Oil nations to do ‘whatever necessary’ to balance market: UAE

Top oil producers will consider fresh output cuts at a meeting this week, but analysts are doubtful they will succeed in bolstering crude prices dented by the US-China trade war. (AFP)
Updated 08 September 2019

Oil nations to do ‘whatever necessary’ to balance market: UAE

  • The UAE energy minister said oil producers were affected by “other concerns” apart from supply and demand
  • The four-day World Energy Congress starts Monday in Abu Dhabi, where a key meeting of oil ministers will also be held

ABU DHABI: Oil producers will do “whatever necessary” to rebalance a crude market depressed by trade tensions and an uncertain global outlook, the United Arab Emirates’ energy minister said Sunday.
Suheil Al-Mazrouei warned however that with the US-China trade row hanging over the world economy, additional output cuts may not be the best way to boost sagging prices.
Deeper production cuts are “not a decision that we take easily,” the minister said ahead of the four-day World Energy Congress starting Monday in Abu Dhabi, where a key meeting of oil ministers will also be held on Thursday.
Mazrouei told a press conference that oil producers were affected by “other concerns” apart from supply and demand.
“Anything that the group sees that will balance the market, we are committed to discuss it and hopefully go and do whatever necessary,” he said.
“But I wouldn’t suggest to jump to cuts every time that we have an issue on trade tensions.”
The Joint Ministerial Monitoring Committee (JMMC), created by an alliance of OPEC oil cartel members and other crude exporters, is scheduled to meet on Thursday to assess the oil market.
European benchmark Brent was selling at $61.54 per barrel on Friday, down from more than $75 this time last year.
OPEC+, dominated by the group’s kingpin Saudi Arabia and non-OPEC production giant Russia, has resorted to massive production cuts to lift prices since the oil market crash in mid-2014.
In June, the group extended by nine months an earlier reduction of 1.2 million barrels per day, but the move has failed to arrest the price decline in light of a faltering global economy.
The one-day JMMC meeting is not set to make decisions but will assess the market and make recommendations to the next full ministerial meeting, to be held in December.
Mazrouei noted that the usual levers to control prices seemed to be having little effect.
The oil market is being affected by factors beyond “supply and demand... which is the main thing that we can control,” he said.


Higher impairment charges hit UAE banks Emirates NBD and ADCB

Updated 23 min 40 sec ago

Higher impairment charges hit UAE banks Emirates NBD and ADCB

DUBAI: Dubai's biggest lender Emirates NBD reported a 15 percent drop in fourth-quarter earnings on Monday, below analysts' forecasts, on a jump in impairment charges, sending its shares down around 1 percent.

The bank booked impairment charges of 2.06 billion dirhams ($560.88 million) in the quarter, up more than three times from a year earlier due to higher bad debt charges as it consolidated results of newly acquired Turkish lender DenizBank.

Even without DenizBank, impairment charges were up 78 percent on lower writebacks and recoveries. The bank did not give details of these charges.

Banks in the United Arab Emirates (UAE) are bracing for more writedowns from the real sector amid a downturn, especially in the Dubai property market.

Fitch Ratings recently warned a weakening property market in the UAE was likely to put more pressure on the asset quality of the banking sector.

Emirates NBD reported a net profit of 2.02 billion dirhams in the fourth-quarter, down from 2.39 billion dirhams in the same period a year earlier. EFG Securities had projected a net profit of 2.45 billion dirhams.

Full year profit, however, surged 44 percent, underpinned by double-digit growth in net interest income, stronger loan growth and gains from the listing of the bank's unit Network International.

Separately, Abu Dhabi Commercial Bank, the UAE's third-biggest bank, also reported a 16 percent drop in fourth-quarter profit on Monday, hurt by an increase in impairment charges.

Emirates NBD said it expected the Expo 2020 world fair to support multiple sectors in Dubai, but a softening real estate market remained a risk for 2020.