Oil prices levelled their gains last week, rounding the week 0.8 per cent lower amid uncertainty over when Opec+ will reconvene to decide output increases.
Brent, the international benchmark, settled 1.93 per cent higher at $75.55 per barrel on Friday, while West Texas Intermediate closed up 2.22 per cent at $74.56 per barrel. The benchmarks have gained nearly 6 per cent over the past four weeks, narrowing their spread amid a tightened market outlook.
Opec+, the exporters' group headed by Saudi Arabia and Russia, deferred a planned ministerial meeting three times earlier this month.
The group has not been able to come together to finalise a deal to bring 2 million barrels per day back to the market by the end of the year.
The UAE, Opec's third-biggest producer, has called on the group to revise an outdated baseline measurement. The joint ministerial monitoring committee of Opec+ is currently reviewing Abu Dhabi's request for a fairer baseline assessment.
The UAE has said that the current baseline used to calculate its production quotas within Opec+ is not reflective of its actual production capacity. The UAE plans to raise its production capacity to 5 million bpd by 2030 and has made significant investments to expand its upstream resources. The country has called on fellow producers to consider its baseline from April 2020, as opposed to the metric being used that dates back to October 2018.
According to estimates, the discrepancy between the baseline used to calculate the UAE's quota under Opec+ and its current production capacity is 18 per cent – the highest among the producers within the group.
The UAE also wants the group to “decouple” output restrictions from plans to extend the agreement beyond April 2022.
“If the current Opec+ discord and attempts at price stoking continue, a post-summer correction would follow, and potentially set the stage for an even more bearish 2022 price environment,” said Louise Dickson, oil markets analyst at Rystad Energy.
“Collectively, Opec+ group has about 8.7 million bpd of crude production that could theoretically be activated and produced within just months,” she added.
The group's spare capacity – with the exception of Iran, Venezuela and Libya, which are currently exempt from cuts – stands at 6.7 million bpd.
“Much of this spare capacity is commercially incentivising at more than $70 per barrel,” said Ms Dickson.
A no-deal among Opec+ producers will allow the current restriction to roll over into August, leaving the market further tightened.
Higher oil prices, which made multi-year gains this month as WTI rose above $75 per barrel for the first time since 2014, will also incentivise producers outside the group, particularly in the US shale basins.
In the current deadlocked scenario, oil prices are poised for further gains, with Brent expected to touch $80 per barrel, according to Swiss bank UBS.
“Opec+ output policies have been the main driving force behind the oil price recovery in 2020-21, after a sharp decline in demand in March 2020 and a short period of unilateral decisions on production volumes taken by key alliance members,” Fitch said in a note on Friday.
So far this year, Brent and WTI have gained 45.8 per cent and 53.6 per cent as developed economies ease Covid-19 lockdown restrictions amid widespread vaccination efforts.
The relaxation of Covid-19 rules, notably in the UK, coincides with the summer travel season, which typically sees higher demand for energy.
The markets would need additional supply to meet the demand for crude as commuters take to roads and airlines fly travellers to summer destinations.
However, Opec+ is also navigating an evolving demand scenario as the highly transmissible Delta variant of coronavirus outpaces vaccination efforts.
“The base case scenario is that Opec countries will work out a solution and prevent oil prices from falling free[ly]," said Ipek Ozkardeskaya, senior analyst at Swissquote.
“Therefore, oil bulls will likely remain in charge above the $70 mark, but we will hardly see US crude surpassing the $80 mark until there is more certainty on the Covid news front,” she added.
Ms Yang's top tips for parents new to the UAE
- Join parent networks
- Look beyond school fees
- Keep an open mind
MOUNTAINHEAD REVIEW
Starring: Ramy Youssef, Steve Carell, Jason Schwartzman
Director: Jesse Armstrong
Rating: 3.5/5
The specs
Engine: Turbocharged four-cylinder 2.7-litre
Power: 325hp
Torque: 500Nm
Transmission: 10-speed automatic
Price: From Dh189,700
On sale: now
COMPANY PROFILE
Name: Mamo Year it started: 2019 Founders: Imad Gharazeddine, Asim Janjua Based: Dubai, UAE Number of employees: 28 Sector: Financial services Investment: $9.5m Funding stage: Pre-Series A Investors: Global Ventures, GFC, 4DX Ventures, AlRajhi Partners, Olive Tree Capital, and prominent Silicon Valley investors. Glossary of a stock market revolution
Reddit
A discussion website
Redditor
The users of Reddit
Robinhood
A smartphone app for buying and selling shares
Short seller
Selling a stock today in the belief its price will fall in the future
Short squeeze
Traders forced to buy a stock they are shorting
Naked short
An illegal practice
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Dubai Bling season three
Cast: Loujain Adada, Zeina Khoury, Farhana Bodi, Ebraheem Al Samadi, Mona Kattan, and couples Safa & Fahad Siddiqui and DJ Bliss & Danya Mohammed
Rating: 1/5
'Panga'
Directed by Ashwiny Iyer Tiwari
Starring Kangana Ranaut, Richa Chadha, Jassie Gill, Yagya Bhasin, Neena Gupta
Rating: 3.5/5
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
Killing of Qassem Suleimani
The five pillars of Islam
2.0
Director: S Shankar
Producer: Lyca Productions; presented by Dharma Films
Cast: Rajnikanth, Akshay Kumar, Amy Jackson, Sudhanshu Pandey
Rating: 3.5/5 stars
UAE currency: the story behind the money in your pockets
The specs
Engine: 3.9-litre twin-turbo V8
Power: 620hp from 5,750-7,500rpm
Torque: 760Nm from 3,000-5,750rpm
Transmission: Eight-speed dual-clutch auto
On sale: Now
Price: From Dh1.05 million ($286,000)
Background: Chemical Weapons
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more from Janine di Giovanni
COMPANY%20PROFILE
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UAE currency: the story behind the money in your pockets
French Touch
Carla Bruni
(Verve)
The specs
Engine: 5.2-litre V10
Power: 640hp at 8,000rpm
Torque: 565Nm at 6,500rpm
Transmission: 7-speed dual-clutch auto
Price: From Dh1 million
On sale: Q3 or Q4 2022
Company Fact Box
Company name/date started: Abwaab Technologies / September 2019
Founders: Hamdi Tabbaa, co-founder and CEO. Hussein Alsarabi, co-founder and CTO
Based: Amman, Jordan
Sector: Education Technology
Size (employees/revenue): Total team size: 65. Full-time employees: 25. Revenue undisclosed
Stage: early-stage startup
Investors: Adam Tech Ventures, Endure Capital, Equitrust, the World Bank-backed Innovative Startups SMEs Fund, a London investment fund, a number of former and current executives from Uber and Netflix, among others.
Petrarch: Everywhere a Wanderer
Christopher Celenza,
Reaktion Books
Points to remember
- Debate the issue, don't attack the person
- Build the relationship and dialogue by seeking to find common ground
- Express passion for the issue but be aware of when you're losing control or when there's anger. If there is, pause and take some time out.
- Listen actively without interrupting
- Avoid assumptions, seek understanding, ask questions
Company%20profile
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Scoreline:
Barcelona 2
Suarez 85', Messi 86'
Atletico Madrid 0
Red card: Diego Costa 28' (Atletico)
GAC GS8 Specs
Engine: 2.0-litre 4cyl turbo
Power: 248hp at 5,200rpm
Torque: 400Nm at 1,750-4,000rpm
Transmission: 8-speed auto
Fuel consumption: 9.1L/100km
On sale: Now
Price: From Dh149,900
How much do leading UAE’s UK curriculum schools charge for Year 6?
- Nord Anglia International School (Dubai) – Dh85,032
- Kings School Al Barsha (Dubai) – Dh71,905
- Brighton College Abu Dhabi - Dh68,560
- Jumeirah English Speaking School (Dubai) – Dh59,728
- Gems Wellington International School – Dubai Branch – Dh58,488
- The British School Al Khubairat (Abu Dhabi) - Dh54,170
- Dubai English Speaking School – Dh51,269
*Annual tuition fees covering the 2024/2025 academic year
House-hunting
Top 10 locations for inquiries from US house hunters, according to Rightmove
- Edinburgh, Scotland
- Westminster, London
- Camden, London
- Glasgow, Scotland
- Islington, London
- Kensington and Chelsea, London
- Highlands, Scotland
- Argyll and Bute, Scotland
- Fife, Scotland
- Tower Hamlets, London
Day 1 results:
Open Men (bonus points in brackets)
New Zealand 125 (1) beat UAE 111 (3)
India 111 (4) beat Singapore 75 (0)
South Africa 66 (2) beat Sri Lanka 57 (2)
Australia 126 (4) beat Malaysia -16 (0)
Open Women
New Zealand 64 (2) beat South Africa 57 (2)
England 69 (3) beat UAE 63 (1)
Australia 124 (4) beat UAE 23 (0)
New Zealand 74 (2) beat England 55 (2)
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Fixtures and results:
Wed, Aug 29:
- Malaysia bt Hong Kong by 3 wickets
- Oman bt Nepal by 7 wickets
- UAE bt Singapore by 215 runs
Thu, Aug 30:
- UAE bt Nepal by 78 runs
- Hong Kong bt Singapore by 5 wickets
- Oman bt Malaysia by 2 wickets
Sat, Sep 1: UAE v Hong Kong; Oman v Singapore; Malaysia v Nepal
Sun, Sep 2: Hong Kong v Oman; Malaysia v UAE; Nepal v Singapore
Tue, Sep 4: Malaysia v Singapore; UAE v Oman; Nepal v Hong Kong
Thu, Sep 6: Final
