The release of oil from emergency reserves by International Energy Agency member countries is expected to ease some market tightness, but will not fix the industry's "structural imbalance”, according to a report by investment bank UBS.
Last week, IEA countries, which include the US, most of Europe, Japan, Australia and others, agreed to release a total of 120 million barrels of oil from their emergency stockpile (up from the 62.7 million they pledged in March) to tackle soaring oil prices after Russia’s military offensive in Ukraine. Half of the total amount will come from the US and the rest from other members.
This is on top of the 120 million barrels that the US plans to release from its Strategic Petroleum Reserve, which will bring total additional supply to the market to 240 million barrels worldwide.
“We are reducing our June Brent forecast by $10 per barrel to $115 per barrel. With the US releasing 180 million barrels and other OECD [Organisation for Economic Co-operation and Development] countries releasing 60 million barrels over the next six months, some of the market tightness caused by the self-sanctioning of Russian crude buyers – either in fear of future sanctions or for reputational reasons – should ease,” Giovanni Staunovo, commodity strategist at UBS, said on Monday.
But the release of the reserves will not fix the "structural imbalance resulting from years of underinvestment" in the oil industry as demand for crude continues to pick up in the global economic recovery, he said.
Total investment in the upstream sector of the oil and gas sector fell 23 per cent below pre-coronavirus levels to $341 billion in 2021 while oil demand continued to rise globally, according to a recent report by the International Energy Forum and IHS Markit.
Zurich-based UBS raised its December 2022 and March 2023 forecasts by $10 per barrel to $115 per barrel on the back of higher demand.
"The impact of high prices on oil demand should be lessened by fuel subsidies from governments to help consumers, the reopening of economies from the pandemic and elevated household savings," Mr Staunovo said.
"A likely refilling of the strategic oil inventories in some OECD countries next year should keep the oil market tight in 2023."
Brent, the global benchmark for two thirds of the world's oil, was trading 1.42 per cent lower at $101.32 per barrel at 12.16pm UAE time on Monday, while West Texas Intermediate, the gauge that tracks US crude, was down 1.55 per cent at $96.74 per barrel.
The biog
Family: He is the youngest of five brothers, of whom two are dentists.
Celebrities he worked on: Fabio Canavaro, Lojain Omran, RedOne, Saber Al Rabai.
Where he works: Liberty Dental Clinic
RIDE%20ON
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GIANT REVIEW
Starring: Amir El-Masry, Pierce Brosnan
Director: Athale
Rating: 4/5
Wicked: For Good
Director: Jon M Chu
Starring: Ariana Grande, Cynthia Erivo, Jonathan Bailey, Jeff Goldblum, Michelle Yeoh, Ethan Slater
Rating: 4/5
The smuggler
Eldarir had arrived at JFK in January 2020 with three suitcases, containing goods he valued at $300, when he was directed to a search area.
Officers found 41 gold artefacts among the bags, including amulets from a funerary set which prepared the deceased for the afterlife.
Also found was a cartouche of a Ptolemaic king on a relief that was originally part of a royal building or temple.
The largest single group of items found in Eldarir’s cases were 400 shabtis, or figurines.
Khouli conviction
Khouli smuggled items into the US by making false declarations to customs about the country of origin and value of the items.
According to Immigration and Customs Enforcement, he provided “false provenances which stated that [two] Egyptian antiquities were part of a collection assembled by Khouli's father in Israel in the 1960s” when in fact “Khouli acquired the Egyptian antiquities from other dealers”.
He was sentenced to one year of probation, six months of home confinement and 200 hours of community service in 2012 after admitting buying and smuggling Egyptian antiquities, including coffins, funerary boats and limestone figures.
For sale
A number of other items said to come from the collection of Ezeldeen Taha Eldarir are currently or recently for sale.
Their provenance is described in near identical terms as the British Museum shabti: bought from Salahaddin Sirmali, "authenticated and appraised" by Hossen Rashed, then imported to the US in 1948.
- An Egyptian Mummy mask dating from 700BC-30BC, is on offer for £11,807 ($15,275) online by a seller in Mexico
- A coffin lid dating back to 664BC-332BC was offered for sale by a Colorado-based art dealer, with a starting price of $65,000
- A shabti that was on sale through a Chicago-based coin dealer, dating from 1567BC-1085BC, is up for $1,950
Timeline
1947
Ferrari’s road-car company is formed and its first badged car, the 125 S, rolls off the assembly line
1962
250 GTO is unveiled
1969
Fiat becomes a Ferrari shareholder, acquiring 50 per cent of the company
1972
The Fiorano circuit, Ferrari’s racetrack for development and testing, opens
1976
First automatic Ferrari, the 400 Automatic, is made
1987
F40 launched
1988
Enzo Ferrari dies; Fiat expands its stake in the company to 90 per cent
2002
The Enzo model is announced
2010
Ferrari World opens in Abu Dhabi
2011
First four-wheel drive Ferrari, the FF, is unveiled
2013
LaFerrari, the first Ferrari hybrid, arrives
2014
Fiat Chrysler announces the split of Ferrari from the parent company
2015
Ferrari launches on Wall Street
2017
812 Superfast unveiled; Ferrari celebrates its 70th anniversary
Match info
Deccan Gladiators 87-8
Asif Khan 25, Dwayne Bravo 2-16
Maratha Arabians 89-2
Chadwick Walton 51 not out
Arabians won the final by eight wickets
The biog
Favourite film: The Notebook
Favourite book: What I know for sure by Oprah Winfrey
Favourite quote: “Social equality is the only basis of human happiness” Nelson Madela. Hometown: Emmen, The Netherlands
Favourite activities: Walking on the beach, eating at restaurants and spending time with friends
Job: Founder and Managing Director of Mawaheb from Beautiful Peopl
Six large-scale objects on show
- Concrete wall and windows from the now demolished Robin Hood Gardens housing estate in Poplar
- The 17th Century Agra Colonnade, from the bathhouse of the fort of Agra in India
- A stagecloth for The Ballet Russes that is 10m high – the largest Picasso in the world
- Frank Lloyd Wright’s 1930s Kaufmann Office
- A full-scale Frankfurt Kitchen designed by Margarete Schütte-Lihotzky, which transformed kitchen design in the 20th century
- Torrijos Palace dome
