BAGHDAD: Iraq wants the Kurdistan region to stop independent crude exports and to hand over sales operations to the Iraqi state-oil marketer SOMO, the company’s director said on Thursday.
Iraq is talking to Turkey to allow SOMO to sell the Kurdish crude that arrives by pipeline in Ceyhan, the Turkish terminal on the Mediterranean, acting SOMO director general Alaa Al-Yasiri told reporters in Baghdad.
About 530,000 barrels per day (bpd) used to arrive in Ceyhan via the pipeline until mid-October, of which about half came from the Kurdistan Regional Government’s oilfields and the rest from Kirkuk, a disputed province claimed by both the Kurdish region and Iraqi authorities in Baghdad.
Output from Kirkuk fell in mid-October, when Iraqi forces took back control of the northern region’s oilfields from Kurdish fighters who had been there since 2014.
Kurdish Peshmerga forces deployed in Kirkuk in 2014, when the Iraqi army fled in the face of an advance by Daesh militants. The Kurdish move prevented the militants taking control of the oilfields.
The pipeline carried on average 419,000 bpd in October, down from 600,000 bpd in September, said Farid Al-Jadir, the director general of North Oil Company, which operates Kirkuk.
NOC should resume exports from Kirkuk through the Kurdish pipeline this month, after the two sides agree on terms of use, Al-Yasiri said. Kirkuk would also export by tanker trucks about 15,000 bpd to the refinery of Kermanshah in Iran, he added.
Al-Yasiri expected an old pipeline that bypasses most of the Kurdistan region to resume operation in three months.
The pipeline was severely damaged by Islamic State after it took over Mosul’s Nineveh province in 2014. US-backed Iraqi forces ousted the group from Mosul in July, after a nine-month campaign supported by Kurdish Peshmerga fighters.
Iraq, the second-largest producer of the Organization of the Petroleum Exporting Countries after Saudi Arabia, supported any future decision by the group to support oil prices, Al-Yasiri said.
OPEC is expected to extend curbs on oil output when it meets in Vienna at the end of month.
Iraq ‘wants control of Kurdish region’s oil exports’
Iraq ‘wants control of Kurdish region’s oil exports’
Respite for oil market amid rate hike worries
- Oil markets may have been oversold in the last two trading days, says analyst
RIYADH: Oil steadied on Thursday as a potential pause in US interest rate hikes and the passing of a crucial vote on the US debt ceiling bill were offset by a report of rising inventories in the world’s biggest oil consumer.
US Federal Reserve officials on Wednesday suggested interest rates could be kept on hold this month and the US House of Representatives passed a bill suspending the government’s debt ceiling, improving the chance of averting a disastrous default.
Brent crude futures fell 10 cents, or 0.14 percent, to $72.50 a barrel by 1339 GMT while US West Texas Intermediate crude rose 7 cents, or 0.1 percent, to $68.16. Both benchmarks fell on Tuesday and Wednesday.
“Oil markets may have been oversold in the last two trading days,” said CMC Markets analyst Tina Teng. “Sentiment rebounded amid the debt bill’s passage in the House and (the) Fed’s rate hike pause signal.”
HIGHLIGHTS
• Market sources citing American Petroleum Institute figures on Wednesday said that US crude inventories rose by about 5.2 million barrels last week.
• Brent crude futures fell 10 cents, or 0.14 percent, to $72.50 a barrel by 1339 GMT while US West Texas Intermediate crude rose 7 cents, or 0.1 percent, to $68.16.
Mixed demand indications from China, the world’s biggest oil importer, have nonetheless weighed on the market, as has industry data showing a rise in US crude inventories.
Market sources citing American Petroleum Institute figures on Wednesday said that US crude inventories rose by about 5.2 million barrels last week.
“The current mood is one of pessimism,” said Tamas Varga of oil broker PVM. “Investors have been pragmatic and risk averse of late.”
Also in focus is the June 4 meeting of the OPEC+ producer group, in which the Organization of the Petroleum Exporting Countries and allies including Russia will discuss whether or not to cut oil production further.
Barclays forecast
British multinational bank Barclays has slashed the average price of its Brent crude forecast for this year from $92 to $87 a barrel. The bank also slashed its price forecast of Brent for 2024 as it cut the average projected price to $87 a barrel from $97.
Chinese company in Brazil
China’s CNOOC Ltd. has begun production at the Buzios5 well off the coast of Brazil, the company said in a statement on Thursday.
The well is the fifth phase of the Buzios oil field off Brazil’s southeast coast. At an average water depth of 1,900 meters to 2,200 meters, the field is the world’s largest deep-water pre-salt oil field, with daily production of 600,000 barrels, the company said.
CNOOC’s Brazilian subsidiary owns 7.34 percent of the Buzios shared reservoir, which is 88.99 percent owned by Brazilian state-owned oil and gas company Petrobras. CNOOC paid $1.9 billion to Petrobras last year to secure a 5 percent stake in a production sharing agreement at the field.
UAE’s in-country value projects driving billions to local firms
ABU DHABI: More than $27.23 billion has been redirected to the local economy since the UAE Ministry of Industry and Advanced Technology (MoIAT) and ADNOC launched major in-country value programs to support domestic industries.
Speaking at the Make in the Emirates Forum, Abdulla Al-Shamsi, Assistant Undersecretary of MoIAT, said more than $14.43 billion of investment was redirected to the local economy last year alone, an increase of 25 percent year-on-year.
“The National In-Country Value Program is a nationwide program that speaks one language across many different sectors,” Al-Shamsi said. “It’s one methodology and this is something we’re very proud of because it benefits the private sector and when the private sector sees this it helps them prepare, invest, and spend.”
The forum heard how the National ICV Program is “functionating well and accelerating.”
The forum also heard how industrial zones are playing a critical role in the in the country’s sustainable industrial development and broader economic prospects. Local industrial leaders described how they are utilizing alternative energy resources such as solar and hydrogen to reduce their carbon footprint.
The second edition of the Make it in the Emirates Forum concluded on Thursday with the UAE showcasing its unique value proposition to international investors.
Investors were invited to explore opportunities and competitive advantages, with panel discussions focusing on the National In-Country Value (ICV) Program, the role of industrial zones, competitive financing as a key enabler and local talent in the private sector.
The UAE’s industrial exports reached $47.6 billion in 2022, growing 49 on 2021. The industrial sector's contribution to GDP rose to $49.5 billion in 2022, a 38 percent increase on 2020.
The Make it in the Emirates Forum is organized by the Ministry of Industry and Advanced Technology in partnership the Abu Dhabi Department of Economic Development (ADDED) and ADNOC.
On the first day of the forum, the UAE government announced $2.7 billion in industrial offtake agreements, building on the $29.9 billion of offtake agreements announced at the 2022 edition of the forum.
Pakistan posts record inflation for second consecutive month
- Inflation of 37.97% in May set national record, adding to problems of balance of payment and risk of sovereign default
- In April, the bureau said Pakistan's CPI at 36.5% was the highest recorded as well as the highest in South Asia
ISLAMABAD: Pakistan's annual inflation rate rose to 37.97% in May, the statistics bureau said on Thursday, setting a national record for the second month in a row, adding to its problems of a balance of payment crisis and the risk of a sovereign default.
Already in April, the bureau said Pakistan's CPI at 36.5% was the highest recorded, as well as the highest in South Asia, ahead of Sri Lanka, which posted annual inflation of 25.2% in May.
Pakistan's month-on-month rise in May was 1.58%, the bureau said in a statement, adding vegetables, pulses, wheat, wheat flour, rice, eggs and chicken in food items and fuel and gas prices caused the increase.
Inflation has been on an upward trend since early this year after the government took painful measures as part of fiscal adjustments demanded by the International Monetary Fund (IMF) to unlock stalled funding.
The IMF demands include the withdrawal of subsidies, a hike in energy prices, a market-based exchange rate and new taxation to generate extra revenue in a supplementary budget.
Islamabad says it has met the demands, but the IMF has yet to release the $1.1 billion funding stalled since November as part of the $6.5 billion Extended Fund Facility agreed in 2019.
The funding is critical for Pakistan to unlock other bilateral and multilateral financing.
Pakistan’s national currency makes historic recovery against USD in open market — currency dealers
- Appreciation follows central bank’s decision to allow banks to buy dollars from interbank market for credit and debit card payment settlements
- Rupee was trading at Rs290 in open market during afternoon trading session as compared to Rs315 in the previous day’s trading
KARACHI: Pakistan’s national currency posted historic gains against the United State dollar in the open market on Thursday, following the central bank’s decision to allow banks to buy dollars from the interbank market for credit and debit card payment settlements, currency dealers said.
The rupee was trading at Rs290 in the open market during the afternoon trading session as compared to Rs315 in the previous day’s trading, showing an appreciation of 8 percent, according to dealers.
“The rupee has appreciated more than Rs25 in the open market and this has happened for the first time in the history of Pakistan,” Malik Bostan, chairman of the Exchange Companies Association of Pakistan (ECAP), told Arab News.
The currency appreciated in the open market after the central bank on Wednesday allowed authorized dealers, that is banks, to “purchase dollar from the interbank for settlement of the card based cross border transactions with IPS (Instant Payment System),” a notification said.
Prior to the State Bank notification, commercial banks were buying around $15-20 million from the free market per day, putting an excessive burden on it, the key reason for the widening gap between the interbank and open market, according to Bostan.
“The banks were buying dollars from the open market at Rs315 but they were selling to their customers for the settlement at Rs325,” Bostan said, adding that banks had been buying from the open market but selling to their credit card holders at higher rates which excessively burdened the free market.
“They, Finance Minister Ishaq Dar and Central bank, took the timely decision and allowed them to purchase from the interbank market instead of the exchange companies,” he added.
Bostan’s claims could not be independently verified.
The ECAP chief predicted that the central bank’s decision would lead to further appreciation of the rupee in the open market, to reach close to the interbank rate.
The rupee in the interbank was trading between Rs290 and Rs300 at the end of trading session on Thursday, according to Bostan.
Pakistani analysts said the central bank’s move had eased the pressure on the open market and would also narrow the gap between the open and interbank markets in line with the International Monetary Fund’s conditions.
“The demand for credit and debit card settlement is around $2 billion to $2.5 billion per annum and the central bank’s decision has eased off the pressure from the open market,” Tahir Abbas, Head of the research at Arif Habib Limited, said. “The IMF also wanted to reduce the gap between the exchange rates prevailing in the interbank and open markets.”
The rupee in the interbank market closed at Rs285.47 against the greenback on Wednesday.
Amid decades-high inflation, Pakistan slashes petrol price by Rs8 per liter
- After revision in prices, petrol will now be sold for Rs262 per liter, says finance minister
- Pakistan slashes prices of high speed diesel, light diesel oil by Rs5 per liter respectively
ISLAMABAD: Pakistan’s Finance Minister Ishaq Dar announced the government’s decision to slash the price of petrol by Rs8 per liter on Wednesday, as Pakistan attempts to provide relief to the masses amid decades-high inflation.
Inflation increased to a historic high of 36.4 percent in Pakistan in April 2023, the highest since 1964, after the South Asian country hiked fuel and energy prices to revive a $6.5 billion loan program with the International Monetary Fund (IMF).
To reduce the burden of inflation from the masses, Pakistan slashed the price of petrol by Rs 12 per liter two weeks ago. The South Asian country revises prices of petroleum products fortnightly.
In a brief video message on Wednesday, the finance minister said that prices of petroleum products had not reduced drastically over the past 15 days nor had the value of the rupee significantly improved against the US dollar.
“The maximum that we could reduce the petrol price [a fortnight ago] was Rs12 per liter,” Dar said. “Today, by reducing an additional Rs8 per liter, the price of petrol will reduce by Rs20 per liter in total. So, its price will reduce from Rs270 per liter to Rs262 from June 1,” he added.
Dar also announced a reduction in the price of high speed diesel by Rs5 per liter and light diesel oil by Rs5 per liter. The price of kerosene oil will remain unchanged, he added.
The finance minister said after the latest price reduction, high speed diesel, kerosene, and light diesel oil would cost Rs253, Rs164.07, and Rs147.68 per liter respectively.
Pakistan also slashed its oil imports by almost half last month, reducing it by 48 percent to 1.07 million tons during April 2023 as compared to 2.05 million tons during April 2022, a research report by Pakistan’s largest securities brokerage company, Arif Habib Limited, said.
