Oil bulls are starting to picture a world in which China, the engine of demand growth, comes back to the market.
And if their analysis is right, the summer is going to be painful for oil consumers everywhere who’re already facing spiralling prices — whether that’s Americans paying about $5 a gallon for petrol, or the British spending more than £100 ($125) to fill a regular car.
In China, renewed restrictions in Shanghai point to a bumpy path ahead, but the world’s biggest crude importer is tentatively emerging from its latest battle with the coronavirus. That is set to add consumption to a market that has traded around $120 a barrel for its longest period in years with little help from China.
“I’ve never seen this combination of circumstances in my career over the last 50 years,” said Gary Ross, an oil consultant turned hedge fund manager at Black Gold Investors.
“The world has very little spare capacity, the economy is strong outside of China, China is now coming back and we’re in the midst of a global oil interruption.”
Opec+ officials said this week there is little extra supply they can add, while similar constraints within the global fleet of oil refineries has consumers facing fuel prices that are rising faster than crude.
Several countries have announced embargoes on Russia, one of the world’s largest producers, following its military invasion of Ukraine. That is disrupting available supplies of crude and fuels. Consumption of refined products has been outpacing production, further eroding inventories.
Much of Wall Street shares the bullish take. This week, Goldman Sachs Group said it expects Brent to peak at $140 a barrel in the coming months. Morgan Stanley said its most bullish scenario of $150 could be moved higher. The record for Brent is $147.50, set in July 2008.
China National Petroleum estimates the country’s consumption could jump by 12 per cent in the third quarter. Bank of China International said it expects a modest recovery in the third quarter, and a stronger fourth.
“We are at $120 without China, so when China comes back, oil is going to go higher,” Amrita Sen, chief oil analyst at consultant Energy Aspects, said at a conference in Calgary.
“Even with high prices, demand is continuing because people, they want to travel, they want to get out. And the second thing is that governments around the world are subsidising prices.”
Those subsidies — or reduced taxation — are boosting demand in countries from Mexico to South Africa. That is one reason why oil prices have held up despite US gasoline futures already trading close to $180 a barrel.
Russia is a major supplier of refined products, most notably diesel, where wholesale prices in Europe are around $170. The premium of both diesel and gasoline over crude has hit a record this year in the US and Europe, with fuel stockpiles low going into summer.
Some of the market’s leading policy figures agree that the world does not currently have enough refining capacity.
Amos Hochstein, the US State Department’s senior adviser for energy security, told an RBC Capital Markets conference this week that underinvestment in the energy space and a downwards trend in refining capacity have been key contributors to the shortage of fuels, echoing a view held by Saudi Arabia’s energy minister.
The US government has even asked the refining industry about firing up mothballed plants again.
What all this means is that, despite the Organisation of Petroleum Exporting Countries and its allies pledging to increase output by more than expected this month, there is little sign for now that such moves — if they do happen — would derail the rampantly bullish market.
Opec secretary general Mohammad Barkindo said this week only two or three of the group’s members have room to increase output.
Even with some parts of Shanghai heading back into Covid-19 restriction, traders believe that an eventual pickup in consumption will come in an oil market where production is, for now, largely tapped out.
For consumers, that is especially risky before summer, when refined product consumption rises thanks to travel and air conditioning demand.
What can victims do?
Always use only regulated platforms
Stop all transactions and communication on suspicion
Save all evidence (screenshots, chat logs, transaction IDs)
Report to local authorities
Warn others to prevent further harm
Courtesy: Crystal Intelligence
The details
Heard It in a Past Life
Maggie Rogers
(Capital Records)
3/5
The low down on MPS
What is myofascial pain syndrome?
Myofascial pain syndrome refers to pain and inflammation in the body’s soft tissue. MPS is a chronic condition that affects the fascia (connective tissue that covers the muscles, which develops knots, also known as trigger points).
What are trigger points?
Trigger points are irritable knots in the soft tissue that covers muscle tissue. Through injury or overuse, muscle fibres contract as a reactive and protective measure, creating tension in the form of hard and, palpable nodules. Overuse and sustained posture are the main culprits in developing trigger points.
What is myofascial or trigger-point release?
Releasing these nodules requires a hands-on technique that involves applying gentle sustained pressure to release muscular shortness and tightness. This eliminates restrictions in connective tissue in orderto restore motion and alleviate pain. Therapy balls have proven effective at causing enough commotion in the tissue, prompting the release of these hard knots.
Election pledges on migration
CDU: "Now is the time to control the German borders and enforce strict border rejections"
SPD: "Border closures and blanket rejections at internal borders contradict the spirit of a common area of freedom"
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)
Biography
Favourite Meal: Chicken Caesar salad
Hobbies: Travelling, going to the gym
Inspiration: Father, who was a captain in the UAE army
Favourite read: Rich Dad Poor Dad by Robert Kiyosaki and Sharon Lechter
Favourite film: The Founder, about the establishment of McDonald's
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
More from Rashmee Roshan Lall
MATCH INFO
Euro 2020 qualifier
Ukraine 2 (Yaremchuk 06', Yarmolenko 27')
Portugal 1 (Ronaldo 72' pen)
Other must-tries
Tomato and walnut salad
A lesson in simple, seasonal eating. Wedges of tomato, chunks of cucumber, thinly sliced red onion, coriander or parsley leaves, and perhaps some fresh dill are drizzled with a crushed walnut and garlic dressing. Do consider yourself warned: if you eat this salad in Georgia during the summer months, the tomatoes will be so ripe and flavourful that every tomato you eat from that day forth will taste lacklustre in comparison.
Badrijani nigvzit
A delicious vegetarian snack or starter. It consists of thinly sliced, fried then cooled aubergine smothered with a thick and creamy walnut sauce and folded or rolled. Take note, even though it seems like you should be able to pick these morsels up with your hands, they’re not as durable as they look. A knife and fork is the way to go.
Pkhali
This healthy little dish (a nice antidote to the khachapuri) is usually made with steamed then chopped cabbage, spinach, beetroot or green beans, combined with walnuts, garlic and herbs to make a vegetable pâté or paste. The mix is then often formed into rounds, chilled in the fridge and topped with pomegranate seeds before being served.
The specs
Price, base / as tested Dh12 million
Engine 8.0-litre quad-turbo, W16
Gearbox seven-speed dual clutch auto
Power 1479 @ 6,700rpm
Torque 1600Nm @ 2,000rpm 0-100kph: 2.6 seconds 0-200kph: 6.1 seconds
Top speed 420 kph (governed)
Fuel economy, combined 35.2L / 100km (est)
