Oil winners-losers in small EM: pre-OPEC+, post ytd rally

Must Read

UCH Chief Medical Director tests positive for Coronavirus

Prof Jesse A. Otegbayo, the chief medical doctor, University College Hospital, Ibadan UCH has tested positive for coronavirus. This...

Top 10 Most Expensive Universities In Nigeria

For many Nigerians, high-quality higher education is a luxury. There are many private universities who are known not only...

List of Guaranty Trust Bank Sort Codes & Branches (with addresses) in Nigeria

The sort code is a number that usually identifies both the bank and the branch where an account is...
Oil winners-losers in small EM: pre-OPEC+, post ytd rallyOil winners-losers in small EM: pre-OPEC+, post ytd rally

After the 34% rally in oil price (Brent) since its end-December 2018 low and in advance of this weekend’s preliminary OPEC+ meeting (17-18 March), we briefly revisit data on macroeconomic exposure (net fuel import or export positions) and equity market performance in small Emerging markets.
Oil winners-losers in small EM: pre-OPEC+, post ytd rally
The performance of Kazakhstan, Malaysia, Nigeria, Oman, Qatar (under-performing oil exporters) and Egypt, Kenya (out-performing oil importers) appear the most incongruous (when viewed through the lens of oil exposure alone). Among oil-related individual stocks, Dana Gas (Egypt, Iraq-KRI), Seplat (Nigeria), Sabic (Saudi) and PTT (Thailand) are notable under-performers relative to oil price, and Ecopetrol (Colombia), Gulf Keystone (Iraq-KRI), Medco Energi (Indonesia) are notable outperformers. See the charts below.

Read:  Oil Prices Crash On Supply Fears - OilPrice

Apart from the oil price increase, we highlight the following context for this preliminary OPEC+ meeting (the meeting involves a subset of the OPEC+ group, the Joint Ministerial Monitoring Committee which reviews the implementation of supply restraint and is intended to prepare the ground for the full meeting on 17-18 April).

Positive oil price:

  • OPEC+ is in the middle of a 1.2m bpd supply cut (this is supposed to last throughout 1H 19);
  • Modestly better global growth expectations following partial progress in US-China trade negotiations (although concerns persist on both US and China growth);
  • Venezuela security deterioration and a new round of US sanctions (partly offset by new Russian agreements);
  • Saudi public signals on its commitment to ongoing production restraint;
  • US government forecast cut for domestic oil output and data showing a drop in US crude inventories;
Read:  ABULE-EGBA EXPLOSION: Government To Meet With NNPC On Compensation For Victims - Sanwo-Olu
Read:  Equity Market Sustains Yesterdays Uptrend, Posts 1.03% Gain.

Negative oil price:

  • Iran oil sanction exemptions have been granted by the US to a greater degree than perhaps initially expected (although these are due to expire in May);
  • Saudi has arguably shouldered a proportionately greater burden of supply restraint than Russia (which may portend differing levels of commitment to restraint in the medium-term).
- Advertisement -

Note that we do not make an oil price forecast (effectively, we assume that spot is the best guide to future price)

Oil-related equity performance in small Emerging Markets

Chart-Oil-Equity

- Advertisement -

Subscribe to BrandSpur Ng

Subscribe for latest updates. Signup to best of brands and business news, informed analysis and opinions among others that can propel you, your business or brand to greater heights.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Latest News

Full Text (Transcript) of President Buhari’s Speech on COVID-19 pandemic

ADDRESS BY H.E. MUHAMMADU BUHARI, PRESIDENT OF THE FEDERAL REPUBLIC OF NIGERIA ON THE COVID- 19 PANDEMIC SUNDAY 29TH...

President Buhari declares curfew in Lagos, Abuja, Ogun; suspends passenger planes, private jets

The Federal Government has declared curfew in Lagos, Abuja and Ogun State. This was disclosed by President Muhammadu Buhari during his national broadcast on...

Keystone Bank Provides N1billion to Fight Against COVID-19

As part of a robust effort to combat the deadly coronavirus outbreak in Nigeria, the management of Keystone Bank has announced the donation of...

Osun State announces total lockdown as Oyetola discloses second confirmed COVID-19 case

The Osun State Government has announced the total lockdown of the State on Tuesday following the confirmation of the second case of the deadly...
- Advertisement -
BrandsPur Weekly Cartoons
%d bloggers like this: