Asian oil refiners’ sweet tooth drives changes in purchases

Asian refiners are buying more light crude. (AFP)
Updated 11 September 2019

Asian oil refiners’ sweet tooth drives changes in purchases

  • Refiners have been building secondary units that can further process the residual fuel oil from initial refining of heavy oils into gasoline and diesel

SINGAPORE: Asian refiners are buying more light crude and trimming purchases of heavy oil, as they tweak production to meet demand for low-sulfur shipping fuels.

Asia’s demand for light, low sulfur crude grades, known as sweet crude, produced by countries such as the US, UAE, Brazil and Nigeria has strengthened after the price gap between light and heavy crude narrowed amid record US shale production and heavy oil scarcity.

“The traded crude slate is getting lighter and sweeter. At the same time, expansion of the refining system is geared toward heavier crude,” Vitol’s Global Head of Research Giovanni Serio said at the Asia Pacific Petroleum Conference.

Refiners have been building secondary units that can further process the residual fuel oil from initial refining of heavy oils into gasoline and diesel. The global shift toward lower sulfur fuel for ships from January was supposed to lower heavy, high-sulfur crude prices  but that has not happened.

Instead, US sanctions on Iran and Venezuela and production quotas set by the OPEC have tightened heavy oil supply.

Strong heavy crude prices have reduced the margins for secondary units, prompting refiners to trim output and process more light oil to produce low-sulfur fuel oil or marine gasoil to meet International Maritime Organization specifications.


Bank jobs go as HSBC and Emirates NBD reduce costs

Updated 15 November 2019

Bank jobs go as HSBC and Emirates NBD reduce costs

  • Others have also reduced headcount amid economic downturn and property market weakness

DUBAI: HSBC Holdings has laid off about 40 bankers in the UAE and Emirates NBD is cutting around 100 jobs, as banks in the Arab world’s second-biggest economy reduce costs.

The cuts come amid weak economic growth, especially in Dubai, which is suffering from a property downturn.

HSBC’s redundancies came after the London-based bank reported a sharp fall in earnings and warned of a costly restructuring, as interim CEO Noel Quinn seeks to tackle its problems head-on.

HSBC has about 3,000 staff in the UAE, part of a nearly 10,000-strong workforce in the Middle East, North Africa and Turkey.

The cuts at Dubai’s largest lender Emirates NBD came in consumer sales and liabilities, one source said, while a second played down the significance of the move.

HSBC and Emirates NBD declined to comment.

“The cuts are part of cost cutting and rationalizing to drive efficiencies in a challenging market,” the second source said.

Other banks have also reduced staff this year. UAE central bank data shows local banks laid off 446 people in the 12 months until the end of September. Foreign banks added staff in the same period.

Staff at local banks account for over 80 percent of the 35,518 banking employees in the country.

The merger between Abu Dhabi Commercial Bank, Union Commercial Bank and Al Hilal Bank saw hundreds of redundancies.

Commercial Bank International (CBI) said it would offer voluntary retirement to employees in September, which sources said saw over 100 departures. Standard Chartered, too, cut over 100 jobs in the UAE in September.

Rating agency Fitch warned in September a weakening property market would put more pressure on the UAE’s banking sector.