Saudi Arabia oil exports fall as trade fears keep prices in check

OPEC and its allies have agreed to limit output to support oil prices. (Reuters)
Updated 18 April 2019
0

Saudi Arabia oil exports fall as trade fears keep prices in check

  • The world’s top oil exporter shipped 6.977 million bpd in February, down from 7.254 million bpd in January
  • Prices have been supported this year by an agreement reached by the OPEC and its allies, including Russia, to limit their oil output by 1.2 million barrels per day (bpd)

DUBAI: Saudi Arabia’s crude oil exports fell by 277,000 barrels per day (bpd) in February from the month before, official data showed on Thursday.
The world’s top oil exporter shipped 6.977 million bpd in February, down from 7.254 million bpd in January, according to data from the Joint Organizations Data Initiative (JODI).
The Kingdom pumped 10.136 million bpd in February, down from 10.243 million bpd in January.
Saudi crude inventories rose to 204.567 million barrels in February from 200.834 million in January, the JODI data showed.
Refineries in the Kingdom processed 2.767 million bpd in February, up from 2.758 million bpd in January, according to JODI.
Prices have been supported this year by an agreement reached by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, to limit their oil output by 1.2 million barrels per day (bpd).
Global supply has been tightened further by US sanctions on OPEC members Venezuela and Iran.
Iran’s crude exports have dropped in April to their lowest daily level this year, tanker data showed and industry sources said, suggesting a reduction in buyer interest ahead of expected further pressure from Washington.
Indian refiners are turning to other OPEC members, Mexico and the US to make up for any loss of Iranian oil.
Spain’s Repsol has suspended its swaps of refined products for crude with Venezuela’s state-run oil company PDVSA, people familiar with the matter said, as US officials weigh penalties for foreign firms doing business with Venezuela.
Growing US oil production and concerns over the US-China trade dispute are keeping prices in check.
US crude oil output from seven major shale formations
was expected to rise by about 80,000 bpd in May to a record 8.46 million bpd, the EIA said in its monthly report on Monday. Surging US production has filled some of the gap in supplies, although not all of the lost production can be immediately replaced by US shale oil due to refinery configurations.
Saudi exports of refined oil products in February fell to 1.461 million bpd, from 1.616 million bpd the month before, the data showed.
The OPEC heavyweight used 259,000 bpd of crude oil to generate power in February, down from 377,000 bpd the month before, while Saudi demand for oil products in February was 2.157 million bpd, up slightly from 2.073 million bpd in January.
Monthly export figures are provided by Riyadh and other members of OPEC to JODI, which publishes them on its website.


Emirates NBD profit surges on asset sale and forex gains

Updated 26 min 22 sec ago
0

Emirates NBD profit surges on asset sale and forex gains

  • Dubai’s largest bank reports 80 percent rise in net profit for second quarter

DUBAI: Emirates NBD, Dubai’s largest bank, reported an 80 percent rise in second-quarter net profit helped by the sale of a stake in Network International and strong non-interest income on foreign exchange gains.

The result included a gain of 2.1 billion dirhams ($572 million) from the sale of a stake in digital payment provider Network International in an initial public offering in London in April.

The earnings showed that top banks in the UAE have still withstood strains from a sluggish economy and a property downturn in Dubai.

Second-quarter net profit jumped 80 percent to 4.74 billion dirhams. EFG Hermes had expected a net profit of 4.06 billion in the second quarter.

The bank said net interest income rose 6 percent in the second-quarter from a year earlier, as growth in assets offset a drop in net interest rate margins.

Non-interest income surged 23 percent, helped by gains in foreign exchange income and investment banking activities.

Provisioning for bad debts more than doubled to 656 million dirhams in the second quarter from a year earlier.

The bank said the cost of risk had increased in 2019 to a more normalized level from relatively better credit quality conditions in 2018.

Cost of risk reflects the price a lender pays to manage its risk exposure. In 2018, Emirates NBD signaled that it expected cost of risk to revert to a long-term level of 80-100 basis points from the 63 basis points seen in 2018.

“The increased cost of risk of 82 basis points in H1 2019 is a result of an expectation of a reversion of credit quality to more normalized levels from the benign conditions in 2018, coupled with the expectation of lower write-backs and recoveries,” it said.

Credit-rating agency Moody’s had warned earlier this year provisioning charges for top banks in the UAE will increase in 2019 owing to pressure in the property and the retail sectors.

The Dubai lender said its net profit surged 49 percent in the first half of the year. “Core operating profit advanced 8 percent compared to the first half of 2018, helped by loan growth, higher foreign exchange income and increased investment banking activity,” the bank’s chief executive Shayne Nelson said in a statement.

Nelson said that the bank continued to make progress on the acquisition of Turkey’s Denizbank and expects this transaction to close in the third quarter of 2019.

Emirates NBD said in April that it was buying Denizbank from Russia’s Sberbank at a roughly 20 percent discount to a previously agreed price, after a steep fall in the Turkish lira.