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Saturday, 10 February 18
OIL PRICE USD 100/BARREL BY END OF 2018! - SAROJ MOHAPATRA
.jpg) All demand supplies calculations are going wrong in oil market at present. US production is increasing at a good pace and set to topple Saudi comfortably as the world’s largest crude producer and to break its previous record of 10.7 Million bpd very soon, registered way back in 1970. Still the investment banks are moderating their previous estimates northwards. Recently JP Morgan estimated 2018 average oil price at USD 70 per barrel, which is approx. 50% higher than its estimates published just six months before. Goldman Sachs went one step ahead by forecasting the 2018 price at USD 80. These estimates are happening against the backdrop of known news of increased oil production from Kazakhstan and Nigeria offshore and ramp up in Libya and may be Venezuela in 2018. Also nobody expects that the winter across globe will be as cruel as in 2017.
In last article it was discussed that US, Russia, Saudi Arab have a good say in affecting the trend of oil price. They together produce appox 30 million bpd of oil against total world’s production of 80 million bpd i.e aprox 40%. Until 6-10 years before Saudi Arab was playing a pivot role in balancing the oil price as a swing producer.
As a swing supplier Saudi Arab was very much successful in limiting the price rise of crude upto good extent despite higher demand from both developed and developing economies. Now from demand side there seem to be no significant boost because of no extraordinary economic growth in China and India. Already the demands in developed countries like EU, Japan, South Korea etc except US are almost stagnant.
Now let us come to our subject line how higher oil price is the new reality in 2018. We are forgetting about a huge event that was missed in 2017 and set to happen in late 2018. It’s the world’s largest ever IPO of Saudi Aramco. For 5% disinvestment, Saudi Govt expects to earn more than USD 100 billion. Apart from income through IPO, the most important thing is the valuation of Saudia Aramco as a whole which will be calculated after IPO. US has also good existing interests in Saudi Aramco. Even investment bankers will earn directly as a stakeholder of IPO. Indirectly there is a golden opportunity to earn billions through derivative market of oil. As per recent report, hedge funds have increased their bullish position in oil, despite the fact that oil has reached the highest level of 2014. Net long positions have been raised across WTI, Brent, NYMEX, ICE, US gasoline etc. Now the ratio of hedge long position to short position has reached 11.5 against the same ratio of 1.5 in June 2017 i.e just few months back. It shows how bullish the market is but may be in hibernation show J . Last year it seems the said IPO was delayed just because the oil price was low (relative to expectation of Saudi Arab), though other reasons of no-decision of IPO subscription market place whther Newyork or london exchange were cited.
It is indeed a last opportunity in front of Saudi arab to earn billions just by selling a small stake in company. This is at a time when big economies like UK, France China have decided to go away from liquid fuel in transportation and industrial sector except petrochemicals (where refined products will be used as feed) by 2030-35. In 2008 when oil touched its peak, Saudi arab produced around 8.5 Million bpd. Lets imagine in case now Saudi Arab lowers its production to 8.5 mbpd or even lower, USD 100 per barerl is simply just a cakewalk for Oil.
Saudi Arab’s dynamic, modern-age and powerful crown prince Muhammad Bin Salman estimates the value of Saudi Aramco more than USD 2 Trillion, which is even more than GDP of almost all countries except 5 or 6. Saudi Arab may also try to disinvest more than 5% as an last attempt to have higher earnings. For that Oil need to be shown off to the outside world very bullish.
Therefore it may be concluded that Saudi Arab is in the process of cutting its oil production in a larger volume (against the official published figures) or will cut aggressively in future as against present rate just to ensure oil price is at higher side by the expected timeline of IPO i.e. Oct 2018. It also may have taken the investment bankers into confidence to ensure high over subscription of world’s largest ever IPO possible. The volume of long positions of hedge funds and money managers are probably just indication.
Just tried to put forward the thought on an idle weekend :) along with logic. Lets See what actually happens finally by dawn of 2019 :).
Saroj Mohapatra
DGM - Marketing and Contracts at H-Energy Group Of Companies
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Friday, 22 March 24
INDONESIA APPROVES 922.14 MLN T COAL PRODUCTION QUOTA FOR 2024, ABOVE TARGET - REUTERS
Indonesia has approved coal production quotas totalling 922.14 million metric tons for 2024, Bambang Suswantono, a senior official at the mining mi ...
Friday, 22 March 24
CHINA COAL INDUSTRY GROUP EXPECTS OUTPUT GROWTH TO SLOW IN 2024 - REUTERS
China’s coal output is expected to increase 36 million metric tons, or 0.8%, to about 4.7 billion tonnes in 2024, a Chinese coal industry gro ...
Monday, 18 March 24
THREE KEY TAKEAWAYS FROM OUR EUROPE GAS MARKETS SHORT-TERM OUTLOOK Q1 2024 - WOOD MACKENZIE
European gas prices are currently back to pre-crisis levels, but with a complex series of factors affecting future supply and demand, are they set ...
Wednesday, 06 March 24
INDONESIA AIMS TO FINISH MINING OUTPUT QUOTAS APPROVAL BY END-MARCH, OFFICIAL SAYS - REUTERS
Indonesia’s has approved the mining production quotarequests from more than 120mineral companies and aims to complete the approval process th ...
Monday, 04 March 24
IS YOUR GUARANTEE A GUARANTEE? NOTE TO SHIPOWNERS - GARD
KNOWLEDGE TO ELEVATE
The law of guarantees is not always obvious or easy to understand without proper guidance. This article clarifies the dif ...
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Showing 26 to 30 news of total 6871 |
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- Indian Energy Exchange, India
- PetroVietnam Power Coal Import and Supply Company
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- McConnell Dowell - Australia
- Straits Asia Resources Limited - Singapore
- CIMB Investment Bank - Malaysia
- Global Business Power Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Toyota Tsusho Corporation, Japan
- Kepco SPC Power Corporation, Philippines
- Romanian Commodities Exchange
- Directorate Of Revenue Intelligence - India
- Manunggal Multi Energi - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bulk Trading Sa - Switzerland
- Port Waratah Coal Services - Australia
- Eastern Energy - Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Petron Corporation, Philippines
- Electricity Authority, New Zealand
- Chamber of Mines of South Africa
- Bahari Cakrawala Sebuku - Indonesia
- Xindia Steels Limited - India
- Borneo Indobara - Indonesia
- Commonwealth Bank - Australia
- Gujarat Mineral Development Corp Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Electricity Generating Authority of Thailand
- Eastern Coal Council - USA
- Global Green Power PLC Corporation, Philippines
- Baramulti Group, Indonesia
- Bhatia International Limited - India
- Sree Jayajothi Cements Limited - India
- Cigading International Bulk Terminal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- PNOC Exploration Corporation - Philippines
- Agrawal Coal Company - India
- LBH Netherlands Bv - Netherlands
- Bukit Baiduri Energy - Indonesia
- Mjunction Services Limited - India
- Energy Link Ltd, New Zealand
- Banpu Public Company Limited - Thailand
- Ind-Barath Power Infra Limited - India
- Cement Manufacturers Association - India
- Merrill Lynch Commodities Europe
- Krishnapatnam Port Company Ltd. - India
- Kapuas Tunggal Persada - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Planning Commission, India
- Wood Mackenzie - Singapore
- VISA Power Limited - India
- International Coal Ventures Pvt Ltd - India
- ASAPP Information Group - India
- Posco Energy - South Korea
- Coastal Gujarat Power Limited - India
- Globalindo Alam Lestari - Indonesia
- Bhushan Steel Limited - India
- Coalindo Energy - Indonesia
- Meralco Power Generation, Philippines
- Global Coal Blending Company Limited - Australia
- Latin American Coal - Colombia
- Mercator Lines Limited - India
- TeaM Sual Corporation - Philippines
- Sojitz Corporation - Japan
- Antam Resourcindo - Indonesia
- Sakthi Sugars Limited - India
- Salva Resources Pvt Ltd - India
- PTC India Limited - India
- Therma Luzon, Inc, Philippines
- India Bulls Power Limited - India
- Karaikal Port Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Central Java Power - Indonesia
- Larsen & Toubro Limited - India
- European Bulk Services B.V. - Netherlands
- Bayan Resources Tbk. - Indonesia
- Kobexindo Tractors - Indoneisa
- Thiess Contractors Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Ministry of Mines - Canada
- Siam City Cement - Thailand
- Vedanta Resources Plc - India
- Anglo American - United Kingdom
- Metalloyd Limited - United Kingdom
- Jaiprakash Power Ventures ltd
- Madhucon Powers Ltd - India
- Kideco Jaya Agung - Indonesia
- San Jose City I Power Corp, Philippines
- The State Trading Corporation of India Ltd
- Timah Investasi Mineral - Indoneisa
- ICICI Bank Limited - India
- Australian Commodity Traders Exchange
- Vizag Seaport Private Limited - India
- Alfred C Toepfer International GmbH - Germany
- SMC Global Power, Philippines
- Singapore Mercantile Exchange
- Lanco Infratech Ltd - India
- Interocean Group of Companies - India
- Sindya Power Generating Company Private Ltd
- The University of Queensland
- New Zealand Coal & Carbon
- GVK Power & Infra Limited - India
- Mintek Dendrill Indonesia
- Thai Mozambique Logistica
- Orica Mining Services - Indonesia
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- South Luzon Thermal Energy Corporation
- Standard Chartered Bank - UAE
- Siam City Cement PLC, Thailand
- Indian Oil Corporation Limited
- Energy Development Corp, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Trasteel International SA, Italy
- Riau Bara Harum - Indonesia
- GMR Energy Limited - India
- Barasentosa Lestari - Indonesia
- Bharathi Cement Corporation - India
- Rio Tinto Coal - Australia
- SMG Consultants - Indonesia
- Deloitte Consulting - India
- White Energy Company Limited
- Sical Logistics Limited - India
- Sinarmas Energy and Mining - Indonesia
- Ambuja Cements Ltd - India
- Savvy Resources Ltd - HongKong
- Australian Coal Association
- Heidelberg Cement - Germany
- Aboitiz Power Corporation - Philippines
- CNBM International Corporation - China
- Grasim Industreis Ltd - India
- London Commodity Brokers - England
- Gujarat Sidhee Cement - India
- Makarim & Taira - Indonesia
- Ministry of Finance - Indonesia
- Tata Chemicals Ltd - India
- Power Finance Corporation Ltd., India
- Maharashtra Electricity Regulatory Commission - India
- Indonesian Coal Mining Association
- Orica Australia Pty. Ltd.
- Meenaskhi Energy Private Limited - India
- Samtan Co., Ltd - South Korea
- Altura Mining Limited, Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Africa Commodities Group - South Africa
- PowerSource Philippines DevCo
- Pipit Mutiara Jaya. PT, Indonesia
- Renaissance Capital - South Africa
- Medco Energi Mining Internasional
- IEA Clean Coal Centre - UK
- Indogreen Group - Indonesia
- The Treasury - Australian Government
- Central Electricity Authority - India
- Marubeni Corporation - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sarangani Energy Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Parliament of New Zealand
- MS Steel International - UAE
- Billiton Holdings Pty Ltd - Australia
- Aditya Birla Group - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Holcim Trading Pte Ltd - Singapore
- Wilmar Investment Holdings
- Minerals Council of Australia
- Neyveli Lignite Corporation Ltd, - India
- Kalimantan Lumbung Energi - Indonesia
- Kartika Selabumi Mining - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- IHS Mccloskey Coal Group - USA
- Carbofer General Trading SA - India
- Georgia Ports Authority, United States
- Videocon Industries ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Simpson Spence & Young - Indonesia
- Jindal Steel & Power Ltd - India
- Parry Sugars Refinery, India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Formosa Plastics Group - Taiwan
- Directorate General of MIneral and Coal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Kumho Petrochemical, South Korea
- Coal and Oil Company - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Malabar Cements Ltd - India
- Price Waterhouse Coopers - Russia
- Ministry of Transport, Egypt
- GN Power Mariveles Coal Plant, Philippines
- SN Aboitiz Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- Bukit Makmur.PT - Indonesia
- Bangladesh Power Developement Board
- Semirara Mining Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Bhoruka Overseas - Indonesia
- Star Paper Mills Limited - India
- Binh Thuan Hamico - Vietnam
- Semirara Mining and Power Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Iligan Light & Power Inc, Philippines
- Tamil Nadu electricity Board
- Independent Power Producers Association of India
- Karbindo Abesyapradhi - Indoneisa
- Economic Council, Georgia
- Oldendorff Carriers - Singapore
- Dalmia Cement Bharat India
- Mercuria Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Edison Trading Spa - Italy
- Indika Energy - Indonesia
- Uttam Galva Steels Limited - India
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