Saudi energy minister asks if NOPEC bill to be applied to consumers managing the market

Update Saudi energy minister asks if NOPEC bill to be applied to consumers managing the market
Saudi Energy Minister Abdulaziz bin Salman addresses the 29th annual Middle East Petroleum and Gas conference in the Bahraini capital Manama. (AFP)
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Updated 17 May 2022

Saudi energy minister asks if NOPEC bill to be applied to consumers managing the market

Saudi energy minister asks if NOPEC bill to be applied to consumers managing the market

Saudi Energy Minister Abdulaziz bin Salman said that oil consuming nations are also trying to manage the oil market, thus questioning if the new US bill would aim at them as well.

Talking about the US bill, dubbed NOPEC, that could open members of OPEC and its partners to antitrust lawsuits for orchestrating supply cuts that raise global crude prices, Prince Abdulaziz questioned whether it would also apply to consuming nations which have released crude from strategic reserves in an attempt to manage the market.

While talking at the opening of the 29th Middle East Petroleum and Gas Conference in Bahrain, the energy minister revealed that oil demand has increased post-pandemic, but there is no refining capacity commensurate with the current demand.

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He also made it clear that there are no issues surrounding the availability of crude. 

"We have no money to waste on anywhere else," he told the conference.

“It is not only OPEC that is trying to manage the market, it is also the consumers...so I don’t know about this NOPEC if it is going to be inclusive of all or just those who are producing?” he told the conference.

The minister has said the Kingdom could produce between 13.2-13.4 million barrels of oil per day by the end of 2026 or beginning of 2027 thanks to increased output in the divided zone.




Saudi Energy Minister Abdulaziz bin Salman addresses the 29th annual Middle East Petroleum and Gas conference in the Bahraini

Durra gas field

On the Durra natural gas field, located in an energy-rich area shared with Kuwait, the minister said both countries were proceeding with its development.

Iran says it has a stake in the field and considers a Saudi-Kuwaiti agreement signed earlier this year to develop it “illegal.”

Saudi Arabia and Kuwait invited Iran in April to hold negotiations to determine the eastern limit of the joint offshore area and reaffirmed their right to develop the gas field located within it.

“We are proceeding with that field, we have made a joint public statement encouraging Iran to come to the negotiation table if they claim they have a piece of that and it remains a claim,” Prince Abdulaziz said, adding Saudi Arabia and Kuwait wanted to work together in any discussions as they had a common interest in the resources.

Prince Abdulaziz also took a swipe at world leaders claiming there is a transition to cleaner energy sources, saying that countries are buying coal for almost four times the previous price and also telling France not to push ahead with new nuclear energy provisions.

The prince also told the conference that oil prices aren't rising as fast as other energy sources and that shows the importance of OPEC+ role in managing the oil market. (As showen in the table below)

He added that Saudi Arabia is working together with countries like Kuwait to return to old oil output capacities. 

The minister stated that power generation using gas and renewables domestically will help free a million barrels of oil per day for export. 

He noted that the Kingdom is running out of capacities at all levels which is truly a matter of concern for the whole world. The minister added that more hydrocarbon investments are needed to resolve issues surrounding energy generation. 


Read More: White House warns of ‘unintended consequences’ of Senate’s NOPEC bill 


Iraq’s oil minister Ihsan Abdul-Jabbar told reporters at the same conference OPEC had discussed the bill at the group’s regular meetings.

“We are in internal discussions about that so for now we have no response,” he said.

Abdul-Jabbar also said his country’s current production capacity of 4.9 million bpd and would reach 5 million by the end of the year.

Iraq, the second largest OPEC producer, aims to raise its capacity to 6 million bpd by 2027, he said. 

- Additional reporting by Reuters


Saudi Exchange kicks off single-stock futures trading, led by Aramco, stc

Saudi Exchange kicks off single-stock futures trading, led by Aramco, stc
Updated 16 sec ago

Saudi Exchange kicks off single-stock futures trading, led by Aramco, stc

Saudi Exchange kicks off single-stock futures trading, led by Aramco, stc

RIYADH: The Saudi Exchange has recorded over 30 trades as it introduced single-stock futures to the market on Monday, led by shares of oil giant Aramco and Saudi Telecom Co.

Aramco futures logged a trading volume of 20 so far with a value of SR76,200 ($20,304), while stc posted 10 trades worth SR97,700.

Saudi Kayan and Ma’aden contributed with one transaction each, valued at SR1,500 and SR5,100, respectively.

The launch of single-stock futures as Tadawul’s second derivatives product — after launching index futures in 2020 — comes amid efforts to bolster liquidity and lure investors into the region’s biggest bourse.

In addition to the aforementioned stocks, the first tranche of the contracts includes Al Rajhi Bank, Saudi National Bank, Alinma Bank, Saudi Basic Industries Corp., Saudi Electricity Co., and Almarai.


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 9 min 40 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 32 min 3 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 04 July 2022

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 04 July 2022

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)