West Texas Intermediate rebounds U.S inventories continue to rise for the fifth week in a row

West Texas Intermediate rebounds U.S inventories continue to rise for the fifth week in a row: On Tuesday Oct 26. The American Petroleum Institute (API) reported a rise in U.S crude stockpiles for the fifth week in a row.

This week the API declared a rise in U.S crude stockpiles by 2.318 million barrels,
while analysts’ expectations were at 1.650 million barrels.

However the frequent decline of Cushing stockpiles disturbs the oil market.

U.S crude stockpiles are still lower by 61 million barrels than they were at the year’s beginning.

In the last week the API declared a sudden rise in oil stockpiles by 3.294 million barrels compared with analysts’ expectations of 2.233 million barrels

Evest follows all this in the following report.

Topics:

Oil prices for the week

Oil production weekly rates

ADNOC succeeds in its initial public offering

The impact of ADNOC’s initial public offering successes

The initial public offering impact on ADNOC

Oil prices for the week

On Tuesday dealings oil prices rose before data publishing, West Texas Intermediate price approached $84.50 a barrel,
Brent crude was at $86.35 a barrel.

West Texas Intermediate crude and Brent crude rose 0.97% and 0.42% in a row on afternoon dealings.

Despite the continuous rise of stockpiles in the last few weeks,
U.S oil stockpiles are declining to 61 million barrels for now,
according to the API data, and 4 million barrels since the beginning of 2020.

Oil production weekly rates

U.S daily oil production fell by 100.000 barrels by the week ending Oct.15 to 11.3 million barrels per day,
still less by 1.8 million barrels than its highest level ever of 13.1 million barrels per day which was reached before pandemic struck the USA.

The API declared that gasoline stockpiles exceeded 500.000 barrels by the week ending Oct.22, compared with last week’s decline of 3.5 million barrels.

Distillate stockpiles rose by 986.000 barrels throughout the week, compared with last week’s decline of 3 million barrels.

As Cushing gained more interest in the last few weeks, this year it’s stockpiles fell approximately 30 million barrels for now before data was published this week,
to raise concerns about how much of its stocks have been consumed.

This week the API declared that as Cushing is able to stock 76 million barrels of crude oil, it now has less than 30 million barrels.

This week the API data shows a decline of 3.734 million barrels, besides last week’s decline of 2.5 million barrels.

ADNOC succeeds in its initial public offering

Abu Dhabi national oil company (ADNOC) public subscription just came at the right time, following the initial public offering of billions of dollars of the drilling unit,
which Adonic drilling belongs to. The company hopes to repeat this success with fertilizer company Fertiglobe JV.

Fertiglobe succeeded to obtain $795 million in its initial public offering, to be the third biggest offering in Abu Dhabi’s stock market.

This week, the company declared that at the end of the offering registration process the final offer price has been set at 2.55 dirhams ($0.69),
at the average price of 2.45 to 2.65 dirhams, which was indicated last week.

The company is a joint stock company between OCI chemicals, headquartered in the Netherlands and ADNOC; it sold 1.145.582.011 ordinary stocks,
equalizing about 13.8% of Fertiglobe’s main capital.

The current numbers indicate that Fertiglobe’s stock value when listing will be $5.8 million. The value confirms analysts’ previous expectations of $5.4 to $6 billion.

The current offering is 22 double of average and 23 double for the qualified investor layer except the main investors.

Yet the reports show a total demand of $17.4 billion.

Fertiglobe’s success follows ADNOC’s drilling initial public offering which gained great success as well.

In the beginning of October, the reports marked that the total revenues of ADNOC’s drilling public offering were above $1.1 billion,
ADNOC said that the offering exceeded 31 times, and the registered demand was $34 billion.

ADNOC in response to the rise of demand increased the offered stocks from 1.200 million ordinary stocks to 1.760 million ordinary stocks,
to equalize %11 of the main capital.

The impact of ADNOC’s initial public offering successes.

The mentioned successes would lead to more active suggestions from ADNOC,
the giant oil and Gas Company located in Abu Dhabi is restructuring its entire portfolio.

The national oil organization isn’t benefiting from the market’s spirits only but also from the rise of demand on oil and gas all over the world,
however for sure it aims at achieving an income due to its position in the chemical and fertilizer field.

In the coming two weeks other projects will be declared, such as natural liquid gas investing, a new campaign from Abu Dhabi’s giant,
and launching of renewable energy approach which supports its current strategy.

The initial public offering impact on ADNOC

If ADNOC is thinking of an initial public offering like its opponent Saudi Aramco this would be the best time, as oil prices are above $80 a barrel.

Listing the oil and gas company in the stock exchange market will not only lead to gain more money,
which is supposed to be cash for nothing but also can with perfect pressure arouse global markets interest.

The challenges national oil companies like ADNOC and Aramco confront at the current time are not only about maintaining its oil and gas basic strategy,
but also raising its non-hydrocarbon works.

The giant investments required to establish (green) hydrogen works units and gain a big part of the renewable energy market
won’t be only expensive but also will be very hard as well.

Activists of ESG and SDG will be careful not to support national oil companies in the next few years.
Although investing in oil is one of the most profitable investments, national companies should make sure of gaining enough money to fund the future growth.

West Texas Intermediate rebounds U.S inventories continue to rise for the fifth week in a row

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