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Regional Oil & Gas Summary - 17 Jun 2015

Core Content

The document provides an overview of the regional oil and gas market as of 16 June 2015, including price movements, import trends, and corporate developments in key countries such as China, Vietnam, Malaysia, and others. It also features analyst ratings and financial metrics for various oil and gas companies across Asia.

Major Price Movements

• Brent Crude Oil: Down by 0.4% to USD63.70/b.
• WTI Crude Oil: Up by 0.8% to USD59.97/b.
• Dubai Fateh Spot: Down by 0.8% to USD61.26/b.
• China Daqing Spot: Up by 0.7% to USD59.53/b.
• NYMEX Henry Hub: Up by 0.2% to USD2.89/MMBtu.
• LNG Northeast Asia CFR: Up by 0.7% to USD7.20/MMBtu.
• Singapore 92 RON Spot: Up by 0.2% to USD81.34/b.
• Gasoil 500 ppm SG Spot: No change at USD76.90/b.
• 3.5% 180cst Fuel SG Spot: Up by 1.5% to USD355.67/mt.
• Gold: Down by 0.4% to USD1,182.07/Oz.
• USD-CNY Exchange Rate: No change at 6.21.
• DJI: Up by 0.6% to 17,904.48.
• S&P 500: Up by 0.6% to 2,096.29.

Key News Headlines

1. Vietnam's Oil Products Imports from ASEAN Countries Soaring:

   • Vietnam's oil products imports from Singapore, Thailand, and Malaysia increased significantly in May 2015, driven by reduced import duties.
   • Singapore was the top supplier with a 26.2% year-on-year increase in imports.

2. Corruption in Major Oil Nations:

   • The Middle East is highlighted as one of the most corrupt regions for oil business, with Iraq ranking ninth in the Corruption Risk Index.

3. China's Crude Oil Stocks Decline:

   • China's crude oil stocks experienced the largest monthly decline since October 2013, at 631,000 b/d, indicating a significant drawdown.

4. Chinese Gas Glut Until 2017:

   • WoodMac predicts that China's gas market will remain oversupplied until 2017 due to weak demand growth.

5. CNPC and Tencent Strategic Partnership:

   • China National Petroleum Corporation (CNPC) partnered with Tencent for energy internet development, in line with the Internet Plus strategy.

6. Iran's Oil Storage at Sea:

   • Iran is storing 40 million barrels of oil on supertankers, preparing for potential sales if a nuclear deal is reached by June 30.

7. Ex-PetroChina Official Expelled:

   • Liao Yongyuan, former vice chairman of PetroChina, was expelled from the Communist Party and will face prosecution for alleged corruption.

Analyst Reports

• SapuraKencana Petroleum: No surprises; margin pressure expected. Rating: HOLD.
• Gas Malaysia: Surprise price hike of 10.3% effective 1 July 2015; spreads unclear. Rating: HOLD.
• Malaysia Oil & Gas: OPEC's output target is a floor, not a ceiling. Rating: NEUTRAL.
• Petron Corp: Strong recovery expected if crude prices remain stable. Rating: BUY.

Company Valuations and Ratings

Asia Oil & Gas Valuations

Asia Oil-Service Valuations

Summary of Key Trends

• Crude oil prices showed mixed movements with Brent down and WTI up.
• Vietnam's oil imports from ASEAN, especially Singapore, surged due to reduced import duties.
• China's crude oil stocks declined significantly, and gas demand is expected to remain low until 2017.
• Iran's oil reserves at sea could impact the global oil market if a nuclear deal is reached.
• CNPC is collaborating with Tencent for digital transformation in the energy sector.
• Analysts suggest that Petron Corp could see a strong recovery if crude prices remain stable.
• The Middle East, particularly Iraq, is noted for high levels of corruption in the oil industry.
• Various companies in Malaysia and other Asian markets have different ratings and price targets, with some showing positive outlooks and others facing challenges.