Egypt rebounds from four-week low; Gulf stock markets mixed

Updated 31 January 2013
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Egypt rebounds from four-week low; Gulf stock markets mixed

DUBAI: Egypt’s bourse recovered yesterday from a four-week low as bargain hunters shrugged off political unrest, while Gulf markets were mixed.
Cairo’s main index rose 1.5 percent, halting two sessions of sharp declines after the government declared a state of emergency in three cities on the Suez Canal.
“The market rebound today is a correction after a sharp decline yesterday, but we expect the bourse will break 5,500 again to target 5,300 next week,” said Ahmed Sharaby, Cairo-based technical analyst at Mawarid Egypt.
Heavyweight Orascom Construction Industries and Telecom Egypt each climbed 0.8 percent. Orascom Telecom gained 2.8 percent.
However, investor concerns still linger as two more protesters were shot dead before dawn near Cairo’s central Tahrir Square on the seventh day of a wave of unrest.
“There’s a psychological pressure (on investors) from the political situation,” said Sharaby.
Elsewhere, petrochemical stocks helped lift Saudi Arabia’s index as better-than-forecast European data spurred optimism for the global economy and drove oil prices higher.
Brent crude reached its highest level in three and a half months yesterday, passing $ 115 a barrel.
Saudi Basic Industries added 0.5 percent, National Industrialization (TASNEE) climbed 0.4 percent and Rabigh Refining and Petrochemical gained 1.2 percent.
Saudi petrochemical stocks tend to track oil prices, with crude impacting their bottom line. Oil is also seen as a proxy for global economic activity and therefore demand for petrochemical products.
The Kingdom’s index gained 0.2 percent, its third gain in the last five sessions.
In the UAE, Dubai’s Emaar Properties hit a 39-month high as investors bet the developer will announce market-pleasing earnings and dividends for 2012.
Emaar climbed 1.5 percent to AED 4.88, its highest close since October 2009. The intraday peak of that month — AED 5.01 — is a major resistance level for the stock.
“Foreign flows continue ... the market is predominantly led by Emaar — we will need to see earnings to see if the rally is justified,” said Anastasios Dalgiannakis, institutional trading manager at Mubasher.
Analysts polled by Reuters forecast Emaar to post a 23.8 percent drop in fourth-quarter profit. Some traders expect the developer will announce its results today, although it has not made an official announcement to that effect.
Shares in courier Aramex jumped 5.1 percent to AED 2.27, its highest close since October 2010, on a technical breakout. It broke through a resistance at AED 2.22, the peak of Dec. 4.
Dubai’s index rose 1.1 percent to — its highest close since March 2010 — while Abu Dhabi’s benchmark climbed 0.4 percent to reach a similar milestone.
First Gulf Bank gained 0.8 percent after posting an estimate-beating 12-percent rise in fourth-quarter profit. The bank proposed a cash dividend of 0.83 dirhams per share for 2012.
In Qatar, the index climbed 0.4 percent.
Elsewhere, Kuwait’s index slipped 0.1 percent, halting a 10-session rally.


World oil demand, refining growth to peak in 2035 — Unipec

Updated 43 min 1 sec ago
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World oil demand, refining growth to peak in 2035 — Unipec

  • Improved energy efficiency and technological changes, including the rise of renewables, meant global oil demand growth would slow in coming years before peaking in 2035
  • The switch to cleaner fuels will boost global demand for liquefied natural gas

SINGAPORE: World oil demand will peak at 104.4 million barrels per day (bpd) in the mid-2030s, up from just below 100 million bpd currently, as new technologies gradually eat into oil use, China’s Unipec said on Monday.
Improved energy efficiency and technological changes, including the rise of renewables, meant global oil demand growth would slow in coming years before peaking in 2035, Unipec President Chen Bo told the annual Asia Pacific Petroleum Conference (APPEC).
This in turn will slow growth in global oil refining capacity, which is set to hit 5.6 billion tons per year in 2035, he said.
“We believe 2018-2035 will be the last cycle of global refining capacity expansion. After 2035, it is difficult to see large-scale refining projects in construction, except for some small upgrade projects and petrochemical projects,” said Chen.
Unipec is the trading arm of Asia’s largest refiner Sinopec.
The switch to cleaner fuels will also boost global demand for liquefied natural gas (LNG), particularly in the Asia Pacific, after 2025, he added.
An escalating trade war between China, the largest energy importer, and the United States has dampened the Asian nation’s demand for US crude oil and LNG.
The United States exported 300,000 barrels per day (bpd) of crude oil to China in the first half of 2018, and 56 cargoes of LNG through July, or roughly 10 percent of its total LNG exports, according to official data.
Despite the trade dispute, Chen said US crude supply was an important new source for Chinese refiners as it allowed diversification from Middle East and African crudes.
Trade war tensions between the two countries would last “for the time being, and in the future we’ll be active in this area,” he added.
Beijing has excluded US crude imports from its tariffs list so far, but most Chinese buyers are staying away from US oil as the trade war shows no signs of cooling.
Unipec resumed loading US crude in September after a two-month hiatus.
China is also under pressure from the US to reduce its Iranian oil imports as Washington aims to cut exports from OPEC’s third-largest exporter to zero to force Tehran to negotiate a nuclear treaty.
Buyers in Europe, Japan, South Korea and India have either stopped or are reducing Iranian oil imports sharply ahead of the introduction of sanctions in November.
“I expect we’ll cut a little but the volume has not been finalized,” Chen said, without giving a timeframe for the cuts.
He added that Unipec has resumed normal loadings of Saudi oil after it cut imports in May-July.
Given the current supply and demand dynamic in global markets, Chen said, crude oil prices between at $60 and $80 per barrel were normal.