SAUDI RAISES PRICE
Saudi Arabia raised the cost of its oil sales to Asia in February, prompting speculation the world's biggest exporter is retreating from using record price discounts to defend market share.
Saudi Arabian Oil Co. will sell its Arab Light grade for $1.40 a barrel less than a regional average next month, the company said yesterday in a statement. That's a narrowing from January, when the discount was $2, the biggest in at least 14 years. It decreased 11 prices globally and increased six. Brent oil fell 5.9 percent yesterday.
Oil prices collapsed 32 percent since the Organization of Petroleum Exporting Countries decided to maintain its output target on Nov. 27, amid signs Saudi Arabia and other members are determined to let North American shale drillers and other producers share the burden of reducing an oversupply. When Aramco lowered prices for November it prompted speculation the nation was seeking to preserve market share.
"They're putting the brakes on a little bit," Leo Drollas, a London-based independent consultant and former chief economist at the Centre for Global Energy Studies, said by phone. "It's a little message that maybe prices are going down too far too quickly, and this is a little signal that they're looking at things."
Brent crude added 22 cents to $53.33 a barrel on the ICE Futures Europe exchange at 12:38 p.m. Singapore time. Prices yesterday declined $3.31, or 5.9 percent, to $53.11, the lowest close since May 1, 2009.
The state-owned producer, known as Saudi Aramco, raised prices for all its crudes in Asia and cut all of them for Europe and most in the U.S.
Saudi Aramco surprised the oil market in October when it trimmed November crude prices to five-year lows in Asia, signaling the biggest producer in OPEC would defend its market share rather than seeking to prop up prices. It continued last month, cutting the discount for Arab Light crude for sale to Asia in January to the deepest in at least 14 years.
Swelling supplies from producers outside OPEC drove Brent crude into a bear market on Oct. 8 amid waning demand from China, the world's second-largest importer. Middle Eastern producers are increasingly competing with cargoes from Latin America, North Africa and Russia for buyers in Asia.
"There is a fight for market share going on," said Tariq Zahir, a New York-based commodity fund manager at Tyche Capital Advisors. "We are not seeing any kind of production decreased."
OPEC decided at its last meeting to keep its production target unchanged at 30 million barrels a day. Members pumped more than that for a seventh straight month in December even as the group itself forecasts that markets will need less of its crude.
|August, 17, 12:01:00|
|August, 17, 11:55:00|
|August, 17, 11:50:00|
|August, 17, 11:45:00|
|August, 17, 11:40:00|
|August, 17, 11:35:00|
U.S. FRB - Industrial production edged up 0.1 percent in July after rising at an average pace of 0.5 percent over the previous five months. Manufacturing production increased 0.3 percent, the output of utilities moved down 0.5 percent, and, after posting five consecutive months of growth, the index for mining declined 0.3 percent. At 108.0 percent of its 2012 average, total industrial production was 4.2 percent higher in July than it was a year earlier. Capacity utilization for the industrial sector was unchanged in July at 78.1 percent, a rate that is 1.7 percentage points below its long-run (1972–2017) average.
NPD - Preliminary production figures for July 2018 show an average daily production of 1 911 000 barrels of oil, NGL and condensate, which is an increase of 64 000 barrels per day compared to June.
GAZPROM NEFT - For the first six months of 2018 Gazprom Neft achieved revenue** growth of 24.4% year-on-year, at one trillion, 137.7 billion rubles (RUB1,137,700,000,000). The Company achieved a 49.8% year-on-year increase in adjusted EBITDA, to RUB368.2 billion. This performance reflected positive market conditions for oil and oil products, production growth at the Company’s new projects, and effective management initiatives. Net profit attributable to Gazprom Neft PJSC shareholders grew 49.6% year on year, to RUB166.4 billion. Growth in the Company’s operating cash flow, as well as the completion of key infrastructure investments at new upstream projects, delivered positive free cash flow of RUB47.5 billion for 1H 2018.
REUTERS - Front-month Brent crude oil futures LCOc1 were at $72.34 per barrel at 0648 GMT, down by 12 cents, or 0.2 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures CLc1 were down 23 cents, or 0.3 percent, at $66.81 per barrel.