Oil prices touch fresh 11-month highs after fall in US crude stockpiles

The drop in US crude stocks is a typical year-end occurrence as energy companies take oil out of storage to avoid tax bills. (AFP file photo)
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Updated 08 January 2021
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Oil prices touch fresh 11-month highs after fall in US crude stockpiles

  • Oil prices have been supported this week by a pledge by Saudi Arabia to cut output

LONDON: Oil prices were steady on Thursday after hitting fresh 11-month highs on a fall in US stockpiles and in the wake of a pledge by Saudi Arabia to cut output by more than expected.

Brent crude was up 5 cents to $54.35 a barrel at London afternoon trade after touching $54.90, a fresh high not seen since before the first COVID-19 lockdowns in the West.

US West Texas Intermediate (WTI) was up 26 cents, or 0.5 percent to $50.89 after touching $51.28.

Wednesday’s storming of the US Capitol by supporters of US President Donald Trump appeared to have little impact, while a slight rise in global equities suggested investors believed President-elect Joe Biden would be empowered to spend more freely.

Oil prices have been supported this week by a pledge by Saudi Arabia to cut output by an additional 1 million barrels per day (bpd) in February and March.

“Saudi Arabia ... intimately knows the relationship between the oil price and the global inventory levels. Lower inventories equal higher prices,” SEB chief commodity analyst Bjarne Schieldrop said.

BACKGROUND

$63 - UBS expects Brent to trade at $63 per barrel in the second half of 2021 and WTI to trade at a $3 per barrel discount to Brent prices.

“The strategy of course only works if the OPEC+ (group of oil producers) stays disciplined,” he added. UBS analysts raised their forecast for Brent to $60 per barrel by mid-year, citing the Saudi output decision.

“The Kingdom’s preemptive move suggests to us a desire to defend prices and support the oil market amid demand concerns due to extended mobility restrictions in Europe,” they said.

US crude stocks fell and fuel inventories rose, the Energy Information Administration said on Wednesday.

Crude inventories were down by 8 million barrels in the week to Jan. 1 to 485.5 million barrels, against a Reuters poll showing analysts expected a 2.1 million barrel fall.

The drop in crude stocks is a typical year-end occurrence as energy companies take oil out of storage to avoid tax bills.

UBS raised its Brent forecast amid expectations of a sharp recovery in demand in the second quarter on vaccine rollouts and increased travel.

With Saudi Arabia’s move, OPEC’s production increase of 0.5 million barrels per day (bpd) for January is reversed in full, which will result in a tighter oil market in the first half of the year, analysts at the Swiss bank wrote in a note.

The bank expects Brent to trade at $63 per barrel in the second half of 2021 and WTI to trade at a $3 per barrel discount to Brent prices.


Biggest snowstorm in half century hits Seoul

Updated 6 min 12 sec ago
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Biggest snowstorm in half century hits Seoul

  • Around 300 flights were grounded, massive crowd at subways caused delays

SEOUL: The biggest November snowstorm to hit South Korea’s capital in more than a half century blanketed the capital on Wednesday, grounding hundreds of flights, disrupting commuter traffic and leaving at least two dead.

South Korea’s weather agency said 20 to 26 centimeters of snow fell in northern areas of Seoul and nearby areas. The agency said it was the heaviest snowstorm Seoul has experienced in November in 52 years. A storm on Nov. 28, 1972, dumped 12 centimeters.

South Korea’s Yonhap news agency said one person died and four others were injured in a five-vehicle accident in the eastern town of Hongcheon. The storm blanketed much of the country, with the central, eastern and southwestern regions recording about 10 to 28 centimeters of cover.

At least 317 flights were canceled or delayed at airports nationwide, while authorities ordered around 90 ferries to remain at port. They also shut down hundreds of hiking trails.

Icy road conditions slowed down the morning commute in Seoul and led to massive crowds at subways, causing delays. Emergency workers across the country responded to fallen trees, road signs and other safety risks.

Officials at the Safety Ministry said they couldn’t confirm any school closures as of Wednesday afternoon. Visitors dressed in traditional hanbok garb were busy taking photographs at Seoul’s snow-covered medieval palaces while snowmen popped up in playgrounds and schoolyards across the country.

The weather agency said snow will continue in most parts of the country until noon Thursday.

President Yoon Suk Yeol instructed the safety and transport ministries to mobilize all available relevant personnel and equipment to prevent traffic and other accidents.


Israeli soccer team prepares for closed-door match in Hungary after attacks on fans in Amsterdam

Updated 9 min 44 sec ago
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Israeli soccer team prepares for closed-door match in Hungary after attacks on fans in Amsterdam

  • The team will face off Thursday against Turkiye’s Besiktas in an Europa League match that was relocated to Hungary
  • Maccabi Tel Aviv head coach Zarko Lazetic told a news conference on Wednesday that his team was focused on its game, regardless of what tensions may exist elsewhere

DEBRECEN, Hungary: Israel’s Maccabi Tel Aviv soccer team returned to Europe on Wednesday for the first time since its fans were assaulted in the Netherlands earlier this month in attacks that were condemned as antisemitic by authorities in Israel and across Europe.
The team will face off Thursday against Turkiye’s Besiktas in an Europa League match that was relocated to Hungary. The contest at Nagyerdei Stadium in the city of Debrecen will be played without fans due to security concerns following the violence in Amsterdam on Nov. 7 that resulted in five people being treated in hospitals and dozens of detentions.
Maccabi Tel Aviv head coach Zarko Lazetic told a news conference on Wednesday that his team was focused on its game, regardless of what tensions may exist elsewhere.
“It’s not a question for me what happened outside of the stadium. We saw some videos and everything, but we really try to focus on football,” he said. “We’ll see tomorrow what is the effect.”
The violence in Amsterdam came after local authorities banned pro-Palestinian demonstrators from gathering outside the stadium where Maccabi was playing Dutch team Ajax.
A large crowd of Israeli fans chanted anti-Arab slogans on their way to the match, video showed. Afterward, youths on scooters and on foot crisscrossed the city in search of Israeli fans, punching and kicking them, according to Amsterdam’s mayor.
The city’s police commander said the incidents had “an antisemitic character.”
Maccabi press officer Ofer Ronen-Abels said Wednesday the events in Amsterdam “had nothing to do with football.”
Before the assaults, Besiktas had requested its home game against Maccabi, originally scheduled for Istanbul, to be moved to “neutral ground” over security concerns.
The club later said on social media that Hungary was the only country willing to host the match and that Hungarian authorities requested it be played behind closed doors.
Hungary has hosted several home games for Israel’s national team for security reasons since the war in Gaza began.
Maccabi held its final practice session at the Kiryat Shalom training complex in Tel Aviv on Wednesday before departing for Hungary, the team said on its website.


Court to rule on ineligibility for France’s Le Pen in March

Updated 25 min 20 sec ago
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Court to rule on ineligibility for France’s Le Pen in March

  • “This case is a lot less simple than some wanted to think. I still hope we will be heard” by the court, Le Pen, 56, told reporters
  • Her defense lawyer Rodolphe Bosseult had earlier told judges that prosecutors’ sentencing request was “a weapon of mass destruction of the way things work in a democracy“

PARIS: French far-right figurehead Marine Le Pen will learn in March whether she will be declared ineligible for elections, a Paris court said on Wednesday at the end of a trial for embezzling funds from the European Parliament.
Prosecutors have asked judges at the Paris criminal court that any sentence shutting Le Pen out of public office be applicable even if she appeals the court’s ruling.
That means that if found guilty on March 31, she could be blocked from participating in France’s next presidential election, scheduled for 2027 at the latest.
“This case is a lot less simple than some wanted to think. I still hope we will be heard” by the court, Le Pen, 56, told reporters following the hearing.
Her defense lawyer Rodolphe Bosseult had earlier told judges that prosecutors’ sentencing request was “a weapon of mass destruction of the way things work in a democracy.”
Bosseult added that if imposed, the penalty would affect “the whole electoral roll or even the validity of the vote” in any election.
Prosecutors’ bombshell request was topped off with a five-year jail term, three of which suspended, and a fine of 300,000 euros ($320,000).
At issue in the case are employment practices for assistants in the European Parliament to representatives of Le Pen’s National Front party — since renamed the National Rally (RN) — between 2004 and 2016.
Prosecutors say the party created a “system” using MEPS’ parliamentary allowances to hire people who in fact worked for the outfit in France — not in Brussels or Strasbourg.
The defense struggled throughout the case to produce evidence that any of the supposed assistants had in fact carried out relevant work.
And the European Parliament itself said the RN had cooked the books to the tune of 4.5 million euros.
Prosecutors said that Le Pen could again misuse public funds if allowed to continue in elected office, as justification for their sentencing request.
But her lawyer Bosselut said that the RN’s financial practices at the time were “banal... shared by every European party” in the parliament.
Buoyed this year by the RN’s unprecedented success at snap parliamentary elections, becoming France’s largest single party in parliament, Le Pen has characterised the sentencing request as an attempt to remove her by means of the judiciary rather than a political fair fight.


Saudi Arabia halves desalination costs, boosts efficiency by 80%, official says

Updated 36 min 20 sec ago
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Saudi Arabia halves desalination costs, boosts efficiency by 80%, official says

  • Technological advancements have played a critical role in the Kingdom’s water conservation efforts

RIYADH: Saudi Arabia has improved its desalination efficiency by 80 percent and halved costs by 50 percent in recent years, a top official from the Kingdom has said.

“Our achievements in desalinated water production in the last eight years are equivalent to what was achieved in the previous four decades,” Deputy Minister of Environment, Water and Agriculture Mansour bin Hilal Al-Mushaiti said.

He outlined the accomplishments at the 2025 Budget Forum hosted by the Ministry of Finance in Riyadh, calling the progress a “historic milestone” for the Kingdom, according to the Saudi Press Agency.

Daily desalinated water production has surged to 6 million cubic meters, contributing to a total capacity of 11.3 million cubic meters daily, he added.

The improvement is testament to the Kingdom’s commitment to water security, environmental sustainability and Vision 2030, the deputy minister said.

He highlighted the monumental scale of the Kingdom’s water infrastructure, noting that water production facilities are primarily located along the coasts, requiring water to be transported across thousands of kilometers.

“The water transmission network we have built spans more than 14,000 km — double the length of the Nile River,” he said. “It crosses mountain peaks, valleys and deserts to deliver water to communities across the Kingdom.”

Strategic water storage capacity has also seen a significant boost, rising from 13 million cubic meters in 2016 to more than 25 million cubic meters today.

“This expansion ensures the Kingdom’s resilience in times of crisis, guaranteeing reliable access to water for all regions,” said Al-Mushaiti.

He attributed the achievements to strong government support and private-sector collaboration.

“We have implemented 29 water projects worth SR28 billion ($7.46 billion), of which 30 percent — SR8 billion — is foreign investment,” he said.

Looking forward, Al-Mushaiti announced plans for private sector projects worth SR58 billion.

“We are building a system where public and private sectors work hand-in-hand to achieve national goals,” he said.

Technological advancements have played a critical role in the Kingdom’s water conservation efforts.

Al-Mushaiti said that by using innovation and sustainable practices, the Kingdom is saving more than 9 billion cubic meters of groundwater annually.

“That’s equivalent to the water consumption of the entire Kingdom’s population for three years,” he added.

During the COVID-19 pandemic, the water sector installed 2 million electronic meters, enabling more efficient billing and consumption monitoring.

“These meters send notifications to users when their consumption exceeds normal levels, promoting the principle of ‘responsible consumption’,” Al-Mushaiti said.

Furthermore, water rationalization initiatives in government agencies saved more than 31 million cubic meters of water in 2023 alone.

The ministry’s efforts have also spurred growth in the agricultural sector, which has seen its contribution to gross domestic product rise from SR64 billion in 2016 to SR109 billion in 2023.

“We achieved self-sufficiency rates for many crops that now exceed 100 percent,” Al-Mushaiti said, adding that these gains reflect the success of policies aimed at conserving water resources while boosting productivity.

On the environmental front, Saudi Arabia is making strides with its Saudi Green Initiative.

Al-Mushaiti said that in just three years, the country has planted more than 95 million trees using renewable water and supplementary irrigation.

“This number will surpass 100 million by the end of the year, marking the start of a green era for the Kingdom,” he said.

The deputy minister also highlighted Saudi Arabia’s leadership in addressing global water challenges.

“Water is the backbone of life and development, and achieving sustainability is one of the greatest global challenges,” he said.

In this regard, Crown Prince Mohammed bin Salman in 2023 announced the establishment of the Global Water Organization, headquartered in Riyadh.

The decision underscores Saudi Arabia’s commitment to advancing water sustainability worldwide, Al-Mushaiti said.

He added that the World Bank has recognized Saudi Arabia’s water system as unique and a model that others should study.

As Saudi Arabia pushes forward with its ambitious plans for water security, agriculture and environmental sustainability, Al-Mushaiti concluded with optimism: “The journey so far has been remarkable, but the best is yet to come.”


Saudi Geological Survey celebrates excellence in research, innovation

Updated 53 min 12 sec ago
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Saudi Geological Survey celebrates excellence in research, innovation

  • Makkah Deputy Gov. Prince Saud bin Mishaal and Minister of Industry and Mineral Resources Bandar Al-Khorayef attended the event
  • CEO Abdullah Al-Shamrani reviewed 25 years of accomplishments, emphasizing the survey’s role in advancing geological sciences

JEDDAH: The Saudi Geological Survey recently celebrated its 25th anniversary with a special event in Jeddah, marking a quarter-century of excellence in geological research and exploration.
Makkah Deputy Gov. Prince Saud bin Mishaal and Minister of Industry and Mineral Resources Bandar Al-Khorayef attended the event.
The event highlighted the survey’s achievements, future initiatives, and contributions to geological research and innovation. Guests shared insights from their experiences with the organization.
CEO Abdullah Al-Shamrani reviewed 25 years of accomplishments, emphasizing the survey’s role in advancing geological sciences, supporting national development, and managing resources sustainably.
He also outlined plans to raise awareness of geological risks via the “Rawasi” platform, preserve Zamzam water sustainability, and complete digital transformation of technical services.
Al-Shamrani affirmed a commitment to advancing technical achievements, implementing projects, and supporting development for a promising future through skilled Saudi cadres.
Al-Khorayef said that since the start of the millennium, the Kingdom had made intensive efforts in mineral resource research and exploration. Led by SGS employees, this had yielded significant discoveries over the past 25 years, impacting the mining sector by boosting investment and developing mineral wealth.
He added that the aim was to position the Kingdom as a global leader in earth sciences and geology through ambitious plans, aligning with its international standing.
These efforts included fully uncovering its mineral wealth, meeting geological needs, building a global earth sciences database, and creating a platform for stakeholders worldwide, the minister said.