Boeing kickstarts Farnborough Airshow with order for jets worth $4.7bn

The US planemaker said logistics group DHL placed the order and acquired purchase rights for 7 additional freighters. (Courtesy Boeing)
Updated 16 July 2018
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Boeing kickstarts Farnborough Airshow with order for jets worth $4.7bn

BENGALURU: Boeing Co. said on Monday it won an order for 14 freight aircraft for a value of $4.7 billion, firing the opening salvo against rival Airbus in a contest for business on day one of the Farnborough Airshow.
Logistics group DHL placed the order for the 777 freighters and acquired purchase rights for seven more freighters, the US planemaker said.
Boeing and Airbus are expected to make several announcements on the first day of the July 16-22 event, as they seek to bolster their already bulging order books.
The latest order follows Boeing’s deal with FedEx Corp. unit FedEx Express in June for 24 medium and large freighters.
While global trade tensions are escalating, the industry is counting on e-commerce continuing to soar, with more people buying products online for quick delivery.
Air freight demand is expected to increase 4 percent this year, according to the International Air Transport Association (IATA).
Last year was the best for cargo since 2010, with traffic growth more than doubling to 9 percent, three times the growth in capacity.
Boeing’s latest order will double the size of DHL’s global 777 fleet, the companies said. The delivery of the first four planes is expected to be completed in 2019, DHL said in a separate statement.
The Farnborough Airshow is the industry’s biggest event this year. It alternates with the Paris Airshow and, collectively, they account for over a quarter of industry order intake each year.


Oil mixed on tighter US outlook

Updated 21 August 2018
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Oil mixed on tighter US outlook

  • Traders said US markets were lifted by a tightening outlook for fuel markets in the coming months
  • The Iran supply cut may also be more than compensated for by production increases outside OPEC

SINGAPORE: Oil prices were mixed on Tuesday, with US fuel markets seen to be tightening while the Sino-US trade dispute dragged on international crude contracts.
US West Texas Intermediate (WTI) crude futures for September delivery were up 27 cents, or 0.4 percent, at 0306 GMT, at $66.70 per barrel. The contract expires on Tuesday.
The more active October futures were up 7 cents, or 0.1 percent, to $65.49 a barrel.
Traders said US markets were lifted by a tightening outlook for fuel markets in the coming months.
Inventories in the United States for refined products such as diesel and heating oil for this time of year are at their lowest in four years.
This is occurring just ahead of the peak demand period for these fuels, with diesel needed for tractors to harvest crops and the arrival of colder weather during the Northern Hemisphere autumn raising consumption of heating oil.
Outside the United States, Brent crude oil futures were somewhat weaker, trading at $72.18 per barrel, down 3 cents from their last close.
This followed the United States offering on Monday 11 million barrels of crude from its Strategic Petroleum Reserve (SPR) for delivery from Oct. 1 to Nov. 30.
The released oil could offset expected supply shortfalls from US sanctions against Iran, which will target its oil industry from November.
Because of the sanctions, French bank BNP Paribas said it expected oil production from the Organization of the Petroleum Exporting Countries (OPEC), of which Iran is a member, to fall from an average of 32.1 million barrels per day (bpd) in 2018 to 31.7 million bpd in 2019.
Still, traders said overall market sentiment was cautious because of concerns over the demand outlook amid the trade dispute between the United States and China.
A Chinese trade delegation is due in Washington this week to resolve the dispute, but US President Donald Trump told Reuters in an interview on Monday he does not expect much progress, and that resolving the trade dispute with China will “take time.”
The impact of the Iran sanctions is not yet clear.
China has indicated that it will continue to buy Iranian oil despite the US sanctions.
The Iran supply cut may also be more than compensated for by production increases outside OPEC.
BNP Paribas said non-OPEC output would likely grow by 2 million bpd in 2018 and by 1.9 million bpd next year.
“Depending on when pipeline infrastructure constraints are lifted in the US, non-OPEC supply growth by the end of 2019 may prove higher than currently assumed,” the bank said.
The search for new oil has increased globally in the last two years, with the worldwide rig count rising from 1,013 at the end of July 2016 to 1,664 in August 2018, according to energy services firm Baker Hughes.
The biggest increase was in North America, where the rig count shot up from 491 to 1,057 in the last two years.
How prices develop will also depend on demand.
“We see global oil demand growing by 1.4 million barrels per day in both 2018 and 2019,” BNP Paribas said, implying that global markets are likely to remain sufficiently supplied.