Oil Prices Plunge on Increasing OPEC Crude Production

Oil prices slipped on Monday as the increasing production in the Middle East overshadowed a decline in the U.S. output and a weakening dollar, while Morgan Stanley warned that an emerging gasoline glut could also spill back into crude markets.

Brent was trading at $46.90 per barrel at 0643 GMT, down 47 cents, or 1 percent, from its last settlement. U.S. crude was down 33 cents at $45.59 a barrel.

Also, liquidity was low due to May Day holiday in many countries.

According to analysts, rising output from the Organization of the Petroleum Exporting Countries (OPEC) was outweighing a decline in the U.S. output and a sliding dollar, which makes it cheaper for countries using other currencies to import dollar-traded fuel.

“The weaker dollar failed to excite investors in the crude oil markets,” ANZ bank said, citing a rise in OPEC-output as the main downward driver for prices.

This year, the dollar has fallen over 6 percent against a number of other leading currencies, but traders said the weak greenback and falling U.S. output had been priced into the market during April’s price rally.

A Reuters survey indicated that OPEC supplies rose to 32.64 million barrels per day (bpd) in April, from 32.47 million bpd in March. That almost matches January’s 32.65 million bpd, when Indonesia’s return to OPEC boosted production to the highest, since at least 1997.

Russia, the biggest exporter outside OPEC, increased crude for seaborne exports to 3.117 million bpd in April, from 2.903 million bpd in March.

Morgan Stanley said there is also a risk to crude prices coming from an emerging gasoline surplus.

“Asia is the hub of a growing gasoline challenge. A growing product glut could lead to (refinery) run cuts later this year. We see a growing risk to refinery demand for crude oil,” the U.S. bank said.

Despite this, the chief of the International Energy Agency (IEA) said oil prices may have reached their lowest level, providing the health of the global economy does not pose a concern.

“In a normal economic environment, we will see the price direction is rather upwards than downwards,” IEA Executive Director Fatih Birol said on Sunday during a G7 meeting of energy ministers in Japan.

Non-OPEC output is set to fall by more than 700,000 bpd this year, the biggest decline in around 20 years, he said.

With global oil demand seen growing by 1.2 million bpd this year, the draw in global stockpiles will start soon, helping boost up prices, he said.

At the same event in Japan, U.S. energy secretary Ernest Moniz said on Monday that U.S. oil production would likely fall 600,000 bpd this year, compared with 2015 when output peaked around 9.6 million bpd.

Oil Prices Plunge on Increasing OPEC Crude Production

Turkish Drones Target ISIS in Syria, Kill 34

The Turkish military stated that shelling by Turkish artillery and drones which were launched from southern Turkey struck ISIS targets in Syria on Sunday, killing 34 militants.

Turkish howitzers and multiple rocket launchers first hit ISIS targets about 12 km (seven miles) south of the border, then four drones that took off from the Incirlik base in southern Turkey destroyed further targets, the military explained.

The strikes, which destroyed six vehicles and five gun positions for ISIS, came in retaliation to ISIS rocket attacks which hit the southern Turkish province of Kilis.

The border town of Kilis and surrounding area has been hit frequently by rocket fire from ISIS-controlled Syrian territory in recent months, killing civilians.

Turkey has repeatedly fired back at ISIS positions under its rules of engagement, but has called for greater support from Western allies, citing the difficulty of hitting moving targets with howitzers.

Foreign Minister Mevlut Cavusoglu was quoted as saying last week that the United States would deploy a rocket launcher system near the stretch of border that has come under attack. A senior U.S. military official confirmed the matter was under discussion but declined to comment further.

Turkish Drones Target ISIS in Syria, Kill 34

Obama Torches Trump at Star-Studded Washington Dinner

U.S. President Barack Obama on Saturday took aim at Democrats and Republicans alike in his final appearance headlining the star-studded White House correspondents’ dinner. He performed his brand of light-hearted, yet pointed comedy, but saved his sharpest barbs for Republican presidential front-runner Donald Trump.

“The Republican establishment is incredulous that he’s their most likely nominee,” Obama told attendees at the black-tie event, which he has previously joked is “a night when Washington celebrates itself,” bringing together journalists and media moguls with Hollywood stars and power brokers from Capitol Hill and beyond.

“They say Donald lacks the foreign policy experience to be president. But in fairness he has spent years meeting with leaders from around the world: Miss Sweden, Miss Argentina, Miss Azerbaijan,” the president said to cries of laughter, referring to contestants on the Miss Universe pageant that Trump formerly co-owned.

Obama also took the chance to make fun of the angst many in the Republican establishment have expressed at the prospect that Trump or Tea Party candidate Ted Cruz could win the party’s nomination to run in the Nov. 8 presidential election.

“Guests were asked to check whether they wanted steak or fish, but instead a whole bunch of you wrote in Paul Ryan,” Obama said, referring to the top Republican in the House of Representatives, who many have hoped could be lured into running for president.

“That’s not an option people,” Obama said, displaying comedic chops perfected through seven previous appearances at the annual dinner. “You may not like steak or fish, but that’s your choice.”

In his remarks, Obama looked back on his presidency and jokingly predicted the country may be nearing its doom.

“The end of the republic has never looked better,” the tuxedo-clad president said looking out at the well-groomed crowd as he blasted Republican Party Chairman Reince Priebus.

“Congratulations on all your success,” Obama told Priebus, while wearing a sarcastic grin. “The Republican party, the nomination process – it’s all going great.”

Larry Wilmore, the host of a show on cable outlet Comedy Central, took his own shots at Trump when he took the podium after Obama, joking that next year the dinner will be called: “Donald Trump presents a luxurious evening paid for by Mexico.”

Trump has notoriously promised to build a wall between the United States and Mexico to prevent illegal immigration, and he has said he would force Mexico to pay for it.

With a bit of nostalgia, Obama reflected on his more than seven years in office, saying he had been a young man of idealism and vigor before he became president.

“Eight years ago I said it was time to change the tone of our politics,” Obama said. “In hindsight, I clearly should have been more specific.”

And he acknowledged that the years had taken their toll. “I’m gray, grizzled … counting down the days to my death panel.”

Obama wrapped up his speech with “Obama out” and dropping the mic while the crowd cheered.

Obama Torches Trump at Star-Studded Washington Dinner

Aramco: From an Oil Titan to a Diversified Conglomerate

Khobar- Ever since Saudi Deputy Crown Prince Mohammed bin Salman bin Abdulaziz announced the Kingdom’s Vision 2030, speculations did not stop as to how Saudi Aramco, the Kingdom’s national petroleum and natural gas company, would become after being offered at the stock market and transformed into an elite power manufacturer, instead of a traditional oil and gas production company.

Some locals, when speaking to Asharq Al-Awsat newspaper, picture Aramco becoming an industrial conglomerate like other prominent groups in Japan and South Korea, like Mitsubishi for example that covers a wide array of manufacture, all the way from home appliances to vehicles; or like Samsung which assembles both cellphones and colossal oil tankers next to construction among which is the establishing of oil facilities.

Analysts add that the company will expand, becoming more versatile and covering further domains. Among the new ventures mentioned by the Deputy Crown Prince Mohammed bin Salman are architecture, construction, solar power in addition to several other domains announced by Aramco its self.

Aramco announced constructing a shipyard, establishing a power manufacturing industrial city and founding a drilling services company.

Prince Mohammed bin Salman had already clarified that Saudi Aramco after restructuring would transform into a holding comprising a conglomerate of subsequent companies that would be managed through day-to-day decisions made by Aramco.

Deputy Crown Prince Mohammed bin Salman bin Abdulaziz, Second Deputy Prime Minister and Defense Minister, said that there are forthcoming programs that will be launched under the umbrella of the Kingdom of Saudi Arabia’s Vision 2030.

In a press conference held on the 25th of April, 2016 after the launch of the “Kingdom of Saudi Arabia’s Vision 2030,” the Deputy Crown Prince said that the first of these programs is the national transformation program, to be announced by the end of the 5th month or at the beginning of the 6th month, indicating that it will be an executive program for achieving the objectives of the vision across many sectors the most important of which are the sector of services and needs of citizens.

Localization will be achieved through direct investments and strategic partnerships with leading companies in this sector. These moves will transfer knowledge and technology, and build national expertise in the fields of manufacturing, maintenance, repair, research and development. Employees will be trained and will be integrated into industrial complexes.

Saudi Arabia has been blessed with rich mineral resources such as aluminum, phosphate, gold, copper, uranium and other raw materials. Although the mining sector has already undergone improvements to cater to the needs of the Kingdom’s industries, its contribution to GDP has yet to meet expectations. As such, Saudi Arabia is determined to ensure it reaches SAR 97 billion by 2020, creating 90,000 job opportunities in the process, SPA reported on the Kingdom’s vision 2030.

The Kingdom is also planning a number of structural reforms, which include invigorating private sector investments by intensifying exploration, building a comprehensive database of the Kingdom’s resources, reviewing the licensing procedures for extraction, investing in infrastructure, developing funding methods and establishing centers of excellence. Saudi Arabia will also form strategic international partnerships and raise the competitiveness and productivity of national companies. This will boost their contribution to the sector’s growth, as well as to the localization of knowledge and expertise.

Even though Saudi Arabia has an impressive natural potential for solar and wind power, and the local energy consumption will increase three folds by 2030, the Kingdom still lacks a competitive renewable energy sector at present. To build up the sector, the government has set itself an initial target of generating 9.5 gigawatts of renewable energy. The Kingdom will also seek to localize a significant portion of the renewable energy value chain in the Saudi economy, including research and development, and manufacturing, among other stages, SPA reported the Kingdom’s 2030 vision on renewable energy.

Aramco: From an Oil Titan to a Diversified Conglomerate

Gulf Markets Mixed in Early Trade, Ma'aden Soars in Saudi

Stock markets in the Gulf were mixed in early trade on Sunday, as Saudi Arabia’s bourse propped up by commodity-related shares while banks weighed on United Arab Emirates indexes.

Shares in Saudi Arabian Mining Co jumped 9.5 percent, their daily limit, after the miner reshuffled its board reshuffle in response to the government’s plans for developing the mining sector.

The Gulf’s largest miner said on Thursday it had appointed Khalid al-Faleh as chairman of its board. Faleh is chairman of state-run Saudi Aramco.

Developing the Saudi mining industry and turning Aramco into a diversified industrial conglomerate are major planks of the national economic reform plan announced last week.

Saudi Basic Industries added 1.2 percent; Abdullah bin Mohammed al-Issa, a board member of Saudi Basic Industries, will also join Ma’aden’s board. The main Saudi stock index was up 0.1 percent after an hour of trade.

Elsewhere in the Gulf, the mood was weaker. Abu Dhabi banks remained soft after disappointing first-quarter earnings last week; the main index fell 0.7 percent. Heavyweight First Gulf Bank was down 1.2 percent and Abu Dhabi Commercial Bank lost 2.4 percent.

But Union National Bank rose 2.2 percent despite weak results from blue-chip Abu Dhabi banks last week and posting a 27 percent drop in first-quarter net profit attributable to equity holders to 447 million dirhams ($121.76 million). Two analysts polled by Reuters had forecast 314.00 million dirhams and 454.30 million dirhams.

Shares in UNB dropped 4.5 percent last week as other Abu Dhabi bank shares slumped.

Dubai’s index fell 0.9 percent. Emaar Properties , which has not yet reported earnings, fell 1.0 percent and Dubai Islamic Bank, which reported a drop in profits last week, lost 0.9 percent.

But Gulf Navigation jumped 6.5 percent in significant high trading volume. The ship operator has not yet reported its quarterly results.

Gulf Markets Mixed in Early Trade, Ma'aden Soars in Saudi

Syrian Army Bombs Aleppo, Begins "Calm" Plan Elsewhere

Syria’s rebel-held Aleppo was shelled Saturday with nearly 30 air strikes, as a temporary “calm” declared by Syria’s military took effect around Damascus and in the northwest.

It was the ninth day of monstrous bombardments in Aleppo, which has borne the brunt of augmented fighting that has all but destroyed a February US- Russian brokered ceasefire and killed nearly 250 people in the northern city since April 22, a monitoring group said.

The shelling also contributed to the peace talks in Geneva falling apart, which the main opposition walked out of last week.

Late on Friday, the Syrian army announced a “regime of calm,” or respite in fighting, which Damascus said was designed to save the wider ceasefire.

The Syrian army did not explain in any detail what military or non-military action the “regime of calm” would bring about. It said it would last for 24 hours in the capital Damascus and its suburb Eastern Ghouta and for 72 hours in rural areas around the northern city of Latakia.

A number of rebel groups however rejected the so-called “regime of calm.”

“We won’t accept any kind of… regional ceasefires,” a statement from a number of groups including Jaysh al-Islam, which controls areas east of Damascus, said.

It also said the main armed opposition as a whole reserved the right to take action against attacks on rebel factions in any part of the country, and criticized the United States doing so little to stop government bombardments.

The lull in fighting around the capital and parts of northwest coastal province Latakia, announced by the army, appeared to hold through most of Saturday but the bombing continued in Aleppo which was excluded from the plan.

Anas Al Abde, president of the Turkey-based opposition Syrian National Coalition, accused the government of violating the February truce “daily.” The opposition was ready to reinstate the wider truce, but reserved the right to respond with force to attacks, he said.

All sides have accused each other of truce violations.

The United States said it was working on “specific initiatives” to trim down the violence in Syria and sees stopping the bloodshed in Aleppo as a top priority, a U.S. State Department spokesman said on Saturday.

In a statement detailing calls U.S. Secretary of State John Kerry has made over the past two days with UN Special Envoy for Syria Staffan de Mistura and with Riad Hijab, chief coordinator of the main opposition HNC bloc, State Department spokesman John Kirby said Kerry had made clear the United States wanted Russia to pressure the Assad government to get it to stop “indiscriminate aerial attacks” in Aleppo.

The State Department said on Saturday that Kerry is travelling to Geneva on May 1-2 to discuss the Syrian conflict with his Jordanian and Saudi counterparts as well as de Mistura.

At least five people were killed in Aleppo early on Saturday in air strikes believed to have been carried out by Syrian government warplanes, the Syrian Observatory for Human Rights said.

Aleppo, Syria’s largest city before the war, has been divided for years between rebel and government-held zones. Full control would be a huge prize for President Bashar al-Assad.

Of the 250 casualties since April 22, 140 were killed in bombardments by government-aligned forces and 96 by rebel shelling. Forty children were among the dead, according to the Observatory’s tally.

“A BIT QUIETER”

Observatory director Rami Abdulrahman said government-held areas of Aleppo were “a bit quieter today,” but that rebels were still firing shells sporadically.

State news agency SANA said at least one person had been killed by rebel shelling on government-held neighborhoods.

Latakia and Ghouta were quiet with only some lower-level violence between rival rebel groups outside Damascus, Abdulrahman said.

A resident of Western Ghouta, which is under government siege, said shellings appeared to have ceased around the capital in the hours after the start of the lull at 1 a.m. (2200 GMT on Friday).

“There has been no military activity and no sound of bombardments in nearby areas, no sound of shelling or of warplanes,” Maher Abu Jaafar told Reuters via the internet.

“It’s the opposite of last night, when there was a lot of bombing and the sounds of rockets and shells.”

Syrian helicopters later in the day dropped barrel bombs southwest of Damascus but outside the area where the lull in fighting was meant to take place, the Observatory said.

Abu Jaafar said he heard several explosions.

The United Nations has called on Moscow and Washington to work on restoring the ceasefire to put a stop to the complete collapse of talks aimed at ending the five-year conflict that has killed more than 250,000 people and left millions seeking refuge around the world.

Agencies have continued their efforts to deliver aid in the west of the country, but say that access is not regular enough and that many Syrians in need still cannot be reached.

The International Committee for the Red Cross said aid had begun to enter the towns of Zabadani and Madaya, where there were reports of starvation earlier this year due to a siege by government forces and their allies.

Trucks simultaneously entered al-Foua and Kefraya in the northwest province of Idlib, which are surrounded by anti-government forces.

Syrian Army Bombs Aleppo, Begins "Calm" Plan Elsewhere

Iraq on the Edge of the Abyss

Baghdad-Yesterday, Iraq officially has rested on the edge of the abyss, as the capital Baghdad witnessed a day of utter chaos after thousands of protestors barged into the Green Zone.

Muqtada al-Sadr, Shi’ite leader of the Sadrist movement, was the one to call onto the demonstrations. The masses marched into the parliament’s building after the ministers, once again, had failed to vote on a proposed list of candidates for establishing a technocratic government. The candidates were proposed by Iraqi Prime Minister Haider al-Abadi and in response to the growing demands of Sadrists (followers of the Sadrist group) for reform and fighting corruption.

Meanwhile, the Sadrists waged an open rally at the Green Zone and Baghdad’s operation rooms declared a state of emergency, shutting down all main gateways to the city. Security was upped at the premise of the central bank and other major banks as well. PM Al-Abadi was also forced to leave his office in the Green Zone as to get to a safer place.

Protestors started marching only hours after a press conference with Muqtada al-Sadr in Najaflocated about 160 km south of Baghdad. At the press talk, al-Sadr condemned the political crisis the country is going through and announced the continuation of the popular “uprising” until all demands are met.

However, al-Sadr, at the conference, made no direct instructions that the protests should be moved into the Green Zone.

Many eyewitnesses said that a number of ministers who were attending parliament had fled outside the Green Zone. “The break-in was a surprising one, and we could not believe that the Sadrists were following through with their threats, actually we have not pictured that the Green Zone and parliamentary guard would allow this flooding of people in,” an Iraqi MP said.

On his behalf, Iraqi President FuadMasum called for calming down the situation.

The Green Zone, situated at the heart of Baghdad, includes the parliamentary building, the presidential palace and the offices of several embassies, including the American and the British embassies.

On the other hand, Iraqi officials reported the death of 23 people and other 38 injured after an explosive-laced vehicle exploded at one of the Shi’ite religious shrines near Baghdad. ISIS immediately claimed the assault. At one of the social media outlets employed by ISIS, an announcement was circulated on an ISIS suicide bomber detonating his 3-tons explosive-packed car.

Iraq on the Edge of the Abyss