WEEKLY ENERGY RECAP: Price up despite rising stockpiles

In this Nov. 22, 2013 file photo, the Centenario deep-water drilling platform stands off the coast of Veracruz, Mexico in the Gulf of Mexico. (AP)
Updated 10 November 2019

WEEKLY ENERGY RECAP: Price up despite rising stockpiles

  • The consecutive drops in the US rig count makes WTI crude oil prices at the level of mid or low $50s unsustainable

Crude prices gained over the week despite the huge weekly build in US inventories as reported by the Energy Information Administration (EIA). Stockpiles rose by 7.9 million barrels, taking the cumulative increase to 30 million barrels over the last seven weeks. Brent crude rose to $62.51 per barrel while WTI advanced to 57.24.
Bullish signs for the oil price continue to emerge amid positive China manufacturing data and falling US rig counts. The number of US oil and gas rigs fell for the 11th time in the last 12 weeks. According to Baker Hughes, the total number of active oil rigs in the US decreased to 684. This brings the total oil and gas rig count down to 817, which is 250 rigs down from this time last year.
The consecutive drops in the US rig count makes WTI crude oil prices at the level of mid or low $50s unsustainable.
It also raises questions about the production forecasts being put out by the EIA as well as the International Energy Agency (IEA) and the narrative that suggests there will still be plenty of oil being produced even if prices remain in the low $50s range.
Although economic uncertainty continues to dominate the market, the upward momentum in oil prices encouraged money managers to increase their net-long positions in Brent and WTI crude oil futures for the third week in a row, after months of pessimism.
This is underpinning trading volumes in Brent and WTI, despite concerns about slowing global growth, the US-China trade war and other geopolitical factors that may have otherwise pointed to a supply glut. Brent crude oil futures and options money managers increased their net-long positions by 28,353 contracts to 282,352 contracts in the week ending Nov. 5. WTI net long positions grew by 11,793 contracts to 116,468 over the same period.

Faisal Faeq is an energy and oil marketing adviser. He was formerly with OPEC and Saudi Aramco. Twitter:@faisalfaeq


A Jordan startup delivers eco-friendly alternative to dry cleaning

Updated 05 December 2019

A Jordan startup delivers eco-friendly alternative to dry cleaning

  • Products used by WashyWash are non-carcinogenic and environmentally neutral
  • Amman-based laundry service aims to relocate to a larger facility in mid-2020

AMMAN: A persistent sinus problem prompted a Jordanian entrepreneur to launch an eco-friendly dry-cleaning service that could help end the widespread use of a dangerous chemical.

“Dry cleaning” is somewhat of a misnomer because it is not really dry. It is true that no water is involved in the process, but the main cleaning agent is perchloroethylene (PERC), a chemical that experts consider likely to cause cancer, as well as brain and nervous system damage.

Kamel Almani, 33, knew little of these dangers when he began suffering from sinus irritation while working as regional sales director at Eon Aligner, a medical equipment startup he co-founded.

The problem would disappear when he went on vacation, so he assumed it was stress related.

However, when Mazen Darwish, a chemical engineer, revealed he wanted to start an eco-laundry and warned about toxic chemicals used in conventional dry cleaning, Almani had an epiphany.

“He began to tell me how PERC affects the respiratory system, and I suddenly realized that it was the suits I wore for work — and which I would get dry cleaned — that were the cause of my sinus problems,” said Almani, co-founder of Amman-based WashyWash.

“That was the eureka moment. We immediately wanted to launch the business.”

WashyWash began operations in early 2018 with five staff, including the three co-founders: Almani, Darwish and Kayed Qunibi. The business now has 19 employees and became cash flow-positive in July this year.

“We’re very happy to achieve that in under two years,” Almani said.

The service uses EcoClean products that are certified as toxin-free, are biodegradable and cause no air, water or soil pollution.

Customers place orders through an app built in-house by the company’s technology team.

WashyWash collects customers’ dirty clothes, and cleans, irons and returns them. Services range from the standard wash-and-fold to specialized dry cleaning for garments and cleaning of carpets, curtains, duvets and leather goods.

“For wet cleaning, we use environmentally friendly detergents that are biodegradable, so the wastewater doesn’t contain any toxic chemicals,” Almani said.

For dry cleaning, WashyWash uses a modified hydrocarbon manufactured by Germany’s Seitz, whose product is non-carcinogenic and environmentally neutral.

A specialized company collects the waste and disposes of it safely.

The company has big ambitions, planning to expand its domestic operations and go international. Its Amman site can process about 1,000 items daily, but WashyWash will relocate to larger premises in mid-2020, which should treble its capacity.

“We’ve built a front-end app, a back-end system and a driver app along with a full facility management system. We plan to franchise that and have received interest from many countries,” Almani said.

“People visiting Amman used our service, loved it, and wanted an opportunity to launch in their countries.”

WashyWash has received financial backing from angel investors and is targeting major European cities initially.

“An eco-friendly, on-demand dry-cleaning app isn’t available worldwide, so good markets might be London, Paris or Frankfurt,” Almani said.

 

• The Middle East Exchange is one of the Mohammed bin Rashid Al-Maktoum Global Initiatives that was launched to reflect the vision of the UAE prime minister and ruler of Dubai in the field of humanitarian
and global development, to explore the possibility of changing the status of the Arab region. The initiative offers the press a series of articles on issues affecting Arab societies.