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Libya's State Oil Company wants to increase output and transparency, says new Chairman
Massoud Suleman, the new acting chairman of Libya's National Oil Corporation, said that it would focus on increasing its output and transparency as Africa's largest oil producer tries to recover from years' worth of instability. Since 2011, violent factionalism, and disputes over labour have disrupted the oil and gas production of the state-owned firm that oversees it. Last year, production plummeted multiple times due to rivalry between groups. This included a dispute over the leadership of Libya's central bank that controls oil revenues. Suleman responded to questions via email by saying, "The National Oil Corporation's strategic plan for increasing production is something we will continue to implement. We can make adjustments whenever needed." According to NOC, the country will produce about 1.4 millions barrels of crude oil per day by the end of 2024. The longer-term goal of the OPEC nation is 2,000,000 bpd. Khalifa Abdelsadek told reporters earlier this month that the country needed $3 to $4 billion in order to achieve a production of 1.6 millions bpd. Suleman said that he also would concentrate on increasing the transparency of NOC, which could include streamlining certain operations and possibly closing some offices. According to its website NOC owns 15 subsidiaries in full, as well as stakes in joint-ventures and other companies. Suleman stated, "I will concentrate on ensuring transparency within the National Oil Corporation, so that any investors, whether they are the Libyan government or our foreign partners can be confident that the money invested in the NOC will use it in the best way possible." Foreign investors are wary about investing in Libya. The country has been divided for years between rival factions of the east and west, backed by Turkey or Russia. "I'm still trying to get a full picture of the work done by some companies like the Mediterranean Oil Services Company", Suleman said, referring specifically to NOC, which is responsible for procuring equipment and services related oilfield operations. "I'll probably move cautiously to evaluate some branches and close some of them... particularly some of the recently established branches." Mediterranean Oil Services is headquartered in Dusseldorf in Germany and, since 2020, in Dubai. Libyan media reported last year that the company opened a branch in Istanbul. Suleman stated that closing some offices would "simplify the corporate structure and make it easier to manage the company in the future." CRUDE FOR FUEL SWAPS He said that he was in touch with the Libyan attorney general regarding a "request for an end to the crude swap program". NOC uses crude-for fuel swaps as a funding alternative. He also said that he would work with the central banks and the Government of National Unity in Tripoli to determine "the appropriate mechanism to provide sufficient budget to ensure the complete supply of refined products to the country". He is the first person to comment on possible office closings, and the first to comment on the decision of the Attorney General to stop NOC from using crude-for fuel swaps. Suleman succeeded Farhat Bengdara in the position of chairman at NOC by mid-January. Bengdara resigned from his position as chairman of NOC in mid-January. He was appointed by NOC in July 2022. Libya, despite being a member of the Organization of the Petroleum Exporting Countries(OPEC), is exempted from the output limits agreed upon by its members and their allies in the so-called OPEC+ producer group. This includes Russia. Donald Trump, the president of the United States, has asked that crude oil prices be reduced.
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Swiss court finds former Trafigura executive guilty of corruption
S witzerland’s top criminal court found Trafigura, a former executive and a company guilty of corruption on Friday in a case involving the payment made to an Angolan government official in exchange for oil contract. The court ordered that the trading house pay $148 million as fines and compensation, and sentenced Mike Wainwright, a former employee of itss to 32 months imprisonment. Of this time 12 months must be served. You can appeal the decision to the same court. This is the first case in Switzerland where a company was charged with corruption of an official from abroad. It's also a rare instance in the world of a former executive of a trading house being brought to trial. The prosecution alleged Trafigura, among others, paid more than $5,000,000 in bribes to an Angolan official via a network intermediaries between 2009 and 2011 to secure oil deals. Trafigura previously stated that the anti-bribery, anti-corruption and compliance program in place at its parent company at the time met legal requirements as well as good practice standards. Wainwright previously denied all allegations made against him. (Reporting and editing by Emma Farge, Matthias Williams).
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LyondellBasell reports quarterly loss due to weak demand for chemicals
LyondellBasell, a petrochemicals company, reported Friday a loss for the fourth quarter. This was due to a weak demand in key markets like Europe and Asia. The economy of the eurozone stagnated in the last quarter due to high inflation, which hampered consumption. This added to concerns that a recovery long predicted could be further delayed. LyondellBasell's second largest market in the United States and Europe, the German economy has been negatively affected by increased competition abroad, a weakening of demand, and an industrial slowdown. The company's profit margins have been affected. Germany represents 6% of LYB’s total revenue. LyondellBasell’s fourth-quarter profits declined across the majority of its businesses. This was also hurt by rising costs for NGL feedstocks, natural gas and restrained prices due to seasonal slower demand. Due to a decrease in polyethylene sales, the company reported core earnings at $496 million for its olefins and polyolefins Americas unit. This is down from $604 million one year earlier. Olefins can be used to make polymers, such as plastic. The adjusted core profit for its Intermediates & Derivatives segment (which makes oxyfuels, intermediate chemicals and intermediate chemicals) fell by 5.6% from the previous year to $250 million. The revenue for the quarter ending December 31 decreased from $9.93 to $9.5 billion. The company reported a loss of 603 million dollars, or 1.87 cents per share. This compares to a profit of $185 millions, or 56c per share a year ago. LSEG data shows that it had a profit adjusted of 75 cents a share, compared to the average analyst estimate of 72 cents. (Reporting by Pooja Menon in Bengaluru; Editing by Shinjini Ganguli)
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Congo's army, Burundian allies halt southern M23 rebel march
As they attempted to push south Friday, the Rwandan-backed rebellions that have swept eastern Congo in this week were met with resistance by the army and allies of Rwanda including Burundian forces. This was confirmed by a Congolese source and an official. Rwanda denies that it sent troops to the neighbouring Democratic Republic of Congo where U.N. inspectors reported in December that thousands of Rwandan soldiers were deployed in support of M23 rebel group. On Tuesday, the rebels seized control of Goma, a city in the volatile and mineral-rich eastern region. Jean Jacques Purusi, the governor of South Kivu, said that the latest M23 offensive along the western shores Lake Kivu was checked within the last two days. Around 1,500 soldiers, including the Burundians, the local militias, and the Burundians, have been deployed to protect the town of Nyabibwe, on the road towards Bukavu. The person who has direct knowledge of the current situation, but declined to be named for security reasons, said. The United Nations has already stated that there is a risk of escalation in the Congo conflict between Rwanda and Burundi. In two major Congo conflicts that lasted from 1996 to 2003, millions of civilians perished - mainly from malnutrition or disease. Willy Nangaa, spokesman for M23, said that the rebels had been fighting Burundian forces in Goma to defend the city and other cities over the past few weeks. A diplomat from Africa said that the situation is alarming. "The regionalization risk is real." In eastern Congo, the Rwandans, Congoleses and Burundians are already fighting each other. The capture of Goma served as a warning to the international community. They now realize the danger," said the diplomat. The Burundi military declined to comment this week on the developments in Congo where it was present at a government request. Burundian officials said that their government has received an increasing number of requests from Congolese authorities in the last two years for support to the Congolese Army. The official stated that "our country has also suffered a heavy cost, and we have asked both of our neighbours to negotiate and sign a ceasefire." The Government is looking for Volunteer Fighters Authorities in Bukavu recruited civilian volunteers to protect the city as the next likely target of the armed group. Albert Kahasha - a former rebel officer and former army officer - told a rally on Thursday to recruit volunteers to fight. Sources said that fighting around Mukwinja (located 70km north of Bukavu), a city with over one million residents, was slowing down the rebel advance on Friday morning. Sources at the U.N. estimate that there are several thousands Burundian soldiers in eastern Congo. They are deployed to support the Congolese Army. Rwanda informed the U.N. Security Council on Sunday that there are 10,000 Burundian soldiers in eastern Congo. U.N. warned on Thursday that the absence of peacekeepers from the United Nations in South Kivu increases the likelihood of escalation of fighting. It also said there had been reports of Rwandan troops crossing into Congo, in the direction Bukavu. Rwanda did not respond immediately to a comment request. Feeling Surrounded M23 claims to exist in order to protect the ethnic Tutsi people of eastern Congo from Rwandan Hutu remnants who were involved in Rwanda's genocide in 1994, which resulted in over one million Tutsis as well as moderate Hutus being killed. The Congolese Government describes the rebels, as "terrorist proxies of Rwanda", who are out to pillage Congo's minerals. M23, a well-trained and professionally armed rebel group led by Tutsi, is the latest in an illustrious line of Tutsi movements that have emerged in Congo's volatile east borderlands following two wars in succession caused by the Rwandan genocide. Bukavu fell to rebels for the last time in 2004 when dissidents led by Tutsi General Laurent Nkunda refused their integration into national army. Rights groups accused the rebels of committing rapes and killing civilians. On Thursday, at the packed Bukavu football stadium, residents of the city chanted and pledged "Free Goma", while the crowd chanted. "It's been thirty years since we were victims of war, and yet nothing has been done. Fiacre Kalugusha said, "Today, the youth is standing up to fight on the frontlines." Bukavu residents reported on Friday that people in the city had started stocking up food, batteries and torches, or fled along the road toward the Burundi border. Helene, who lives in Bukavu, said that gunshots can be heard throughout the city. This also reinforces the psychosis. "We feel like we are surrounded by the M23 and it's scary."
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Phillips 66 reports smaller-than-expected fourth quarter loss on renewables strength
Refiner Phillips 66 reported a smaller-than-expected loss on Friday as strength in its renewables segment offset a sharp decline in refining margins. The renewable fuels segment posted a profit of $28 millions for the quarter, compared with a loss $11 million a year ago. After the Russian invasion of Ukraine caused supply shortages, the U.S. refinery industry enjoyed exceptional profits over a two-year period. A post-pandemic surge in demand also helped to boost margins. New refining capacity will be available at the end 2023. This will cause margins to return back to normal and put pressure on refiner profit. The 3-2-1 crack spread is a measure of the quarterly U.S. refinery profit margins. The average price of, has dropped by a third from the previous year, reaching as low as $16.04 in mid-December. The realized margin of the company was $6.08 per barrel in the third quarter compared to $13.88 per barrel a year ago. According to data compiled and analyzed by LSEG, on an adjusted basis the company reported a quarterly loss of 15 cents, compared to the average analyst estimate of 23 cents. (Reporting from Tanay in Bengaluru, Editing by Tasim)
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Russia extends the gasoline export license for large companies to end-Feb
The government has granted permission to Russia's biggest oil companies to continue gasoline sales until the end February. This extends a waiver that was due to expire this Friday. The Russian government lifted the temporary ban at the end of November on gasoline exported by the majority of producers. However, the restrictions were extended to other exporters, such as independent traders or re-sellers until January 31. These restrictions will continue to be in effect in February. The first ban on gasoline imports was implemented in March of last year in response to a steep rise in wholesale fuel costs and the threat of a shortage in the domestic market. This excludes fuel supplies to the Moscow led Eurasian Economic Union (a group of former Soviet states), and to other countries, such as Mongolia, with whom Russia has intergovernmental agreements for fuel supply. According to industry sources, the top three gasoline producers in Russia include Gazprom's Omsk oil refinery, Lukoil’s NORSI refinery in Nizhny Novgorod, and Rosneft’s Ryazan refinery. According to industry sources, production at the Ryazan refinery is currently suspended after a Ukrainian drone attacked last week. Nigeria, Libya Tunisia, and the United Arab Emirates are among the top importers of Russian gas. Reporting by Olesya A. Astakhova, Vladimir Soldatkin and Mark Trevelyan. Editing by Mark Trevelyan.
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Tokyo Gas announces 40 billion yen in share buybacks, and plans to do more next fiscal year
Tokyo Gas announced on Friday that it will buy back its own shares up to 40 billion Japanese yen ($259,000,000) by the end March. It plans to continue buying large amounts of stock next year to increase shareholder value. Elliott Management, an activist investor from the United States, has been pressing the company to sell off parts of its real estate portfolio in order to increase shareholder value. Taku Minami, Chief Financial Officer, said at a press conference that "our business portfolio management focuses primarily on increasing business synergy while accelerating the withdrawal of inefficient or low-synergy businesses and assets including real estate". Shinichi Sasayama, the President of Tokyo Gas, said this month that Tokyo Gas is identifying assets with low performance, including its vast portfolio of real estate, which will be sold in order to fund investments for growth. Minami didn't provide any further details about the asset reshuffle including the size or specific assets or businesses that may be divested. He said that the company will announce specific measures to reach its goal of a 8% return on equity in the next fiscal period starting in April in March.
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Aluminum and copper prices drop on possible Trump tariffs
Prices of aluminium and copper fell in London Friday, as a result of a stronger dollar. The markets were preparing for U.S. Tariffs to be imposed on Canada and Mexico by the United States as early as this Saturday. The London Metal Exchange's (LME) three-month copper was down by 0.8% to $9,055.50 per metric ton at 1106 GMT, while aluminium fell 1.1% to 2,598. LME copper is on course for a fall of 2.4% this week. This will be its worst week in over two and a half months. However, it remains set to record its first monthly increase since September, with a gain of 3.3% in January. "One down, and 11 more to go." Alastair M. Munro, broker at Marex, said that January 2025 reminded him of the turbulent nature of the first month of the year. Donald Trump, the president of the United States, reiterated on Thursday his threat to impose 25% tariffs on imports from Canada or Mexico. This helped boost the U.S. dollar, making metals priced in dollars more expensive for buyers with other currencies. This also increased the overall level of uncertainty, which drove more investors to safe-haven investments. "The truth is that the majority of fund interest lies elsewhere, in commodity markets such as agriculture, energy and precious metals, where they have a better picture. Munro explained that our space is dominated by high-frequency traders. The recent concerns about global economic growth also affect industrial metals. U.S. inflation figures on Friday are expected to give clues as to the interest rate outlook. The U.S. Federal Reserve kept rates unchanged on Wednesday and said that it would not rush to reduce them until inflation and job data indicated otherwise. Other metals saw a 0.9% drop in LME zinc to $2,767.50 per ton. Lead fell by 0.7% to 1,953 and tin dropped 0.6% to $30,005. Nickel was down 0.9% to $15,255. Chinese metals consumers are closing their main markets for Lunar New Year until February 5. Reporting by Polina Devlin in London, Editing by David Goode)
Japan's Kansai Electric increases FY profit forecasts on nuclear energy, demand
Kansai Electric Power Co, Japan's largest nuclear power company, has raised its profit forecast by 40% for the fiscal year that ends in March to 365 billion Japanese yen ($2.4billion) due to higher nuclear power runs as well as stronger earnings from its transmission and distribution businesses.
Kansai Electric has five nuclear reactors with a combined power of 4.6 gigawatts. This was the case as of December 31. The company increased its nuclear capacity factor forecast, an indicator of nuclear power load to 85% on Friday from the previous expected 80%.
Kansai Electric expects its profit in the transmission and distribution sector to increase by 73 billion Japanese yen compared to previous estimates.
The company also targets higher gas and electricity sales due to the higher demand forecast in the Kansai region, Japan's second-busiest area after the Tokyo Metropolitan Area. This includes Osaka and Kyoto.
Kansai Electric's nine-month period ending in December saw a 362 billion-yen increase in its net profit, a result of increased nuclear operations, and a gain of 63 billion-yen from the sale a 28 percent stake in UK-based Electricity North West.
Results from Kansai Electric which retained a 12% share in Electricity North West following the deal are different from those of major Japanese power companies.
JERA, Japan's largest utility, saw profits fall by half to 155 billion Japanese yen between April and December due to weaker performances in the overseas power generation business, fuels, and renewable energy, including Taiwan.
Tokyo Gas, Japan’s largest city gas provider, saw its profit for the quarter drop by 68% to 36,6 billion yen due to rising raw material prices. It revised its guidance for the full-year to 72 billion yen, from an earlier expectation of 81 billion.
JERA's profit forecast for the entire fiscal year remained at 200 billion yen.
(source: Reuters)