Growing Oil Prices in Asia

(AFP) / 19 June 2013

Oil prices turned higher in Asian trade Wednesday, as investors await the outcome of a US Federal Reserve meeting for clues on when it will begin scaling back its massive stimulus programme.
New York’s main contract, light sweet crude for delivery in July, was up 17 cents to $98.61 a barrel and Brent North Sea crude for August delivery added 12 cents to $106.14 in the afternoon.

Markets have been in turmoil for weeks on speculation the US central bank will announce a tightening of its $85 billion-a-month asset-buying programme, known as quantitative easing.

“Trading is quiet today as investors are looking to the US Fed meeting for direction,” Desmond Chua, market analyst at CMC Markets in Singapore, said.

“If the US Fed decides on a more gradualist approach to tapering quantitative easing, that is likely to push oil prices up,” he said.

The US Fed’s Federal Open Market Committee will issue a statement later on Wednesday after a two-day policy meeting, which will be quickly followed by a briefing from Fed chairman Ben Bernanke.

Some analysts say Bernanke would likely signal the Fed is close to tapering the purchases, but would temper that by arguing that a move would depend on conditions in the world’s largest economy. A mixed bag of US data recently has pointed to an uncertain recovery.

Leaders from the influential Group of Eight nations on Tuesday called for a peace conference for the country and agreed to push for a transitional government that could include defectors from President Bashar Al Assad’s regime.

Source: Khaleej Times

Record increase on Abu Dhabi Oil Prices

Haseeb Haider / 20 June 2013

Abu Dhabi grew 7.7 per cent year on year in 2012, on higher oil prices. “The flexibility of Abu Dhabi economy combined with the huge financial surpluses, strong growth in non-oil sectors, high oil prices, along with several other significant factors have all contributed to the stability and sustained growth of the local economy,” said Statistics Centre – Abu Dhabi, or Scad.
Abu Dhabi’s GDP at current prices reached a record Dh911.6 billion in 2012, up from Dh846.7 billion in 2011, according to a report released by Scad.

The preliminary data announced by the statistical gathering agency also indicate a rise in the annual growth rate of non-oil sectors to 9.6 per cent, surpassing all earlier forecasts and estimates, underlining the “robustness, stability and competitive advantage of the economy, boosting its appeal to local and foreign investors.”

Abu Dhabi showed a significant growth in oil and non-oil sectors at current prices achieved a net gain of Dh64.9 billion, surpassing all forecasts and estimates. The GDP time series indicates that the Abu Dhabi GDP at current prices has doubled 2.4 times from 2005 to 2012, increasing form Dh383.430 billion to Dh911.591 billion during this period.

The non-oil activities and sectors contributed about 43.5 per cent of Abu Dhabi’s GDP at current prices in 2012, and 48 per cent at constant prices for the same year.

The non-oil activities achieved high growth rates of about 9.6 per cent at current prices and 7.7 per cent at constant prices over the past year.

There has been an upward trend in non-oil activities over the course of the past few years, with the non-oil GDP at constant prices growing from Dh200.209 billion in 2005 to Dh325.433 billion in 2012.

Abu Dhabi has made huge strides and achieved a high level of diversity in a short span of time becoming a business hub. for concluding major business deals.

Buoyed by oil revenues going into infrastructure, in recent years Abu Dhabi economy has advanced in leaps and bounds and has evolved into regional, financial, commercial and tourist hotspot.

Oil accounted for 56.5 per cent of the Abu Dhabi’s GDP at current prices and only for 52 per cent of the GDP at constant prices in 2012 despite the considerable rise in oil prices during the past years.

The real estate and education sectors grew 15 per cent in 2012, while wholesale and retail trade grew 14.5 per cent, followed by transport and storage 13.4 per cent.

Manufacturing activities achieved a record growth rate of 11.2 per cent followed by the electricity, gas, and water by10.1 per cent.

Source: Khaleej Times

Oil Prices Falls – US Economy

Oil prices fell Thursday, a day after the Federal Reserve indicated it could begin to wind down its massive stimulus program later this year, as long as the US economy remains on the upswing.
U.S. benchmark oil for July delivery fell $2.08 to $96.16 per barrel by late afternoon Bangkok time in electronic trading on the New York Mercantile Exchange.

The contact dropped 20 cents to finish at $98.24 a barrel on the Nymex on Wednesday, when Fed chairman Ben Bernanke suggested that he was optimistic about the U.S. economy — and that the Fed might start scaling back its massive $85 billion a month government bond purchases later this year if conditions continue to improve.

The Fed’s stimulus program has been a boon to stock and commodities markets, where investors have turned in search of returns that outgun those on bonds.

Analysts said the slump in oil prices could be just a short-term response to a change in U.S. central bank policy. In the medium term, the scaling back of such a loose monetary policy will be “a positive for the oil market, suggesting that the economy is on a sustainable growth trajectory,” said Caroline Bain, lead commodities analyst for The Economist Intelligence Unit.

Separately, the American Petroleum Institute said U.S. crude stocks fell by about 4.3 million barrels for the week ending June 14 to 362 million barrels. That contrasted with figures given by the U.S. Energy Information Administration, which said that crude inventories grew by 300,000 for the week. Analysts expected supplies to drop by 1 million barrels.

Brent crude, a benchmark for many international oil varieties, fell $1.80 to $104.32 a barrel on the ICE Futures exchange in London.

Source: Khaleej Times