DBS and OCBC are regional leaders in fintech and innovation.

Singapore retained the top spot in Asia’s’ open banking readiness index amidst proactive decisions by the city state’s regulators to embrace the technology while regional neighbors are only just catching up to the growing momentum to open up their data, according to a report from Finastra.

With a score of 8.1, Singapore towers over Australia (7.1), Hong Kong (6.6), New Zealand (6.4) and China (6.4) with strong showing that has even outpaced the Asia-Pacific average of 5.8.

“[Singapore is] most advanced in open banking readiness index in the region, primarily because of its Open Application Programming Interfaces (APIs) and data infrastructure maturity,” the report’s authors said.

Open banking leverages on the use of APIs to share the data they have on customers with third-party players like fintech firms in an effort to build new applications and create new revenue streams from a value proposition that they could upsell and cross-sell.

The index evaluates the readiness of a country based on five factors: adoption of Application Programming Interface (APIs), fintech/third-party ecosystem, state of data-based transformation, data monetisation and state of innovation.

Singapore holds an ‘intermediate’ score for data monetisation and an ‘advanced’ score across the four remaining categories.

In fact, the city’s very own DBS Bank holds the distinction as a regional leader in the fintech ecosystem sub-categories with a massive platform of over 155 APIs across 20+ categories which it developed in late 2017 through its API developer hub, DBS Developers. The bank was also lauded as a leader in the data transformation subcategory with technology, hardware, data centres, network management and app development that are 85% insourced – a bank that owns its tech.

OCBC also made Singapore proud as it ranks amongst the regional leaders in the state of innovation subcategory as it steadily built its operations around the steady adoption of AI, machine learning, robo-advisory, cloud and blockchain tech.

Citi leads in the API adoption subcategory with a thriving ecosystem in Hong Kong that already counts partnerships with AIA Hong Kong and Octopus Cards whilst India’s third largest private sector lender Axis Bank leads in the data monetisation subcategory.

Singapore’s readiness for open banking also received a significant boost from the proactive stance taken by the regulatory bodies. In fact, the Monetary Authority of Singapore (MAS) was the first regulator in APAC to release open banking guidelines in 2016, effectively giving banks the confidence to liberalise their data.

“Singapore continues to set the pace for other regulators in the region,” it added. Together with Australia and Hong Kong who released similar guidelines in the first half of 2018, the three economies rank as ‘early adopters.’

New Zealand, South Korea and India rank as ‘steady warm-ups’ as they do not generally have concrete guidelines in place although concepts and a thriving fintech ecosystem can be found across the industry. Thailand and Malaysia are dubbed ‘fast followers’ with expectations of guidelines to be released by mid-2019 to early 2020 whilst Japan and China are ‘giants with potential.’ On the other hand, Taiwan, Indonesia, Philippines and Vietnam still have other priorities to settle such as financial inclusion before they can embark on their open banking journeys.

“Open Banking in the Asia-Pacific region is unlike Europe, where it is primarily driven by regulators,” the report’s authors said. “In general, banks in the Asia-Pacific can decide for themselves if they want to pursue it, how soon, and their preferred approach for partnering with trusted third parties (TTPs).”

The Finastra’s Open Banking Readiness Index is developed by Finastra in cooperation with with IDC Financial Insights.

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Hard-cash circulation has ballooned by 150% in the past decade.

Malaysia will lower the cash threshold reporting requirement as the country intensifies the crackdown against money laundering activity, central bank governor Nor Shamsiah Yunus said at an international conference on financial crime and terrorism financing.

Commercial banks in Malaysia, who were previously, required to disclose cash transactions exceeding RM50,000 ($11,900) will be subject to new reporting thresholds of RM25,000 ($5,981) effective January 1, 2019.

“When we compare Malaysia with other countries, our current threshold is too high,” she explained.

Malaysia has an index score of 6.1 in the Basel Anti-Money Laundering Index 2017 which puts it level of risk to money laundering and terrorist financing higher than that of Taiwan, Australia, Singapore, South Korea and Japan.

“We do not anticipate any impact in terms of economic activity but an increase in effectiveness in taming the black economy that is still heavily reliant on cash transactions,” she added as hard-cash circulation has increased by around 150% over the past ten years.

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With the whole oil world watching the latest news around Iran and the U.S. sanctions that seek to reduce its exports of crude to zero, an announcement by Iraq’s Energy Minister passed largely unnoticed. The announcement was, as reported by Bloomberg, that Iraq’s oil production rate had hit a record-high of 4.78 million bpd, which made the OPEC member the world’s fourth-largest oil producer, ahead of Canada.

One might wonder how this is significant, but only if this one is somebody who has only been focusing on Iran lately. Iraq’s in the second-largest producer in OPEC after Saudi Arabia, and it is a very politically unstable country. The higher its production, the greater its share of the overall increase in output that the cartel is attempting, and so far, failing to achieve in a bid to offset the shortage from Iran.

And Iraq is not the only large producer that can swing prices higher or lower. Count Libya and Nigeria in as well. In Libya, the danger of production outages should be factored into prices on general principle given the frequency of these outages. The North African country has proved quite effective in reducing the duration of these outages, but any supply disruption from the Oil Crescent will immediately affect international prices.

Then there is Nigeria. While militant attacks on infrastructure in the Niger Delta have stopped after the federal government managed to convince the militants to lay down their arms, this does not mean it is all quiet in Africa’s top oil exporter. RBC’s Helima Croft, for example, told CNBC this week that with elections pending in both Libya and Nigeria, supply could be threatened. RBC also warned its clients that half a million barrels daily could be wiped out from the combined production of Nigeria and Libya after the elections.

Yet elections in Nigeria are still months away. The worry that the next government could take a different approach to Niger Delta militants and these groups might resume their attacks on infrastructure is still in the realm of the hypothetical. Besides, any effect from the change of government in Nigeria will come even later. By then, the actual impact of U.S. sanctions on the Iranian oil industry should be evident, stabilizing prices, albeit temporarily.

Libya’s elections may be a more direct threat for oil prices. Scheduled for December, the presidential and parliamentary votes might not even take place, according to a September update from the UN envoy to the country. “There is still a lot to do. It may not be possible to respect the date of December 10,” the envoy, Ghassan Salame, told AFP. And yet, violent clashes in Libya have regrettably become more or less a part of life, and the National Oil Corporation has become rather effective in dealing with them so as to minimize the impact on production. Given Libyan’s dependence on oil revenues, this effectiveness is only to be expected.

Here’s what Vandana Hari, founder of Vanda Insights, a Singapore-based provider of research and analysis on the global oil markets, had to say about this. “If—and that’s a big if—both Libyan and Nigerian production is affected and it is as bad in Libya as the incident this summer, we could see 600-700,000 bpd disappear from the market. That would surely have OPEC running on fumes if it is already stretched covering the loss of barrels from Iran. However, if it is just Libya or Nigeria and the problem is it a prolonged one, OPEC may be able to compensate and we wouldn’t necessarily see a sustained spike in crude.”

Ole Hansen, Saxo Bank’s head of commodity strategy told Oilprice there was no doubt that the outages, if materialized, would increase the market volatility. “Additional uncertainty about supply on top of Iran,” Hansen said, “should support the price while reducing the current focus on a demand destructive global slowdown.”

So perhaps the danger of Brent hitting US$100 a barrel as a result of production outages in Iraq, Libya or Nigeria may be a little bit overblown in light of the fact that such outages are far from certain. On the other hand, these three certainly bear watching, in addition to Iran. It pays to be prepared, after all.

By Irina Slav for Oilprice.com

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SP Group launched on Monday the world’s first index to help utilities measure and advance the development of smart grids.

A smart grid is an electricity supply network that uses digital technology to detect and react to local changes in usage.  It also allows for deployment and integration of electricity drawn from non-traditional sources such as the photovoltaic cells installed on the rooftops of private residences.

Utilities worldwide have applied varying parameters to benchmark smart grids.  But SP, in a bid to derive a suitable framework, has drawn on definitions published by the European Union and the US Department of Energy.

The Smart Grid Index (SGI) thus far covers seven key aspects of an electricity grid: supply reliability; monitoring and control; data analytics; integration of distributed energy resources (DER); green energy; security; and customer empowerment and satisfaction.

Using publicly available data, SP applied the Smart Grid Index (SGI) framework on 45 utilities across 30 countries.

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SINGAPORE (Oct 29): The rising risk aversion among global investors has been the product of geopolitical and economic risks that are not specific to Asia, yet they have taken a toll on Asian equities and currencies in the past two weeks. The unrelenting flow of bad news has not helped the mood. The serious deterioration in US-Chinese ties and the potentially grave implications for Middle East stability of the shocking murder of Saudi dissident Jamal Khashoggi have unnerved investors. Continuing worries about trade wars and the further slowing of the global economy, especially in China, have added to the sense of foreboding among investors.

Our take is that some trends are indeed of concern, but that the overall picture for emerging Asian economies remains reasonably good through 2019. The headwinds to economic growth will cause some slowing, but the impact will be contained. Asian countries are also likely to successfully limit the depreciating pressures on their currencies. Moreover, over time, we could even see some positives emerge from recent developments, such as a stepped-up pace of production relocation from China to Southeast Asia.

How much downside to economic growth in 2019? 

By Jonathan Saul LONDON, Oct 26 (Reuters) – The United Nations shipping agency pushed back this week on any phased entry for tougher marine fuel rules and further tightened regulations that will come into force in 2020.

The International Maritime Organization will prohibit ships from using fuels with sulphur content above 0.5 percent from Jan. 1, 2020, compared with 3.5 percent today, unless they are equipped with so-called scrubbers to clean up sulphur emissions.

Ships found in breach of the new rules will face fines or the risk of impoundment by IMO member states.

The shipping and oil-refining industries are scrambling to prepare for the shift and have made large investments to comply with the new standards since they were set in 2016.

Oil companies expect a jump in demand for cleaner distillates, mainly diesel, at the expense of fuel oil that would become largely redundant.

Last week, Washington said it backed a phase-in of the 2020 rules to protect consumers from any price spikes in heating and trucking fuels, although it did not seek a delay.

Some shipping associations together with the Bahamas, Liberia, Panama and the Marshall Islands had proposed an “experience-building phase”, which gained support from Washington, leading to widespread market speculation in recent days about a possible review of the regulatory timeframe.

A discussion of their proposal in London this week at the IMO’s Marine Environment Protection Committee, MEPC 73, failed to advance after the chair of the session said it was too vague.

The paper’s backers were told they could submit more concrete proposals at the next MEPC in May 2019 – especially focused on data collection and fuel oil quality.

That timeframe would, however, leave little time realistically before the regulations kick in for any potential review.

The IMO has reiterated that there will be no delay in implementing the rules.

A U.S. Coast Guard official said on Thursday that Washington sought a “pragmatic” approach and would seek to develop proposals with like-minded countries for the May 2019 meeting.

Some analysts including Rapidan Energy Group have suggested that major stakeholders including flag carriers were working to push back the global sulphur ban.

They also suggested that U.S. President Donald Trump’s administration was likely to oppose the 2020 start date as it would cause a significant diesel, distillate and heating oil price spike in the winter of a U.S. presidential election year.

“Many saw MEPC 73 as the last chance to delay or soften implementation and the fact that both proposals were rejected strongly suggests that IMO 2020 will enter the market as expected on Jan. 1, 2020,” Vienna-based consultancy JBC Energy said in a note on Friday.

REGULATIONS TIGHTENED

The IMO on Friday adopted a ban on ships carrying high-sulphur marine fuel unless they have special equipment on board, further tightening regulations.

This latest amendment, which comes into force on March 1, 2020, makes it illegal for ships to carry high-sulphur fuel “for combustion purposes, for propulsion or operation on board” without scrubbers, which was not codified in the main regulation.

“The amendment does not change in any way the entry into force date of the 0.50 percent limit from Jan. 1, 2020. It is intended as an additional measure to support consistent implementation and compliance and provide a means for effective enforcement by states, particularly port state control,” the IMO said on Friday.

Roger Strevens, chair of the Trident Alliance – a coalition of shipping companies that has pushed for enforcement of the sulphur rules – said Friday’s adoption was “an unmistakable signal” of the IMO’s commitment to “full and effective implementation”.

“The focus now shifts to preparation, both on the part of the industry and of the enforcement authorities,” Strevens said. (Additional reporting by Dmitri Zhdannikov in London and Roslan Khasawneh in Singapore, Editing by Dale Hudson and David Evans)

(c) Copyright Thomson Reuters 2018.

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China will lead global refinery capacity expansion and investments with 3.12 million bpd additional refining capacity and US$67.3 billion capital expenditure through 2022, data and analytics company GlobalData said in a new report.

Total refining capacity in the world is expected to grow by 15.1 percent between 2018 and 2022, with global crude distillation units (CDU) capacity expected to hit 117 million bpd by 2022, GlobalData said in its report.

Asia will lead the pack with the highest planned and announced CDU capacity of 5.4 million bpd in 2022, followed by Africa and the Middle East with 3.2 million bpd and 2.7 million bpd, respectively. In capital expenditure (capex), Asia will again be the leader with expected capex for new build refineries of US$194.9 billion, followed by Africa and the Middle East, with US$126.6 billion and US$87.1 billion, respectively, GlobalData has estimated.

Among individual countries, China is the leader, with ten new-build refineries expected to come on line by 2022, followed by Nigeria and Kuwait. The top ten also includes Iraq, Iran, Turkey, Brunei, Indonesia, the Philippines, and Saudi Arabia, GlobalData’s report shows.

“China’s ambitious refinery capacity expansion programme continues fuelled by the country’s industrial growth, and growing demand from the transportation sector. The capacity expansion program is powering China’s crude imports, and will transform the country to become a strong contender for exports of petroleum products globally,” Sumit Kumar Chaudhuri, Oil & Gas Analyst at GlobalData, said, as carried by East African Business Week.

Last month, Chinese refiners processed a record daily amount of crude oil. At a calculated 12.49 million bpd, the September run rate of Chinese refineries was more than 600,000 bpd higher than the August figure.

According to the GlobalData report, Nigeria is also planning a massive refinery expansion to meet growing domestic demand for petroleum products. The African OPEC member is expected to expand its CDU capacity by 2.003 million bpd, spending US$57.6 billion. Kuwait will add 615,000 bpd of CDU capacity by 2022, and is expected to spend US$7.5 billion through 2022.

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Bucking the trend from last month, when spot cargoes of Middle Eastern oil traded at multi-year premium highs in Asia due to falling Iranian oil supply, this month spot cargoes are trading at discounts to their official prices, due to increased supply from Iran’s fellow OPEC members in the Middle East and to lower demand from Japan, where some refineries had closed in the wake of natural disasters.

Most of the Middle Eastern grades on spot cargoes for December loadings are trading at discounts this month, Reuters reported on Tuesday, citing industry sources.

Last month, refiners asked for a lot of additional Saudi crude, according to a trader at a North Asian refiner. Saudi Arabia is boosting deliveries of Arab Extra Light to some refiners in north Asia, Reuters’ sources say.

Earlier this month, Saudi Arabia was said to be set to deliver extra 4 million barrels of its oil to India in November, in what could be a Saudi move to replace the loss of Iranian barrels due to the U.S. sanctions on Tehran returning early next month.

Apart from Saudi Arabia, Persian Gulf producers Kuwait and the UAE are also increasing supply and have recently launched new crude grades. The UAE’s Umm Lulu and Kuwait’s Super Light Crude are adding a combined 170,000 bpd of new light oil supply, according to Reuters estimates.

The Asian market is currently well-supplied with light sour crude grades, including Saudi Arab Extra Light, grades from the UAE’s ADNOC, and from Kazakhstan, another trader with a refiner in north Asia told Reuters.

While supply is ample, demand in Japan has faltered over the past two months, after a typhoon swept through the country in September, killing 11 people and forcing some refiners to shut refining units.

As of October 10, Japanese refiners had 20 percent of all refining capacity shut down, due to a combination of scheduled maintenance and unexpected closures because of natural disasters, S&P Global Platts has estimated.

Utilization rates in Japan are not very high and spot purchases are at a minimum, a Japanese oil buyer told Reuters on Tuesday.

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Global oil and gas development spend needs to increase by around 20 percent, to about $600 billion, to meet future demand growth and ensure companies sustain production next decade.

That’s according to Wood Mackenzie (WoodMac), which says development spend will increase five percent this year, after a two percent rise on 2017. WoodMac forecasts investment to rise from a low of $460 billion in 2016 to just over $500 billion in the early 2020s, far below the $750 billion peak in 2014.

“Four years of deep capital rationing have had a severe impact on resource renewal, especially in the conventional sector,” Tom Ellacott, senior vice president of corporate research at WoodMac, said in a company statement.

“Companies are rightly cherry-picking the best conventional projects in their portfolios for greenfield development. But not enough new high-quality projects are entering the funnel to replace those that have left,” he added.

WoodMac expects strict capital discipline to continue to frame investment decisions, at least in the near-term. The company said this will favour short-cycle, higher-return opportunities.

“Many companies will justifiably be concerned about committing substantial capital to long-term projects with peak oil demand and energy transition risks within the investment horizon,” Ellacott stated.

“There’s also a prevailing mindset of austerity designed to appease shareholders – investment is lower in the pecking order for surplus cash flow than dividends and buy-backs,” he added.

Conventional growth inventories have shrunk during the downturn, WoodMac highlighted, stating that global pre-FID conventional reserves now only cover two years of global oil and gas production. The energy research and consultancy group stated that “bigger and better” conventional projects will ultimately be required and said exploration success will also be crucial to replenishing depleted conventional inventories.

WoodMac said investment in conventional, deepwater, U.S. shale gas and oil sands will be “well below” pre-downturn levels, with only U.S. tight oil “set for consistent investment growth over the next few years, driven by the Permian”.

Last month, in a statement posted on WoodMac’s website, WoodMac Chairman and Chief Analyst Simon Flowers warned that the industry isn’t finding enough oil.

“Guyana is one of the very few giant oil discoveries made during the downturn. Fact is, we need more Guyanas, a lot more, and we need them soon. Without them, the oil market is in danger of tightening in the not too distant future,” he stated.

WoodMac’s roots trace back to 1923. The company, which is a Verisk business, has locations all over the world.

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(Bloomberg) — Saudi Arabia gave the strongest indication yet that it’s trying to stop oil prices from rising further, saying that OPEC and allies are in a “produce as much as you can mode” to assure customers that they can meet demand and remove any uncertainties about looming shortages.

The kingdom has already boosted oil production to 10.7 million barrels a day, near an all-time high, and it can increase it even more to help plug any supply shortfalls due to U.S. sanctions against Iran’s energy industry, Saudi Energy Minister Khalid Al-Falih told a conference in Riyadh. U.S. President Donald Trump is counting on Saudi cooperation to soften potential price increases from the sanctions that take effect next month.

“We will meet any demand that materializes,” Al-Falih said at the country’s signature investment conference, which is being overshadowed by an international outcry over the killing of Saudi government critic Jamal Khashoggi.

Brent crude, the global benchmark, has dropped almost 10 percent from a four-year high of $86.29 a barrel on Oct. 3 as Saudi Arabia and Russia promised extra supplies and U.S. stockpiles climbed.

The Riyadh conference is aimed to generate investments in the country as part of a broad economic transformation plan to wean it off reliance on oil.

Al-Falih said plans to diversify the economy will continue, but oil and gas expansion will also remain a priority. In addition to its crude investments, Saudi Arabia intends to partner in liquefied natural gas projects abroad and start trading LNG in the future. Global gas consumption is growing, he said, and oil demand will reach 120 million barrels a day in 30 years, from 100 million currently.

In an effort to maintain stable supplies to the crude market, Al-Falih said he hopes the Organization of Petroleum Exporting Countries and its non-OPEC oil partners will sign an “open-ended” agreement in December. The group, sometimes known as OPEC+, agreed in late 2016 to cut production to eliminate a supply glut and has since intervened to coordinate output and balance the market.

The Saudi oil chief lauded the achievements of the group, saying that it has stabilized the market and helped the energy industry to recover.

“Significant investment flows” have returned to the oil and gas industry that will bring on new supplies to help replace losses in areas such as the North Sea and in some OPEC countries, he said. Even still, the outlook for next year is “very unpredictable” in terms of both supply and demand, Al-Falih said.

With assistance from Mohammed Aly Sergie. To contact the reporters on this story: Javier Blas in Riyadh at jblas3@bloomberg.net; Vivian Nereim in Riyadh at vnereim@bloomberg.net. To contact the editors responsible for this story: Nayla Razzouk at nrazzouk2@bloomberg.net Claudia Carpenter, Amanda Jordan.

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