WEEKLY ENERGY RECAP: Spot market tightens

Oil prices were relatively steady with Brent crude holding above $63 per barrel near an eight-week high. (Reuters/File)
Updated 23 November 2019

WEEKLY ENERGY RECAP: Spot market tightens

  • US crude inventories rose by 1.8 million barrels despite refinery runs increasing by 519,000 bpd

Oil prices were relatively steady with Brent crude holding above $63 per barrel near an eight-week high and WTI finishing above $57 per barrel.

The physical spot market is getting tighter and strong demand for Arabian Gulf medium sour crude has reflected that trend.

So as yet, there are no signs of any weaker oil demand as had been anticipated.

Both OPEC and the International Energy Agency (IEA) have pointed to a swelling oil glut next year due to booming non-OPEC supplies, especially in the US.

The physical market tells a different story. The scenarios envisaged by both OPEC and the IEA are based around unrealistic outlooks that focus on lower projected oil demand as a likely consequence of the ongoing trade war between the US and China. As a result, the pair have warned about a looming supply glut which could emerge in 2020.

But again, the real physical market tightness suggests otherwise.

US crude inventories rose by 1.8 million barrels despite refinery runs increasing by 519,000 bpd. However, US crude in storage at the Cushing, Oklahoma, delivery hub for WTI fell 2.3 million barrels, which represents the biggest drawdown in three months, as reported by the IEA.

The US oil and gas rig count continued to fall in what was the 13th drop for the past 14 weeks. 

According to Baker Hughes, the US oil rig count is down three from last week to 671, with gas rigs unchanged at 129. US shale oil rigs also continued to drop.

The overall positive demand picture has encouraged money managers to continue to increase their net-long positions in Brent crude oil futures for the 4th consecutive week in a row. That followed nine months of decline.

Brent crude oil futures and options money managers increased their net-long positions by by 543 contracts to 311,304 in the week ending Nov. 19.

However, they cut net long positions in WTI crude oil futures and options by 19,593 contracts to 133,581, over the same period.


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.