Oil Updates — Crude slides; China's oil output plunges to two-year low

Oil Updates — Crude slides; China's oil output plunges to two-year low
Brent crude futures were down $1.66, or 1.5 percent, at $109.89 a barrel at 0356 GMT. (Shutterstock)
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Updated 16 May 2022

Oil Updates — Crude slides; China's oil output plunges to two-year low

Oil Updates — Crude slides; China's oil output plunges to two-year low

RIYADH: Oil prices fell on Monday, paring early gains as investors took profit from a surge in the previous session, albeit in the shadow of supply fear as the EU prepares an import ban on Russian crude and with a limited increase in OPEC output.

Brent crude futures were down $1.66, or 1.5 percent, at $109.89 a barrel at 0356 GMT, while US West Texas Intermediate (WTI) crude futures dropped $1.55, or 1.4 percent, to $108.94 a barrel.

Both benchmarks, which jumped about 4 percent last Friday, earlier climbed by more than $1 a barrel, with WTI reaching its highest since March 28 at $111.71.

China’s April oil refinery output plunges to a two-year low

China processed 11 percent less crude oil in April than a year earlier, with daily throughput falling to the lowest since March 2020 as refiners slashed operations on weaker demand due to widespread COVID-19 lockdowns.

Crude throughput last month was 51.81 million tons, equivalent to 12.61 million barrels per day (bpd), data from the National Bureau of Statistics showed on Monday.

This compared with 13.8 million bpd in March and 14.09 million bpd in April last year.

Processing volumes for the January-April period were down 3.8 percent on the year at 223.25 million tons or 13.58 million bpd.

(With input from Reuters) 

 


Egypt awaits Saudi PIF’s decision on investing in EGX-listed Egyptalum

Egypt awaits Saudi PIF’s decision on investing in EGX-listed Egyptalum
Updated 14 sec ago

Egypt awaits Saudi PIF’s decision on investing in EGX-listed Egyptalum

Egypt awaits Saudi PIF’s decision on investing in EGX-listed Egyptalum

RIYADH: Egypt is waiting for Saudi Arabia’s Public Investment Fund to make a decision on investing in the state-owned aluminum company Egyptalum by the end of the year, according to Hisham Tawfik, the minister of public enterprise sector.

Tawfik added that the investment includes increasing the company’s capital, rather than selling a stake, he told Asharq.

Talking about investments amounting to $300 million, the minister said it will rehabilitate the factory to produce efficiently for the next 20 years.


Rising fuel prices causing demand destruction, says Vitol exec

Rising fuel prices causing demand destruction, says Vitol exec
Updated 22 min 37 sec ago

Rising fuel prices causing demand destruction, says Vitol exec

Rising fuel prices causing demand destruction, says Vitol exec

RIYADH: The global surge in fuel price is starting to have negative effects on demand, according to a senior executive of the world’s biggest oil dealer.

Mike Muller, who is the head of Asia at Vitol Group, recently told a Dubai-based media Gulf Intelligence that consumers are being badly affected by the price hikes of gasoline, diesel and other oil products.

“There’s very clear evidence out there of economic stress being caused by the high prices, what some people refer to as demand destruction,” he said, Bloomberg reported.

Prices of refined fuels have hit an all-time high in several countries including the US, contributing to a rise in inflation.

The oil prices have risen as a fallout of the changing economic environment due to Russia’s invasion of Ukraine, coupled with supply-chain issues and a western ban on Russian fuel.

According to the latest updates, Brent crude is priced at $111.27 a barrel, while US West Texas Intermediate is priced at $108.09 a barrel.


India In-Focus — Shares slip; India to drop windfall tax if oil prices fall $40 a barrel

India In-Focus — Shares slip; India to drop windfall tax if oil prices fall $40 a barrel
Updated 51 min 52 sec ago

India In-Focus — Shares slip; India to drop windfall tax if oil prices fall $40 a barrel

India In-Focus — Shares slip; India to drop windfall tax if oil prices fall $40 a barrel

MUMBAI: Indian shares began the week on a tepid note on Monday, dragged by metal stocks due to demand worries and weaker sentiment in global markets.

The NSE Nifty 50 index was down 0.3 percent at 15,704, while the S&P BSE Sensex was unchanged at 52,930.86. The indexes rose about 0.3 percent each last week.

India to drop windfall tax if oil prices fall $40 a barrel

India will only withdraw its windfall tax introduced last week for oil producers and refiners if global prices of crude fall as much as $40 a barrel from present levels, Revenue Secretary Tarun Bajaj told Reuters on Monday.

The tax on firms that have increased product exports to gain from higher overseas margins took effect on July 1, as the government moves to boost domestic supply and revenue.

The taxes, and some accompanying export curbs, will hit the earnings of companies such as Reliance Industries, and Nayara Energy, which is partly owned by Russia’s Rosneft, the Oil and Natural Gas Corp., Oil India Ltd. and Vedanta Ltd.

“The taxation would be reviewed every 15 days,” Bajaj said, adding that it would depend on international crude prices. “If crude prices fall, then windfall gains will cease and windfall taxes would also be removed.”

The government believes such windfall gains will cease once prices fall to $40 from existing levels, Bajaj said.


China In-Focus — Yuan inches up; stocks rise; Evergrande canvassing creditors’ support

China In-Focus — Yuan inches up; stocks rise; Evergrande canvassing creditors’ support
Updated 55 min 14 sec ago

China In-Focus — Yuan inches up; stocks rise; Evergrande canvassing creditors’ support

China In-Focus — Yuan inches up; stocks rise; Evergrande canvassing creditors’ support

BEIJING: China’s yuan inched up against the dollar on Monday, underpinned by a narrowing US 10-year yield advantage versus its Chinese counterpart.

Currency traders and investors usually use the yield gap between the world’s two largest economies as a key indicator of the relative value of the two respective currencies.

The yield gap between the benchmark 10-year Chinese bonds and Treasuries narrowed to -3 basis points from roughly -15 bps last week, as US bond prices rose amid worries over a global recession.

In the forward market, the benchmark one-year dollar/yuan swaps bounced to a three-week high of -182.5 points, from -280 points on Friday.

Prior to market opening, the People’s Bank of China set the midpoint rate at 6.7071 per dollar, 208 pips or 0.3 percent weaker than the previous fix 6.6863.

In the spot market, the onshore yuan opened at 6.7010 per dollar and was changing hands at 6.6921 at midday, 99 pips firmer than the previous late session close.

Traders said the strength in the yuan on Monday also came as China’s central bank made the smallest daily cash injection through open market operations in one-and-a-half year, resulting in a net withdrawal of 97 billion yuan ($14.50 billion)for the day. 

Chinese stocks rise 

China stocks rose on Monday supported by healthcare shares and the launch of cross-border investment scheme ETF Connect, while Hong Kong shares slipped weighed by airline operators.

China’s blue-chip index CSI300 rose 0.7 percent and the Shanghai Composite index gained 0.5 percent. In Hong Kong, the benchmark Hang Seng index dipped 0.1 percent.

Evergrande canvassing creditors’ support 

China Evergrande Group is reaching out to its offshore creditors for their support to fight a lawsuit in a Hong Kong court aimed at liquidating the embattled property developer, according to a person with direct knowledge of the matter.

Evergrande, which is deemed to be in default on its nearly $23 billion of offshore debt and is working on a debt restructuring plan, aims to submit the backing of creditors as part of the evidence to the court ahead of the first hearing on the winding-up petition on Aug. 31, the person said.

Last week, Top Shine Global Ltd, an investor in Evergrande unit Fangchebao, said it had filed a winding-up petition against the developer as it had not honored a pact to repurchase shares from Top Shine in Fangchebao.

A successful outcome of the petition could impact the developer’s debt restructuring plan by diminishing the value of the overseas assets that are central to the interests of offshore creditors.

The developer was not considering an out-of-court settlement with Top Shine at the moment, the source said.

 

(With input from Reuters)


UAE In-Focus — Dubai Taxi to test Tesla Model 3; policies approved to expedite circular economy transition

UAE In-Focus — Dubai Taxi to test Tesla Model 3;  policies approved to expedite circular economy transition
Updated 04 July 2022

UAE In-Focus — Dubai Taxi to test Tesla Model 3; policies approved to expedite circular economy transition

UAE In-Focus — Dubai Taxi to test Tesla Model 3;  policies approved to expedite circular economy transition

DUBAI: Dubai’s Roads and Transport Authority has announced that Dubai Taxi Corp. has added Tesla Model 3 to its taxi fleet for a trial after operating 172 Tesla vehicles since 2017, according to the Dubai Media Office.

During the trial run, the vehicle will be deployed on the emirate’s taxi fleet to test its efficiency.

Mattar Al-Tayer, director general and RTA’s board chairman, said: “In 2017, RTA started the operation of 172 Tesla vehicles as part of the limousine fleet of the Dubai Taxi comprising 80 Tesla Model S, 50 Tesla Model X, and 42 Tesla Model 3,” he said.

Al-Tayer noted that these vehicles were highly efficient, especially in terms of carbon emissions and customer satisfaction.

“The success of that experiment prompted us to widen the scope of using electric vehicles as part of the Dubai Taxi fleet over the upcoming years,” he said.

In his view, the experiment supports Dubai’s effort to transform 90 percent of its limo fleet into eco-friendly vehicles by 2026.

Circular economy transition

As part of its drive toward sustainable economic development, the UAE has approved 22 policies aimed at accelerating the country’s transition to a circular economy.

According to the government, the UAE Circular Economy Council’s policies will cover four main sectors: Manufacturing, food, infrastructure, and transportation.

Furthermore, the council identified 16 circular economy activities that offer opportunities for businesses, such as upcycling textile waste into new products and developing AI-driven waste management solutions.

Minister of Climate Change and Environment and Minister of State for Food Security Mariam Almheiri said: “Our current linear economy consumes valuable materials and resources without being able to benefit from them after use, which represents waste in the modern concept of sustainability.”

“Our approach seeks to protect our environment and to ensure the long-term economic and social prosperity of our country,” she added.

Circular economies focus on reducing the extraction of natural resources, minimizing waste, and restoring natural systems.

Renewable energy sources fuel economic activity by maintaining the value of raw materials, components, and products.