Why Goldman Sachs Remains Bullish On Russian Oil - by Rakesh Upadhyay

A deeply troubled global oil industry is cutting production but Russians are defying the trend. Goldman Sachs has forecast Russian crude production to rise to 11.7 million barrels per day (b/d) in 2018, which is an increase of almost 600,000 b/d from 2015.

“We remain positive on Russian oil industry production,” Goldman analysts led by Geydar Mamedov said. “At current oil prices, Russian oils are among the few global majors that can maintain their growth plans and dividends,” reports World Oil.

Goldman believes that the largest Russian producer Rosneft, which produces more than a third of the nation’s output, will be a major contributor to the increase in production. However, Rosneft’s output has been declining steadily and its current production is 3 percent below the peak achieved in late 2013. The giant Vankor field, which had boosted Rosneft’s production, has also declined by around 5 percent, from the highs of 447,000 b/d in the third quarter of 2015.

Goldman believes that new projects in Suzun, Tagul, Yurubcheno-Tokhomskoye and Messoyakha will be the major driver of growth. It expects oil from these new projects to push up overall output from 470,000 b/d in 2015 to 850,000 b/d in 2018, reports Bloomberg. However, the current available pipeline capacity is not adequate to transport the oil from the producers to the export network. So, new projects need to be matched by an expansion in the pipeline network.

Considering these challenges, the International Energy Agency expects Russian production to decline to 10.94 million b/d from 11.06 million b/d in 2016.


Read more: Why Goldman Sachs Remains Bullish On Russian Oil | OilPrice.com

Financial Industry: Conflict of Interest? Goldman Sachs hires former EU chief Barroso

Goldman Sachs (GS.N) has hired former European Commission President Jose Manuel Barroso to be an advisor and non-executive chairman of its international business, the U.S. bank said on Friday, as it grapples with the fallout from Britain’s exit from the European Union.

Barroso served as president of the commission, the EU’s executive arm, from 2004 to 2014 and was prime minister of Portugal from 2002 to 2004, Goldman said in a statement.

Goldman Sachs and other U.S. investment banks are seen as particularly vulnerable to Brexit since they rely on the EU’s “passporting” regime that allows them to offer services across the bloc while basing most of their staff and operations in the UK. Banks have warned that if their British outposts lose their “passports” they will have to move some employees and business units to alternative bases in the EU.

Goldman Sachs International, which Barroso will chair, is headquartered in London and of its roughly 6,000 staff fewer than 1,000 are based outside Britain.

Barroso is credited with helping the euro zone survive the 2009-13 debt crisis by establishing a financial rescue fund, enacting stricter budget rules and tightening financial regulation.

He was also a signatory to the Lisbon Treaty that revamped the bloc’s complex institutions after French and Dutch voters rejected a European constitution.

Barroso will help the firm as it advises clients on dealing with the ensuing “challenging and uncertain economic and market environment,” Goldman Sachs International co-chiefs Michael Sherwood and Richard Gnodde said in the statement.

The question which obviously immediately arises following Mr.Barroso's employment by the US financial giant Goldman Sachs is that of conflict of interest, given the stature former European Commission President Jose Manuel Barroso had in the EU and, consequently, the confidential information available to him about EU member nations classified financial and economic data.  
 
Insure-Digest

Banking Industry: Nine of the World’s Biggest Banks Form Blockchain Partnership

Nine of the world’s biggest banks, including Goldman Sachs and Barclays, have joined forces with New York-based financial tech firm R3 to create a framework for using blockchain technology in the markets, the firm said on Tuesday.

It is the first time banks have come together to work on a shared way in which the technology that underpins bitcoin — a controversial, Web-based “cryptocurrency” — can be used in finance.

Over the past year, interest in blockchain technology has grown rapidly. It has already attracted significant investment from many major banks, which reckon it could save them money by making their operations faster, more efficient and more transparent.

Read more: Nine of the World’s Biggest Banks Form Blockchain Partnership | Re/code

Banking Industry: Nine of the World’s Biggest Banks Form Blockchain Partnership

Nine of the world’s biggest banks, including Goldman Sachs and Barclays, have joined forces with New York-based financial tech firm R3 to create a framework for using blockchain technology in the markets, the firm said on Tuesday.

It is the first time banks have come together to work on a shared way in which the technology that underpins bitcoin — a controversial, Web-based “cryptocurrency” — can be used in finance.

Over the past year, interest in blockchain technology has grown rapidly. It has already attracted significant investment from many major banks, which reckon it could save them money by making their operations faster, more efficient and more transparent.

Read more: Nine of the World’s Biggest Banks Form Blockchain Partnership | Re/code