Oil extends losses as Texas prepares to ramp up output after freeze | Reuters
Oil prices fell for a second day on Friday, retreating further from recent highs, as Texas energy companies began preparations to restart oil and gas fields shuttered by freezing weather and power outages.
Brent crude futures ended the session down $1.02, or 1.6%, at $62.91 a barrel while U.S. West Texas Intermediate (WTI) crude fell $1.28, or 2.1%, to settle at $59.24.
For the week, Brent gained about 0.5% while WTI fell about 0.7%.
This week, both benchmarks had climbed to the highest in more than a year.
“Price pullback thus far appears corrective and is slight within the context of this month’s major upside price acceleration,” said Jim Ritterbusch, president of Ritterbusch and Associates.
Friday 19 February 2021
The ultimatum: #SaudiArabia pushes foreign companies to relocate from #Dubai to #Riyadh - tks @RiyadhBureau
The ultimatum: #SaudiArabia pushes foreign companies to relocate from #Dubai to #Riyadh - tks @RiyadhBureau
From the Saudi Press Agency:
This comes after the Financial Times first reported last month that Crown Prince Mohammed bin Salman was spearheading an initiative called “Programme HQ” to convince multinationals to relocate their headquarters from Dubai to Riyadh. When the Public Investment Fund hosted its annual conference in late January, the government said 24 companies, including PepsiCo and Bechtel, intend to open regional offices in the kingdom as part of a major development plan for the Saudi capital.
From the Saudi Press Agency:
An official source stated that the Kingdom of Saudi of Arabia intends to cease contracting with companies and commercial institutions with regional headquarters not located in the Kingdom. The cessation will include agencies, institutions and funds owned by the government and will take effect January 1st, 2024.
The source stated that the decision aims to incentivize the localization of businesses by foreign companies that deal with the Kingdom’s government or any of its agencies, institutions and funds, in addition to creating more jobs, limit economic leakage, increase spending efficiency, and guarantee that the main goods and services purchased by the different government agencies are made in the Kingdom with appropriate local content.
This comes after the Financial Times first reported last month that Crown Prince Mohammed bin Salman was spearheading an initiative called “Programme HQ” to convince multinationals to relocate their headquarters from Dubai to Riyadh. When the Public Investment Fund hosted its annual conference in late January, the government said 24 companies, including PepsiCo and Bechtel, intend to open regional offices in the kingdom as part of a major development plan for the Saudi capital.
#SaudiArabia should make environment more conducive to business rather than issuing 'ultimatums': CE - YouTube
(9) Saudi Arabia should make environment more conducive to business rather than issuing 'ultimatums': CE - YouTube
Nomura Asset Management's Tarek Fadlallah weighs in on Saudi Arabia's move to lure more companies into setting up regional headquarters in the Kingdom.
#SaudiArabia's MBS and the #UAE's MBZ Are on an Economic Collision Course - Bloomberg
Saudi Arabia's MBS and the UAE's MBZ Are on an Economic Collision Course - Bloomberg
For several years now, Saudi Arabia and the United Arab Emirates have been in lockstep on foreign policy. The close friendship of their de facto rulers, Saudi Crown Prince Mohammed bin Salman and Abu Dhabi Crown Prince Mohammed bin Zayed, is the Middle East’s most important alliance. It allows them to boss around the Gulf Cooperation Council, to the disquiet of other members, and set the agenda for the wider Arab world.
Better known as MBS and MBZ, the two leaders share a fear of Iran and a loathing of Turkey and the Muslim Brotherhood. Their countries have formed coalitions with other Arab states to fight a war in Yemen and impose an (only recently lifted) embargo on Qatar. Beyond the Middle East, they have collaborated to broker a peace deal between Ethiopia and Eritrea and pursue military and security alliances in Asia and Africa. They have even, on occasion, pledged economic partnership, at home and farther afield.
Although they are mostly united by their mutual interests, there is one shared goal that threatens to divide them. Both are keen to reduce their dependence on hydrocarbon exports by diversifying their economies — and this puts them on a collision course.
The Saudis and Emiratis are pursuing diversification into the same sectors: tourism, financial services, logistics, petrochemicals, technology. Since they both lack the talent pools required to serve these industries, they must vie with each other for expatriate expertise as well as investment.
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Come on down to Riyadh. Photographer: FAYEZ NURELDINE/AFP |
Better known as MBS and MBZ, the two leaders share a fear of Iran and a loathing of Turkey and the Muslim Brotherhood. Their countries have formed coalitions with other Arab states to fight a war in Yemen and impose an (only recently lifted) embargo on Qatar. Beyond the Middle East, they have collaborated to broker a peace deal between Ethiopia and Eritrea and pursue military and security alliances in Asia and Africa. They have even, on occasion, pledged economic partnership, at home and farther afield.
Although they are mostly united by their mutual interests, there is one shared goal that threatens to divide them. Both are keen to reduce their dependence on hydrocarbon exports by diversifying their economies — and this puts them on a collision course.
The Saudis and Emiratis are pursuing diversification into the same sectors: tourism, financial services, logistics, petrochemicals, technology. Since they both lack the talent pools required to serve these industries, they must vie with each other for expatriate expertise as well as investment.
RPT-COLUMN-OPEC+ under pressure to boost output as oil climbs towards peak: Kemp | Reuters
RPT-COLUMN-OPEC+ under pressure to boost output as oil climbs towards peak: Kemp | Reuters
Saudi Arabia’s oil minister has called for a cautious approach to raising production, even as prices surge and many traders anticipate an increasingly severe shortage of petroleum later this year.
“We are in a much better place than we were a year ago, but I must warn, once again, against complacency. The uncertainty is very high, and we have to be extremely cautious,” the minister said in a speech on Wednesday.
In contrast, futures markets point to a rapid tightening of supply, with front-month Brent up more than $25 per barrel or 65% in just over three months since successful vaccine trials were announced in early November.
Brent’s six-month calendar spread has surged into a backwardation of more than $3.70 per barrel, putting it in the 94th percentile for all trading days since 1990, and indicating traders expect a rapid depletion in oil stocks.
The spread was this strong for brief periods during 2019 and in the first few weeks in 2020, flashing expected tightness, but the last time it was this tight on a sustained basis was in 2013.
Saudi Arabia’s oil minister has called for a cautious approach to raising production, even as prices surge and many traders anticipate an increasingly severe shortage of petroleum later this year.
“We are in a much better place than we were a year ago, but I must warn, once again, against complacency. The uncertainty is very high, and we have to be extremely cautious,” the minister said in a speech on Wednesday.
In contrast, futures markets point to a rapid tightening of supply, with front-month Brent up more than $25 per barrel or 65% in just over three months since successful vaccine trials were announced in early November.
Brent’s six-month calendar spread has surged into a backwardation of more than $3.70 per barrel, putting it in the 94th percentile for all trading days since 1990, and indicating traders expect a rapid depletion in oil stocks.
The spread was this strong for brief periods during 2019 and in the first few weeks in 2020, flashing expected tightness, but the last time it was this tight on a sustained basis was in 2013.
Damac chairman mulls #Saudi presence after kingdom's regional HQ ruling - Arabianbusiness
Damac chairman mulls Saudi presence after kingdom's regional HQ ruling - Arabianbusiness
The chairman of Dubai-based developer Damac Properties has said he is looking into adding a regional office in Saudi Arabia following the kingdom's ruling aimed at attracting more foreign companies.
Starting on January 1, 2024, the Saudi government and state-backed institutions will stop signing contracts with foreign firms that base their Middle East HQ outside the kingdom.
It is unclear whether that would impact Damac but Hussain Sajwani told CNBC Middle East in an interview that he was considering a regional office in the kingdom.
"I think it's logical that if you're doing big business with the government of a country to have some presence there," he told CNBC's Hadley Gamble.
The chairman of Dubai-based developer Damac Properties has said he is looking into adding a regional office in Saudi Arabia following the kingdom's ruling aimed at attracting more foreign companies.
Starting on January 1, 2024, the Saudi government and state-backed institutions will stop signing contracts with foreign firms that base their Middle East HQ outside the kingdom.
It is unclear whether that would impact Damac but Hussain Sajwani told CNBC Middle East in an interview that he was considering a regional office in the kingdom.
"I think it's logical that if you're doing big business with the government of a country to have some presence there," he told CNBC's Hadley Gamble.
Oil Giving Up Big-Freeze Gains With Wells Slowly Restarting - Bloomberg
Oil Giving Up Big-Freeze Gains With Wells Slowly Restarting - Bloomberg
Oil fell for a second day as production slowly restarted in Texas and the White House said it would be willing to meet with Iran, potentially paving the way for more crude exports from the Persian Gulf nation.
Futures in New York dropped toward $59 a barrel, falling the most in three months at one point on Friday. Companies are using restored power from grids or generators to resume output that was halted by the frigid weather, according to people familiar with the matter. The timeline for a full restoration of the estimated 40% or so of U.S. oil production that was shut in by the big freeze is unclear.
Fuel margins rocketed again on Friday, however, with four of the biggest plants in Texas facing delays of several weeks or more to resume operations. While that potentially limits demand for crude, it also raises the potential for prolonged fuel shortages that could spread across the U.S.
Oil fell for a second day as production slowly restarted in Texas and the White House said it would be willing to meet with Iran, potentially paving the way for more crude exports from the Persian Gulf nation.
Futures in New York dropped toward $59 a barrel, falling the most in three months at one point on Friday. Companies are using restored power from grids or generators to resume output that was halted by the frigid weather, according to people familiar with the matter. The timeline for a full restoration of the estimated 40% or so of U.S. oil production that was shut in by the big freeze is unclear.
Fuel margins rocketed again on Friday, however, with four of the biggest plants in Texas facing delays of several weeks or more to resume operations. While that potentially limits demand for crude, it also raises the potential for prolonged fuel shortages that could spread across the U.S.
National Bank of #Kuwait sells $700mln AT1 bonds | ZAWYA MENA Edition
National Bank of Kuwait sells $700mln AT1 bonds | ZAWYA MENA Edition
The National Bank of Kuwait launched $700 million Additional Tier 1 bonds on Thursday at 3.625%, a document showed.
It had given initial price guidance of about 4% for the bonds, which are non-callable for six years.
AT1 bonds, the riskiest debt instruments banks can issue, are designed to be perpetual in nature, but lenders can call them after a specified period.
Citi, HSBC, JPMorgan, NBK Capital, Standard Chartered and UBS arranged the deal.
The National Bank of Kuwait launched $700 million Additional Tier 1 bonds on Thursday at 3.625%, a document showed.
It had given initial price guidance of about 4% for the bonds, which are non-callable for six years.
AT1 bonds, the riskiest debt instruments banks can issue, are designed to be perpetual in nature, but lenders can call them after a specified period.
Citi, HSBC, JPMorgan, NBK Capital, Standard Chartered and UBS arranged the deal.
Oil drops as investors gauge big chill impact on U.S. refineries, OPEC+ output rise | Reuters
Oil drops as investors gauge big chill impact on U.S. refineries, OPEC+ output rise | Reuters
Oil prices slid more than 1% on Friday, adding to overnight declines, on worries that refineries will take time to resume operations after the big freeze in the U.S. South, creating a gap in demand, while OPEC+ supplies were expected to rise.
“The market was ripe for a correction and signs of the power and overall energy situation starting to normalise in Texas provided the necessary trigger,” said Vandana Hari, energy analyst at Vanda Insights.
Brent crude futures dropped 87 cents, or 1.4%, to $63.06 a barrel, by 0744 GMT, while U.S. West Texas Intermediate (WTI) crude futures fell 82 cents, or 1.4%, to $59.70 a barrel.
Both benchmark contracts rallied to 13-month highs on Thursday driven by the historic freeze in U.S. southern states. While analysts estimate the extreme cold has shut in as much as one-third of U.S. crude production, attention has now turned to the impact on refiners.
Oil prices slid more than 1% on Friday, adding to overnight declines, on worries that refineries will take time to resume operations after the big freeze in the U.S. South, creating a gap in demand, while OPEC+ supplies were expected to rise.
“The market was ripe for a correction and signs of the power and overall energy situation starting to normalise in Texas provided the necessary trigger,” said Vandana Hari, energy analyst at Vanda Insights.
Brent crude futures dropped 87 cents, or 1.4%, to $63.06 a barrel, by 0744 GMT, while U.S. West Texas Intermediate (WTI) crude futures fell 82 cents, or 1.4%, to $59.70 a barrel.
Both benchmark contracts rallied to 13-month highs on Thursday driven by the historic freeze in U.S. southern states. While analysts estimate the extreme cold has shut in as much as one-third of U.S. crude production, attention has now turned to the impact on refiners.