Oil rises as tight supply trumps recession fears

Brent crude rose $2.26, or 2 percent, to $113.89 a barrel by 12:47 p.m. ET (1648 GMT) after falling more than $1 in early trade. US West Texas Intermediate crude rose $2.20, or 2 percent, to $110.63.
Brent crude rose $2.26, or 2 percent, to $113.89 a barrel by 12:47 p.m. ET (1648 GMT) after falling more than $1 in early trade. US West Texas Intermediate crude rose $2.20, or 2 percent, to $110.63.
Short Url
Updated 04 July 2022

Oil rises as tight supply trumps recession fears

Oil rises as tight supply trumps recession fears
  • OPEC misses target to boost output in June: Survey

LONDON: Oil rose on Monday as supply concerns driven by lower OPEC output, unrest in Libya and sanctions against Russia outweighed fears of a demand-sapping global recession.
Eurozone inflation hit yet another record high in June, strengthening the case for rapid European Central Bank rate increases, while US consumer sentiment hit a record low.
Brent crude rose $2.26, or 2 percent, to $113.89 a barrel by 12:47 p.m. ET (1648 GMT) after falling more than $1 in early trade. US West Texas Intermediate crude rose $2.20, or 2 percent, to $110.63, in thin volume during the US Independence Day holiday.
The Organization of the Petroleum Exporting Countries missed a target to boost output in June, a Reuters survey found.
In OPEC member Libya, authorities declared force majeure at Es Sidr and Ras Lanuf ports as well as the El Feel oilfield on Thursday, saying oil output was down by 865,000 barrels per day.
Meanwhile, Ecuador’s production has been hit by more than two weeks of unrest that has caused the country to lose nearly 2 million barrels of output, said state-run oil company Petroecuador.
Adding to potential supply woes, a strike this week in Norway could cut supply from Western Europe’s largest oil producer and reduce overall petroleum output by about 8 percent.
“This backdrop of mounting supply outages is colliding with a possible shortage in spare production capacity among Middle Eastern oil producers,” said Stephen Brennock of oil broker PVM, referring to the limited ability of producers to pump more oil.
“And without new oil production hitting markets soon, prices will be forced higher.”

British PM
British Prime Minister Boris Johnson on Monday called on the OPEC+ producer group to produce more oil to tackle a cost-of-living crisis.
Brent crude has come close this year to topping the 2008 record high of $147 a barrel after Russia’s invasion of Ukraine added to supply concerns.
Soaring energy prices on the back of bans on Russian oil and reduced gas supply have driven inflation to multi-decade highs in some countries and stoked recession fears.


Crypto Moves — Bitcoin and Ethereum rise; Australia’s central bank launches digital currency project

Crypto Moves — Bitcoin and Ethereum rise; Australia’s central bank launches digital currency project
Updated 17 sec ago

Crypto Moves — Bitcoin and Ethereum rise; Australia’s central bank launches digital currency project

Crypto Moves — Bitcoin and Ethereum rise; Australia’s central bank launches digital currency project

RIYADH: Bitcoin, the leading cryptocurrency internationally, traded higher on Tuesday, rising by 2.33 percent to $23,889 as of 8:03 a.m. Riyadh time.

Ethereum, the second most traded cryptocurrency, was priced at $1,779 rising by 3.87 percent, according to data from Coindesk.

Australia’s central bank launches digital currency project

The Australian central bank announced on Tuesday that it will conduct research into the possibility of a central bank digital currency in Australia, according to Reuters.

The year-long program is a partnership between the Reserve Bank of Australia and the Digital Finance Cooperative Research Center.

In addition to better understanding some of the technological, legal, and regulatory considerations associated with the issuance of a CBDC, the project will identify innovative use cases and business models that would be supported by it.

An RBA-responsible CBDC pilot will be developed as part of the program and will operate in a ring-fenced environment.

The CBDC will be able to provide households and businesses with innovative and value-added payment and settlement services based on the specific use cases developed by industry participants.

BitMEX crypto exchange laundering case: new guilty plea

Following the guilty pleas of BitMEX’s three co-founders, BitMEX’s first employee has also pleaded guilty to violating US bank secrecy laws, reported Reuters.

In Manhattan, Gregory Dwyer, 39, of Australia and Bermuda, pleaded guilty before US District Judge John Koeltl. In addition, he agreed to pay a fine of $150,000.

In 2015, Dwyer and BitMEX founders Benjamin Delo, Arthur Hayes, and Samuel Reed willfully violated the federal Bank Secrecy Act by failing to implement anti-money laundering and “know your customer” programs, effectively transforming the exchange into a money laundering operation.

At BitMEX, the Bitcoin Mercantile Exchange, Dwyer was head of business development.

Although Delo, Hayes, and Reed were each sentenced to probation, Dwyer could face up to five years in prison.

Requests for comment from Dwyer’s lawyer were not immediately returned, according to Reuters

Two US Financial regulators filed civil charges last August against BitMEX for failing to properly screen customers and accepting customer funds for crypto trading without registration.

(With inputs from Reuters.)


SABIC expects margins to remain under pressure despite profit jump

SABIC expects margins to remain under pressure despite profit jump
Updated 9 min 59 sec ago

SABIC expects margins to remain under pressure despite profit jump

SABIC expects margins to remain under pressure despite profit jump

RIYADH: Chemical giant Saudi Basic Industries Co. expects profit margins to remain under pressure in the second half, despite posting a nearly 4 percent surge in second-quarter earnings, as cost burdens persist.

“Due to slowdown in global gross domestic product growth, lockdowns in China, conflict in Europe, and continued supply chain challenges, we expect margins to be under pressure in the second half of 2022,” SABIC said in a statement.

It added that GDP is estimated to grow at a rate between 2.5 percent and 2.8 percent, compared to 3.2 percent and 3.6 percent previously.

The Saudi-listed firm made SR7.93 billion ($2.1 billion) in profits during the second quarter of 2022, up from SR7.6 billion in the same period a year earlier.

It beat analysts’ expectations of a 23-percent profit decline to SR5.9 billion, Argaam data showed.


Gulf Domino’s Pizza operator Alamar gains 2.4% on Saudi market debut

Gulf Domino’s Pizza operator Alamar gains 2.4% on Saudi market debut
Updated 22 min 22 sec ago

Gulf Domino’s Pizza operator Alamar gains 2.4% on Saudi market debut

Gulf Domino’s Pizza operator Alamar gains 2.4% on Saudi market debut

RIYADH: Fast-food chain operator Alamar Foods Co. saw its shares surge 2.4 percent as it started trading on the Saudi Exchange on Tuesday, following a SR1.2 billion ($326 million) initial public offering.

Its share price rose to SR117.6 from the IPO price of SR115 by 10:47 a.m. Saudi time, amid trading of almost 1.9 million shares.

The company raised 42 percent of its capital, representing 10.6 million ordinary shares, in an initial share sale to join the Kingdom’s primary market TASI.

Following the bidding period and strong demand from investors, the IPO was priced at the top end of an indicative range of SR115.

Alamar is a fast-food restaurant franchiser of two globally recognized brands: Domino’s Pizza and Dunkin, with operations across 11 Middle Eastern, North African countries, and Pakistan.


ADNOC Drilling’s profit surges 34% to $379m on revenue boost in H1 

ADNOC Drilling’s profit surges 34% to $379m on revenue boost in H1 
Updated 47 min 27 sec ago

ADNOC Drilling’s profit surges 34% to $379m on revenue boost in H1 

ADNOC Drilling’s profit surges 34% to $379m on revenue boost in H1 

RIYADH: Abu Dhabi-based ADNOC Drilling’s net profit surged 34 percent to $379 million in the first half of 2022, as the firm’s revenue rose amid a continued fleet expansion program.

The half-yearly revenue of ADNOC Drilling, a unit of Abu Dhabi National Oil Co., increased 13 percent at the end of June to $1.27 billion, according to a press release.

The release added that the net profit to $204.85 million, while the revenue increased 11 percent to $669 million in the second quarter of 2022. 

The company’s board has also approved an interim dividend rise of 5 percent to $341 million, which translates into 7.83 fils per ordinary share. 

“Excellent half-year results and successful strategic execution are testaments to the vital role that the company is playing in enabling significant production capacity growth for ADNOC as well as the UAE’s objective to achieve gas self-sufficiency,” said Sultan Ahmed Al Jaber, UAE minister of industry and advanced technology and chairman of ADNOC Drilling. 

Abdulrahman Abdullah Al Seiari, CEO of ADNOC Drilling said: “The rigs we have added to our fleet in the first half will support us in delivering on our resolute commitments to our shareholders, including ADNOC, as it works toward its production capacity targets and gas self-sufficiency for the UAE.” 


TASI edges higher; eXtra leads the market: Opening bell

TASI edges higher; eXtra leads the market: Opening bell
Updated 55 min 51 sec ago

TASI edges higher; eXtra leads the market: Opening bell

TASI edges higher; eXtra leads the market: Opening bell

RIYADH: TASI started Tuesday’s session 0.17 percent higher to 12,317 after a wave of strong earnings reports buoyed investor sentiment.

Nomu, the parallel market, added 0.86 percent at 22,262, as of 10:10 a.m. Saudi time.

eXtra climbed 4.70 percent to lead the gainers, after its half-year profits advanced 24 percent to SR225 million ($60 million).

Saudi chemical giant SABIC rose 1.58 percent, following a hike in second-quarter profits to SR7.93 billion, beating analysts’ average estimate of SR5.9 billion.

City Cement Co. fell 0.35 percent, after reporting SR42 million in profits for the first half, a 64 percent decline from the same period in 2021.

Arabian Cement Co. rose 1.06 percent, despite a 14 percent drop in profits to SR87 million during the first half of 2022.

Retal Urban Development Co. decreased 1.55 percent, despite a first-half profit increase of 10 percent to SR93.5 million.

Bawan Co. gained 1.82 percent, after posting a 12 percent profit increase to SR95 million for the first half of 2022.

Saudi Airlines Catering Co. slipped 0.62 percent, despite turning into profits of SR78.8 million during the first half of 2022, from SR47.5 million losses in the prior-year period.

Nahdi Medical Co. added 1.47 percent, following a 20 percent profit surge to SR506 million during the six-month period.

The Kingdom’s oil giant Saudi Aramco started the day with a 0.13 percent decline.