Review: MbS, Saudi Arabia’s sharpest prince 4 Sep 2020 From the Ritz rumble to unleashing a sovereign fund, "Blood and Oil" brings together the antics of the kingdom’s crown prince in a gripping page-turner. Mohammed bin Salman’s rise through grisly palace politics to unprecedented power elicits horror and, sometimes, admiration.
Aramco’s dividend defences are triple-locked 10 Aug 2020 The Saudi state oil giant is disbursing $18.8 bln despite quarterly earnings slumping to $6.6 bln. Ultra-low costs lend an edge over Western rivals. Low debt and priority for private shareholders are extra buffers for those willing to overlook environmental and social concerns.
Saudi $45 bln bank M&A is haunted by past failure 25 Jun 2020 The kingdom’s biggest lender NCB wants an all-share combo with Samba, having dropped its pursuit of Riyad Bank last year. Local retail investors may shrug at the prospect of creating a banking champion. That means the acquirer will have to pay towards the top of a mooted range.
Sovereign funds are having their rainy-day moment 23 Jun 2020 Temasek is stepping in to support Singapore Airlines and a marine group. It makes sense to shore up strategic assets at home when global valuations are high and cash is on hand. Peers from Abu Dhabi’s Mubadala to Malaysia’s Khazanah are likely to follow.
Aramco’s SABIC saga ends in unhappy compromise 17 Jun 2020 The $69 bln that the oil giant has ended up paying for a 70% stake in the chemicals firm is a lot more than its current value. Aramco’s consolation is that it can pay SABIC’s owner, a Saudi wealth fund, over a longer period. But neither buyer nor seller is getting what they want.
Oil prices are stuck in a narrow tunnel 12 Jun 2020 After spiking above $40 a barrel, crude has now slumped again. Voluntary and enforced supply cuts have put a floor under the market after April’s shock falls. But the risk of a second coronavirus wave, and the difficulties of coordinating production hikes, point to a ceiling.
Aramco well placed for timid oil recovery 12 May 2020 The Saudi oil giant’s earnings slumped 25% in the first quarter, but its cash pile means it can keep dividends flowing. True, Aramco may not prevail in its Atlas-like attempt to prop up the world’s oil market alone. But there are tentative indications that it might not have to.
Saudi’s $69 bln asset rejig collides with reality 11 May 2020 Giant Aramco is trying to cut the price of last year’s deal to buy 70% of chemicals firm SABIC. A discount would give Riyadh’s Public Investment Fund less cash to pivot Saudi’s economy away from oil. Budget concerns make helping the kingdom’s corporate cash cow more important.
Oil car crash highlights Aramco investors’ airbag 6 May 2020 The Saudi crude giant’s shares have fallen less than those of western peers. Shareholders’ scope to avoid the dividend cuts now hitting oil majors is one reason why. It helps that Riyadh may be able to borrow its way out of the crisis rather than have to drain its cash cow.
Mukesh Ambani gives Saudis a run for their money 4 May 2020 A $7 bln rights issue backstopped by the Reliance Industries boss will help keep his promise to cut debt. Although smaller than a delayed deal with Aramco, the discounted stock sale is a record for India. The symbolic significance should instil more confidence amid the pandemic.
Viewsroom: The F’d up oil market 23 Apr 2020 Breakingviews columnists in London, Mumbai and Brooklyn discuss what’s going on in the global energy markets amid the coronavirus crisis, as well as Facebook’s big Indian deal and the U.S. government’s attempt to prop up small businesses with the Paycheck Protection Program.
Corona Capital: Extended Stay, Victoria’s Secret 22 Apr 2020 Concise views on the pandemic’s corporate and financial fallout: Blackstone checks back into one of its favorite old haunts, hotel chain Extended Stay; while another private-equity shop, Sycamore, tries to dump its proposed investment in lingerie seller Victoria’s Secret.
SEC puts small plug in oil ETF loss gusher 21 Apr 2020 The U.S. agency has stopped USO, a popular exchange-traded fund used by investors to bet on oil, from creating new shares. Stemming the fund’s growth may help trading in a futures market wracked by negative prices. But it won’t stop its investors facing huge losses.
Oil’s big crash is more rational than it looks 20 Apr 2020 U.S. one-month crude futures went below zero for the first time ever on Monday. With the May contract about to expire, the slump is partly driven by technical factors. But the wider panic – that recent output cuts won’t stop storage being filled – couldn’t be any more real.
Flaky oil output cuts will favour Saudi Arabia 15 Apr 2020 Supply curbs brokered by the United States make President Donald Trump look like a big winner. But the deal isn’t robust and won’t lift crude prices enough to prevent some U.S. shale producers from going bust. Riyadh could end up with a bigger market share once the dust settles.
OPEC throws sand in wheels of oil’s runaway train 9 Apr 2020 The producer group and allies like Russia are set to knock one-tenth off global daily oil output. The cut, which could rise if other countries agree to join in, might start draining the epic glut holding down prices. But it won’t do much if the Covid-19 demand slump persists.
Saudis’ Warren Buffett impression looks skin-deep 9 Apr 2020 The kingdom’s wealth fund looks to be ditching diversification by snapping up stakes in big European oil groups. Unless MbS knows something that others don’t, buying stock on the open market is riskier than a classic Sage of Omaha swoop. Oil groups may also be cheap for a reason.
Brazen Trump oil claims may yet fire partial deal 2 Apr 2020 A day before meeting with beleaguered U.S. crude-industry execs, the American president predicted an epic supply cut by Saudi Arabia and Russia. Yet he may only need a chunk of the 10 mln barrels a day reduction he’s hoping for to keep the U.S. shale industry from total collapse.
Corona Capital: Ackman’s hedge, Oil stockpiles 26 Mar 2020 Concise views on the pandemic’s corporate and financial fallout, including investor Bill Ackman’s surprise reversal of fortune, and the U.S. shale oil bailout that wasn’t.
Oil storage crisis is new threat to OPEC 25 Mar 2020 The double whammy of a Saudi Arabia-led price war and a virus-fuelled collapse in demand points to a huge oversupply of crude this year. Space to store the surplus may run out at this rate. If that’s exhausted, a barrel of the commodity could soon be worth less than $20.