Hindustani78
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- Apr 8, 2014
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http://www.businessinsider.com/wher...e-brink-of-political-and-economic-collapse-14
Qatar
relies on liquid natural gas,
Risk for this year: 2
Oil production last month: 0.62 millions of barrels/day
Oil production 2015 average: 0.67 mb/d
Qatar is a big player in the liquefied natural gas sector, and so analysts believe that its challenges "will emerge later this decade."
Still, it's notable that the country raised $9 billion in Eurobonds back in May, which was the biggest bond issuance in the Middle East until Saudi Arabia's last month.
United Arab Emirates
Risk for next year: 2
Oil production last month: 3.11 mb/d
Oil production 2015 average: 2.88 mb/d
Like other GCC states, the United Arab Emirates remains better positioned than other producers to weather lower oil. However, it, too, has made some cutbacks.
"GCC monarchies survived the Arab spring uprisings largely unscathed by ratcheting up social spending. Now, however, the recent moves to scale back the social contract pose the risk of domestic discord and strife," wrote Croft.
"Hence, the GCC — UAE included— will likely remain core members of the Saudi-led OPEC coalition of the willing, together looking to add a little extra grease to the wheels toward achieving moderately higher prices."
Kuwait
Risk for next year: 3
Oil production last month: 2.96 mb/d
Oil production 2015 average: 2.85 mb/d
Although Kuwait has a small population and a relatively large sovereign wealth fund, the country has seen some disarray in 2016.
Back in April, oil workers went on strike to protest proposed government cutbacks. And more recently, the Emir dissolved parliament following "disputes between MPs and the government over fuel price increases in the oil-rich country."
Indonesia
Risk for next year: 3
Oil production last month: 0.74 mb/d
Oil production 2015 average: 0.79 mb/d
Indonesia is highly exposed to any potential slowdown in China, one of the big oil guzzlers.
Separately, there were reports that the country's state oil company, Pertamina, wants to up production by 42% in 2017.
Iran
Risk for next year: 5
Oil production last month: 3.68 mb/d
Oil production 2015 average: 2.81 mb/d
Iran previously saw a "reversal of fortunes" after sanctions were lifted. However, the election of Donald Trump now increases the possibility of a "snap-back" of sanctions on Tehran, given that the president-elect called the Iran deal "one of the worst deals ever negotiated."
"Given the question mark now looming over its economic revival, Iran may no longer be able to maintain such a price agnostic production position," argued Croft. "We may already be seeing signs of this, with oil minister Bijan Zanganeh saying on Sunday that it is 'highly probable' that OPEC will reach a consensus in Vienna."
"The fact that the country has basically clawed itself back to its pre-sanctions output
position may also make it adopt a more conciliatory stance in Vienna and our base case is that Iran will be part of OPEC’s coalition of the willing on November 30."
Ecuador
Risk for next year: 5
Oil production last month: 0.56 mb/d
Oil production 2015 average: 0.54 mb/d
Ecuador suffered a powerful 7.8-magnitude earthquake back in April, which saw a death toll of over 650. China helped with the relief effort, and since then, the two countries have worked to expand economic ties.
Angola
Risk for next year: 6
Oil production last month: 1.66 mb/d
Oil production 2015 average: 1.80 mb/d
Angola briefly enjoyed the status as Africa's largest producer earlier this year, but has fallen back to second place as Nigerian production ramped back up.
The country continues to struggle with high inflation — which hit 40.04% year-over-year in October — and its currency, the kwanza, fell by over 30% against the dollar in 2015.
At the same time, there are concerns about corruption after President Jose Eduardo dos Santos hired his daughter, the richest woman in the country, to lead the state oil company.
Saudi Arabia
Risk for next year: 6
Oil production last month: 10.58 mb/d
Oil production 2015 average: 10.24 mb/d
The RBC Capital Markets team argues that there's a good chance OPEC will agree to a cut come November 30 — and all because of Saudi Arabia.
"Our view is primarily based on the belief that the single most important country in OPEC, Saudi Arabia, wants it, and that the ability of a number of suspected cheaters to cheat is constrained," they wrote. "OPEC’s leadership is cognizant of the risks posed by failing to reach a deal."
Against the backdrop of this, Saudi Arabia is pushing forward with major reforms. Although there have yet to be major protests, the austerity measures are front-loaded — which creates a challenge for the government.
Gabon
Risk for next year: 6
Oil production last month: 0.20 mb/d
Oil production 2015 average: 0.21 mb/d
Gabon saw protests erupt after the outcome of the presidential election this past summer. Protestors even set fire to the parliament building, according to the Washington Post. According to authorities, three were killed, 105 were wounded, and 800 people were arrested.
Algeria
Risk for next year: 8
Oil production last month: 1.11 mb/d
Oil production 2015 average: 1.10 mb/d
"Algeria is facing the twin challenges of a fiscal crisis and a serious terrorism threat at a time when the aged head of state is largely incapacitated due to health problems," wrote Croft.
Reuters reports that the president, Abdelaziz Bouteflika, who is 79, has been rarely seen in public since suffering a stroke in 2013. This has raised questions about whether he will finish out his term to 2019.
Iraq
Risk for next year: 9
Oil production last month: 4.59 mb/d
Oil production 2015 average: 4.03 mb/d
"Regarding coordinated OPEC action, Iraqi officials insist that any cap would hurt efforts to fight ISIS," wrote Croft. "In our view, though, a far greater threat to Iraq’s financial health is lower oil prices."
"The country has a limited ability to offset the negative economic effects of a 'no deal' price slide given already high output levels and the ongoing security threat."
Libya
Risk for next year: 9
Oil production last month: 0.52 mb/d
Oil production 2015 average: 0.39 mb/d
Libya has fractured into turmoil since Muammar Gaddafi was overthrown in 2011. Fast forward to today, the RBC Capital Markets team argues that there remain obstacles to a sustainable return of production.
"In our view, battle lines between the west and the east seem to be hardening and oil could easily become a casualty of the deteriorating security environment," they wrote.
Nigeria
Risk for next year: 10
Oil production last month: 1.67 mb/d
Oil production 2015 average: 1.94 mb/d
The fundamental drivers of instability in Nigeria's oil region — namely, poverty, corruption, and the proliferation of weapons — remain in place. And the country has seen a number of pipeline attacks over the last few weeks.
"Leading Nigeria experts contend that the government has made little progress toward a settlement with the multitude of armed actors despite several high-profile meetings in Abuja," wrote Croft. "Nigeria, like Libya, is one of the wild card red herrings where we think many market participants have a bullish view on production, which to us seems unwarranted."
Venezuela
Risk for next year: 10
Oil production last month: 2.18 mb/d
Oil production 2015 average: 2.36 mb/d
Venezuela is currently on the precipice of political and economic disaster, plagued by economic mismanagement, a chronic balance of payments problem, soaring inflation, food and essential goods shortages, and looting and violence. Most recently, its state oil company, PDVSA, activated a 30-day grace period for $404 million in interest payments on its 2021, 2024 and 2035 bonds.
"Seasoned country experts contend that production could soon dip below 2 mb/d. While many market participants think of Venezuela as likely to cheat, it simply lacks the barrels to do so in our view," wrote Croft.
"...it is likely that no sovereign producer is facing as frightening a future in a low oil price environment."
Qatar
relies on liquid natural gas,
Risk for this year: 2
Oil production last month: 0.62 millions of barrels/day
Oil production 2015 average: 0.67 mb/d
Qatar is a big player in the liquefied natural gas sector, and so analysts believe that its challenges "will emerge later this decade."
Still, it's notable that the country raised $9 billion in Eurobonds back in May, which was the biggest bond issuance in the Middle East until Saudi Arabia's last month.
United Arab Emirates
Risk for next year: 2
Oil production last month: 3.11 mb/d
Oil production 2015 average: 2.88 mb/d
Like other GCC states, the United Arab Emirates remains better positioned than other producers to weather lower oil. However, it, too, has made some cutbacks.
"GCC monarchies survived the Arab spring uprisings largely unscathed by ratcheting up social spending. Now, however, the recent moves to scale back the social contract pose the risk of domestic discord and strife," wrote Croft.
"Hence, the GCC — UAE included— will likely remain core members of the Saudi-led OPEC coalition of the willing, together looking to add a little extra grease to the wheels toward achieving moderately higher prices."
Kuwait
Risk for next year: 3
Oil production last month: 2.96 mb/d
Oil production 2015 average: 2.85 mb/d
Although Kuwait has a small population and a relatively large sovereign wealth fund, the country has seen some disarray in 2016.
Back in April, oil workers went on strike to protest proposed government cutbacks. And more recently, the Emir dissolved parliament following "disputes between MPs and the government over fuel price increases in the oil-rich country."
Indonesia
Risk for next year: 3
Oil production last month: 0.74 mb/d
Oil production 2015 average: 0.79 mb/d
Indonesia is highly exposed to any potential slowdown in China, one of the big oil guzzlers.
Separately, there were reports that the country's state oil company, Pertamina, wants to up production by 42% in 2017.
Iran
Risk for next year: 5
Oil production last month: 3.68 mb/d
Oil production 2015 average: 2.81 mb/d
Iran previously saw a "reversal of fortunes" after sanctions were lifted. However, the election of Donald Trump now increases the possibility of a "snap-back" of sanctions on Tehran, given that the president-elect called the Iran deal "one of the worst deals ever negotiated."
"Given the question mark now looming over its economic revival, Iran may no longer be able to maintain such a price agnostic production position," argued Croft. "We may already be seeing signs of this, with oil minister Bijan Zanganeh saying on Sunday that it is 'highly probable' that OPEC will reach a consensus in Vienna."
"The fact that the country has basically clawed itself back to its pre-sanctions output
position may also make it adopt a more conciliatory stance in Vienna and our base case is that Iran will be part of OPEC’s coalition of the willing on November 30."
Ecuador
Risk for next year: 5
Oil production last month: 0.56 mb/d
Oil production 2015 average: 0.54 mb/d
Ecuador suffered a powerful 7.8-magnitude earthquake back in April, which saw a death toll of over 650. China helped with the relief effort, and since then, the two countries have worked to expand economic ties.
Angola
Risk for next year: 6
Oil production last month: 1.66 mb/d
Oil production 2015 average: 1.80 mb/d
Angola briefly enjoyed the status as Africa's largest producer earlier this year, but has fallen back to second place as Nigerian production ramped back up.
The country continues to struggle with high inflation — which hit 40.04% year-over-year in October — and its currency, the kwanza, fell by over 30% against the dollar in 2015.
At the same time, there are concerns about corruption after President Jose Eduardo dos Santos hired his daughter, the richest woman in the country, to lead the state oil company.
Saudi Arabia
Risk for next year: 6
Oil production last month: 10.58 mb/d
Oil production 2015 average: 10.24 mb/d
The RBC Capital Markets team argues that there's a good chance OPEC will agree to a cut come November 30 — and all because of Saudi Arabia.
"Our view is primarily based on the belief that the single most important country in OPEC, Saudi Arabia, wants it, and that the ability of a number of suspected cheaters to cheat is constrained," they wrote. "OPEC’s leadership is cognizant of the risks posed by failing to reach a deal."
Against the backdrop of this, Saudi Arabia is pushing forward with major reforms. Although there have yet to be major protests, the austerity measures are front-loaded — which creates a challenge for the government.
Gabon
Risk for next year: 6
Oil production last month: 0.20 mb/d
Oil production 2015 average: 0.21 mb/d
Gabon saw protests erupt after the outcome of the presidential election this past summer. Protestors even set fire to the parliament building, according to the Washington Post. According to authorities, three were killed, 105 were wounded, and 800 people were arrested.
Algeria
Risk for next year: 8
Oil production last month: 1.11 mb/d
Oil production 2015 average: 1.10 mb/d
"Algeria is facing the twin challenges of a fiscal crisis and a serious terrorism threat at a time when the aged head of state is largely incapacitated due to health problems," wrote Croft.
Reuters reports that the president, Abdelaziz Bouteflika, who is 79, has been rarely seen in public since suffering a stroke in 2013. This has raised questions about whether he will finish out his term to 2019.
Iraq
Risk for next year: 9
Oil production last month: 4.59 mb/d
Oil production 2015 average: 4.03 mb/d
"Regarding coordinated OPEC action, Iraqi officials insist that any cap would hurt efforts to fight ISIS," wrote Croft. "In our view, though, a far greater threat to Iraq’s financial health is lower oil prices."
"The country has a limited ability to offset the negative economic effects of a 'no deal' price slide given already high output levels and the ongoing security threat."
Libya
Risk for next year: 9
Oil production last month: 0.52 mb/d
Oil production 2015 average: 0.39 mb/d
Libya has fractured into turmoil since Muammar Gaddafi was overthrown in 2011. Fast forward to today, the RBC Capital Markets team argues that there remain obstacles to a sustainable return of production.
"In our view, battle lines between the west and the east seem to be hardening and oil could easily become a casualty of the deteriorating security environment," they wrote.
Nigeria
Risk for next year: 10
Oil production last month: 1.67 mb/d
Oil production 2015 average: 1.94 mb/d
The fundamental drivers of instability in Nigeria's oil region — namely, poverty, corruption, and the proliferation of weapons — remain in place. And the country has seen a number of pipeline attacks over the last few weeks.
"Leading Nigeria experts contend that the government has made little progress toward a settlement with the multitude of armed actors despite several high-profile meetings in Abuja," wrote Croft. "Nigeria, like Libya, is one of the wild card red herrings where we think many market participants have a bullish view on production, which to us seems unwarranted."
Venezuela
Risk for next year: 10
Oil production last month: 2.18 mb/d
Oil production 2015 average: 2.36 mb/d
Venezuela is currently on the precipice of political and economic disaster, plagued by economic mismanagement, a chronic balance of payments problem, soaring inflation, food and essential goods shortages, and looting and violence. Most recently, its state oil company, PDVSA, activated a 30-day grace period for $404 million in interest payments on its 2021, 2024 and 2035 bonds.
"Seasoned country experts contend that production could soon dip below 2 mb/d. While many market participants think of Venezuela as likely to cheat, it simply lacks the barrels to do so in our view," wrote Croft.
"...it is likely that no sovereign producer is facing as frightening a future in a low oil price environment."
