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Oil’s Rebound Has Citigroup Seeing Worst Over for Commodities
The commodities market has turned a corner and prices are unlikely to return to lows hit in the first quarter, according to Citigroup Inc., which boosted forecasts from metals to grains amid the oil-led recovery. The bottom was likely hit this year when weak fundamentals across all commodities were reinforced by bearish selling after the collapse of China’s equity markets, Citigroup analysts including Ed Morse wrote in a report Tuesday. The bank is now predicting Brent oil will climb to $50 a barrel in the third quarter, earlier than its previous forecast for the fourth quarter, while increasing its year-end gold estimate by $100 an ounce to $1,250. “This recovery is starting in the oil sector, where market fundamentals are tightening much faster than we had forecast at the start of the year,” the analysts wrote. “Across the industrial metals, markets are also slowly firming and prices bottoming as […]
Saudis Move Away from Crude with $1.4B In Deals With GE
GE Saudi Arabia Even as the International Monetary Fund (IMF) lent its backing to Saudi Arabia’s economic reform to diversify away from crude oil this week, General Electric (GE) accounted a series of deals with Saudi Arabia worth over US$1.4 billion to boost the kingdom’s manufacturing industry. Some US$1 billion worth of these deals are with the Saudi Arabian Industrial Investments Co., while around US$400 million is earmarked for a forging and casting manufacturing facility that will cater to the marine and energy industries. For this project, GE will be joining forces with Saudi state-owned oil giant Aramco. GE also signed a memorandum of understanding to invest US$1 billion jointly with a major Saudi entity into water and aviation, among other segments, by 2017, according to the Wall Street Journal . Related: The Biggest Winner Of The Oil Bust: Interview With Aeromexico GE has also intimated that there may […]
Exxon Investors Seek Assurance as Climate Shifts, Along With Attitudes
Exxon Mobil has been under pressure for over a year to explain its handling of climate change issues in the past. Now the company faces new pressure to explain its future, particularly how it will change in response to a warming world. At the company’s planned annual meeting on Wednesday in Dallas, shareholders will vote on a resolution to prod Exxon Mobil to disclose the risks of climate change to its business. Such resolutions have been floated before, and they typically do not pass. But there is a growing chorus of investors, many of them large institutional shareholders, who say they are worried that Exxon Mobil, the largest publicly traded energy company in the world, is not […]
North Dakota rig count low sets new record
State data in North Dakota show the number of rigs searching for or producing oil and gas as of Monday broke a record low set more than 10 years ago. State data show 25 rigs actively producing or exploring for oil or natural gas as of Monday . By two rigs, that breaks a record low set in July 2005 and comes at a time when energy companies are spending less on exploration and production because of lower crude oil prices, despite recent recovery. The all-time low point for rigs in North Dakota is zero. Rig counts serve as a loose barometer for the health of the oil and gas industry, which has been bruised by weak economics. Oil […]
Oil Discoveries Have Shrunk to a Six-Decade Low
Oil discoveries have fallen to a six-decade low as explorers cut billions of dollars of spending to ride out the biggest market slump in a generation. About 12.1 billion barrels of oil reserves were found in 2015, markin
g a fifth consecutive year of decline and the smallest volume since 1952, Oslo-based industry consultant Rystad Energy said in an e-mailed note. Oil exploration is typically the first casualty of a crude-price collapse. Companies from BP Plc to Royal Dutch Shell Plc have cut budgets and staff as […]
BP’s Oil Search Strategy Shrinks With Budget Cuts
The surprise departure of BP’s exploration boss has turned the spotlight on an oil search strategy that, after years of spending cuts, is focusing mainly on expanding existing fields rather than venturing expensively into the unknown. That caution reflects a firm chastened by the $55 billion cost of its 2010 Gulf of Mexico spill, and needing to squeeze every last drop out of a sharply reduced exploration budget at a time of low oil prices. “Exploration doesn’t necessarily have to look like (nature broadcaster) David Attenborough standing on a brand new frontier,” a BP source told Reuters. While BP’s total reserves and fields coming onstream in the next four years look healthy compared to the […]
