Oil
Oil Futures Rise on Positive U.S., China Economic Data
WASHINGTON – Oil futures were higher in Asian hours Monday as investors cheered positive economic data out of the world’s two largest economies, the U.S. and China, while the lack of a resolution in nuclear talks with Iran also provided support.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in December traded at $94.74 a barrel at 0625 GMT, up $0.14 in the Globex electronic session. December Brent crude on London’s ICE Futures exchange rose $0.24 to $105.36 a barrel.
“U.S. payrolls and third-quarter GDP outperformed expectations, lifting sentiment, as this fuels expectations about demand in the world’s largest crude-oil consuming country,” said Singapore-based Phillip Futures analyst Tan Chee Tat.
Data Friday showed that the U.S. added 204,000 jobs in October, much higher than a forecast of 120,000 new jobs. The U.S. economy expanded at an annual rate of 2.8% in the third quarter, the Commerce Department said Thursday. Economists polled by MarketWatch had forecast 2.3% growth.
The good news spilled across the Pacific to China, which released economic data Saturday that provided further evidence of a steady recovery from a slowdown earlier in the year as industrial production grew by 10.3% on year in October.
The positivity over China’s figures came despite a decline in October crude-oil imports, which fell to 20.41 million metric tons, preliminary data from the General Administration of Customs showed Friday. This a 14% decline from a year earlier and 5.3 million tons below September levels.
“A restocking of crude over the late summer and a seasonal slowing in crude processing weighed on October imports,” said Morgan Stanley Research in a note.
“Demand and imports are likely to recover into year-end as distillate demand recovers in winter. However, the pace of import growth may be tempered by weak refinery margins, higher crude stocks and the risk of overbuilding products once again.”
Phillip Futures’ Mr. Tan said Nymex crude-oil price gains are likely to extend this week as U.S. refineries emerge from seasonal maintenance. Weekly Energy Information Administration data to be released Wednesday will provide greater clarity, he added.
There is also supportive news from Europe as talks among Iran and six world powers to freeze Tehran’s nuclear program ended without a resolution, putting paid to hopes that oil sanctions against the Middle Eastern country would be lifted soon.
Nymex reformulated gasoline blendstock for December–the benchmark gasoline contract–rose 71 points to $2.5605 a gallon, while December heating oil traded at $2.8792, 73 points higher.
ICE gasoil for November changed hands at $899.75 a metric ton, up $6.75 from Friday’s settlement.
– WALL STREET JOURNAL
Oil
FG Introduces New Incentives To Revitalize Nigeria’s Oil & Gas Industry
In a strategic move to revitalize Nigeria’s oil and gas sector, the Federal Government has unveiled two key fiscal incentives aimed at attracting investment and enhancing energy security.
The announcement was made by Mr. Wale Edun, the Minister of Finance and Coordinating Minister of the Economy on Wednesday.
The first initiative, the Value Added Tax (VAT) Modification Order 2024, introduces critical exemptions for essential energy products and infrastructure, including Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment.
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These exemptions are designed to reduce living costs for Nigerians, promote energy security, and accelerate the transition to cleaner energy alternatives.
The second initiative, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production, offers new tax relief options for deep offshore exploration projects.
This measure aims to position Nigeria’s deep offshore basin as a premier destination for international oil and gas investments, boosting the country’s appeal to foreign investors.
These reforms are part of a broader set of policy initiatives, known as Policy Directives 40-42, endorsed by President Bola Ahmed Tinubu.
The directives reflect the administration’s commitment to fostering sustainable development in the energy sector and enhancing Nigeria’s competitive edge in the global oil and gas market.
Business
Tinubu set to approve ExxonMobil-Seplat oil deal, expands CNG bus initiative
By Yemie Adeoye
NIGERIA’s President Bola Tinubu has announced that the protracted ExxonMobil-Seplat upstream oil divestment will be formally approved by the Minister of petroleum within a matter of days, just as he announced his government’s intention to expand the Compress natural Gas, CNG buses initiative.
The President who stated this during his Independence day nationwide broadcast stated that the move is in line with his administration’s commitment to free enterprise, free entry and free exit in investments which is the hallmark of his administration investment policy.
“Fellow compatriots, our administration is committed to free enterprise, free entry, and free exit in investments while maintaining the sanctity and efficacy of our regulatory processes. This principle guides the divestment transactions in our upstream petroleum sector, where we are committed to changing the fortune positively. As such, the ExxonMobil Seplat divestment will receive ministerial approval in a matter of days, having been concluded by the regulator, NUPRC, in line with the Petroleum Industry Act, PIA. This was done in the same manner as other qualified divestments approved in the sector.”
The President also seized the opportunity to plead with Nigerians to be patient with his administration’s reform policies. “As your President, I assure you that we are committed to finding sustainable solutions to alleviate the suffering of our citizens. Once again, I plead for your patience as the reforms we are implementing show positive signs, and we are beginning to see light at the end of the tunnel”.
“Our energy transition programme is on course. We are expanding the adoption of the Presidential Initiative on Compressed Natural Gas for mass transit with private sector players. The Federal Government is ready to assist the thirty-six States and FCT in acquiring CNG buses for cheaper public transportation.
Fellow Nigerians, while we are working to stabilise the economy and secure the country, we also seek to foster national unity and build social harmony and cohesion. Our economy can only thrive when there is peace”. he enthused.
Oil
ExxonMobil To Invest $10bn In Nigeria’s Deep-Water Oil Operations
As part of the administration’s push to improve Ease of Doing Business (EoDB), Nigeria’s Vice President Kashim Shettima has expressed support for ExxonMobil’s plan to invest $10 billion in the country’s deep-water oil sector.
Speaking on Wednesday, September 25, 2024, during a meeting with ExxonMobil executives at the 79th United Nations General Assembly (UNGA) in New York, Shettima called the investment “a clear testament to the administration’s economic reforms and investor-friendly policies.”
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This announcement follows news that international maritime company DP World intends to develop a multibillion-dollar port project in Nigeria.
Stanley Nkwocha, Senior Special Assistant to the President on Media and Communications, shared the development in a statement on Wednesday. He quoted Shettima as saying: “ExxonMobil’s potential investment aligns with the vision of President Bola Ahmed Tinubu’s administration for a more investment-friendly Nigeria.
We are committed to fostering an environment that supports such transformative projects.”Shettima also discussed the administration’s broader efforts to improve the ease of doing business, highlighting the “Renewed Hope Agenda,” which aims to simplify bureaucratic processes, enhance transparency, and offer fiscal incentives to attract global investors.
“Our administration has taken bold steps to unify the exchange rate, remove fuel subsidies, and implement tax reforms. These measures, though challenging in the short term, are intended to create a stable and predictable business environment in the long term,” he added.
On the oil and gas sector, Shettima mentioned that the government is revising the fiscal framework for deep-water operations to attract investment while ensuring fair returns for the Nigerian people.