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Euro Shares Extend Fall From Highs

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LONDON – European markets remained cautious Wednesday, with Thursday’s crucial European Central Bank meeting looming large.

The Stoxx Europe 600 closed broadly unchanged, having in the previous session declined from a 6½-year high. The move echoed action on Wall Street, where U.S. stocks showed little direction after edging off record levels.

A run of disappointing economic data has heaped pressure on the ECB to take fresh measures this week to boost the economy.

Tuesday’s slump in euro-zone inflation was followed by data Wednesday showing business activity in the currency area slowed more sharply in May than first estimated.

Data firm Markit said its composite purchasing managers index for the euro zone—which measures activity across both the manufacturing and services sectors—fell to 53.5 from 54 in April. First-quarter growth in the currency bloc came in at 0.9%, meeting earlier forecasts.Prospects that the ECB will cut interest rates, take steps to boost liquidity or even launch a program of asset purchases have helped to prop up stock markets in recent weeks. But with expectations running sky-high, some analysts think ECB action is unlikely to drive markets up any further.

“I think we are at the beginning of a consolidation phase for European equities. Most of the possible actions of the ECB are already priced in, we have sluggish earnings growth and high valuations,” said Christian Stocker, an equity strategist at UniCredit in Munich.

Royal Bank of Scotland credit strategist Alberto Gallo, meanwhile, warned that expectations may have already climbed too high and that investors may be holding out too much hope that Thursday’s meeting will be a game-changer.

“Not all of Europe’s problems can be addressed by central bankers,” he said, explaining that low inflation is a result of prolonged austerity and lack of credit transmission in the banking system. “As banks focus on strengthening their capital, it’s unlikely that a long term refinancing operation or any extension of liquidity would have a big impact: loans absorb capital, and capital is scarce. Draghi may not have the silver bullet this time around,” he added.A small minority are even hesitant to predict a rate cut at all.

“We see no reason for the ECB to cut rates at Thursday’s meeting,” said Lorcan Roche Kelly, an analyst at investor-advisory service provider Agenda. He described a cut as “the wrong solution to the problem the euro area faces” adding that the “critical factor for the meeting will be the staff projections. “If they show current inflation trends to continue, then Draghi will announce a broad-based asset purchase scheme,” said Mr. Kelly.

German’s DAX index closed 0.1% higher, France’s CAC-40 was down 0.1%, while the U.K.’s FTSE 100 lost 0.3%.

Those mixed moves were echoed in the U.S., where the Dow Jones Industrial Average fell or 0.1% in late European trade, while the S&P 500 index was broadly unchanged on the day.

On Tuesday, the Dow slipped to snap a three-session win streak, and the S&P 500 also failed to close at a record for the first time in four sessions.Strategists said that the lack of direction the market came as investors struggled to digest mixed economic data.

Data compiled by Automatic Data Processing, and Moody’s Analytics showed that 179,000 private-sector jobs were added in May, falling short of expectations of a 210,000 increase. The report is seen as a preview of the government’s February employment report Friday, which is expected show nonfarm payroll growth of 210,000.

In currency markets, the euro was a touch weaker against the dollar at $1.3618 after rising slightly in the previous session.

“The expectation is that it will be quiet in FX until the ECB,” said currency strategists at Citigroup.

Elsewhere, sterling rose slightly against the euro and the dollar after data showed the U.K. services sector maintained a strong pace of expansion in May, but quickly gave back those gains.

In commodities markets, gold edged 0.3% lower to $1,244.30 an ounce, while Brent crude oil lost 0.2% to $108.58 a barrel.

– WALLSTREET JOURNAL

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Adoption of AI Feature as NIPetGE Pays Courtesy Call at NNPC Ltd

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Enhanced adoption of artificial intelligence and other digital technologies to improve operations in Nigeria’s oil and gas industry is taking the centre stage in relevant circles.

The issue came up strongly when the President-elect of the Nigerian Institute of Petroleum and Gas Engineers NIPetGE, Prisca Kanebi, paid a courtesy call at the Nigerian National Petroleum Company Limited (NNPC Ltd), Abuja.

Biztellers reports that the Kanebi led delegation was received by the Group Chief Executive Officer of the NNPC Ltd, Bayo Ojulari, represented by the Executive Vice President, Gas, Power and New Energy, Olalekan Ogunleye.

According to a statement made available on Sunday, discussions at the meeting focused on the future of Nigeria’s hydrocarbon industry amid global energy transition concerns, technological changes and sustainability targets.

ALSO READ: NNPC Ltd, IOCs Raise Crude Supply to Local Refineries by 103% in 4 Months

The statement indicated that the NNPC Ltd acknowledged the role of NIPetGE in policy advocacy, technical development and innovation within the sector.

Speaking during the meeting, Kanebi highlighted recommendations from the institute’s recent conference, including the proposed establishment of a national centre for intelligent energy systems to support the deployment of artificial intelligence, the Internet of Things and robotics across the petroleum value chain.

She also commended the Federal Government’s decarbonisation efforts and reiterated the institute’s support for policies aimed at improving sustainability in the industry.

The institute also recommended the creation of a hydrocarbon-linked emissions trading system to allow Nigeria to take part in global carbon markets.

The institute also proposed fiscal incentives to support local manufacturing and service delivery in the oil and gas sector, as well as the expansion of the Energy Transition Plan to include measurable upstream decarbonisation targets backed by tax credits.

Other proposals included increased public-private partnerships in emission control infrastructure, carbon capture projects and hybrid renewable energy initiatives.

Both organisations also stressed the need for stronger collaboration between industry and academic institutions to improve professional capacity and align petroleum engineering practice in Nigeria with international standards.

The institute further disclosed that its bill seeking chartered status had passed second reading and was progressing towards a third hearing at the National Assembly.

It added that NNPC Ltd pledged support for future collaborations with the institute on initiatives aimed at improving efficiency and innovation in the energy sector.

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FHC Orders NUPRC to Comply with PIA

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Local Firms Lead Revival of Idle Oil Wells – SPE

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Nigeria’s indigenous oil and gas companies are reopening dormant wells and ramping up production from assets acquired from international oil companies (IOCs) to boost crude oil output.

The Society of Petroleum Engineers (SPE), Nigeria Council, made the assertion through its Chairman, Francis Nwaochie, on the sideline of the Offshore Technology Conference (OTC) which ended at the weekend in Houston, Texas.
Nwaochie said indigenous operators were already taking advantage of opportunities created by disruptions in the global energy market to increase production from existing assets.

According to him, local firms that recently acquired onshore and shallow water assets from IOCs were aggressively reviving inactive wells and maximizing available infrastructure to raise output levels.

“What we are seeing now is that indigenous companies are reopening wells from the assets they acquired from the IOCs. Some of them have almost doubled production from those existing assets,”.

He explained that the renewed focus on dormant wells and existing facilities had become critical at a time the global oil market was facing supply shortages triggered by geopolitical tensions in the Middle East.

The SPE Nigeria Council Chairman noted that Africa, particularly Nigeria, was well positioned to benefit from the supply gap because of the continent’s relative stability compared to some other oil-producing regions.

“There is a huge opportunity for Africa right now. The focus is gradually shifting to Africa because of the volatile environment in many other producing regions.”

He stated that indigenous operators were leveraging digital technologies, financing opportunities and local expertise to improve production efficiency and optimise existing fields.

He added that stronger implementation of local content policies was also helping to create a more stable operating environment for oil and gas investments.

“Local content is very critical. Once communities and local companies clearly understand their roles and benefits, then you create peace across the industry. Business only thrives in peaceful environments.”

ALSO READ: Nigerian Navy Recovers Large Cache of Illegal Refined Petroleum Products

Nwaochie also stressed the need for Nigeria to move beyond crude oil production and begin developing indigenous technologies for the energy industry.

According to him, SPE Nigeria Council was actively supporting innovation and technology development among young Nigerian engineers and researchers.

He disclosed that the association was engaging the National Universities Commission(NUC) on reforms to engineering curricula in universities to better prepare graduates for the future of the energy industry.

“One of our major focuses in SPE is technology development. We should not only import machines and equipment, we must begin to develop our own technologies locally.”

Nwaochie revealed that SPE was already supporting local innovators working on technologies such as remotely operated underwater vehicles (ROVs), noting that indigenous technology development will strengthen Nigeria’s economy and deepen local participation in the oil and gas sector.

“We may not get everything right immediately but we must start somewhere. That is how countries that dominate the global energy industry built their capacities.”

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