Oil extends rally to multiyear peaks as energy crunch bites: Energy market wrap

Oil extends rally to multiyear peaks as energy crunch bites: Energy market wrap
Short Url
Updated 11 October 2021

Oil extends rally to multiyear peaks as energy crunch bites: Energy market wrap

Oil extends rally to multiyear peaks as energy crunch bites: Energy market wrap

RIYADH: Oil prices extended gains to scale multiyear peaks on Monday, fueled by the rebound in global demand that has also contributed to power and gas shortages in key economies like China.

Brent crude was up $1.49, or 1.8 percent, at $83.88 a barrel by 01:18 p.m. EDT (1718 GMT), after hitting its highest since October 2018 at $84.60 earlier in the session.

US West Texas Intermediate crude rose $1.69, or 2.1 percent, to $81.03, after touching its highest since late 2014 at $82.18.

Aramco’s Asian customers

Saudi Aramco has agreed to supply additional crude to at least three Asian buyers in November, while meeting full contractual volume for four others, sources with knowledge of the matter told Reuters.

Acquisition

Eneos Holdings, the biggest refinery in Japan, said on Monday it would buy Japan Renewable Energy for about $1.8 billion to expand its low-carbon business, joining a list of major global companies moving away from climate-changing fossil fuels.

China’s rust belt

Analysts and traders forecast a 12 percent drop in industrial power consumption in the fourth quarter this year because coal supply is expected to fall short this winter in China’s northeast rust belt.

Liaoning province issued its second-highest alert level, which indicates a power shortage equivalent to 10-20 percent of total demand for power, warning that the shortfall could reach nearly 5 GW.

LNG 

China’s ENN Natural Gas Co. Ltd. signed a long-term deal to buy liquefied natural gas from Cheniere Energy, the company said on Monday. The deal starts in July 2022, is for 900,000 tons of LNG a year, and was purchased on a free-on-board basis, it added.

Emissions

Australian Energy Minister Angus Taylor on Monday rejected a call from a lobby group for the country’s biggest companies to set stricter emissions limits on polluters but gave no indication what targets the government may announce ahead of UN climate talks this month.

“A substantial tightening of the Safeguard Mechanism is a backdoor carbon tax consumers will ultimately have to pay for, and that's not acceptable,” Taylor said at a conference organized by the Australian Financial Review.

Canada, Nigeria, Japan, and Pakistan are among 31 parties to join a global pledge, led by the US and EU, to slash planet-warming methane emissions by 30 percent by the end of the decade, US climate envoy John Kerry announced on Monday.

Shale oil and gas producer APA Corp. on Monday said it has ended routine gas flaring in the US, after demands from environmentalists and investors to reduce carbon emissions, to counter global warming.


Ryanair not sure it will hit 12.5% 2030 sustainable fuel target

Ryanair not sure it will hit 12.5% 2030 sustainable fuel target
Getty Images
Updated 15 sec ago

Ryanair not sure it will hit 12.5% 2030 sustainable fuel target

Ryanair not sure it will hit 12.5% 2030 sustainable fuel target
  • O'Leary said he was concerned that increasing use of sustainable aviation fuels could have an upward impact on food prices

Ryanair is not sure it will reach its "very ambitious target" of powering 12.5 percent of its flights with sustainable aviation fuels by 2030, Group Chief Executive Michael O'Leary told CNBC television on Thursday.


But he said Ryanair, Europe's largest low-cost airline, was confident of reaching at least 10 percent and called for the European Union to set a similar target.


"The European Union has set a target of 5 percent of sustainable aviation fuel by 2030," O'Leary told the television station. "We think we can do better than that – I think we'll get to 10 percent."


"Whether we can get to 12.5 percent, I'm not sure, but I know if we don't invest in the research and that technology now, we certainly won't get there," O'Leary said, referring to a target Ryanair set in April.


O'Leary said he was concerned that increasing use of sustainable aviation fuels could have an upward impact on food prices.


FII is now a US-registered international organization: CEO

FII is now a US-registered international organization: CEO
Updated 16 min 38 sec ago

FII is now a US-registered international organization: CEO

FII is now a US-registered international organization: CEO

The head of the Future Investment Initiative Institute (FII) has said that the nonprofit foundation is now an international organization which is registered in the United States.

Speaking in a press conference in Riyadh today, Richard Attias added there are plans to build offices in Asia soon.

The chief executive officer pointed out that to build credibility, the organization must have sponsors. While they are a part of the organization now, he remarked that it was not easy to attract the likes of HSBC and Zoom.

The FII's chief operating officer Rakan Tarabzoni also said the foundation is now independent from the PIF and is focusing on promoting thinking and investments in startups among other areas.


Egypt's non-oil exports rose to $2.56 billion in September

Egypt's non-oil exports rose to $2.56 billion in September
Getty Images
Updated 33 min 40 sec ago

Egypt's non-oil exports rose to $2.56 billion in September

Egypt's non-oil exports rose to $2.56 billion in September
  • This reflects the efforts made by the government to support the production and export sectors during the pandemic

Egypt's non-oil exports saw a significant annual increase during September, recording a 16 percent rise as it reached $2.56 billion compared to $2.12 billion in September 2020.

Nevin Gamea, the Egyptian Minister of Trade and Industry, said the country's imports witnessed a noticeable decline of 7 percent during the month of September, reaching $4.9 billion, compared to $5.29 billion in the same month of last year. 

This contributed to a 24 percent decrease in the trade balance deficit as it stood at $2.3 billion last month, compared to $3.8 billion during September the year prior. 

Gamea explained the positive developments achieved during September come as a continuation of the expanding Egyptian merchandise exports since the beginning of this year — growing by 25 percent during the first nine months of 2021 compared to the same period last year. 

This reflects the efforts made by the government to support the production and export sectors during the pandemic, which contributed to the preservation of the export markets.

She pointed out that Egyptian exports to the European Union increased to $739 million in September, compared to $463 million during the same period last year.

Exports to the United States experienced a 52 percent rise to reach $205 million, compared to $135 million during the same period last year. Exports to African countries — excluding Arab countries — rose by 31 percent as well.

Gamea noted that exports of the printing, packaging, paper, literary and artistic works sector and the engineering and electronic goods sector had the highest growth rates at 76 percent and 34 percent respectively when compared to the same period in 2020.

The markets that received the highest levels of Egyptian exports in September included the US, Saudi Arabia and Italy while imports to Egypt were largely from China, the US and Germany.


Kuwait has begun increasing oil production: KUNA

Kuwait has begun increasing oil production: KUNA
Updated 39 min 31 sec ago

Kuwait has begun increasing oil production: KUNA

Kuwait has begun increasing oil production: KUNA

 Kuwait has begun to increase its crude production in accordance with an agreement reached by the Organisation of Petroleum Exporting Countries and its allies, a group known as OPEC+, Oil Minister Mohammad al-Fares said on Thursday.


The minister, cited by the state news agency KUNA, said Kuwait's plans to increase output includes production from the shared zone with Saudi Arabia.

Separately the foreign minister added that the Arab League supports holding elections in Libya on time on December 24 and that all foreign forces should leave the country as stipulated by UN resolutions.


Egypt aims to boost renewable energies to over 42% by 2035: Electricity minister

Egypt aims to boost renewable energies to over 42% by 2035: Electricity minister
Getty Images
Updated 54 min 5 sec ago

Egypt aims to boost renewable energies to over 42% by 2035: Electricity minister

Egypt aims to boost renewable energies to over 42% by 2035: Electricity minister
  • The minister indicated that Egypt is the largest holder of electrical capacities in the MENA region

Egypt will aim to increase the share of renewable energies to over 42 percent by 2035, after the country reached 2022’s target for boosting renewables to 20 percent early this year. 

The minister of electricity and renewable energy, Mohamed Shaker, noted that Egypt has allocated 7,650 square kilometres of unused lands to new and renewable energy projects, during a meeting with CEO of Lekela Power, Chris Antonopoulos. 

The minister indicated that Egypt is the largest holder of electrical capacities in the MENA region and has the capacity to produce up to 90 gigawatts of wind and solar capacity, citing Wind Atlas. 

The meeting was held to support and enhance cooperation between Egypt’s electricity sector and the company, which boasts high expertise in the field of wind energy power plants.