BUSINESS SATURDAY, AUGUST 27, 2011
Middle East Crude-Oman, Basrah, condensates rise SINGAPORE: October trade drew to a close yesterday with strength across the Middle East crude complex, after Oman, Basrah and Qatari condensates traded at their peaks for the month. ExxonMobil was heard to have bought an Oman crude cargo at a premium of 75 cents to Dubai quotes, up from discounts as deep as 30 cents just two weeks ago. Cargos of Iraqi Basrah Light for loading in October had cleared, earlier than in recent months, when a backlog contributed to weaken values into the following trading month. Traders value Basrah at premiums of about 10 cents to the grade’s official selling price. Qatar International Petroleum Marketing Co, or Tasweeq, sold fewer than usual October-loading deodorized field condensate (DFC) cargoes via tender because of abundant term sales and an outage at Qatargas LNG trains, traders said yesterday. Qatargas will reduce output including condensates in October because of maintenance at its liquefied natural gas plant (LNG), two trading sources with knowledge of the situation said yesterday. Rotating maintenance at three LNG trains, numbers 5, 6 and 7, between mid-September and early November will curb production, one of the trading sources said. Repairs at each train will last for about two weeks, curbing condensate loadings by as much as four cargoes of 500,000 barrels. Tasweeq sold DFC at premiums as high as $2.50 a barrel to Dubai quotes in the tender after naphtha margins strengthened, up from premiums of $1.70-$1.80 last month. DFC prices were attractive before the tender because of expensive alternative Australian condensate, allowing Tasweeq to place a greater-than-usual amount of cargoes among term buyers and leaving less supplies for spot sales. The company also sold as much as three cargoes of Qatar low sulfur condensate (LSC) at premiums of more than $1 a barrel to Dubai quotes. EAST-WEST. The Brent/Dubai Exchange of Futures for Swaps (EFS) for October gained 10 cents to $4.58 a barrel at 0830 GMT, Reuters data showed, down from levels above $5 last week, before the Libyan rebels’ decisive advance against Muammar Gaddafi. The front-month EFS on June 15 touched $9.20, the highest intraday value since the spread reached a record of almost $12 in October 2004. • DME OMAN • October Oman traded on the DME rose 18 cents to a premium of 82 cents to Dubai swap quotes at 0830 GMT, using the settlement price for DME futures, the ICE one-minute marker for Singapore and the Brent-Dubai EFS as calculated by Reuters. • MARKET NEWS • The Libyan rebel government hopes to restart oil exports within two to three months and reach full volumes in about a year, Ali Tarhouni, the official in charge of financial and oil matters told Reuters from Libya’s oil ministry in Tripoli. • Iraq, a major buyer of oil products, is set to import around 950,000 tons of gasoline and gas oil in the fourth quarter, the country’s deputy oil minister told Reuters. Oil major Royal Dutch Shell is planning to continue exporting Syrian oil in September despite fresh US sanctions and a looming EU embargo, which have already forced at least one company to cut oil trade with the country. — Reuters
DAMASCUS: A banker stacks packed Syrian lira bills at the Central Bank in Damascus on Thursday. US sanctions have forced Syria to stop all transactions in US dollars, with the country turning completely to euro deals, the governor of the Central Bank Adib Mayaleh told the AFP during an interview. — AFP
Oil prices edge lower, Bernanke speech eyed Concerns over hurricane in the US LONDON: Oil prices fell yesterday as analysts played down expectations of further quantitative easing ahead of a speech by US Federal Reserve Chairman Ben Bernanke on the health of the world’s top oil consumer, after the US economy grew slower than previously thought in the second quarter. Brent crude futures were 53 cents lower at $110.09 a barrel as of 1337 GMT. US light crude futures were down $1.15 to $84.15 a barrel. All eyes were on Bernanke’s speech in Jackson Hole, Wyoming scheduled for 1400 GMT, with markets eager to hear what the Fed’s plan is to help a struggling US economy, although the consensus was that its options are limited. The US economy grew slower than previously thought in the second quarter as business inventories and exports were less robust, a government report showed yesterday, although consumer spending was revised up. “Today the focus will be on Ben (Bernanke) and (hurricane) Irene, and one is as unpredictable as the other,” said Petromatrix’s Olivier Jakob. At last year’s meeting, Bernanke hinted at what eventually became a $600 billion quantitative easing bond-buying program. “The key question is whether Bernanke will announce a further round of quantitative easing of US monetary policy, as he did last year,” Commerzbank
analysts said In a note. “We do not expect such an announcement, however, and oil prices could come under pressure as a result. The price rally of past days was mainly due to the expectation of further liquidity.” Some price support came from Hurricane Irene as it barrelled towards US East Coast refineries, posing a potential threat to supply; while the ongoing conflict in OPEC member Libya and international pressure on Syria also underpinned sentiment. But worries about the outlook of the faltering recovery remained high on the agenda. Deutsche Bank joined a growing chorus of banks in downgrading oil price forecasts, trimming its Brent forecast for 2011 to $112 a barrel from $114 a barrel and US light crude to $94 a barrel from $100. “We now believe that the economy is likely to grow more slowly in 2011-2012,” Deutsche Bank’s Adam Sieminski said in a note. A Reuters poll of analysts meanwhile showed that oil prices are likely to stay above $100 a barrel next year despite increasing downward pressure from the expected return of some Libyan production and fears of a double-dip recession. Economic worries on the other side of the Atlantic also kept investors on edge. The Spanish economy grew at a slower
pace in the second quarter than the first, fuelling concerns Spain could slip back into recession if the euro zone economy continued to worsen. German consumer sentiment fell slightly going into September, hitting a 10-month low as the euro zone debt crisis and fears of another recession in Europe and the United States weighed on consumer expectations, a survey showed. Hurricane Irene, a Category 3 storm that lashed the low-lying Bahamas on Thursday, was expected to hit North Carolina on Saturday before heading up the coast to New York and beyond. MF Global said in its daily report that it expected refineries in the path of the hurricane to withstand the winds from the storm and not shut down for now.While the East Coast region has no major offshore oil and gas production like the hurricane-prone Gulf Coast, the stakes are still high. The region has around a dozen nuclear plants and a massive oil delivery hub at New York Harbor. Its pipelines and power networks serve more than 100 million Americans. “The biggest issue may be flooding if the storm surge brings water up into New York Harbor. The harbor imports 400 kb/d in gasoline,” the MF Global report said. — Reuters
KSE index loses Markaz weekly update
Open: 5,809, High: 5,809, Low: 5,746 Close: 5,786. KUWAIT: This week the KSE market price index lost 0.7% or 41 points and closed at 5786 level. While the KSE weight index lost 0.7% or 3 points to reach 400 level. Among the sectors this week all the negative this week. The Food Sector was the worst performer this week losing 1.7% followed by the Real Estate Sector which lost 1.5%, Banking Sector down 1.1%, Investment Sector down 0.7%, Industrial Sector down 0.4%, Non-Kuwaiti Sector down 0.3% and Services Sector down 0.2%. The market sentiment was negative as 41 stocks declined against 21 stocks gained and 12 stocks remained flat compared to the previous week. Among the blue chips this week Agility was the top performer gaining 3.9% followed by CBK up 3.5%,BPCC up 1.9%KFIN and GBK both up 1.1% each. NBK and NIND were all flat this week. Among the top blue chip losers PIPE was the leader down 9.6% followed by KIB down 3.7%, FOOD down 2.7%, BURG down 2.2%, KPRIJ down 1.6%, MABANEE down 1.2%, NINV and ZAIN both
down 1.1% and NMTC down 1%. The KSE weighted index has downside support at 394 level and upside it faces resistance at 400 lev-
el. While the KSE price index has upside resistance at 5,800 level and downside support remains at 5,750 level.