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Today, 12:55 PM
- Iran plans to sell 300K bbl/day of crude oil to European customers now that Western sanctions have been lifted, Iran’s oil minister said over the weekend, the first time the country's top oil official has said how much of its new exports would be headed for Europe.
- The comments came amid signs that European oil tanker companies were finding ways to ship Iranian oil despite remaining U.S. sanctions on Iran.
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) on Friday became the first Western company to load Iranian oil, the first in a wave of European purchases of Iranian oil, although the others have yet to be loaded.
- Iranian officials also said Total (NYSE:TOT) will start importing 160K bbl/day of oil starting on Feb. 16; shipping officials say the company has chartered a 2M-barrel tanker to load crude next week.
- ETFs: USO, OIL, UCO, UWTI, SCO, BNO, DWTI, DBO, DTO, USL, DNO, OLO, SZO, OLEM
Fri, Feb. 5, 12:58 PM
- Mining stocks hit hard in 2015 are the darlings of the new year, as the drag on the dollar due to fresh jitters about the strength of the U.S. economy has helped power the group higher.
- The dollar’s weakness has helped fuel the recent bounce in commodities: Iron ore, which sank 40% in 2015, has gained 14% since mid-January, while copper prices, which hit their lowest levels since early 2009 in mid-January, are up 10%.
- A glimmer of hope about China and global growth could signal a bottom for commodities and mining stocks, Bernstein's Paul Gait says, but other analysts caution that the rally could be a “bull trap" - a brief bounce before another dive into the red.
- Relevant tickers: FCX, OTCPK:AAUKF, OTCPK:AAUKY, OTCPK:GLCNF, OTCPK:GLNCY, BHP, RIO, VALE
Thu, Feb. 4, 9:50 AM
- Glencore's (OTCPK:GLCNF, OTCPK:GLNCY) credit rating is downgraded to BBB-, just one notch above junk, from BBB by Standard & Poor's, which has lowered its price assumptions for some of Glencore’s key products, including copper, zinc and nickel.
- S&P cites the mining industry's material challenges, with increased uncertainty about future operating performance in 2016-17, as well as its assessment that Glencore's 2015 financial profile fell below earlier expectations with funds from operations to debt closer to 20%.
- However, SP judges Glencore's outlook as stable, as the miner's meaningful continuing free cash generation, strong liquidity and active balance sheet deleveraging should mitigate downside risk.
- S&P cut its credit rating for BHP Billiton earlier this week and Vale last week.
Thu, Jan. 28, 12:59 PM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) is said to be storing oil on ships off the coast of Singapore and Malaysia, with at least four very large crude carriers that can hold at least ~2M barrels each floating at sea, Bloomberg reports.
- While the oil market has been in contango since 2014, the premium fetched by future cargoes has increased to the highest since February; the price difference between a Brent oil contract for immediate delivery and a year forward reportedly is near -$7/bbl, twice the level in mid-July.
- The CEO of Euronav (NYSE:EURN), Europe’s largest owner of supertankers, says his company would charge ~$0.75/bbl each month for storing; Brent crude for April costs ~$0.80 more than for March, according to ICE Futures Europe data.
Thu, Jan. 21, 6:24 PM
- European companies and trading houses are not rushing to buy Iranian oil because of legal uncertainties over the lifting of sanctions that are likely to take weeks to clarify, Reuters reports.
- Iran ordered a 500K bbl/day increase in oil production after international sanctions were lifted on Saturday, but many European firms reportedly are wary of violating other sanctions that were imposed by the U.S. and have not been lifted.
- The CEO of Russia's Lukoil (OTCPK:LUKOY, OTC:LUKOF), Vagit Alekperov, says it remains unclear whether the company's refineries in Italy or the Netherlands are free of legal risks to buy Iranian oil, and the head of Swiss trading house Mercuria also believes Iranian oil imports into Europe remain complicated.
- Alekperov says he thinks it will take 5-7 years for Iran to raise output significantly, and that this would happen only if the country enacts the right legislation to compete for investments.
- Market players, however, assume that companies which bought Iranian crude before the sanctions - such as Royal Dutch Shell (RDS.A, RDS.B), Total (NYSE:TOT), Eni (NYSE:E), and traders such as Glencore (OTCPK:GLCNF, OTCPK:GLNCY) and Vitol - will resume purchases at some point later this year.
Fri, Jan. 15, 10:34 AM
- Shares in global mining companies face their biggest back-to-back weekly losses in four years after signs of slowing growth in China, plunging oil prices and asset writedowns at BHP Billiton spark a selloff.
- Copper prices hit a six-year low for the fifth time in a week in London, -1.9%, amid worries about China’s economy, and are now down nearly 9% YTD; aluminum, lead, nickel and zinc all fell more than 1%.
- Long-dated “copper prices adjusted for producer country FX are mostly unchanged, which underscores the macro nature of the recent declines,” according to Goldman Sachs.
- "No lasting price recovery appears possible at present, neither on the metal markets nor on the commodities markets in general," Commerzbank says.
- BHP -7.7%, RIO -6.4%, OTCPK:AAUKF -5.7%, VALE -5.5%, FCX -5.4%, OTCPK:GLCNF -4.4%, TCK -4.3%, SCCO -1.1%.
- ETFs: JJC, DBB, JJN, JJU, CPER, JJT, BOM, RJZ, BOS, FOIL, JJM, LD, BDD, NINI, CUPM, LEDD
Thu, Jan. 14, 11:57 AM
- Former Barrick Gold CEO Aaron Regent is among the remaining bidders for Glencore’s (OTCPK:GLCNF, OTCPK:GLNCY) Lomas Bayas copper mine in Chile, Bloomberg reports.
- Regent, who now runs Magris Resources, is competing against a small number of Chile-focused operators that reportedly have offered Glencore close to $1B for the mine; a sale at such a price would be a boon for Glencore, which is seeking to trim its $30B debt load to ease investor concerns about weakening commodity prices.
- Lomas Bayas is an open-pit mine located ~75 miles northeast of the port of Antofagasta, and produces ~75K tons/year of copper cathode.
Thu, Jan. 14, 10:23 AM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) reportedly has launched an early refinancing of an $8.45B one-year revolving credit facility it signed in May 2015, as it tries to shore up investor confidence amid the commodity price rout.
- The terms for the credit line - used to fund Glencore’s business of transporting and storing commodities including coal, oil and copper - are expected to be on similar terms to last year, Financial Times reports.
- Glencore is said to want to complete the refinancing before it announces its annual results on March 1, and would then launch a wider syndication.
- Other major commodity traders, including Singapore-listed Noble Group and privately-held Trafigura, also are looking to refinance credit lines with their banks.
Tue, Jan. 12, 12:46 PM
- BHP Billiton (BHP -4.3%) could cut is payout in half when it releases results, and Rio Tinto (RIO -4.5%) also could cut its dividend later this year, HSBC analysts say, citing the need for the miners to cut expenses to help indebted balance sheets and offset weak commodities prices.
- HSBC also says Anglo American (OTCPK:AAUKF, OTCPK:AAUKY) and First Quantum Minerals (OTCPK:FQVLF) are most at risk if commodities remain weak, although continued South African rand weakness would help Anglo, while strength in copper and other stock-specific reasons could favor returns for Freeport McMoRan (FCX -13.4%) and Glencore (OTCPK:GLCNF, OTCPK:GLNCY).
- The firm downgrades BHP and First Quantum to Reduce, maintains a Reduce rating on Anglo, and has a Buy rating on FCX and Glencore.
Mon, Jan. 11, 7:40 AM
- Glencore's (OTCPK:GLCNF, OTCPK:GLNCY) Sherwin Alumina U.S. unit says it has filed for chapter 11 bankruptcy.
- Sherwin says it will continue to operate while in bankruptcy and that Corpus Christi Alumina, another Glencore unit, has offered to purchase nearly all of Sherwin's assets as a stalking horse bidder.
- Sherwin says it will immediately launch a competitive sale process to ensure that the Corpus Christi offer is the highest available offer.
Dec. 23, 2015, 9:19 AM
- Mining stocks look to be headed for a strong day, following a rebound in metal prices after China earlier this week raised hopes that demand may strengthen next year when it unveiled plans for more flexible fiscal and monetary policies.
- Prices for industrial commodities including copper, zinc, lead and aluminum are up at least 1%.
- Anglo American (OTCPK:AAUKF, OTCPK:AAUKY) +8.1%, Glencore (OTCPK:GLCNF, OTCPK:GLNCY) +6.7% in London.
- MT +10.2%, RIO +5.4%, VALE +4.8%, BHP +4.5% in U.S. premarket.
Dec. 18, 2015, 12:38 PM
- Glencore’s (OTCPK:GLCNF, OTCPK:GLNCY) debt is downgraded to Baa3 - one notch above junk - from Baa2 by Moody’s, citing its view that the pricing environment in mining will remain unfavorable in 2016-17.
- However, Moody's assigns a "stable" outlook to its rating, implying it does not expect to make a further downgrade in the coming months; the ratings agency says Glencore has the capacity to adjust its balance sheet to a reduced earnings level in order to maintain its investment grade ratings.
- Overcoming deep skepticism, analysts and investors are now more optimistic that CEO Ivan Glasenberg’s aggressive approach to the protecting the company’s balance sheet will help it weather the commodities rout.
- Earlier: BHP on review for downgrade at Moody's
Dec. 10, 2015, 2:15 PM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) enjoyed a rare bit of good news today, reporting that it is cutting costs by more than expected and reducing net debt faster than expected, and shareholders reacted accordingly, sending shares up as much as 14% in London before closing with a 7.7% gain.
- Glencore is making "strong progress,” Citigroup says, adding that marketing EBIT guidance of $2.4B-$2.7B is in line with its $2.5B forecast, and "sequentially lower unit costs in 2016 should be taken positively by the market."
- Credit Suisse says the marketing outlook surpasses its $2.35B estimate and is above consensus; Glencore also cut its capex to $9.5B from $10B-$10.5B for this year, beating the firm’s forecast of $9.5B, while net debt is falling faster than expected with a new target set for $18B-$19B by year-end 2016 from the low $20B level previously.
Dec. 10, 2015, 3:28 AM
- Embattled miner Glencore (OTCPK:GLNCY) is planning to deepen its spending cuts and increase its overall debt reduction goal.
- The move translates into a net debt target of $18B-$19B by the end of 2016, against previous guidance in the low-$20B range.
- Under measures announced in September, the producer already scrapped its dividend, raised $2.5B in a share sale, signed a $900M silver streaming deal and started talks on selling a stake in its agricultural unit.
Dec. 7, 2015, 8:37 AM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) says it will cut nearly 80% of its workforce at its Collinsville coal mine in Australia's Queensland state, as it reduces production at the site next year.
- The company says it will start cutting by March ~180 of 230 jobs at the mine; it does not give specific production cuts, but had said earlier this year it was considering annual output reductions of ~2M metric tons to 2.8M tons.
- Glencore, the world's largest supplier of thermal coal, says it will reassess its plans for the operation during 2016, and signals it is keeping all its mines under review amid the downturn in world commodity prices.
- Earlier: Glencore to highlight progress this week
Dec. 7, 2015, 4:24 AM
- Looking to reassure nervous shareholders, Glencore (OTCPK:GLNCY) plans to use a call with investors on Thursday to highlight the progress it's making with a disposal program and its expectations of completing a $10.2B debt reduction plan before the end of 2016.
- Glencore shares have tumbled over 70% since January and have lost more than three-quarters of their value since the company's 2011 stock market flotation due to its hefty debt load and rout in commodity prices.
Glencore Xstrata is one of the worlds largest global diversified natural resource companies and is one of the ten biggest companies within the FTSE 100 Index. The Groups industrial and marketing activities are supported by a global network of more than 90 offices located in over 50 countries.
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