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S-Oil to Supply Oil Products to Aramco's Trading Unit

FILE PHOTO: The Saudi Aramco logo is pictured at the company's oil facility in Abqaiq, Saudi Arabia, October 12, 2019. REUTERS/Maxim Shemetov/File Photo
FILE PHOTO: The Saudi Aramco logo is pictured at the company's oil facility in Abqaiq, Saudi Arabia, October 12, 2019. REUTERS/Maxim Shemetov/File Photo
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S-Oil to Supply Oil Products to Aramco's Trading Unit

FILE PHOTO: The Saudi Aramco logo is pictured at the company's oil facility in Abqaiq, Saudi Arabia, October 12, 2019. REUTERS/Maxim Shemetov/File Photo
FILE PHOTO: The Saudi Aramco logo is pictured at the company's oil facility in Abqaiq, Saudi Arabia, October 12, 2019. REUTERS/Maxim Shemetov/File Photo

South Korea’s third-biggest refiner, S-Oil, has signed a contract to supply a total of 3.1 trillion won ($2.66 billion) of refined oil products to Saudi Aramco’s trading arm, it said on Wednesday.

A regulatory filing showed the firm will supply up to 10 million barrels of diesel, up to 15 million barrels of naphtha, up to 11 million barrels of jet fuel and up to 8 million barrels of gasoline to Aramco Trading Singapore under the contract, valid between Jan. 1 and Dec. 31, 2020.

S-Oil’s top shareholder is Saudi Aramco.

Oil prices were mixed on Wednesday as worries about the coronavirus outbreak and swelling US crude inventories weighed on prices, counter-balanced by talk that OPEC could extend oil output cuts.

The Organization of the Petroleum Exporting Countries wants to extend production cuts, currently planned till the end of March, until at least June, and could deepen reductions should oil demand in China fall significantly due to the coronavirus, OPEC sources said.

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China Flags More Fiscal Stimulus for Economy

FILE PHOTO: Chinese Finance Minister Lan Foan speaks at the China Development Forum (CDF) 2024, in Beijing, China March 24, 2024. REUTERS/Jing Xu/File Photo
FILE PHOTO: Chinese Finance Minister Lan Foan speaks at the China Development Forum (CDF) 2024, in Beijing, China March 24, 2024. REUTERS/Jing Xu/File Photo
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China Flags More Fiscal Stimulus for Economy

FILE PHOTO: Chinese Finance Minister Lan Foan speaks at the China Development Forum (CDF) 2024, in Beijing, China March 24, 2024. REUTERS/Jing Xu/File Photo
FILE PHOTO: Chinese Finance Minister Lan Foan speaks at the China Development Forum (CDF) 2024, in Beijing, China March 24, 2024. REUTERS/Jing Xu/File Photo

China pledged on Saturday to "significantly increase" debt to revive its sputtering economy, but left investors guessing on the overall size of the stimulus package, a vital detail to gauge the longevity of its recent stock market rally.
Finance Minister Lan Foan told a press conference Beijing will help local governments tackle their debt problems, offer subsidies to people with low incomes, support the property market and replenish state banks' capital, among other measures.
These are all steps investors have been urging China to take as the world's second-largest economy loses momentum and struggles to overcome deflationary pressures and lift
consumer confidence amid a sharp property market downturn, Reuters reported.
But Lan's omission of a dollar figure for the package is likely to prolong investors' nervous wait for a clearer policy roadmap until the next meeting of China's rubber-stamp legislature, which approves extra debt issuance. A date for the meeting has yet to be announced but it is expected in coming weeks.
The press conference "was strong on determination but lacking in numerical details," said Vasu Menon, managing director for investment strategy at OCBC in Singapore.
"The big bang fiscal stimulus that investors were hoping for to keep the stock market rally going did not come through," said Menon, adding this may "disappoint some" in the market.
A wide range of economic data in recent months has missed forecasts, raising concerns among economists and investors that the government's roughly 5% growth target this year was at risk and that a longer-term structural slowdown could be in play.
Data for September, which will be released over the coming week, is expected to show further weakness, but officials have expressed "full confidence" that the 2024 target will be met.
New fiscal stimulus has been the subject of intense speculation in global financial markets after a September meeting of the Communist Party's top leaders, the Politburo, signaled an increased sense of urgency about the economy.
Chinese stocks reached two-year highs, spiking 25% within days since that meeting, before retreating as nerves set in given the absence of further policy details from officials. Global commodity markets from iron ore to industrial metals and oil have also been volatile on hopes stimulus will stoke sluggish Chinese demand.
Reuters reported last month that China plans to issue special sovereign bonds worth about 2 trillion yuan ($284.43 billion) this year as part of fresh fiscal stimulus.
Half of that would be used to help local governments tackle their debt problems, while the other half will subsidize purchases of home appliances and other goods as well as finance a monthly allowance of about 800 yuan, or $114, per child to all households with two or more children.
Separately, Bloomberg News reported that China is also considering injecting up to 1 trillion yuan of capital into its biggest state banks, though analysts say more lending firepower will come up against stubbornly weak credit demand.