Petronas profit surges on higher prices

15th January 2018

Malaysia’s national oil company Petronas saw an increase in profit during the second quarter 2017 helped by higher prices across all products and cost cuts.  Petronas’ profit after tax for the quarter was RM 7 billion compared to RM 1.7 billion in 2Q of 2016, a significant improvement mainly due to lower net impairment on assets and well costs, coupled with higher average realized prices recorded across all products. This was partially offset by higher net foreign exchange losses, amortization of oil and gas properties and non-FID costs for PNW LNG in Canada, the company said. The profit was posted on...

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Reality check for Malaysian oil and gas players

15th January 2018

PETALING JAYA: Oil and gas (O&G) counters have gained much attention of late following the rise in oil prices. Since the new year began, O&G stocks that operate in the upstream services segment such as UMW Oil & Gas Corp Bhd (UMW-OG), Sapura Energy Bhd image: https://cdn.thestar.com.my/Themes/img/chart.png  and Bumi Armada Bhd image: https://cdn.thestar.com.my/Themes/img/chart.png  have seen impressive gains of as much as 55% in just two weeks. But some counters had retraced at least half of their gains by the end of last week. Notably, they reminded that upstream O&G service players would be the biggest beneficiaries should capital spending return. However, there...

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Oil & gas sector still stinging Singapore banks

15th January 2018

DBS Bank closed off the second-quarter results session for Singapore banks with a more muted assessment of its oil and gas (O&G) portfolio, joining its peer OCBC Bank in signalling that the sector is still stinging from low oil prices. “While contracts are picking up, the oil-and-gas service players don’t have any pricing power,” DBS chief executive officer Piyush Gupta told reporters at the bank’s results briefing on Friday. The rates today are barely able to cover operating expenses for such players, he added. Even as there are efforts by support service players to repurpose vessels, such work not only...

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Crude Oil Demand Will Grow for Next 10 years

15th January 2018

Takayuki Nogami, a chief economist of the Japan Oil, Gas and Metals National Corporation, spoke about the current crude oil market with The Yomiuri Shimbun. The following are excerpts from the interview. The Yomiuri Shimbun: How is the November agreement between OPEC and non-OPEC countries including Russia to be interpreted? Nogami: OPEC, led by Saudi Arabia, and non-OPEC oil-producers such as Russia have agreed to extend the current cut in oil output for nine months. I believe that OPEC has successfully projected the image of itself in the market as an actor that can effectively play a role in pursuing...

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China to step up banking oversight to tackle financial risks

15th January 2018

BEIJING (Reuters) – China will step up oversight in the banking sector this year to reduce financial risks, the country’s banking regulator said, stressing that long-term efforts would be needed to control banking sector chaos. The China Banking Regulatory Commission (CBRC) said late on Saturday (Jan 13) in a statement that its priorities included increasing supervision over shadow banking and interbank activities. “Banking shareholder management, corporate governance and risk control mechanisms are still relatively weak, and root causes creating market chaos have not fundamentally changed,”the CBRC said. “Bringing the banking sector under control will be long-term, arduous, and complex,” it...

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Morning Coffee: Ominous signs that big banking redundancies are coming in mid-2018. Over-excitable crypto-enthusiasts

15th January 2018

As U.S. banks prepare to announce their fourth quarter results in the coming week, an unwanted spectre is waiting in the wings: job cuts. They may make their entrance towards the end of the second quarter. Nomura has become the first bank to articulate the possibility of cuts to come. In an interview with theFinancial Times, Koji Nagai, Nomura’s president, said the bank is contemplating completely restructuring its research operations in the U.S. in response to the impact of MiFID II in Europe. Nagai even spells out the implications of the proposed “restructuring.” – “We already stopped providing research services in Europe....

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Saudi Arabia expects 80% surge in oil revenues by 2023

3rd January 2018

Authorities expect oil production to go from the current 10 million barrels a day to 11.03 million barrels in 2023 Saudi Arabia expects oil revenue to jump about 80 percent by 2023 to help the kingdom record its first budget surplus in a decade, according to people with knowledge of the matter. Under a six-year program to balance the budget, officials predict rising oil prices and output will push income from oil sales to 801.4 billion riyals ($214 billion) from 440 billion riyals this year, the people said on condition of anonymity because they aren’t authorized to share the data...

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Geopolitical premium seen on oil prices due to Iran unrest

3rd January 2018

Oil prices may rise further due to geopolitical risks associated with Iran protests, but the ongoing protests is not expected to impact oil production in the Islamic republic, analysts said. Protests broke out in Iran during the weekend over rising inflation and unemployment with more than 20 people reported to have been killed, which is also third biggest producer of oil within the Opec (Organisation of the Petroleum Exporting Countries) block. The country has an estimated output of 3.8 million barrels per day, according Opec. “We do see a spike in crude oil prices due to the geopolitical risk associated...

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‘UAE serves as financial hub for the Middle East, says DIFC official

3rd January 2018

Raja Al Mazrouei, the acting executive vice president of Fintech Hive at the Dubai International Financial centre, talks to The National about the year in fintech Was 2017 the year fintech really took off? Absolutely. Really it started with announcement of [DIFC’s] FinTech Hive in January of 2017 and then in August we started actual programmes. We received more than 200 applications and we were actually expecting 50. It means the industry is ready and that the timing was just right. What is Dubai’s position as a fintech hub in a global context? I think the UAE is taking a lead in...

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Oil, gas sector still strained, but positive signs emerge

3rd January 2018

The pain afflicting the oil and gas sector will continue for some time, said OCBC chief executive Samuel Tsien yesterday. Mr Tsien told a results briefing: “Unfortunately we do not see a noticeable uptick in chartering rates, and no substantial new capital coming in.” However, he said the stress has not been increasing and added that there have been positive signs, including a slight increase in oil-drilling activity, chartering becoming more active, and oil prices that have now hovered above $50 for quite a while. Mr Tsien also noted that “there were talks among oil-producing countries that the current control...

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