BP boss forecasts balanced oil market in second half of 2016

BP boss forecasts balanced oil market in second half of 2016
Updated 10 February 2016

BP boss forecasts balanced oil market in second half of 2016

BP boss forecasts balanced oil market in second half of 2016

LONDON: BP boss Bob Dudley said he was “very bearish” on oil prices for the first half of 2016, but forecast supply and demand would balance in the second half.

“We have been bearish for two years now on the price of oil and we are very bearish on this first half of the year,” Dudley told the International Petroleum Week industry conference in London, indicating that price levels would remain subdued.
“I think it’s going to be a very choppy and volatile first half of the year.
“Some time in the second half of the year, in the third or fourth quarter, we actually believe the daily supply and demand” will be balanced, he added.
“By that time, every storage tank and swimming pool in the world will be full of oil. And then ... the market then starts to pull the plug.
“And I think we will begin to see the fundamentals (of supply and demand) take over.”
Crude prices have crashed from peaks above $100 per barrel in mid-2014 to under $30, hit by chronic oversupply, weak demand and a slowdown in the global economy — particularly key consumer China.
Brent and New York oil prices had slumped on January 20 to 12-year lows at $27.10 and $26.19 per barrel respectively.
Prices were approximately $2-3 above those levels in afternoon deals on Wednesday.
The precipitous drop in the cost of oil has slashed the profits of energy companies, prompting them to axe thousands of jobs, slash investment and restructure for a low-price environment.
“I don’t think we will see $100 oil for a while, and I agree ... now is probably not the right time to prophesize prices but the commodities cycle is not over,” added Dudley on Wednesday.
He said that about “$400 billion of projects have been deferred or canceled” by the global energy sector in response to collapsing oil prices.
“Some groups can see a trillion dollars worth of activity being deferred over the next three years.
“That’s going to lead to another reaction” in the oil market, he warned.
BP last week posted the company’s biggest loss in at least 20 years, ravaged by tumbling oil prices, and axed another 3,000 jobs.
The latest job cuts take BP’s total cull to 11,000 positions since the start of 2015.
The group suffered a loss after taxation of $6.48 billion (5.97 billion euros) last year, compared with a net profit of $3.78 billion in 2014.


King Salman Energy Park signs anchor tenants

King Salman Energy Park signs anchor tenants
Updated 21 min 37 sec ago

King Salman Energy Park signs anchor tenants

King Salman Energy Park signs anchor tenants
  • President and CEO of SPARK Saif Al-Qahtani: SPARK is proud to welcome TAQA and AMCO as they take the first step toward launching their operations
  • By 2035, the park is expected to contribute more than SR22 billion to the Kingdom’s gross domestic product

RIYADH: King Salman Energy Park (SPARK), the Dammam-based project backed by Saudi Aramco, added two new anchor tenants on Thursday, the Abu Dhabi National Energy Company (TAQA) and AMCO.

President and CEO of SPARK Saif Al-Qahtani said: “SPARK is proud to welcome TAQA and AMCO as they take the first step toward launching their operations. SPARK sits at the heart of the energy market, offering a world-class ecosystem that facilitates the growth of our tenants’ businesses and brings sustained value to our wider communities. SPARK is set to be a fully integrated city, bringing together major national and international companies and fuelling economic growth and job creation.”

TAQA will expand its local operations with the TAQA Industrial Park at SPARK, including a new facility for oilfield services, a specialist unit for engineering and manufacturing, and a wireline and perforation center of excellence.

The facilities will be constructed in two phases starting in the second quarter of 2021, with the design and developmental planning stages having already commenced.

TAQA CEO Khalid Nouh said: “With our plans for future acquisitions focused on cutting-edge technology and innovative solutions, we further cement our alignment with Vision 2030 and the government’s drive to diversify and localize services and manufacturing in the Kingdom.”

AMCO is investing over SR260 million ($69.33 million) in a new center at SPARK. Its plans include the development of facilities to enable the manufacturing and production of steel pipes, valves, pumps, turbines, and machine and rotary equipment.

AMCO’s facilities will be developed in three phases, allowing for the gradual build-up of manufacturing capabilities and onboarding of local talent.

By 2035, the park is expected to contribute more than SR22 billion to the Kingdom’s gross domestic product, provide up to 100,000 direct and indirect jobs and localize more than 350 new industrial and service facilities.


Saudi Arabia to ship gas to South Korea and take CO2 back

Saudi Arabia to ship gas to South Korea and take CO2 back
Updated 25 min 17 sec ago

Saudi Arabia to ship gas to South Korea and take CO2 back

Saudi Arabia to ship gas to South Korea and take CO2 back
  • Hyundai to take LPG cargoes
  • CO2 sent back to use in oil fields

RIYADH: Saudi Arabia plans to ship gas to South Korea where it will be used to make hydrogen, and the carbon dioxide produced in the process will be transported straight back to the Kingdom, Asharq reported, citing Bloomberg.

Hyundai Oil Bank Co. will take liquefied petroleum gas cargoes from Saudi Aramco and convert them into hydrogen, to use for chemical and power solutions, the Korean energy company’s parent Hyundai Heavy Industries Holdings Company said.

Aramco and Hyundai OilBank Co. agreed in the deal signed on Wednesday, that the carbon dioxide emitted in the hydrogen-making process will be transported back to Aramco, to use it in its oil production facilities, according to a Hyundai Heavy spokesman.

“It seems the project will bank on the idea that shipping LPG to Korea and carbon dioxide back to Saudi Arabia will be cheaper than shipping hydrogen to Korea,” said Martin Tengler, BloombergNEF’s lead hydrogen analyst.

Saudi Aramco has huge quantities of natural gas, which it has identified as a key area of expansion for domestic supply and export in the form of liquefied natural gas (LNG).

“We basically look at natural gas as an area for growth for the company,” Khalid Al-Dabbagh, Aramco’s chief financial officer, said in an investor call in the run-up to its successful IPO back in 2019.


GRAPHIC: From Beirut to Damascus currencies take a battering

GRAPHIC: From Beirut to Damascus currencies take a battering
Updated 56 min 55 sec ago

GRAPHIC: From Beirut to Damascus currencies take a battering

GRAPHIC: From Beirut to Damascus currencies take a battering

Lebanon’s president this week ordered the central bank governor to open an investigation into currency speculation, after the Lebanese pound plunged to record lows on the black market.
But the battered Lebanese pound is not alone among regional currencies that have been decimated by the impact of the pandemic and other factors.
The Syrian pound also fell to a record low on the black market this week, dragged down by its close commercial and banking ties with Lebanon.
“Businessmen and traders are fretting over fears of a free-fall in coming days and watching if unrest grows in Lebanon and its impact on dealings since Lebanon is our lifeline to the outside world,” said one Damascus-based trader told Reuters, who requested anonymity.


Oil prices rise after Saudi minister urges caution on market

Oil prices rise after Saudi minister urges caution on market
Updated 04 March 2021

Oil prices rise after Saudi minister urges caution on market

Oil prices rise after Saudi minister urges caution on market
  • OPEC and allies meet today
  • Oil price rises ahead of meeting

LONDON Oil prices rose more than $1 per barrel on Thursday after Saudi Energy Minister Prince Abdul Aziz bin Salman urged caution and vigilance at the beginning of a meeting of OPEC ministers and their allies about the future of supply cut
Brent crude futures were up $1.11, or 1.7 percent, at $65.18 a barrel while U.S. West Texas Intermediate (WTI) crude rose $1.07, or 1.8 percent to $62.35.
Ministers from OPEC members and their allies started a meeting to discuss the future of an oil output cut at 1300 GMT.
Analysts and traders say a four-month price rally from below $40 a barrel is now out of step with demand and that physical sales are not expected to match supply until later in 2021.
In the United States, despite a record surge of more than 21 million barrels in crude oil stockpiles last week, gasoline stocks fell by the most in 30 years as refining plunged to a record low because of the Texas freeze.


Saudi energy minister: Recovery in oil demand related to speed of COVID-19 vaccine distribution

Saudi energy minister: Recovery in oil demand related to speed of COVID-19 vaccine distribution
Updated 38 min 28 sec ago

Saudi energy minister: Recovery in oil demand related to speed of COVID-19 vaccine distribution

Saudi energy minister: Recovery in oil demand related to speed of COVID-19 vaccine distribution

LONDON: The recovery in oil demand is related to the speed of COVID-19 vaccine distribution, Saudi Arabia’s energy minister said on Thursday.

Speaking at the opening of a meeting of the Organization of the Petroleum Exporting Countries, Russia and its allies, a group known as OPEC+, Prince Abdulaziz bin Salman said that the Kingdom has “contingency and backup plans in case unforeseen things happen,” Al-Ekhbariya reported. 

He added that the situation in the oil market had improved but the outlook for a recovery in demand remained uncertain.

Ministers from OPEC members and their allies started a meeting to discuss the future of an oil output cut at 01:00 P.M. GMT.