The end of a long and difficult pandemic year for oil marked a changeover of the government in the United States, which is now led by President Joe Biden.
What lies ahead could mean a major change for the oil markets.
Ex-president Donald Trump reshaped the country's shale oil policy with an eye to dominate global energy markets and in just four years, the country’s exports became a force to be reckoned with.
Between 2016 and 2020, US shale grew aggressively and established a balance of market power with Opec. The group of oil-producing countries constrained production several times amid negative sentiment, supply chain disruptions during the US-China trade dispute and their subsequent impact on oil demand.
Both Opec and US shale tumbled into the pandemic precipice last year.
Low point for Opec export revenues in 2020
In 2020, Opec’s oil export revenues fell to their lowest point in 18 years, according to an estimate by the US Energy Information Administration. The coronavirus pandemic and low demand for oil pushed export revenues down to $323 billion for the year, compared with $595bn in 2019, the EIA said.
Opec’s export revenues for 2021 may rise to $397bn provided production cuts ease and global oil demand recovers, according to the EIA. In its January short-term outlook, the EIA forecast Brent crude price to average $53 per barrel in 2021 and 2022, up from $42 a barrel in 2020.
The US domestic oil industry also suffered considerably during the first and second waves of Covid-19. Energy giant Halliburton lost $2.9bn in 2020 and the country’s largest energy company – Exxon Mobil – said all four quarters of 2020 were loss-making.
EIA expectations for 2021
After a devastating 2020 for the international oil markets, what does 2021 hold for the rivals?
Global liquid fuel consumption is expected to rise by 5.6 million barrels per day in 2021 and 3.3 million bpd in 2022, according to the EIA.
Opec expects crude oil to remain a vital part of the energy mix, while acknowledging that climate change and the move to cleaner energy is a top priority
In 2020, US domestic crude oil production is expected to have fallen to 11.3 million bpd from a record high of 12.2 million bpd in 2019. Another slide to 11.1 million bpd from 11.3 million bpd is expected in 2021 before production rises to 11.5 million bpd in 2022.
Opec is forecast to produce more than double US crude oil production at 27.2 million bpd in 2021, up from an estimated 25.6 million bpd in 2020, the EIA said.
This analysis puts Opec firmly ahead of the US shale industry, at least in terms of output.
US energy policy under Biden
Much of the industry’s assumptions are based on US shale continuing the path to export growth, but what if the new administration is less supportive?
Public policy already shows signs of shifting as energy companies may face increased climate risk disclosure rules and an end to new drilling permits for federal land, along with the elimination of tax subsidies for the oil and gas industry.
Nonetheless, now that oil export revenues contribute to GDP, it is unlikely that there will be a full reversal to the US’s previous position of being a net crude oil importer, especially now that the US economy has to recover as quickly as possible from the pandemic. Vaccination programmes are in motion, but will take many months to reach the goal of immunising at least 70 per cent of the population.
Green energy
In the coming years, Opec and US shale face rising competition from green energy companies. Indeed, many of the major fossil fuel companies are shifting their production to green energy sources as climate change policies affect funding and demand. Opec expects crude oil to remain a vital part of the energy mix, while acknowledging that climate change and the move to cleaner energy is a top priority.
To conclude, Opec and US shale still have the brakes on because of anaemic demand for crude oil. Barring an unforeseen development in the US policy on exports, the rivalry is set to continue as oil-producing countries strive to recover from the pandemic. The next two years could see major changes in the balance of market power.
Hussein Sayed is the chief market strategist at FXTM
Haircare resolutions 2021
From Beirut and Amman to London and now Dubai, hairstylist George Massoud has seen the same mistakes made by customers all over the world. In the chair or at-home hair care, here are the resolutions he wishes his customers would make for the year ahead.
1. 'I will seek consultation from professionals'
You may know what you want, but are you sure it’s going to suit you? Haircare professionals can tell you what will work best with your skin tone, hair texture and lifestyle.
2. 'I will tell my hairdresser when I’m not happy'
Massoud says it’s better to offer constructive criticism to work on in the future. Your hairdresser will learn, and you may discover how to communicate exactly what you want more effectively the next time.
3. ‘I will treat my hair better out of the chair’
Damage control is a big part of most hairstylists’ work right now, but it can be avoided. Steer clear of over-colouring at home, try and pursue one hair brand at a time and never, ever use a straightener on still drying hair, pleads Massoud.
How to apply for a drone permit
- Individuals must register on UAE Drone app or website using their UAE Pass
- Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
- Upload the training certificate from a centre accredited by the GCAA
- Submit their request
What are the regulations?
- Fly it within visual line of sight
- Never over populated areas
- Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
- Users must avoid flying over restricted areas listed on the UAE Drone app
- Only fly the drone during the day, and never at night
- Should have a live feed of the drone flight
- Drones must weigh 5 kg or less
MATCH STATS
Wolves 0
Aston Villa 1 (El Ghazi 90 4' pen)
Red cards: Joao Moutinho (Wolves); Douglas Luiz (Aston Villa)
Man of the match: Emi Martinez (Aston Villa)
Why your domicile status is important
Your UK residence status is assessed using the statutory residence test. While your residence status – ie where you live - is assessed every year, your domicile status is assessed over your lifetime.
Your domicile of origin generally comes from your parents and if your parents were not married, then it is decided by your father. Your domicile is generally the country your father considered his permanent home when you were born.
UK residents who have their permanent home ("domicile") outside the UK may not have to pay UK tax on foreign income. For example, they do not pay tax on foreign income or gains if they are less than £2,000 in the tax year and do not transfer that gain to a UK bank account.
A UK-domiciled person, however, is liable for UK tax on their worldwide income and gains when they are resident in the UK.
'The worst thing you can eat'
Trans fat is typically found in fried and baked goods, but you may be consuming more than you think.
Powdered coffee creamer, microwave popcorn and virtually anything processed with a crust is likely to contain it, as this guide from Mayo Clinic outlines:
Baked goods - Most cakes, cookies, pie crusts and crackers contain shortening, which is usually made from partially hydrogenated vegetable oil. Ready-made frosting is another source of trans fat.
Snacks - Potato, corn and tortilla chips often contain trans fat. And while popcorn can be a healthy snack, many types of packaged or microwave popcorn use trans fat to help cook or flavour the popcorn.
Fried food - Foods that require deep frying — french fries, doughnuts and fried chicken — can contain trans fat from the oil used in the cooking process.
Refrigerator dough - Products such as canned biscuits and cinnamon rolls often contain trans fat, as do frozen pizza crusts.
Creamer and margarine - Nondairy coffee creamer and stick margarines also may contain partially hydrogenated vegetable oils.
UAE SQUAD
Khalid Essa (Al Ain), Ali Khaseif (Al Jazira), Adel Al Hosani (Sharjah), Mahmoud Khamis (Al Nasr), Yousef Jaber (Shabab Al Ahli Dubai), Khalifa Al Hammadi (Jazira), Salem Rashid (Jazira), Shaheen Abdelrahman (Sharjah), Faris Juma (Al Wahda), Mohammed Shaker (Al Ain), Mohammed Barghash (Wahda), Abdulaziz Haikal (Shabab Al Ahli), Ahmed Barman (Al Ain), Khamis Esmail (Wahda), Khaled Bawazir (Sharjah), Majed Surour (Sharjah), Abdullah Ramadan (Jazira), Mohammed Al Attas (Jazira), Fabio De Lima (Al Wasl), Bandar Al Ahbabi (Al Ain), Khalfan Mubarak (Jazira), Habib Fardan (Nasr), Khalil Ibrahim (Wahda), Ali Mabkhout (Jazira), Ali Saleh (Wasl), Caio (Al Ain), Sebastian Tagliabue (Nasr).
Libya's Gold
UN Panel of Experts found regime secretly sold a fifth of the country's gold reserves.
The panel’s 2017 report followed a trail to West Africa where large sums of cash and gold were hidden by Abdullah Al Senussi, Qaddafi’s former intelligence chief, in 2011.
Cases filled with cash that was said to amount to $560m in 100 dollar notes, that was kept by a group of Libyans in Ouagadougou, Burkina Faso.
A second stash was said to have been held in Accra, Ghana, inside boxes at the local offices of an international human rights organisation based in France.
