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Zawya
a day ago
- Business
- Zawya
OPEC+ oil producers stick to their guns with another big hike for July
LONDON/MOSCOW - The world's largest group of oil producers, OPEC+, stuck to its guns on Saturday with another big increase of 411,000 barrels per day for July as it looks to wrestle back market share and punish over-producers. Having spent years curbing production - more than 5 million barrels a day (bpd) or 5% of world demand - eight OPEC+ countries made an modest output increase in April before tripling it for May, June and now July. They are spurring production despite the extra supply weighing on crude prices as group leaders Saudi Arabia and Russia seek to win back market share as well as punish over-producing allies such as Iraq and Kazakhstan. "Today's decision only goes to show that market share is on top of the agenda. If price will not get you the revenues you want, they are hoping that volume will," said analyst Harry Tchilinguirian of Onyx Captal Group. The eight countries held an online meeting on Saturday to set July production. They also discussed other options, an OPEC+ delegate said. On Friday, sources familiar with OPEC+ talks had said they could discuss an even larger hike. In a statement OPEC+ cited a "steady global economic outlook and current healthy market fundamentals, as reflected in the low oil inventories" as its reasoning for the July increase. OPEC+ pumps about half of the world's oil and includes OPEC members and allies such as Russia. Its increased supply is weighing on crude prices, squeezing all producers, but some more than others, including a key group of rivals - U.S. shale producers, analysts say. "Three strikes from OPEC+, and none were softballs. May warned, June confirmed, and July fires a shot across the bow," said Jorge Leon, head of geopolitical analysis at Rystad and a former OPEC official. Since April, the OPEC+ eight have now made or announced increases totalling 1.37 million bpd, or 62% of the 2.2 million bpd they aim to add back to the market. Higher summer oil demand favours increasing output at this time, OPEC+ officials including Russian Deputy Prime Minister Alexander Novak have said. "The oil market remains tight indicating it can absorb additional barrels, as the effective increase should be smaller as several of the eight countries are overproducing, and demand is seasonally rising," said Giovanni Staunovo, analyst at UBS. Algeria was among a small number of nations that requested a pause in the output hikes on Saturday, a source familiar with the matter said. Oil prices fell to a four-year low in April, slipping below $60 per barrel after OPEC+ said it was tripling its output hike in May and as U.S. President Donald Trump's tariffs raised concerns about global economic weakness. Prices closed just below $63 on Friday. Global oil demand is expected to grow by an average of 775,000 bpd in 2025, according to a Reuters poll of analysts published on Friday, while the International Energy Agency in its latest outlook saw an increase of 740,000 bpd. Besides the 2.2 million bpd cut that the eight members started to unwind in April, OPEC+ has two other layers of cuts that are expected to remain in place until the end of 2026. (Reporting by Alex Lawler, Ahmad Ghaddar, Olesya Astakhova, Maha El Dahan and Yousef Saba; editing by Jason Neely)
Forbes
a day ago
- Business
- Forbes
OPEC+ Ups The Ante Via Another 411,000 Barrels Per Day Oil Output Hike
The logo of the Organization of Petroleum Exporting Countries (OPEC) is seen at its headquarters in ... More Vienna, Austria. (Photo: Joe Klamar) Oil producers' group OPEC+ decided to up its production levels despite weak crude prices in what is being seen as a bid to hold on to its market share in a tough economic environment. At their meeting on Saturday, eight members of OPEC+, a select group of Russia-led oil producers and the Organization of the Petroleum Exporting Countries (OPEC) spearheaded by Saudi Arabia, opted to raise collective production levels for July by another 411,000 barrels per day. Producers Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman cited 'healthy market fundamentals and low oil inventories' as their reasons behind the move indicating their belief that the global oil market can absorb the additional supply. The decision over the weekend was third consecutive output hike announced by OPEC+. Earlier in May, it agreed to up oil production for a second consecutive month, raising output for June by a similar 411,000 bpd level. The June hike by OPEC+ took the total combined production increases for April, May and June to 960,000 bpd, or 44% of the 2.2 million bpd of previously agreed cuts since 2022. The latest hike implies a higher unwinding of over 1.37 million bpd (or 62%). In a statement, OPEC+ also noted: 'The gradual increases may be paused or reversed subject to evolving market conditions. This flexibility will allow the group to continue to support oil market stability.' The group is scheduled to meet on July 6 to decide on its production levels for August, the week of OPEC's International Seminar - an event it organizes every two years to draw in major industry players. Barring a considerable deteriorating in the macroeconomic climate, another production hike appears to be on the horizon next month as well. The move is a clear bid for a greater market share at the expense of non-OPEC producers, especially U.S. light sweet crude suppliers. Investment banks and other forecasters are scrambling to lower their oil price forecasts while the International Energy Agency is forecasting a market surplus. But there is another strategic reason behind the move by OPEC+ heavyweight and de facto leader Saudi Arabia - that of disciplining errant overproducing fellow members alongside non-OPEC competitors. They include the likes of Iraq and Kazakhstan, which have repeatedly exceeded their oil production quotas. For instance, the latter exceeded its March target by 422,000 bpd. As a result, squeezed profit margins beckon for the entire oil industry if prices remain low. That is the likely expectation on Wall Street courtesy of higher production from OPEC+ as well as non-OPEC producers like the U.S., Brazil, Canada and Guyana. And despite a claim by OPEC+ of falling inventories, latest data on oil storage is sending bearish market signals. According to the IEA, global inventories continue to remain elevated. In its market assessment published on May 15, it said inventories rose for a second consecutive month to 7.7 billion barrels in March. While the said figure may be below the five-year average, a change in sentiment appears to be pretty clear. For the IEA currently expects oil inventories to rise by an average of 720,000 bpd this year, and by 930,000 bpd in 2026. If this drags OPEC+ producers and their competitors toward a full-blown glut, another tussle for market share at low prices beckons.
Yahoo
2 days ago
- Business
- Yahoo
OPEC+ oil producers stick to their guns with another big hike for July
By Alex Lawler, Olesya Astakhova and Ahmad Ghaddar LONDON/MOSCOW (Reuters) -The world's largest group of oil producers, OPEC+, stuck to its guns on Saturday with another big increase of 411,000 barrels per day for July as it looks to wrestle back market share and punish over-producers. Having spent years curbing production - more than 5 million barrels a day (bpd) or 5% of world demand - eight OPEC+ countries made an modest output increase in April before tripling it for May, June and now July. They are spurring production despite the extra supply weighing on crude prices as group leaders Saudi Arabia and Russia seek to win back market share as well as punish over-producing allies such as Iraq and Kazakhstan. "Today's decision only goes to show that market share is on top of the agenda. If price will not get you the revenues you want, they are hoping that volume will," said analyst Harry Tchilinguirian of Onyx Captal eight countries held an online meeting on Saturday to set July production. The also discussed other options, an OPEC+ delegate said. On Friday, sources familiar with OPEC+ talks had said they could discuss an even larger hike. In a statement OPEC+ cited a "steady global economic outlook and current healthy market fundamentals, as reflected in the low oil inventories" as its reasoning for the July increase. OPEC+ pumps about half of the world's oil and includes OPEC members and allies such as Russia. Its increased supply is weighing on crude prices, squeezing all producers, but some more than others, including a key group of rivals - U.S. shale producers, analysts say. "Three strikes from OPEC+, and none were softballs. May warned, June confirmed, and July fires a shot across the bow," said Jorge Leon, head of geopolitical analysis at Rystad and a former OPEC official. Since April, the OPEC+ eight have now made or announced increases totalling 1.37 million bpd, or 62% of the 2.2 million bpd they aim to add back to the market. Higher summer oil demand favours increasing output at this time, OPEC+ officials including Russian Deputy Prime Minister Alexander Novak have said. "The oil market remains tight indicating it can absorb additional barrels, as the effective increase should be smaller as several of the eight countries are overproducing, and demand is seasonally rising," said Giovanni Staunovo, analyst at UBS. Algeria was among a small number of nations that requested a pause in the output hikes on Saturday, a source familiar with the matter said. Oil prices fell to a four-year low in April, slipping below $60 per barrel after OPEC+ said it was tripling its output hike in May and as U.S. President Donald Trump's tariffs raised concerns about global economic weakness. Prices closed just below $63 on Friday. Global oil demand is expected to grow by an average of 775,000 bpd in 2025, according to a Reuters poll of analysts published on Friday, while the International Energy Agency in its latest outlook saw an increase of 740,000 bpd. Besides the 2.2 million bpd cut that the eight members started to unwind in April, OPEC+ has two other layers of cuts that are expected to remain in place until the end of 2026.
Yahoo
2 days ago
- Business
- Yahoo
OPEC+ oil producers stick to their guns with another big hike for July
By Alex Lawler, Olesya Astakhova and Ahmad Ghaddar LONDON/MOSCOW (Reuters) -The world's largest group of oil producers, OPEC+, stuck to its guns on Saturday with another big increase of 411,000 barrels per day for July as it looks to wrestle back market share and punish over-producers. Having spent years curbing production - more than 5 million barrels a day (bpd) or 5% of world demand - eight OPEC+ countries made an modest output increase in April before tripling it for May, June and now July. They are spurring production despite the extra supply weighing on crude prices as group leaders Saudi Arabia and Russia seek to win back market share as well as punish over-producing allies such as Iraq and Kazakhstan. "Today's decision only goes to show that market share is on top of the agenda. If price will not get you the revenues you want, they are hoping that volume will," said analyst Harry Tchilinguirian of Onyx Captal eight countries held an online meeting on Saturday to set July production. The also discussed other options, an OPEC+ delegate said. On Friday, sources familiar with OPEC+ talks had said they could discuss an even larger hike. In a statement OPEC+ cited a "steady global economic outlook and current healthy market fundamentals, as reflected in the low oil inventories" as its reasoning for the July increase. OPEC+ pumps about half of the world's oil and includes OPEC members and allies such as Russia. Its increased supply is weighing on crude prices, squeezing all producers, but some more than others, including a key group of rivals - U.S. shale producers, analysts say. "Three strikes from OPEC+, and none were softballs. May warned, June confirmed, and July fires a shot across the bow," said Jorge Leon, head of geopolitical analysis at Rystad and a former OPEC official. Since April, the OPEC+ eight have now made or announced increases totalling 1.37 million bpd, or 62% of the 2.2 million bpd they aim to add back to the market. Higher summer oil demand favours increasing output at this time, OPEC+ officials including Russian Deputy Prime Minister Alexander Novak have said. "The oil market remains tight indicating it can absorb additional barrels, as the effective increase should be smaller as several of the eight countries are overproducing, and demand is seasonally rising," said Giovanni Staunovo, analyst at UBS. Algeria was among a small number of nations that requested a pause in the output hikes on Saturday, a source familiar with the matter said. Oil prices fell to a four-year low in April, slipping below $60 per barrel after OPEC+ said it was tripling its output hike in May and as U.S. President Donald Trump's tariffs raised concerns about global economic weakness. Prices closed just below $63 on Friday. Global oil demand is expected to grow by an average of 775,000 bpd in 2025, according to a Reuters poll of analysts published on Friday, while the International Energy Agency in its latest outlook saw an increase of 740,000 bpd. Besides the 2.2 million bpd cut that the eight members started to unwind in April, OPEC+ has two other layers of cuts that are expected to remain in place until the end of 2026.
Yahoo
3 days ago
- Business
- Yahoo
Ambarella Inc (AMBA) Q1 2026 Earnings Call Highlights: Record AI Revenue and Strategic Growth ...
Release Date: May 29, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Ambarella Inc (NASDAQ:AMBA) reported first-quarter revenue of $85.9 million, exceeding the midpoint of their guidance range. AI revenue accounted for more than 75% of Q1 revenue, marking the fourth consecutive quarter of record AI revenue. The company increased its fiscal 2026 revenue growth estimate to a range of 19% to 25%, reflecting strong market demand. Ambarella Inc (NASDAQ:AMBA) is expanding its market reach with new edge infrastructure products, leveraging their third-generation AI accelerator. The company has a strong cash position with $259.4 million in cash and marketable securities, up $56 million from the previous year. Geopolitical uncertainties remain a concern, potentially impacting future revenue and growth projections. Gross margin is expected to decline in the next quarter due to changes in customer and product mix. There is uncertainty regarding the seasonality of revenue due to geopolitical factors, which could affect the second half of the fiscal year. The company faces competition in the low-end market from Chinese and Taiwanese suppliers, which could impact market share. Ambarella Inc (NASDAQ:AMBA) is cautious about potential indirect impacts from tariffs, which could affect financial performance. Warning! GuruFocus has detected 3 Warning Signs with AMBA. Q: Can you clarify the growth profile for the year, especially regarding the first and second halves? A: Dr. Fermi Wong, President and CEO: We are confident about our second-half growth and have extended our guidance range to reflect regular seasonality and strong growth. The geopolitical situation adds uncertainty, but we maintain high confidence in our second-half performance. Q: Could you explain what you mean by "edge infrastructure" and how it fits into your product strategy? A: Dr. Fermi Wong, President and CEO: Edge infrastructure refers to integrating multiple endpoints using a server or AI box to run advanced AI models. This approach allows for upgrading existing installations without replacing all endpoints, which is becoming a trend. Q: How is the non-camera IoT business performing, and will you consider breaking it out separately in your financials? A: Louis Gerhary, Vice President, Corporate Development: Most of our revenue still comes from data ingested through cameras, but we are seeing growth in other IoT markets. Security is less than half of our revenue now, and we are leveraging our expertise into additional vertical applications. Q: With the strong product cycle, could there be a change in your seasonality, especially as human interface devices become less relevant? A: Dr. Fermi Wong, President and CEO: Geopolitical uncertainties make seasonality a question mark, but we are not ruling out regular seasonality. We have provided a broader range for annual guidance to account for these uncertainties. Q: How do you view the competitive landscape for edge infrastructure compared to traditional processors like FPGAs and GPUs? A: Louis Gerhary, Vice President, Corporate Development: We approach this market with a more efficient solution in terms of performance per watt and thermal impacts. Our advantages in other markets will apply to the edge market, particularly in near-edge applications using cameras. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
