LONDON/NEW YORK: Oil is expected to hit $100 a barrel this quarter, but a new record high above $147 is far less likely any time soon, a poll of investment managers and bank analysts showed on Wednesday.
Investment managers are as bullish as investment bank analysts about the prospects for ICE Brent futures, which are trading near $98.
Brent hit a 27-month high on Wednesday following production interruptions in Norway and Alaska, while growing global demand raised expectations of tighter supplies.
"We don't see too much supply coming into the market," said Alex Moiseev, chief investment officer at Dighton Capital Management, a managed futures firm based in Switzerland.
"$100 is an almost immediate target." Jeremy Charlesworth, chief investment officer at Moonraker Fund Management, a London-based commodity fund of hedge funds, expects to see Brent touch $100 by the end of the first quarter.
"We will have a little bit of a pull-back but the recovery is definitely there," he told Reuters. "I think it's a bit like 2004 when we had a few stop-starts."
There was a strong divergence among respondents as to when they next saw U.S. crude oil prices reaching a new record high of over $147. U.S. crude is now trading at around $91 due to high inventories at its delivery point in Cushing, Oklahoma.
John Kilduff, a partner at New York-based hedge fund Again Capital, said the second half of 2012 was a reasonable target for a record high for U.S. oil prices, but Adam Sieminski, an energy analyst at Deutsche Bank in the United States was far more bearish medium term.
SPARE CAPACITY "Short of some massive geopOlitical event I don't see oil hitting $147 in the next few years," he said. "The difference this time is there is far more spare OPEC production and global refining capacity."
The majority of buy-side respondents saw a new high reached in 2013 or 2014. Christopher Wheaton, manager of the Allianz RCM Energy Fund, who chose 2013, said that, longer term, the world needed higher prices to choke off demand.
"The problem is that a lot of the nations where you have the biggest increases in demand you also have subsidised fuel," he said. "So if demand is to be cut off, prices will have to climb to all-time highs in the OECD nations first."
Colin O'Shea, head of commodities at UK-based asset manager Hermes, went for 2014, arguing that it would take a few years to reduce spare capacity, which would then induce a price response.
"We also need quite a bit of demand growth to maintain levels of $140-$150," O'Shea said.
$100 oil imminent but new record high years away
Govt extends tenure of judge in 2G probe: Statement
NEW DELHI: India's telecom ministry said on Wednesday it had extended up to Jan. 31 the tenure of a former judge probing procedures followed in the country's allocation of telecoms licences and spectrum between 2001 and 2009.
The ministry did not give any reason in its statement for extending the investigator's tenure.
Former Supreme Court judge Shivaraj Patil is investigating if there were any shortcomings and lapses in the 2G licensing process, after a government audit said in November the award of licences and spectrum in 2007-08 could have deprived the government as much as $39 billion.
Telecoms Minister Kapil Sibal had said on Dec. 9 he would like to see the inquiry completed in a month.
Two Arunachal men get stapled China visas, stopped at airport
ITANAGAR: In a departure from past practice, China has begun issuing visas to residents of Arunachal Pradesh, over which it lays claim, but they are stapled to passports as in the case of people from Jammu and Kashmir.
China's new tactics came to light when two sportsmen from Arunachal Pradesh were prevented by immigration officials from boarding a flight today from New Delhi to Beijing since they had stapled visas issued by the Chinese Embassy on their passports.
Indian Weightlifting Federation's Joint Secretary Abraham K Techi along with a weightlifter of the state were taken aback when immigration officials at New Delhi's IGI Airport stopped them and turned the two men away because of the stapled visas issued by the Chinese Embassy.
Techi and the weightlifter, who were to visit the country at the invitation of Chinese Weightlifting Association president Menguang for the January 15-17 China Weightlifting Grand Prix at Fujian province, thereafter got in touch with the Chinese Embassy.
Reacting to the Chinese action, the Ministry of External Affairs said India considers Arunachal Pradesh as an integral part of India and has conveyed to the Chinese side that a uniform process of issue of visas to Indian citizens be followed regardless of applicant's ethnicity or place of domicile.
Maintaining that both the athletes are reportedly domiciles of Arunachal Pradesh, the Ministry recalled that a travel advisory had been issued in February, 2009 cautioning Indian citizens that Chinese visas stapled to passports were not valid for travel outside the country.
Needling India, China started issuing stapled visas to people from J and K from later part of 2008 in an attempt to project it as a disputed area. In the case of residents of Arunachal Pradesh, visas were never issued till now as China claims the whole of the north-eastern state as its own.
The contentious issue of stapled visas for residents of J and K had figured during Chinese Premier Wen Jiabao's visit to New Delhi last month. Wen had said that China takes India's concerns on the issue seriously.
Techi told PTI the Chinese officials at the Embassy informed him that the 'right' visas have been issued to them.
"This is an insult and unnecessary harassment to Arunachalees," Techi said.
12 Jan, 2011, 10.07PM IST,PTI US cos must cash in on high-growth emerging markets: Geithner
"As countries like China, India, Brazil and other emerging economies grow and expand, we want the American economy, American workers and American companies to play a major role in and gain substantial benefits from that growth," Geithner said in his speech at a think-tank here.
"We want to see a substantial part of that growing demand outside of the United States met by goods and services that are created and produced in the United States and fuelled by investment in the United States," Geithner said.
"If we are successful in doing that, we will be stronger as a nation. But to be successful in meeting that challenge, there are things we must do. We must invest more in research and development. We must invest more in educational reforms. We must invest more in public infrastructure," he said.
"We must create stronger incentives for investment in the United States, by both American and foreign companies. We must be more forceful and effective in promoting American exports. And we must restore fiscal responsibility," he said.
"This will require the government to spend less and spend more wisely, so that we can afford to make the investments that are critical to future growth. And it will require tax reform that produces a system that is more simple and more fair, that encourages growth and investment and that will help restore fiscal sustainability," Geithner said.
"These are our challenges. And they are not just an economic imperative, they are a national security imperative. Our strength as a nation depends on the ability of our political system to move quickly enough to put in place solutions to our long-term problems," he said.
"Our great strengths as a country have been in our openness to ideas and talent, our capacity to innovate, our excellence in higher education, a willingness to invest public resources strategically in scientific research and discovery and the political will to confront challenges with wisdom and force," Geithner said.
"If we preserve and build on these strengths and if China successfully continues on its path to a more open market economy, then both our countries and the world economy will be in a much stronger position," he said.
"The President recently said, 'We should feel confident about our ability to compete', but we are going to have to step up our game," Geithner warned.
"China's rise offers us the opportunity of dramatic growth in demand for things Americans create and produce. But it also will force us to raise our game," he said.
Making public statements on 2G spectrum report improper: CAG
"Making public comments on the matter which is being considered by a Parliamentary Committee is highly improper and may even amount to contempt of the House," Comptroller and Auditor General (CAG) said in a statement.
Sibal had recently slammed the CAG for its report on 2G spectrum allocation saying that its projection of Rs 1.76 lakh crore as presumptive loss on account of 2G spectrum allocation was "utterly erroneous".
The Minister's view was later supported by Congress MP and spokesperson Manish Tewari, who lashed out the CAG for violating canons of Parliamentary propriety.
"The CAG after holding a live press conference on 2G Spectrum issue is now advising MPs not to comment on it because the matter is being considered by PAC.
"It is an exotic logic that after going live with presumptive losses contained in CAG report in flagrant violation of canons of Parliamentary propriety, now CAG is resorting to argument of propriety," Tewari had said yesterday.
As per rules of Parliamentary procedure, the CAG said, "When any matter is under consideration of a Parliamentary Committee and the Committee is holding its sittings for that purpose, no persons, including a Member of Parliament should make or publish a statement or comment about that matter".
Equity mutual funds receive Rs 5,000 cr every month: Bhave
MUMBAI: In spite of it being a tough year for the mutual fund (MF) industry, equity funds received a healthy Rs 5,000 crore every month, Securities and Exchange Board of India (SEBI) Chairman C B Bhave said today.
The existing equity fund products received steady inflows in 2010 despite it being a tough year for the MF industry, he said.
Bhave was speaking to the media after launching a certified financial programme by TeamLease here.
However, on newer products getting lacklustre response, the SEBI chief made his reservations public by saying that they were mostly replicas of the older ones.
The stock market regulator's move to do away with the entry load on funds - the money paid to distributors as commissions -- had hit the MF industry severely.
Asset management firms used to spend a major portion of the money they collected as entry fees from investors to pay distributors' commissions. After the load was scrapped in 2009, distributors lost the incentive to sell funds.
Bhave also said that the regulator is looking into the idea of setting up SME Exchanges even though no bourses have formally approached it.
"We are very keen on that (SME Exchanges) ... We have initiated the process ... finally it is in the hands of the exchanges to decide whether they want to create a separate platform for SMEs," Bhave said.
On January 5, BSE Chief Executive Officer Madhu Kannan had said the country's premier bourse would announce the launch of its SME Exchange within a fortnight.
12 Jan, 2011, 10.10PM IST,PTI Iran to sell crude to India on credit this month
NEW DELHI: Weeks after RBI clamped down on the main conduit Indian companies use for paying Iranian oil, the Persian Gulf country has agreed to sell crude oil on credit this month.
There were no problem in supplies till early last week, as payments mechanism had been decided prior to the Reserve Bank of India (RBI) closed the Asian Clearing Union route, a move that effectively stops settlements in US dollars and the euro.
" Iran has agreed to sell crude oil on credit this month pending resolution of the gridlock," a senior official said.
Mangalore Refinery and Petrochemicals Ltd, the nation's largest importer of Iranian crude oil, and other state refiners Indian Oil Corp and Hindustan Petroleum Corp will get some 6 million barrels of crude on 60 to 90 days credit.
"This is a stop-gap arrangement. This cannot last long and a permanent solution has to be found," the official said.
India has asked Iran to identify a panel of banks, which are not under US sanctions, to route payments to National Iranian Oil Co (NIOC). State Bank of India, the nation's largest lender, is ready to facilitate payments but is not willing to deal with any bank on US sanctions list.
The two nations have so far not been able to find a solution on how New Delhi should pay for oil imports from Iran after India's central bank on December 23 said that payments to Iran could no longer be settled using a long-standing clearing house system run by regional central banks.
An Indian delegation would visit Tehran on January 14 to explore payments in yen, euro and dirham currencies.
The official said SBI has refused to route payments through the Hamburg-based EIH Bank which Iran had last week identified as temporary channel for routing money to NIOC.
NIOC has an account in the bank but SBI felt since the bank is already under US sanctions, its business in America may be affected in dealing with EIH.
"Some nine banks mostly in UAE have been identified. Details will be discussed at the January 14 meeting in Tehran," he said.
Iran is India's second-largest supplier of crude oil, after Saudi Arabia. India imports USD 12 billion of crude annually from Iran -- about 14 per cent of its total crude import bill. MRPL buys 7.1 million tons of Iranian oil while IOC and HPCL import 3 million tons each. Private sector Essar Oil imports about 5 million tons.