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How the Aramco IPO will make history and transform Saudi Arabia’s economy

How the Aramco IPO will make history and transform Saudi Arabia’s economy thumbnail

The US and Saudi Arabia have signed hundreds of billions of dollars worth of business deals following Donald Trump’s trip to the oil-rich state. The biggest deal was for nearly US$110 billion worth of weapons (extending to US$350 billion over ten years). But a number of smaller agreements were made between Saudi and US firms, […]

Big Oil Is Betting on Plastics. It May Be a Risky Bet.


Big Oil is betting on plastics. In a world awash with oil, and amid mounting consensus that demand for oil-based transport fuel for automobiles might decline over time, the world’s largest oil companies are counting on a rising need for petrochemicals. There’s some justification for that. McKinsey & Co.’s projected demand for oil to make […]

The Rise of the Amateur Oil Sleuths


On a recent Sunday evening, Samir Madani had dinner with his family in suburban Stockholm, did the dishes and put his two children to bed. Then he opened his laptop and started crunching U.S. oil import data late into the night. Mr. Madani, a technology executive who trades and researches crude as a hobby, is part of a growing […]

Will Exxon Mobil Buy BP?


Summary Exxon Mobil holds the best balance sheet; thus, is in a position to consolidate the industry. Big deals have happened when oil prices were low. BP is very cheap relative to the huge reserves the company owns. XOM could finance such an acquisition relatively easily via a 50% equity/50% cash deal. Regulatory headwinds and […]

The oil and gas industry has a problem – and the industry knows it


Oil and gas company executives believe that they’re doing right by the world. Most people disagree. In a survey conducted by the consulting firm EY, 75 percent of oil and gas executives rated themselves as good corporate citizens. But only 37 percent of the general public said the oil industry can be trusted to do […]

Saudis To Retain Full Control Over Aramco’s Oil After IPO


Saudi Arabia will continue to have full control over the oil wells and production of Aramco, after the much-anticipated initial public offering of around 5 percent of the Saudi oil giant next year, Deputy Crown Prince Mohammed bin Salman said on Tuesday. “The wells will still be owned by the government. The company only has […]

Junk-Bond Armageddon


In recent years, whenever U.S. credit markets have become mired in boredom and melted up out of sheer habit, traders start worrying about junk-bond bubbles. Now is no different. It has been a notably unremarkable year for credit traders despite populist upheavals in Europe and the U.S. and subsequent unpredictable policies and rhetoric. Meanwhile, yields […]

A $500 Billion “Hitch” Emerges In The Saudi Aramco IPO

A $500 Billion “Hitch” Emerges In The Saudi Aramco IPO thumbnail

As Saudi Arabia’s deputy crown prince pushes his nation’s Vision 2030 economic overhaul and crows of the $2 trillion Saudi Aramco valuation (ahead of its potential IPO), WSJ reports that officials at the state-owned oil company are using internal value estimates to $1.3 to $1.5 trillion, calling bin Salman’s estimate “unrealistic and mind blowing.” Since […]

Space May Be Next Frontier for Earth’s Crude Oil Giants


The Middle East has an outsize impact on energy here on Earth. One analyst thinks some regional powerhouses may leverage that role into the development of natural resources in space. Countries like the United Arab Emirates and Saudi Arabia are developing space programs and investing in nascent private space commodity initiatives, said Tom James, a […]

Who wants to be rich like a sheikh?


Long before the Russians blinded English society with their conspicuous wealth, it was the Arabs descending on Europe’s capitals in the 1970s who became proverbial for their prodigious wealth: “Rich like an oil sheikh,” said the gawping crowds as they watched the princes in their floating garments checking into the most luxurious hotels, showering bell […]

Oil Companies Exploiting Famine And Financial Ruin In South Sudan

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South Sudan’s vulnerable financial state is making the civil-war-torn state easy prey for opportunistic oil and gas companies that could be offering Juba a fraction of the energy profits they would earn under stable circumstances. The South Sudanese government and three humanitarian agencies declared a famine in some parts of the country in February, while […]

Oil majors’ reserves are shrinking and investors don’t mind


As crude prices recover, oil majors face a dilemma – how quickly should they seek to replenish reserves? It’s the same question the cyclical oil industry has tackled many times before: go too fast and risk spending too much for little reward, go too slowly and your rivals will be better positioned to grab market […]

Chevron executive pay rises

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Compensation for three of Chevron Corp’s (CVX.N) senior leaders, including Chief Executive John Watson, rose last year due to a change in how the value of pensions are calculated. The disclosure, required by U.S. regulators, comes as the oil industry grapples with low prices and Chevron, the second-largest U.S.-based oil producer, tries to bounce back […]

Oil – Expect More Uncertainty


Summary In this article, I decided to go over some weekly oil statistics that cover production, demand, inventories, etc. I found a mixed but slightly bearish picture facing the industry, but demand figures suggest that there is still some bullish data out there. I also looked at export data and figured that, with regulatory changes […]

Geopolitical Risk Premium Is Back In Oil


WTI and Brent jumped to one month highs on the news of U.S. airstrikes in Syria, and while direct risks to oil supply are limited, oil traders are on edge. (Click to enlarge) The U.S. launched airstrikes on a Syrian airbase late Thursday in response to the alleged use of chemical weapons by the Syrian […]

Where Do Oil, Gas Professionals Want to Work?


North America, the Middle East and Europe are the top three regions where oil and gas professionals would like to work, according to the first Global Energy Talent Index (GETI). The survey revealed that 22 percent of voters said North America was their top location, compared to 22 percent for the Middle East and 21 […]

The Secret History of Wall Street’s Largest Oil Trade


The men huddled in the same first-floor conference room as always, only this time they’d decided to make their annual oil bet bigger and bolder than ever before. Fewer than a dozen representatives from three Mexican government ministries and Petróleos Mexicanos, the state energy company, were about to make a wildly contrarian play. If it paid […]

Oil’s Central Bank To The Rescue!


WTI rallied back into $50 territory this week with help from positive OPEC speak regarding an output cut renewal, production outages in Libya, Iraq and Canada and compliance levels on output cuts near 95% (via Reuters) for March. We continue to be believers in flat price strength thinking that high levels of OPEC compliance and […]

Determining the Oil Market’s Path of Least Resistance


In “Futures in Focus,” Dan Deming, managing director at KKM Financial, and Bloomberg’s Mark Barton examine the factors shifting momentum in the oil market. They speak on “Bloomberg Markets.”

ConocoPhillips just proved low oil prices are here to stay


Jim Cramer saw ConocoPhillips’ sale of a portion of its oil sands to Canadian producer Cenovus as a sign that the oil glut will keep prices low for a while. “In one fell swoop ConocoPhillips confirmed a lot of what’s become the conventional wisdom in the oil patch: the price of crude’s not going to […]

Saudi Aramco’s $2 Trillion Valuation Has Too Many Assumptions


Changing a tax system that has endured since the 1970s is no small matter, especially when it concerns what could be the world’s most valuable company. Saudi Arabia’s announcement on Monday that it was cutting the tax rate on large oil companies to 50 percent from 85 percent is crucial for the fate of the […]

Goldman Sachs in Talks for Saudi Arabian Equities License


U.S. bank said to hold preliminary discussions with regulators Goldman Sachs has yet to file an application for the license Goldman Sachs Group Inc. is in preliminary talks for an equities license in Saudi Arabia as the U.S. lender seeks to take advantage of the country’s economic reforms, according to people familiar with the matter. […]

Oil giants upending American shale turf


Big Oil is muscling in on shale country. ExxonMobil, Royal Dutch Shell and Chevron are jumping into American shale with gusto, planning to spend a combined $10 billion this year, up from next to nothing only a few years ago. The giants are gaining a foothold in West Texas with such projects as Bongo 76-43, […]

Can Big Oil Survive A CO2 Crackdown?


Over the long run, the oil business is under threat. There are various arguments about why that might happen. Peak supply people argue we are running out of oil. Peak demanders say that market saturation, efficiency, and new technologies will cause oil demand to peak and decline. Similarly, clean energy proponents argue oil will be […]

Saudi Arabia Downgraded By Fitch To A+ On Soaring Fiscal Deficit, Deteriorating Balance Sheet


With Saudi Arabia scrambling to respond to surging US shale production in what many analysts warn is a lose-lose decision, as either Saudi Arabia will lose market share under the current status quo, or government revenue will tumble should the Vienna 2016 production cut deal be cancelled, moments ago Fitch poured some fuel on the […]

Big Oil’s Plan to Buy Into the Shale Boom


Exxon, Shell, and Chevron plan to spend $10 billion in the U.S. shale patch this year. A gas flare is seen through the window as Royal Dutch Shell’s Scott W. Scheffler drives near Mentone, Texas, in Loving County situated in a central portion of the Delaware Basin, on Thursday, March 2, 2017. Photographer: Matthew Busch/Bloomberg […]

The Great Battery Race

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he coming of cheap and effective lithium-based batteries will cause the greatest changes in the energy and automobile sector since Henry Ford built the model T, writes Gerard Reid, founding partner of Alexa Capital, financial analyst and co-founder of the Energy and Carbon blog. But European countries like Germany and France have no significant production, in […]

Exxon Could Use An Oil Price War


If Saudi Arabia’s saber-rattling leads to renewed price warfare in the oil market this year, then everyone involved will suffer — except you drivers, of course. And Exxon Mobil Corp. Exxon does not actually like getting lower prices for its primary product; its cash flow has been cut in half over the past two years. […]

Why I Totally Hate Big Oil – And Why You Should Too…

Why I Totally Hate Big Oil – And Why You Should Too… thumbnail

Did you hear the speech that Al Gore gave in Texas the other day saying that the oil industry should take climate change more seriously, that oil could peak in the next decade, that the “social acceptance” for oil was disappearing, that there needed to be a meaningful tax on carbon emissions and that he “strongly supported” […]

Big Oil’s Big Climate Divide


Among other things, carbon dioxide contributes enormously to cognitive dissonance. Scott Pruitt, head of the Environmental Protection Agency, demonstrated as much last week when he expressed doubts about the role of carbon dioxide emissions in fostering climate change. Only in January, the then-unconfirmed Pruitt was telling senators that “human activity” had a role in climate […]

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