OPEC

O&G sector due for a turnaround on rising capex in 2019 & beyond, says DBS

SINGAPORE (Oct 5): DBS is maintaining its average Brent crude oil forecasts of ~US$75/bbl for 2018 and US$75-80/bbl for 2019, with the intention to monitor developments in the coming weeks.

The move comes despite growing optimism on the possibility of oil prices rising above US$100/bbl due to talks of Saudi Arabia and Russia striking a private deal to raise production and US inventory buildup.

OPEC sees lower demand for its oil in 2018, points to surplus

(July 13): OPEC said on Wednesday its oil production jumped in June and forecast world demand for its crude will decline next year as rivals pump more, pointing to a market surplus in 2018 despite an OPEC-led output cut.

Giving its first 2018 forecasts in a monthly report, the Organization of the Petroleum Exporting Countries said the world will need 32.20 million barrels per day (bpd) of crude from its members next year, down 60,000 bpd from this year.

Oil could hit US$60 before year-end, says Barron's citing Citi analyst

BENGALURU (July 10): Accelerating world oil demand and reduced supply from the Organization of the Petroleum Exporting Countries (Opec) could push crude prices up to US$60 ($82.92) a barrel before the end of the year, according to a report from Barron's.

The report cites research from Citigroup senior energy analyst Eric Lee, who previously called for a bear market in oil when the price was above US$100. The decline in recent weeks to a low of just over US$44 for Brent crude, the international benchmark, has made Mr Lee a short-term bull, Barron's notes.

Once costly deep-sea oil turns cheap, to OPEC's dismay

(May 31): Reports of deep-sea drilling’s demise in a world of sub-US$100 ($138.6) oil may have been greatly exaggerated, much to OPEC’s dismay.

Pumping crude from seabeds thousands of feet below water is turning cheaper as producers streamline operations and prioritize drilling in core wells, according to Wood Mackenzie. That means oil at US$50 a barrel could sustain some of these projects by next year, down from an average break-even price of about US$62 in the first quarter and US$75 in 2014, the energy consultancy estimates.

Oil traders warn there's a supply crunch looming

GENEVA/LAUSANNE (March 30): The oil market is risking a supply crunch as producers cut spending on major projects to focus on short-term low-cost shale output in the US, some of the top crude and products traders said.

Oil at US$40 no problem as US drillers snub OPEC with hedges

Oil drillers

CHICAGO/HOUSTON (March 16): OPEC’s worst enemy isn’t US shale drillers. It’s the hedges propping them up.

American oil explorers who survived the worst of the 2014-2016 market rout are shrugging off the 14% slide in prices this year from a high of US$55.24 ($77.47) to less than US$48 a barrel Tuesday. The price would have to drop to the US$30s or lower to dent the bottom line of many drillers now working US shale fields, said Katherine Richard, the CEO of Warwick Energy Investment Group, which own stakes in more than 5,000 oil and natural gas wells.

Investors see oil break out of narrow range with record bets

Oil drums

NEW YORK (Feb 28): Oil has been bound to the tightest price range in more than a decade, and yet hedge funds have never been so confident it will eventually rally.

Money managers boosted their bets on rising West Texas Intermediate prices to a record on speculation that the Organization of Petroleum Exporting Countries and its partners will manage to ease a global supply glut. America’s crude producers, which are increasing output, aren’t so sure. They’ve been hedging against price declines for this year and 2018.

Saudi Arabia breaks records on oil exports and output for year

KUWAIT (Feb 21): Saudi Arabia boosted oil exports and production last year to the highest monthly averages on record as the global crude market endured oversupply.

Exports climbed to 7.65 million barrels a day on average last year, from 7.39 million barrels a day a year earlier, according to Joint Organisations Data Initiative monthly data compiled by Bloomberg. Production rose to 10.46 million barrels a day from 10.19 million, on average, over the same period.

Don’t be too heartened by SIA’s fuel hedging move yet, say analysts

SINGAPORE (Feb 9): UOB Kay Hian maintains its “hold” rating in Singapore Airlines (SIA) while raising its target price on the stock to $10.40 from $10.10 previously, following the release of the carrier’s 3Q17 results.

The suggested entry price is $9.60 based on a 10% total return, inclusive of dividends.

Keppel shares are up 15% as oil prices stabilise. Is this the time to jump in?

SINGAPORE (Feb 3): Keppel Corporation is among the heavyweight blue-chip stocks that drove the Straits Times Index sharply higher in the wake of Donald Trump’s election victory.

Since Nov 8, the stock is up more than 15% versus a 9% gain in the benchmark index.

The key metric being watched by investors is the price of oil, which has stabilised at around US$55 per barrel, up from less than US$50 per barrel in 2016.

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