respectively.
The Greens, Dubai Silicon Oasis, Dubai Sports City and Discovery Gardens all saw double-digit falls since Q2 2019, with rents for a one-bedroom unit falling to AED59,250, AED38,000, AED40,000, and AED45,000 per annum, respectively.
In terms of villas, the sharpest rental rate falls were witnessed across The Springs and The Meadows, as annual rents fell by 12.2 percent and 12.7 percent respectively, compared to Q2 2019, with a three-bedroom rent in The Meadows standing at AED165,000.
Average annual rents in some areas of Dubai declined by almost 15 percent in Q2, with real estate firm Chestertons forecasting further drops in the second half of the year.
According to the latest ‘Observer: Dubai Residential Report Q2 2020’, average apartment rents across Motor City and The Views saw the highest average declines of 14.8 percent and 13.2 percent, respectively.
The Greens, Dubai Silicon Oasis, Dubai Sports City and Discovery Gardens all saw double-digit falls since Q2 2019, with rents for a one-bedroom unit falling to AED59,250, AED38,000, AED40,000, and AED45,000 per annum, respectively.
In terms of villas, the sharpest rental rate falls were witnessed across The Springs and The Meadows, as annual rents fell by 12.2 percent and 12.7 percent respectively, compared to Q2 2019, with a three-bedroom rent in The Meadows standing at AED165,000.
RPT-COLUMN-Oil diplomacy and the U.S. presidential election: Kemp - Reuters
RPT-COLUMN-Oil diplomacy and the U.S. presidential election: Kemp - Reuters:
Slower growth in petroleum consumption has intensified competition among the major oil producers and contributed to periodic volume wars and price slumps as they have fought for market share.
For now, the big three producers, Russia, the United States and Saudi Arabia, have reached a truce to stabilise prices during the COVID-19 pandemic and the deepest slump in oil consumption in the industry’s history.
But the truce is fragile and depends on substantial volumes of output from three other major producers, Venezuela, Iran and Libya, remaining off the market for the foreseeable future.
Civil war and U.S. sanctions have cut the combined output from these three producers by almost 5 million barrels per day compared with their respective peaks in the last two decades.
Slower growth in petroleum consumption has intensified competition among the major oil producers and contributed to periodic volume wars and price slumps as they have fought for market share.
For now, the big three producers, Russia, the United States and Saudi Arabia, have reached a truce to stabilise prices during the COVID-19 pandemic and the deepest slump in oil consumption in the industry’s history.
But the truce is fragile and depends on substantial volumes of output from three other major producers, Venezuela, Iran and Libya, remaining off the market for the foreseeable future.
Civil war and U.S. sanctions have cut the combined output from these three producers by almost 5 million barrels per day compared with their respective peaks in the last two decades.
MIDEAST STOCKS-Gulf stocks move sideways; #Saudi gains ahead of OPEC+ meet - Reuters
MIDEAST STOCKS-Gulf stocks move sideways; Saudi gains ahead of OPEC+ meet - Reuters:
Major stock markets in the Gulf moved sideways on Wednesday, with the Saudi index edging up ahead of a meeting on the future level of oil output cuts by the Organization of the Petroleum Exporting Countries (OPEC) and its allies.
Key members of OPEC and allies including Russia, collectively known as OPEC+, are set to decide whether to extend output cuts of 9.7 million barrels per day (bpd) that end in July or ease them to 7.7 million bpd.
The benchmark stock index in Saudi Arabia, the de facto leader of OPEC, added 0.3%. Al Rajhi Bank rose 0.5%, while National Commercial Bank was up 0.7%.
In Qatar, the index gained 0.5%, buoyed by a 1.3% rise in petrochemical firm Industries Qatar and 1% increase in Qatar Islamic Bank.
Major stock markets in the Gulf moved sideways on Wednesday, with the Saudi index edging up ahead of a meeting on the future level of oil output cuts by the Organization of the Petroleum Exporting Countries (OPEC) and its allies.
Key members of OPEC and allies including Russia, collectively known as OPEC+, are set to decide whether to extend output cuts of 9.7 million barrels per day (bpd) that end in July or ease them to 7.7 million bpd.
The benchmark stock index in Saudi Arabia, the de facto leader of OPEC, added 0.3%. Al Rajhi Bank rose 0.5%, while National Commercial Bank was up 0.7%.
In Qatar, the index gained 0.5%, buoyed by a 1.3% rise in petrochemical firm Industries Qatar and 1% increase in Qatar Islamic Bank.
UPDATE 1- #SaudiArabia's Bindawood postpones IPO to September -sources - Reuters
UPDATE 1-Saudi Arabia's Bindawood postpones IPO to September -sources - Reuters:
Saudi Arabian supermarket retailer Bindawood Holding has postponed its planned initial public offering (IPO) to September, two sources with knowledge of the matter told Reuters.
Bindawood, which controls supermarket chains under its own brand and Danube in the kingdom, was preparing for a public share sale in the second quarter.
However, the IPO market worldwide has been hit by the economic disruption caused by the COVID-19 pandemic. The market in the Gulf tends to cool in the summer anyway, before picking up again in September.
The Saudi market regulator, the Capital Market Authority (CMA), approved Bindawood’s application to list in June. The regulator gives companies six months from the date of approval to list.
Saudi Arabian supermarket retailer Bindawood Holding has postponed its planned initial public offering (IPO) to September, two sources with knowledge of the matter told Reuters.
Bindawood, which controls supermarket chains under its own brand and Danube in the kingdom, was preparing for a public share sale in the second quarter.
However, the IPO market worldwide has been hit by the economic disruption caused by the COVID-19 pandemic. The market in the Gulf tends to cool in the summer anyway, before picking up again in September.
The Saudi market regulator, the Capital Market Authority (CMA), approved Bindawood’s application to list in June. The regulator gives companies six months from the date of approval to list.
UN's top court backs #Qatar in air blockade row with neighbours | News | Al Jazeera
UN's top court backs Qatar in air blockade row with neighbours | News | Al Jazeera:
The International Court of Justice, the UN's top court, has backed Qatar in a dispute with four neighbours that imposed an air blockade against Doha more than three years ago.
The Hague-based ICJ on Tuesday rejected the appeal by Bahrain, Egypt, Saudi Arabia, and the United Arab Emirates (UAE) against a decision by the world civil aviation body in favour of Qatar over sovereign airspace, ICJ President Abdulqawi Ahmed Yusuf said on Tuesday.
The court also "holds that the International Civil Aviation Organisation (ICAO) has jurisdiction" in the case, by 15 judges to one, Yusuf said.
The ICAO in 2018 ruled it had jurisdiction to handle a dispute brought by Qatar, which accused its neighbours of violating a convention that regulates the free passage of its passenger planes through foreign airspace.
The International Court of Justice, the UN's top court, has backed Qatar in a dispute with four neighbours that imposed an air blockade against Doha more than three years ago.
The Hague-based ICJ on Tuesday rejected the appeal by Bahrain, Egypt, Saudi Arabia, and the United Arab Emirates (UAE) against a decision by the world civil aviation body in favour of Qatar over sovereign airspace, ICJ President Abdulqawi Ahmed Yusuf said on Tuesday.
The court also "holds that the International Civil Aviation Organisation (ICAO) has jurisdiction" in the case, by 15 judges to one, Yusuf said.
The ICAO in 2018 ruled it had jurisdiction to handle a dispute brought by Qatar, which accused its neighbours of violating a convention that regulates the free passage of its passenger planes through foreign airspace.
Oil gains after big U.S. drawdown; eyes on OPEC committee meeting - Reuters
Oil gains after big U.S. drawdown; eyes on OPEC committee meeting - Reuters:
Oil prices rose on Wednesday following a sharp drop in U.S. crude inventories, with the market waiting for next steps from a meeting later in the day on the future level of output cuts by OPEC and its allies.
Brent crude LCOc1 futures were up 22 cents, or 0.5%, at $43.12 a barrel as of 0640 GMT, and U.S. West Texas Intermediate (WTI) crude CLc1 futures rose 23 cents, or 0.6%, to $40.52 a barrel.
Reflecting a recovery in fuel demand despite the coronavirus pandemic, U.S. crude inventories fell by 8.3 million barrels in the week to July 10, beating analysts’ expectations for a decline of 2.1 million barrels, according to data from industry group the American Petroleum Institute. [API/S]
Official numbers from the U.S. Department of Energy’s Energy Information Administration (EIA) are due on Wednesday.
Oil prices rose on Wednesday following a sharp drop in U.S. crude inventories, with the market waiting for next steps from a meeting later in the day on the future level of output cuts by OPEC and its allies.
Brent crude LCOc1 futures were up 22 cents, or 0.5%, at $43.12 a barrel as of 0640 GMT, and U.S. West Texas Intermediate (WTI) crude CLc1 futures rose 23 cents, or 0.6%, to $40.52 a barrel.
Reflecting a recovery in fuel demand despite the coronavirus pandemic, U.S. crude inventories fell by 8.3 million barrels in the week to July 10, beating analysts’ expectations for a decline of 2.1 million barrels, according to data from industry group the American Petroleum Institute. [API/S]
Official numbers from the U.S. Department of Energy’s Energy Information Administration (EIA) are due on Wednesday.