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Oil prices were little changed on Wednesday, steadying after Saudi Arabia said it will restore by the end of the month production lost in weekend attacks on its facilities. Prices plummeted 6% on Tuesday after Saudi Arabia's energy minister said the country had managed to restore oil supplies to customers to where they stood before the attacks on its facilities that shut 5% of global oil output by drawing from its huge inventories. "Considering limited spare (production) capacity outside Saudi Arabia and risks of renewed attacks on Saudi energy infrastructure, a risk premium is likely to stay on oil prices in the foreseeable future," UBS analysts said in a note.
India plans to invite bids from global firms for the first time for coal mining blocks before end-2019, sources familiar with the matter said, a move that would end Coal India Ltd's near-monopoly for the fuel as the nation tries to cut imports. Coal is among the top five commodities imported by India, one of the world's largest consumers of the fuel. Coal imports are surging after the government failed to open the industry to competition, despite having passed a liberalization policy 19 months ago.
As an investor, I look for investments which do not compromise one fundamental factor for another. By this I mean, I...
(Bloomberg) -- Saudi Arabia joined a U.S.-led coalition to secure sea lines vital to oil shipping in the Middle East in the aftermath of a devastating attacks on Aramco’s oil facilities.The International Maritime Security Construct’s area of operation covers the Strait of Hormuz, the world’s most critical waterway for oil supplies, the Strait of Bab al-Mandab, the Gulf of Oman and the Persian Gulf. The move aims to support efforts to thwart threats to trade as well as guarantee energy security, the state-run Saudi Press Agency reported.U.S. Seeks Support to Watch Gulf Shipping as Iran Tensions RiseA showdown between Iran and the Trump administration after the U.S. pulled out of the 2015 nuclear agreement with the Islamic Republic has threatened shipping in the region. Attacks on tankers and drones prompted the U.S. to call for a coalition of allies to protect ships passing through the area.About 40% of the world’s seaborne oil travels through the Strait of Hormuz. The U.S. and U.K. have stepped up their military presence in the region amid calls to ensure the waterway remains open.The International Maritime Security Construct task force is headquartered in Bahrain, and its members include the U.S., the U.K., Australia as well as the host country.Shaped like an inverted V, the waterway connects the Persian Gulf to the Indian Ocean, with Iran to its north and the United Arab Emirates and Oman to the south. Its shallow depth makes ships vulnerable to mines, and the proximity to land -- Iran, in particular -- leaves large tankers open to attack from shore-based missiles or interception by fast patrol boats and helicopters.To contact the reporter on this story: Abbas Al Lawati in Dubai at email@example.comTo contact the editors responsible for this story: Shaji Mathew at firstname.lastname@example.org, Alaa ShahineFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Indian power plants’ appetite for imported coal is on the rise again. The country’s electricity generating firms are expected to import up to 74 million tonnes of the fossil fuel in the current financial year ending March 2020, according to India Ratings and Research. Coal imports to produce electricity have already risen by five million tonnes year-on-year in the April-July period, at the end of which they stood at a total 23 million tonnes.
(Bloomberg) -- Oil stabilized on signs Saudi Arabia is quickly restoring production following a debilitating weekend attack, after two tumultuous days in which it surged the most on record and then pared almost half of that gain.Brent edged higher on Wednesday after tumbling Tuesday as Saudi Aramco said it had revived 41% of capacity at a key crude-processing complex days after a devastating aerial attack that wrecked vital equipment and rocked global energy markets. The global crude benchmark, was back to about $65 a barrel after jumping to near $72 in reaction to the disruptions.The Aramco announcement followed conflicting media reports about the pace and probable duration of the state-owned company’s efforts to repair the damaged Abqaiq facility. Despite the kingdom’s reassurances at a media briefing in Jeddah, crude remained almost 8% higher than the pre-attack price.The question of how the U.S. and Saudi Arabia will respond to the attacks, which Secretary of State Mike Pompeo has blamed on Iran, still hangs over the market. The Pentagon is preparing an assessment on who was responsible for the strike and hopes to make it public, a U.S. defense official said. Saudi Arabia will show evidence of Iran’s involvement in the strike, state television reported.“The market is certainly setting itself up for a surprise, considering they aren’t really pricing in that geopolitical risk premium at the moment,” said Daniel Hynes, a senior commodity strategist at Australia & New Zealand Banking Group Ltd. in Sydney.Abqaiq is now processing about 2 million barrels a day and should return to pre-attack levels of about 4.9 million barrels by the end of September, Aramco Chief Executive Officer Amin Nasser said Tuesday. Two-thirds of production has been restored and the kingdom sees full recovery in 10 days, Crown Prince Mohammed bin Salman told South Korean President Moon Jae-in, according to a statement from the president’s office on Wednesday.Adding to the bearish sentiment, the American Petroleum Institute reported a 592,000-barrel increase in stockpiles for the week ended Sept. 13, according to people familiar with the data. That compares with analyst expectations for a 2.25 million-barrel drop. If confirmed by government data due Wednesday, it would break a four-week streak of declines.Brent for November delivery rose 33 cents, or 0.5%, to $64.88 a barrel on the ICE Futures Europe exchange at 7:31 a.m. in London. It tumbled by 6.5% Tuesday after surging 14.6% on Monday.West Texas Intermediate for October delivery was down 8 cents, or 0.1%, at $59.26 a barrel on the New York Mercantile Exchange. The U.S. benchmark’s discount to Brent for the same month was $5.72 a barrel.Meanwhile, U.S. President Donald Trump said he saw no reason to allow refiners to dip into the nation’s emergency reserves. “I don’t think we need to. Oil has not gone up very much,” Trump told reporters Tuesday aboard Air Force One. “There’s a lot of oil in the world.“Saudi Aramco is firing up idle offshore oil fields -- part of its cushion of spare capacity -- to replace some lost production, a person familiar with the matter said. Some customers are being asked to accept different grades of crude. The kingdom’s domestic inventories are sufficient to cover about 26 days of exports, according to consultant Rystad Energy A/S.\--With assistance from Joe Carroll, James Thornhill, David Marino and Sheela Tobben.To contact the reporter on this story: Saket Sundria in Singapore at email@example.comTo contact the editors responsible for this story: Serene Cheong at firstname.lastname@example.org, Andrew Janes, Alexander KwiatkowskiFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Saudi Arabia will soon restore most of its oil output and return to normal production levels in weeks, the country’s energy ministry said Tuesday.
The weekend attacks on vital oil infrastructure in OPEC’s largest producer and the world’s top oil exporter Saudi Arabia could be a boon to Brazil
U.S. stocks ticked up as oil prices retreated from a historic gain and investors looked ahead to an expected cut in interest rates by the Federal Reserve.
Saudi Arabia said Tuesday its oil output will return to normal by the end of September, seeking to soothe rattled energy markets after attacks on two instillations that slashed its production by half. The weekend strikes on Abqaiq –- the world's largest oil processing facility –- and the Khurais oil field in eastern Saudi Arabia roiled energy markets and revived fears of a conflict in the tinderbox Gulf region. Energy Minister Prince Abdulaziz bin Salman, who was only appointed to the role earlier this month, said that the world's top energy exporter had dipped into its strategic reserves to maintain supply to clients.
Three Aframax vessels that can carry about 750,000 barrels, and one supertanker that can hold about 2 million barrels of crude, have been chartered by Unipec tentatively, according to a shipping source and Refinitiv Eikon data. The attack on Saudi oil facilities on Saturday knocked out half of Saudi Arabia's oil production, or 5% of global output, sending prices soaring and setting off a flurry of inquiries for export cargoes out of the U.S. Gulf Coast in anticipation of a prolonged outage.
Even though weekend attacks on Saudi oil facilities cut that country's output in half, American petroleum producers appear neither ready nor willing to fill the void and capture new market share for themselves. The so-called fracking boom -- in which new technologies unlocked tremendous oil and gas deposits in shale formations -- has more than doubled US output to almost 12 million barrels per day over the last decade. The United States is now the world's largest producer and regularly exports more than three million barrels per day as well.
The loss of production capacity following weekend attacks on Saudi Arabian oil production facilities and increasing tensions in the region highlighted the outsized impact the kingdom's oil supply has on China, which is already facing worries of economic sluggishness. China is the world's second-largest importer of oil from Saudi Arabia, having last year bought just under $30 billion worth of crude from the kingdom. The good news for China is that Saudi Arabia is only its second-largest supplier of crude oil.
Midstream biggie Energy Transfer (ET) said on Monday it would buy SemGroup (SEMG) for $5.1 billion. Meanwhile, supermajor ExxonMobil (XOM) confirmed its 14th oil discovery off the coast of Guyana.
A feared rise in U.S. gasoline prices after drone attacks on Saudi oil facilities could ease up as the kingdom brings crude production back quickly.
Saudi Arabia will restore its lost oil production by the end of September and has managed to recover supplies to customers to the levels they were at prior to weekend attacks on its facilities by drawing from its huge oil inventories. Energy Minister Prince Abdulaziz bin Salman said on Tuesday that average oil production in September and October would be 9.89 million barrels per day and that the world's top oil exporter would ensure full oil supply commitments to its customers this month. "Over the past two days we have contained the damage and restored more than half of the production that was down as a result of the terrorist attack," Prince Abdulaziz told a news conference in the Red Sea city of Jeddah.
Losses for oil futures deepened on Tuesday, as Saudi Arabia's energy minister Prince Abdulaziz bin Salman said his nation's oil production will be fully back online by the end of the month, according to CNBC. His comments follow a weekend attack on Saudi oil facilities that was estimated to have cut the kingdom's daily crude production down by 5.7 million barrels a day, sparking concerns of potentially prolonged supply shortage. October West Texas Intermediate oil was down $2.90, or 4.6%, to trade at $60 a barrel on the New York Mercantile Exchange. It rose nearly 15% Monday to settle at $62.90, the highest finish for a front-month contract since May 21, according to FactSet data. November Brent crude traded at $64.62, down $4.40, or 6.4%.
(Bloomberg) -- Saudi Arabia attempted to move beyond the worst oil disruption in its history, assuring the world that crude exports won’t suffer, its damaged facility has partially restarted and that production capacity will be back to normal within months.The long-awaited update on Tuesday from the kingdom -- which before the strike pumped almost 10% of the world’s oil -- gives the market much-needed clarity after days of speculation over how severe the damage was at Saudi Aramco’s Abqaiq plant.However, progress has been slower than was initially expected and crude prices remain elevated as traders factor in higher risks for Saudi supply.“During the two past days, we managed to contain the damage by recovering more than half of the production that we had lost during that terrorist attack,” Energy Minister Prince Abdulaziz bin Salman said at a briefing in Jeddah. “The company will be able to meet all its commitments to customers this month by drawing on its crude oil reserves.”Abqaiq is now processing about 2 million barrels a day, Aramco Chief Executive Officer Amin Nasser said. The facility should return to pre-attack levels of about 4.9 million barrels by the end of September, he said.Soon after the weekend attack, officials indicated that the majority of output would be restored within days, with weeks required to get back to full capacity. The outlook became more pessimistic in subsequent days as photos were released showing the scale of the damage at the crucial facility.The minister and CEO assured customers Aramco’s crude exports won’t be reduced this month because it will draw down strategic reserves. The kingdom also temporarily reduced the rate at which domestic refineries process oil by about 1 million barrels a day, making more crude available for shipment overseas.Still, figures provided by the energy minister suggested the kingdom will take months to fully recover from the incident. Full output capacity of 12 million barrels a day will only be available at the end of November, with about 11 million restored by the end of this month, said Prince Abdulaziz. Saudi Arabia aims to pump 9.8 million barrels a day in October, he said, in line with recent months.Houthi rebels in Yemen initially claimed responsibility for the attacks, although the U.S. later blamed Iran. The oil market has been gripped with uncertainty since the plant was hit. The international benchmark jumped 15%, the most on record, on Monday, before tumbling 6.5% after Aramco’s update on Tuesday. It was 0.1% lower at $64.50 a barrel in early Asian trading on Wednesday.Unprecedented DisruptionThat historic price gain underscored the unprecedented nature of the disruption caused by the attack. For decades, Saudi Arabia has been the oil market’s great stabilizer, maintaining a large cushion of spare production capacity that can be tapped in emergencies, such as during the 2011 war in Libya.The suspension of 5.7 million barrels day of Saudi production -- the worst sudden loss in history -- exposed the inadequacy of the rest of the world’s supply buffer. Aramco ramped up offshore fields to maximum to replace some lost production, Nasser said. Customers were also being supplied using stockpiles, though some buyers are being asked to accept different grades of crude, a person familiar with the matter said earlier this week.Beyond the kingdom, other participants in the OPEC+ cuts, such as Russia, Kazakhstan and the United Arab Emirates, could restore a few hundred thousand barrels a day of idled production, but that’s not enough to offset Saudi losses.Escalation ThreatEven as Aramco fixes the damage at Abqaiq, the possibility of further escalation of conflict in the Middle East hangs over the market.Tehran and Riyadh are historic foes backing opposing sides in Yemen’s long-running civil war. The volatile situation in the region finally boiled over earlier this year as U.S. President Donald Trump used sanctions to attempt to choke off all of Iran’s oil exports -- the lifeblood of its economy -- after unilaterally withdrawing from an international nuclear deal.Understanding the Conflicts Leading to Saudi Attacks: QuickTakeSince then, the Persian Gulf, source of about a third of the world’s seaborne oil exports, has been under siege, targeted by air, sea and land. While Trump has shown some reluctance to go to war, there are also few prospects for easing tensions as Saudi Crown Prince Mohammed bin Salman decides how to respond to the assault.Prince Abdulaziz said he wouldn’t comment on whether Iran was responsible for the attack. The Pentagon is preparing a report on who was to blame and intends to make it public within 48 hours, a U.S. defense official said Tuesday.Houthi rebels in Yemen, who are backed by Tehran, said Monday that oil installations in Saudi Arabia will remain among their targets and their weapons can reach anywhere in the country. Iran’s supreme leader Ayatollah Ali Khamenei said Tuesday his country won’t negotiate with the U.S. on any level.The threat to key Saudi infrastructure has loomed over the planned initial public offering of Aramco. The state-run company will still be ready for a share sale any time in the next 12 months, Chairman Yasser Al Rumayyan said at the briefing.(Updates with latest oil price in ninth paragraph.)To contact the reporter on this story: Anthony DiPaola in Dubai at email@example.comTo contact the editors responsible for this story: James Herron at firstname.lastname@example.org, Will KennedyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
The attacks on Saudi Arabia that have sent crude-oil prices surging are certainly the story for financial markets on Monday and Tuesday. Analysts at U.K. investment adviser (AJB) calculated that the last eight times that the year-over-year price growth for oil was over 100%, there was either a global recession or economic slowdown six times. It’s worth pointing out that even with the big 10% rally in crude-oil prices, Brent crude prices, trading around $65 a barrel, are still below year-earlier levels.
Reliant on crude imports from the region and heavily invested in some of Iran’s megaprojects, China stands to lose most if tensions in the Middle East escalate further
The Zacks Analyst Blog Highlights: U.S. Silica, Chevron, AngloGold Ashanti, Kinross Gold and Barrick Gold
Saudi Arabia's oil output will be fully restored quicker than thought following weekend attacks on production facilities, two sources briefed on developments said on Tuesday, taking two or three weeks not months as initial indications suggested. The kingdom is close to restoring 70% of the 5.7 million barrels per day (bpd) production lost due to the attacks, said one of the sources, a top Saudi official briefed on progress.