Oil Price Rises To One-year High At $51

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Oil prices hit one-year high yesterday as Brent Crude, the international benchmark for oil gained 3 per cent to trade at $53.55 in London, while West Texas Intermediate (WTI) sold for $51.45 per barrel.

It will be recalled that the last time Brent hit this level was October 12, 2015, when it reached $53.73 a barrel.

The price spike came on the heel of Russia’s expression of its readiness to join the organisation of petroleum exporting countries (OPEC) in curbing crude output as agreed in Algeria by oil ministers recently.

Speaking at the World Energy Congress in Istanbul, Russian President Vladimir Putin said his country would join OPEC in implementing an output freeze.

Putin signaled that his country, which is one of the top three producers of oil, may even agree to a production cut to drive market stability.

“Russia is ready to join the joint measures to cap production and is calling for other oil exporters to join. We support the recent initiative of OPEC to fix oil production limits”.

“We hope that at the OPEC meeting in November, the idea will be embodied in an official agreement, giving a positive signal to the markets and investors.

“The demand for traditional energy supported not only the motorization and electrification of such huge countries and economies as China and India, but also by the continuing participation of oil and gas products in the most diverse areas of human life, in industrial processes,” Putin said.

Following Putin’s speech market sentiment was also boosted by a rally in Wall Street shares .SPX and news that work was underway for the launch of the first sovereign bond issue of No. 1 crude exporter Saudi Arabia before the eventual listing of the kingdom’s state-oil company Aramco.[FRX/]

Brent crude LCOc1 hit its highest level since Oct. 12, 2015, reaching $53.73 a barrel, before paring gains to trade up $1.44, or 2.8 percent, at $53.37 by 11:37 a.m. EDT (1537 GMT).

U.S. West Texas Intermediate crude CLc1 rose to $51.60, its highest since June 10, before trading at $51.38, up $1.57, or 3.2 percent.

The Organisation of the Petroleum Exporting Countries aims to agree on cutting about 700,000 barrels per day, bringing its output to 32.5-33.0 million bpd by the time it meets in Vienna for its policy meeting on Nov. 30. OPEC has also asked Russia and other non-members to join in making cuts.

Speaking on the implication of the Russia President remark on Monday’s trading, John Kilduff, partner at New York energy hedge fund Again Capital told Reuters that, “Putin coming out to say Russia will be part of the initiative has added another layer of credence to the speculation there will be a coordinated cut.”

“At some point, the market will call them on it and say ‘show us the cuts.’ And at that point, the Saudis might be willing to underwrite the cuts on their own because they really want these high prices. To me, $55 Brent is without doubt the next target,” he added.

Saudi Energy Minister Khalid al-Falih said he was optimistic of deal by November. His Algerian counterpart Nouredine Bouterfa said he expected to see “commitments” on cuts from non-OPEC oil producers at meetings in Istanbul this week.

Money managers have amassed their largest bullish position in U.S. crude futures in more than four months on OPEC’s planned output cut, data showed on Friday.

“History would suggest that a large amount of room still exists for additional speculative entry into the long side, at least enough to associate with our upside expectation of about $52” for WTI, said Jim Ritterbusch of Chicago-based oil markets consultancy Ritterbusch & Associates.

Amaya Capital expands its Azura power generation platform with new investment from Actis

Amaya Capital, the African-focused principal investment firm is pleased to announce over $300m of equity commitments in its power generation platform. The new investment follows the acquisition by growth markets investor Actis of American Capital Energy & Infrastructure’s stake in Azura Power Holdings Limited (“Azura”). This transaction, and the consequent expansion of Azura’s capital base, now allows the business to scale up its pan-African power generation capacity to a target of over 3,000MW.

The World Bank estimates that as many as 600 million of Africa’s 1 billion people lack access to electricity. The Azura platform seeks to ameliorate this acute shortage of power on the African continent with a primary focus on gas-to-power assets in addition to the development of renewable projects within Nigeria.

The Azura platform is anchored on the Azura-Edo IPP, a 1,500MW power station complex located in Edo State, Nigeria which is being developed in three phases with the first (459MW) phase currently under construction. Azura’s Nigerian investments also include a controlling stake in the 125MWp, gridscale, “Nova Solar” project which is currently under development in Katsina State.

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