Monday, October 31, 2022

Chile’s government, miners still clashing over mining royalty bill


Jorge Riesco, president of Chile’s National Mining Society. Credit: Sonami 

Chile’s government and mining industry continued to disagree over a proposed mining royalty bill on Wednesday despite recent adjustments.

The government had on Tuesday announced modifications to a proposed mining royalty bill, lowering a variable “ad valorem” rate to a flat 1% for large producers and tying another rate to operating margins, instead of the price of copper as was originally proposed.

Jorge Riesco, president of Chile’s National Mining Society (Sonami) which represents small, medium and large companies including Anglo American, BHP and Glencore, said that while the adjustments benefited medium-sized miners, he believed the tax burden would still be too high.

“It is undeniable that this proposal still lacks if it wants to be at a level comparable to other countries for attracting investment in terms of total tax burden,” Riesco said in a local radio interview.

He added that dialogue between the government and companies was frank “but not totally fruitful” and that according to Sonami’s calculations, the tax burden on mining companies could be between 50% and 55%.

Chile’s finance ministry estimates the tax burden with copper prices of $3.74 per pound would reach 39.8%, marginally below Peru and Queensland, Australia.

Speaking to congress on Wednesday, Finance Minister Mario Marcel defended the bill and said state participation in copper income would go from 45% to about 55%-56% when copper prices surpass $4 a pound.

“We’re confident that this is a plan that better balances the aim of increased revenue with the objective of maintaining the mining sector’s development opportunities,” Marcel said.

Marcel added that the bill would allow Chile to remain competitive with Peru while greatly reducing the gap in collected revenue.

Sonami’s Riesco argued that the government should consider promoting more mining production instead of increasing taxes, arguing this would make a greater contribution to the treasury.

(By Fabián Andrés Cambero and Alexander Villegas; Editing by David Holmes and Bernadette Baum)

Tuesday, October 25, 2022

Dangote Refinery: Africa’s Largest Oil Facility is 97% Complete

Aliko Dagote

[Business Insider Africa] – Members of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) who recently paid a visit to Aliko Dangote’s multi-billion-dollar refinery disclosed that the refinery is 97 per cent near completion. 

The NMDPRA disclosed the news in Abuja when representatives of the Dangote Petroleum Refinery presented the work plan for the facility for 2022/2023, Daily Trust reported.

Speaking on the refinery project, NMDPRA’s Chief Executive, Farouk Ahmed, reiterated the importance of the Dangote Petroleum Refinery to the country while assuring that the Authority will give all necessary support to ensure timely completion and kick-start operations.

The Dangote Refinery, situated on 6,180 acres (2,500 hectares) of land, is Africa’s biggest oil refinery and the world’s biggest single-train petroleum facility. Upon completion, the refinery will be able to process 650,000 barrels of crude oil per day into refined petroleum products, which will help Nigeria become an oil refining country.

The Group Executive Director, Strategy, Portfolio Development & Capital Projects, Dangote Industries Limited, Devakumar Edwin, hinted that the refinery would allow for smooth transhipment of refined petroleum products to international markets and ultimately eliminate the overreliance on fuel import from other regions into Nigeria.

According to him, the refinery would stimulate economic development in Nigeria, adding that it can meet 100 per cent of Nigeria’s requirement of all liquid products (Gasoline, Diesel, Kerosene and Aviation jet) and also have a surplus of each of these products for export.

“The high volume of petrol output from the refinery would transform Nigeria from a petrol import-dependent country to an exporter of refined petroleum products,” he stated, adding that the refinery would produce Euro-V quality gasoline, diesel, jet fuel, kerosene and poly-propylene for local consumption and also have a surplus of each of the products for export.

Nigeria currently imports most of its refined petroleum due to a lack of domestic refining capacity. With this new facility, Nigeria’s refining capacity will double and help meet the increasing fuel demand while providing cost savings.

China’s billion-dollar cash-for-copper trade grinds to a halt 

For the past 15 years, the center of gravity of the global copper market has been a row of warehouses in Shanghai’s free-trade zone where the Yangtze River meets the Pacific.

Traders from London to Lima would obsess over the flows in and out of Shanghai’s huge bonded copper stockpile. It was the focal point for a multi-billion-dollar cash-for-copper trade, whereby Chinese companies would use metal as collateral for cheap financing. A cottage industry of analysts sprang up to estimate the size of what became the world’s largest cache of copper metal.

But now China’s bonded warehouses are all but empty. The once-frenetic flow of metal into the stockpile has come to a juddering halt as two dominant financiers of Chinese metals, JPMorgan Chase & Co. and ICBC Standard Bank Plc, have halted new business there. Numerous traders and bankers interviewed by Bloomberg said they believe the trade is dead for now, and some predicted the bonded stocks could drop to zero, or close to it.

The implications are being felt across the market, as the world’s largest copper consumer becomes more reliant on imports to meet its near-term needs at a time when global stocks are already at historically low levels. The Chinese copper market is at its tightest in more than a decade as traders pay massive premiums for immediate supplies.

For now, the miners, traders and financiers arriving in London this weekend for the annual LME Week jamboree are largely cautious on the near-term prospects for copper, given concerns about the global economy. But many in the market say they are braced for price spikes when the macroeconomic news eventually improves. And without its buffer of bonded stocks, any pickup in Chinese demand could have an explosive effect on the market.

“The physical market is so tight, it’s like a room full of gunpowder — any spark and the whole thing could blow,” said David Lilley, chief executive of hedge fund Drakewood Capital Management Ltd. Without the Shanghai bonded inventory, “we are living without a safety net.”

China’s bonded copper stockpile (so called because metal there is held “in bond,” before import duties have been paid) first came to the world’s attention in the wake of the global financial crisis. When copper prices slumped, Chinese traders bought up all the metal they could find — thanks to Beijing’s massive stimulus plan — making copper the leading indicator of the global economic recovery.

But China wasn’t actually consuming all that copper — at least, not right away. Instead, the traders directed it into the bonded stockpile, using the metal to raise financing. An expansion of government credit to support trade and infrastructure meant there were many easy opportunities for companies to raise money with copper — using bank lines for import financing or repurchase agreements, known as “repos,” to turn their metal inventories into short-term cash.

“It’s like a room full of gunpowder — any spark and the whole thing could blow.”

The money they raised could then be reinvested in other areas, such as the red-hot property market. Many Chinese companies with no connection to the commodities industry hired teams of traders and bankers to get into the copper game. The ebbs and flows of China’s credit cycle began to drive the global copper market.

At the peak in around 2011-12, China’s bonded stocks held about a million tons of copper, worth some $10 billion. This month, they totaled just 30,000 tons, according to industry consultancy Shanghai Metals Market. That’s down nearly 300,000 tons from earlier this year and the lowest level in decades, according to several Chinese physical traders who have been in the market for over 15 years.

Warehousing fraud

The decline began several years ago, with the massive warehousing fraud at Qingdao in 2014 that caused many banks and traders to reassess their appetite for the Chinese metals industry as a whole.

But it accelerated this year, as China’s economic slump, rising interest rates and several high-profile losses caused more participants to step away. The final blow came this autumn, as Maike Metals International Ltd., China’s top copper trader and a very active participant in the bonded copper trade, faced a liquidity crisis.

JPMorgan and ICBC Standard Bank have not entered new metal financing trades for bonded metal since September, and people familiar with the matter said it’s not clear if they will restart.

The Chinese physical traders, who asked not to be identified, said they expected Shanghai’s bonded copper stocks to drop further — potentially to zero, or just a few hundred tons — as market participants have lost confidence in the business of using metal to raise financing for other purposes.

To be sure, China’s copper imports and production have remained at high levels despite the economic slowdown: the metal just hasn’t been going into bonded warehouses.

But the consequence of the collapse in stocks is already being felt in the market. Copper for immediate delivery on the Shanghai Futures Exchange traded this month at a 2,020 yuan premium to copper for delivery in three months – the most since 2005. Physical premiums — which are paid over and above exchange prices to secure physical metal — have risen to the highest in nearly a decade at Yangshan, in Shanghai’s bonded zone.

And it’s not just in China that stocks are low. Robert Edwards at CRU Group estimates that global copper stocks currently stand at just 1.6 weeks of consumption — the lowest ever in the consultancy’s data going back to 2001.

As a result, any improvement in the macroeconomic outlook or pickup in Chinese demand could have dramatic implications for global copper prices.

“If the Chinese economy does get a bit better we could in a lot of commodities be saying, ‘Oh, where’s the inventory?’” said Mark Hansen, chief executive of metals trader Concord Resources Ltd. “We’ll find it just doesn’t exist.”

(By Alfred Cang and Jack Farchy)

Wednesday, October 12, 2022

Saudi Arabian minister of state blames high US gas prices on lack of American refinery production

 U.S. President Joe Biden, center left, and Saudi Crown Prince Mohammed bin Salman, center, arrive for the family photo during the "GCC+3" (Gulf Cooperation Council) meeting at a hotel in Saudi Arabia's Red Sea coastal city of Jeddah Saturday, July 16, 2022. 

U.S. President Joe Biden, center left, and Saudi Crown Prince Mohammed bin Salman, center, arrive for the family photo during the "GCC+3" (Gulf Cooperation Council) meeting at a hotel in Saudi Arabia's Red Sea coastal city of Jeddah Saturday, July 16, 2022.  (Mandel Ngan/Pool Photo via AP) 

The Saudi Arabian minister of state fired back against claims the country is responsible for higher U.S. gas prices, asserting lack of American refinery production is to blame. 

"With due respect, the reason you have high prices in the United States is because you have a refining shortage that has been in existence for more than 20 years," Adel al-Jubeir told "Special Report," "You haven't built refineries in decades." 

The Saudi Arabian government has been taking heat since OPEC+ made the decision to slash oil production by 2 million barrels per day. The country was pushed by the White House to avoid making cuts while U.S. gas prices remain high. The Biden administration, meanwhile, has not expanded domestic oil production as Americans are seeing gas prices rise again.

The minister of state asserted that the country does not politicize oil and the shortage is not related to the fundamentals of crude oil supply and demand. 

"Oil is not a weapon," al-Jubeir said. "It's not a fighter plane. It's not a tank. You can't shoot it. You can't do anything with it. We look at oil as a commodity and we look at oil as important to the global economy in which we have a huge stake. The idea that Saudi Arabia would do this to harm the U.S. or to be in any way politically involved is absolutely not correct at all."

While many hoped President Joe Biden’s trip to Saudi Arabia would bring cheaper gasoline to Americans, Adel al-Jubeir explained the trip was about the "bilateral relationship" between the countries in promoting peace, envisioning the future, protecting interests, dealing with instability and promoting economic trade, opportunity and investment. 

"I think that the issue of oil and oil production may have been taken out of context by perhaps commentators and analysts," he said.

Adel al-Jubeir ultimately asserted the country is "committed to ensuring stability in the oil markets to the benefit of consumers and producers." 

The minister of state also offered his condolences to victims of a past California oil refinery accident.

Tuesday, October 11, 2022

Visiting The World's Most Dangerous Country 🇦🇫 ( Afghanistan 2022 )

First US cobalt mining operation to begin after more than 30-year hiatus

 Jervois gets nod for Idaho project development

Idaho Cobalt is Jervois’ flagship project. (Image: Jervois Mining.

Booming demand for batteries powering the world’s shift into electric vehicles is rekindling US cobalt production after at least a 30-year hiatus.

Australia-based Jervois Global Ltd. is starting the first US cobalt mine in Idaho on Friday, according to chief executive Bryce Crocker. The mineral sits “at the top of the table” in terms of national security, said Crocker.

“There aren’t many new sources of supply, particularly in stable jurisdictions, which is why this mine in the US is very important,” he said. Cobalt hasn’t been produced in the US since at least 1994, according to data from the United States Geological Survey.

Cobalt is a crucial component in EV batteries and is on the US government’s critical-minerals list. The US sees widespread adoption of electric vehicles as key to its efforts to combat climate change. Both California and New York have passed laws that will ban the sale of new gasoline-powered vehicles in the coming decades. As automakers gear up to achieve ambitious electrification goals, it’s causing a shortage of materials needed in batteries and sparked a global rush to secure those supplies.

The level of urgency among manufacturers to secure supplies “is profoundly different than it was even two or three years ago,” said Crocker in an interview. “It’s now very elevated in terms of focus at the director and the board level,” he said.

In July, General Motors Co. and Ford Motor Co. stepped up efforts to lock in supplies by signing direct deals with producers of battery metals.

While more than two-thirds of the mined metal comes from the Democratic Republic of Congo, there’s been an increasing shift among manufacturers to source cobalt from outside the African nation due to allegations of corruption, human rights abuses and the use of child labor there.

The passage of the Inflation Reduction Act also provides incentives for battery materials sourced in the US. EVs can qualify for a $7,500 tax credit under President Joe Biden’s climate and tax bill, as long as their batteries contain minerals extracted from or processed in a country with a free trade agreement with the US, and providing part of the components are made or assembled in North America.

The Idaho mine is expected to produce 2,000 tons of mined cobalt a year, according to Crocker. The concentrated cobalt will then be exported and converted into refined products outside the US before ultimately brought back into the US to serve customers, he added.

Jervois owns a nickel and cobalt refinery in Brazil and is talking to third parties in countries such as Canada and Australia to convert the mined material. About 80% of global refining is concentrated in China, but capacity is growing elsewhere, including at Finland’s giant Kokkola refinery, which is owned by Jervois.

Cobalt demand will grow from 127,500 tons in 2022 to 156,000 tons in 2030, as a result of the shift to iron-based batteries by major automakers, according to BloombergNEF.

Shares of Jervois trading in Sydney capped the best week since May, gaining 15%.

(By Yvonne Yue Li)

US EPA Revokes Permit For Oil Terminal Off Texas 

The U.S. Environmental Protection Agency (EPA) has revoked the permit for a proposed 1.92 million barrels-per-day offshore oil export terminal off the coast of Corpus Christi, Texas.

Namely, the Bluewater oil export terminal is being jointly developed by Phillips 66 and Trafigura. The deepwater terminal would be located15 nautical miles off the coast and would allow for up to two Very Large Crude Carriers (VLCCs) to simultaneously load domestically produced crude oil via single point mooring (SPM) buoys for export to overseas markets.

In May 2019, Bluewater Texas Terminals LLC applied for a Clean Air Act permit from the EPA, and later received a pollution control license that allowed it to emit almost 19,000 tons per year of Volatile Organic Compounds, which can lead to adverse health effects, and 833 tons per year of hazardous air pollutants, which cause cancer and other serious health impacts.

However, during a public comment period on the project, the EPA received pushback from environmental groups who argued for stricter pollution controls. As a result, the EPA revoked the license and has now directed the developer to withdraw its applications by September 15 and submit a revised proposal that would reduce pollutants by at least 95%.

`EPA’s regulations require marine vessel loading operations—like the Bluewater port—to reduce toxic air pollution by 95 percent. The application of this rule will reduce the amount of pollution the Bluewater terminal – if it is built — will emit by a whopping 18,000 tons each year` said Gabriel Clark-Leach, Attorney for the Environmental Integrity Project.

Bluewater Texas Terminals LLC also has a pending application for the terminal with the U.S. Maritime Administration’s Deepwater Port Licensing Program covering the designing, engineering, and construction of the facility. It is one of four proposed offshore oil export terminals off Texas with current pending applications with the program.

Friday, October 7, 2022

Credit Suisse to buy back $3 billion in debt, sell landmark hotel as credit fears persist

 Signage hangs over the entrance of a Credit Suisse Group AG branch in Zurich, Switzerland, on Sunday, Sept. 25, 2022. Inflation in Switzerland has more than doubled since the start of the year and the State Secretariat for Economic Affairs expects it to come in at a three-decade-high of 3% for 2022. Photographer: Pascal Mora/Bloomberg via Getty Images

Signage hangs over the entrance of a Credit Suisse Group AG branch in Zurich, Switzerland, on Sunday, Sept. 25, 2022. Inflation in Switzerland has more than doubled since the start of the year and the State Secretariat for Economic Affairs expects it to come in at a three-decade-high of 3% for 2022. Photographer: Pascal Mora/Bloomberg via Getty Images
Bloomberg | Bloomberg | Getty Images 

  • Troubled bank Credit Suisse offered to buy back up to 3 billion Swiss francs ($3.03 billion) of debt securities Friday, as it navigates a plunging share price and a rise in bets against its debt.
  • It comes after Credit Suisse’s shares briefly hit an all-time low earlier this week, and credit default swaps reached a record high, amid the market’s skittishness over its future.
  • Shares closed at 4.22 Swiss francs on Thursday. They are down over 50% year to date.

Troubled bank Credit Suisse

offered to buy back up to 3 billion Swiss francs ($3.03 billion) of debt securities Friday, as it navigates a plunging share price and a rise in bets against its debt.

The Swiss lender also confirmed that it is selling its famous Savoy Hotel in Zurich’s financial district.

In a statement Friday regarding the offer to repurchase debt, Credit Suisse said, “The transactions are consistent with our proactive approach to managing our overall liability composition and optimizing interest expense and allow us to take advantage of market conditions to repurchase debt at attractive prices.”

It comes after Credit Suisse’s shares briefly hit an all-time low earlier this week, and credit default swaps reached a record high, amid the market’s skittishness over its future.

The embattled lender is embarking on a massive strategic review under a new CEO after a string of scandals and risk management failures, and will give a progress update alongside its quarterly earnings, scheduled for Oct. 27.

The most costly of the scandals was the bank’s $5 billion exposure to hedge fund Archegos, which collapsed in March 2021. Credit Suisse has since overhauled its management team, suspended share buybacks and cut its dividend as it looks to shore up its future.

On Friday, the bank announced a cash tender offer relating to eight euro- or sterling-denominated senior debt securities, worth up to 1 billion euros ($980 million), along with 12 U.S. dollar-denominated securities worth up to $2 billion. The offers on the debt securities will expire by Nov. 3 and Nov. 10, respectively.

Credit Suisse shares were trading more than 7% higher following the news Friday, however they remain down around 50% year to date.

No ‘Lehman moment’

Although rising credit risk among European banks may bring back memories of the 2008 global financial crisis, analysts have stressed that capital buffers are now significantly higher.

MSCI Research also highlighted in a note Thursday that although high in historical context — particularly for Credit Suisse and Deutsche Bank

— the volume of credit default swaps does not yet indicate imminent sectorwide default.

Credit Suisse and Deutsche Bank credit spreads have reached historically wide levels, while those for other major European banks have also expanded, but MSCI said the slope of credit spread curves has generally steepened, rather than inverting.

“Inversion of the curve would reflect investors’ short-term default concerns, and this was observed in 2008 across banks. Credit Suisse is the only major bank for which the curve has recently flattened,” MSCI Research Executive Directors Gergely Szalka and Thomas Verbraken noted.

“A standard model using current CDS pricing shows a market-implied six-month default probability of approximately 2% and 1% for Credit Suisse and Deutsche Bank, respectively, and a five-year default probability of 23% for Credit Suisse and 17% for Deutsche Bank.”

While heightened, Szalka and Verbraken said these market-implied probabilities did not suggest imminent default over the short term, but market concern about the viability of both banks over the longer term was more apparent.

“All that to say, the market data suggests that a Lehman moment for European banks does not seem likely for the time being,” they concluded.

‘Positive development’

Johann Scholtz, equity analyst at Morningstar, told CNBC on Friday that the debt repurchase was a “positive” signal from Credit Suisse to a skittish credit market that it is “not in dire straits” with regards to liquidity.

He also dismissed the notion that the sale of the Savoy Hotel in Zurich was part of a “dash for liquidity,” suggesting the cash generated would not be sufficient to address any substantial liquidity issue.

“I think it would be fair to say that there’s going to be quite a lot of write-downs that are going to come down in the third-quarter results. I think they’ll probably look to ‘kitchen sink,’ because I think that’s really what the market is also looking for,” Scholtz said.

Thursday, October 6, 2022

China launches new generation VLCC with rigid wing sails 

The sails are expected to slash average fuel consumption by nearly ten percent

China Classification Society (CCS) is hailing a major milestone after overseeing the delivery and naming ceremony of the first VLCC ever built in China deploying four 40metre rigid wing sails.

CCS attended the naming ceremony of the 307,000 DWT, 333 metre crude oil carrier M/V New Aden at Dalian Shipbuilding Industry Co (DSIC) together with the owner China Merchants Energy Shipping (CMES) and China Shipbuilding Trading Company. China Merchants Group chairman Mr Miu Jianmin meanwhile named the vessel.

CCS Vice President Mr Fan Qiang represented CCS at the ceremony saying the New Aden is ‘one of the most advanced VLCCs ever built in China’. He said the sails are expected to slash average fuel consumption by nearly 10pc on the Middle East to the Far East route cutting an estimated 2900 tons of CO2 emissions a year.

“The New Aden is an outstanding vessel which embraces the very latest design techniques as we work towards meeting the IMO GHG targets,” he said. “China Merchants, Dalian Shipbuilding’s R & D team and Guangwei Composite Materials have undertaken great work in developing the ship and this new generation of rigid wing sail (see notes to editors 1). The sails have a combined surface of around 1200 sq m and are a true innovation. They are made of a low weight carbon fibre composite supported by high strength corrosion resistance and a state-of-the-art autonomous control system. This system maximises efficiency in complex operating conditions. The technology monitors power supply and self-inspects to ensure the hydraulic lifting and electric rotation is optimised to ensure peak performance.”

Mr Fan said the New Aden sets new standards in VLCC performance.

“Together with China Merchants and Dailian Shipbuilding we have looked at every aspect of design to deliver the best possible result in fuel reduction, sailing performance in wind and waves through optimised hull design as well as safety and environmental protection,” he said. “The New Aden further meets the requirements of Harmonized Common Structural Rules (HCSR), the latest oxynitride and oxysulfide emission standards, the update phase requirements of the Energy Efficiency Design Index (EEDI) and the Energy Efficiency Existing Ship Index (EEXI). It further meets the EU Inventory of Hazardous Materials and ship recycling rules in line with the latest oil major requirements.”

So what happens now that OPEC+ has cut production by 2 million barrels a...

Tuesday, October 4, 2022

Saudi Arabia’s Oil Production Increased by 20% in 8 Months


The Kingdom’s production reached around 10.5mln barrels per day.

Saudi Arabia’s average oil production increased since the beginning of 2022 until the end of August by 20 percent, a government document seen by Saudi Gazette showed.

The Kingdom’s production reached around 10.5 million barrels per day, higher by 1.8 million barrels per day compared to the same period last year.

The increase is due to the efforts by the OPEC+ agreement to support market stability and the performance efficiency for the benefit of the participants in the market and the petroleum industry.

Saudi Arabia expects the real GDP growth to reach 8 percent in 2022, driven by real GDP growth in oil activities and the sustained levels of growth in the non-oil activities, which is expected to record growth of 5.9 percent in 2022.

According to the OPEC monthly report on oil markets in August of 2022, global demand for oil is expected to register a growth of 3.1 million barrels per day compared to last year, to reach 100.03 million barrels per day.

Global demand for oil in 2023 is expected to grow by around 2.7 million barrels per day, to reach 102.72 million barrels per day.

It is worth noting that the share of the non-OECD countries constitutes the largest percentage of the growth in 2023, which is around 2.1 million barrels per day.

The report attributes this increase to the economic recovery in these countries and the increase in demand for fuel in the transport, industry, and petrochemicals sectors.

The average price of Brent crude futures increased, since the beginning of 2022 until the end of August, by 55 percent to record around $104.04 per barrel, compared to $67.06 per barrel during the same period last year.

The average prices of Brent crude futures have recorded their highest levels since 2008, with the closing price reaching $127.98 per barrel on March.8, 2022.

Despite uncertainty in the global markets during this year in the midst of the geopolitical events, the severe economic concerns and the tightening of the monetary policies to curb inflation around the world, the oil market has been characterized with stability compared to other energy markets such as natural gas, coal, and electricity.

The OPEC+ agreement contributed to supporting stability of the oil market in particular, and balancing supply with the gradual recovery in global demand for oil after the Coronavirus pandemic has faded.

Oil Prices Rise on U.S. Production Outages 

Oil prices rose on Wednesday in U.S. trading hours as production cuts caused by Hurricane Ian outweighed downward pressure from a strengthening dollar and expected U.S. crude stockpile builds.

Brent crude futures were up 80 cents, or 0.9%, at $87.07 per barrel by 1229 GMT, while U.S. West Texas Intermediate (WTI) crude futures rose 97 cents, or 1.2%, to 79.47 per barrel. Both contracts erased earlier falls after rising over 2% in the previous session.

In the Gulf of Mexico, about 190,000 barrels per day of oil production, or 11% of the Gulf’s total, were shut-in due to Hurricane Ian, according to offshore regulator the Bureau of Safety and Environmental Enforcement (BSEE).

Global equities pulled off two-year lows on Wednesday, after the Bank of England said it would step into the bond market to stem a damaging rise in borrowing costs, thereby dampening investors fears of contagion across the financial system.

Latest Updates

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The dollar hit a fresh two-decade peak against a basket of currencies on Wednesday as rising global interest rates fed recession concerns. A strong dollar reduces demand for oil by making it more expensive for buyers using other currencies.

U.S. crude oil stocks rose about 4.2 million barrels for the week ended Sept. 23, while gasoline inventories fell about 1 million barrels, according to market sources on Tuesday, citing figures from industry group the American Petroleum Institute.

Distillate stocks rose by about 438,000 barrels, according to the sources. The report comes ahead of official Energy Information Administration data due 1430 GMT.

Goldman Sachs cut its 2023 oil price forecast on Tuesday, due to expectations of weaker demand and a stronger U.S. dollar, but said global supply disappointments only reinforced its long-term bullish outlook.

An upcoming price catalyst will be producer group OPEC+’s Oct. 5 meeting at which Russia is likely to propose an output cut of around 1 million barrels per day, a source familiar with the Russian viewpoint said on Tuesday.

Germany Inks LNG Deal As Chancellor Visits Gulf to Secure Energy


German Chancellor Olaf Scholz /UAE  


German utility RWE has signed a deal with Abu Dhabi National Oil Company (ADNOC) to deliver liquefied natural gas to Europe’s largest economy by the end of December, RWE announced on Sunday.

Though the initial amount to be delivered is relatively small, it’s a politically significant deal to shore up supplies of gas from outside of Russia as Chancellor Olaf Scholz seeks to deepen ties with the Gulf and find alternative energy sources.

The deal, which includes a memorandum of understanding for multi-year supplies of LNG, came on the second day of a two-day trip to the Gulf region by Scholz.

“We need to make sure that the production of LNG in the world is advanced to the point where the high demand that exists can be met without having to resort to the production capacity that exists in Russia,” Scholz told journalists before the deal was announced.

The cargo to be delivered this year by ADNOC will be for 137,000 cubic metres of LNG and will be the first LNG to be supplied to the German gas market via the floating LNG import terminal at Brunsbüttel near Hamburg, RWE said.

ADNOC further reserved an unspecified number of LNG cargoes for Germany in 2023.

Germany’s two new planned floating LNG terminals will eventually be able to receive up to 12.5 billion cubic meters of LNG a year, equivalent to about 13% of the country’s gas consumption in 2021, according to data from research firm Enerdata.

“This marks an important milestone in building up an LNG supply infrastructure in Germany and setting up a more diversified gas supply,” RWE said in a statement.

German officials hope an array of deals, like the one struck with Abu Dhabi for LNG, will help take the edge off skyrocketing energy prices.

Meanwhile, frustrated Germans protested on Sunday, calling to put into service the halted Nord Stream 2 pipeline project that was designed to transport fuel from Russia to Germany but was put on ice after the war in Ukraine broke out.

“Immediately open Nord Stream 2,” read one placard. “Opening Nord Stream 2 = Prevention”, read another. Organizers expected some 5,000 protestors in the city of Lubmin, where the pipeline lands in Germany.

In addition to supplying RWE, ADNOC has also agreed to sell ammonia to German companies, including Steag and Aurubis (NAFG.DE). It will also provide 250,000 tonnes of diesel a month to German firm Hoyer.

Earlier on Sunday, the president of the United Arab Emirates, Sheikh Mohammed bin Zayed al-Nahyan, signed an agreement with Scholz that covers accelerating energy security and industrial growth.

Separately, the UAE renewable energy company Masdar will explore wind energy development off the German coast.

Scholz travelled to Qatar after his meetings in Abu Dhabi. On Saturday, he held talks in Jeddah with Saudi Arabia’s Crown Prince Mohammed bin Salman.

Reporting by Andreas Rinke and Moataz Mohamed

Monday, October 3, 2022

Angel Oak proves “resilience once again” during Hurricane Ian 

JOHNS ISLAND, S.C. (WCBD) – An iconic oak tree – named the Angel Oak – has withstood yet another hurricane in its long history, according to the City of Charleston.

Hurricane Ian, a Category 1 storm, brought strong winds to the Charleston area on Friday. Forecasters say wind speeds of 92 miles per hour were reported at Shutes Folly, with nearly 70 miles per hour reported in Charleston.

And while the severe weather put the historic Angel Oak to the test, its survival is a true mark of resiliency.

Charleston city leaders call the Angel Oak a “Lowcountry treasure” with a history dating back 400-500 years.

Located on Johns Island, the tree measures 66.5 feet tall and 28 feet in circumference.

The City of Charleston says that city arborists surveyed the Angel Oak Tree for storm damage on Sunday. “The famous Angel Oak has proven her resilience once again,” city officials said.

The city reported no damage to the iconic tree.