Goldman Sachs says global oil reserves release ‘a drop in the ocean’

Goldman Sachs says global oil reserves release ‘a drop in the ocean’
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Updated 24 November 2021

Goldman Sachs says global oil reserves release ‘a drop in the ocean’

Goldman Sachs says global oil reserves release ‘a drop in the ocean’

SINGAPORE: A coordinated release from government oil reserves led by the US may add about 70 million to 80 million barrels of crude supply, smaller than the more-than-100 million barrels the market has been pricing in, analysts at Goldman Sachs said.

“On our pricing model, such a release would be worth less than $2/bbl, significantly less than the $8/bbl sell-off that occurred since late October,” the bank said in a note titled “A drop in the ocean.” 

Global oil prices rebounded to a one-week high on Tuesday after the move by the US and other consumer nations to release oil from strategic petroleum reserves (SPR) to try to cool the market fell short of some expectations.

On Wednesday, US West Texas Intermediate crude was down 35 cents to $78.15 a barrel by 0031 GMT.

“The aggregate size of the release of about 70-80 mb (million barrels) was smaller than the 100+ mb the market had been pricing in, with the swap nature of most of these barrels implying an even smaller, about 40 million barrels net, increase in oil supplies over 2022-23,” Goldman said.

“That is in the context of a market drawing up to 2mb/d at present.”

Brent crude prices have also priced in an additional hit to global oil demand of 1.5 million barrels per day for the next three months from the impact of COVID-19 in Europe and China, Goldman said.

“We view these as likely excessive concerns over the next three months, leaving the recent sell-off overshooting fundamentals due to the year-end decline in trading activity,” the bank said.

While the coordinated government stock releases would warrant a $2 a barrel downgrade to the bank’s year-end Brent price forecast, it expects the lack of progress on negotiations with Iran to offset risks.

Global powers and Iran will meet on Monday to revive talks on a nuclear deal that could lift US sanctions on Iranian oil, allowing Tehran to increase exports.

“In addition, OPEC could consider halting its production hikes to offset the detrimental SPR impact of lower oil prices on the needed recovery in global oil capex, likely justifying such action as prudent in the face of COVID demand risks,” the bank said.


BitMart pledges to compensate users for $150m hack: Crypto Wrap

BitMart pledges to compensate users for $150m hack: Crypto Wrap
Updated 12 sec ago

BitMart pledges to compensate users for $150m hack: Crypto Wrap

BitMart pledges to compensate users for $150m hack: Crypto Wrap

RIYADH: Crypto exchange BitMart has experienced a security breach that has led to hackers withdrawing around $150 million in cryptocurrency, Bloomberg reported.

Blockchain security firm PeckShield estimates the total loss could run as high as $200 million.

Last week, BitMart closed a Series B funding round led by New York-based private equity firm Alexander Capital Ventures that valued the crypto exchange at more than $300 million.

BitMart will use its own funding to compensate users affected by this hack, according to CEO Sheldon Xia's tweet.

“No user assets will be harmed,” he tweeted, adding the company expects to resume deposit and withdrawal functions on Tuesday.

Also last week, crypto lender Celsius network, which has raised funds from major investors including Canadian pension fund Caisse de Dépôt et Placement du Québec, confirmed that it lost funds as a result of the hack of BadgerDAO, a decentralized finance platform.

Mining

Authorities in Russia and Ukraine have shut down a number of farms involved in the illegal mining of cryptocurrencies allegedly powered by stolen electricity.

"An audit revealed an unauthorized connection to the power grid, theft of electricity and illegal seizure of land for the operation of equipment designed to perform cryptographic calculations related to the mining of digital currencies," Ekaterina Korotkova from the Moscow Interregional Transport Prosecutor’s Office said.

The cost of illegally consumed electricity used to operate mining equipment exceeds 500,000 rubles per day ($7,000), Korotkova explained.

The authorities have filed a criminal case and intend to prosecute the owners of the crypto-mining facility.

Trading

Bitcoin, the leading cryptocurrency in trading internationally, traded higher on Tuesday, rising by 5.39 percent to $51,010 at 4:43 p.m Riyadh time.

Ether, the second most traded cryptocurrency, traded at $4,355, up 7.47 percent, according to data from Coindesk.


Hilton plans to boost Saudi hotel portfolio, says tourism minister

Hilton plans to boost Saudi hotel portfolio, says tourism minister
Updated 2 min ago

Hilton plans to boost Saudi hotel portfolio, says tourism minister

Hilton plans to boost Saudi hotel portfolio, says tourism minister

RIYADH: Hilton plans to increase the number of its hotels in Saudi Arabia from 15 to 75, the Saudi tourism minister said on Tuesday.

 


Saudi sukuk market sees three special deals worth $13.7m

Saudi sukuk market sees three special deals worth $13.7m
Updated 8 min 23 sec ago

Saudi sukuk market sees three special deals worth $13.7m

Saudi sukuk market sees three special deals worth $13.7m

RIYADH: Three special deals were completed on Tuesday in the Saudi sukuk and bond market, with a total value of SR51.7 million ($13.7 million), Argaam reported.

Special deals are orders executed when a seller and a buyer agree to trade specific securities at a certain price in order to comply with the Saudi Stock Exchange, Tadawul. 

Tadawul reported that controls and the regulations are issued by the relevant Capital Market Authority. 

Also, special deals do not affect the price of the last deal, the highest or lowest price of the instrument, the opening or closing price, the market index or sector indices.


UAE sees $3.5bn deal to build world’s largest polyolefin plastics plant

UAE sees $3.5bn deal to build world’s largest polyolefin plastics plant
Updated 13 min 31 sec ago

UAE sees $3.5bn deal to build world’s largest polyolefin plastics plant

UAE sees $3.5bn deal to build world’s largest polyolefin plastics plant

ROME: The owners of the Borouge polyolefin plant in the UAE have signed a $3.5 billion contract to extend the site, which will make it the biggest plastics plant of its kind in the world.

Italian oil and gas engineer Maire Tecnimont has been awarded the contract to work on the Borouge 4 facility, which will be built at the existing complex in Ruwais, the company said in a statement.

A joint venture between the Abu Dhabi National Oil Company and Austrian chemicals group Borealis, the new plant will boost production to 6.4 million tons of polyolefin when work is complete in 2025.

Polyolefin is used to make a range of products such as industrial-grade pipes, cables, films and personal protective equipment.

Maire Tecnimont has signed a series of three engineering, procurement, and construction contracts with the Abu Dhabi Polymers Company.

These include the building of two polyethylene units with a capacity of 700,000 tons per year each.

The Italian business said the project will also include a range of engineering and construction work, equipment and material supply, as well as “commissioning and startup assistance.”

Maire Tecnimont Group CEO Pierroberto Folgiero said: “Our portfolio of digital solutions combined with our technology-driven process expertise will ensure the highest plant assets’ optimization and the best environmentally performing standards.”

Last month, ADNOC and Borealis signed a $6.2 billion deal to extend the Borouge complex.

The joint venture partners also said they would prepare studies for a carbon capture unit to cut CO2 emissions by 80 percent.

The unit may be in operation in time for the start of Borouge 4.
The first Borouge plant was commissioned in 2001, and was followed by Borouge 2 in 2010 and Borouge 3 in 2014. 

The complex produces polypropylene, polyethylene as well as polyolefin plastic.


Saudi-based fintech NQOODLET raises $1m in funding round

Saudi-based fintech NQOODLET raises $1m in funding round
Updated 17 min 10 sec ago

Saudi-based fintech NQOODLET raises $1m in funding round

Saudi-based fintech NQOODLET raises $1m in funding round

RIYADH: Saudi-based expense management fintech platform NQOODLET has raised $1 million in a pre-seed funding round.

The Riyadh-located company will use the funds to build its infrastructure and launch its card and platform, according to MAGNiTT.

The funding was led by angel investor Yaser Alghamdi with the participation of the Saudi Venture Capital Company. OMQ investments also participated in the round.

As of 2020 there are around 600,000 SMEs in the Saudi market generating about $89 billion revenue and employing 8 million employees, cofounder Mohamed Milyani said.

“We can capitalise on this number to help provide and manage travel expenses and even provide an employee card for salaries,” he said.

Founded in 2021, NQOODLET provides a digital platform for SMEs to manage their expenses, purchases, and register bills directly through corporate cards.