• Merrill Lynch tells clients: buy Dragon Oil shares | ArabianOilandGas​.com.

ML (Bank of America) reckons that ENOC will wither return to bid for the rest of Dragon Oil or sell its holdings, in either scenarios the investor according to ML will benefit from upside. What ML is assuming that some action will be taken. Have not provided for scenario of doing nothing.

Gulf Nav will cancel $174m tanker order - three 46,000 DWT IMO type III chemical tankers. Similar ships are selling for 30-40% discount.

• We will see more cancellation of orders by other names in the region as the Tanker market continue to be in distress.

ADNOC is cutting naphtha exports for Jan-Feb by around 10% due to lower & postponing other shipment due condenstate splitter runs. Cracks rose to their highest levels ($ 170.63 a tonne) due to disruption in supply from other Middle Eastern producers.  ADNOC operates two condenstate splitters with capacity of 280,000 bpd in Ruwais refinery. Adnoc was expected to add 1.2 m tonnes per year of splitter naphtha. gulfnews : Adnoc slashes naphtha exports to Asia.

Oman is increasing its output to 900,000 bpd from 810,000 bpd for full year 2009.

ENOC is to start working on upgrading Jabal Ali refinery to convert naphtha to reformate (gasoline compnent) with capacity of 40,000 bpd.  On retail, ENOC is seeking to end petrol price limits in UAE. Currently, retail price is fixed at Dhs 1.37 per liter or Dhs 6.25 per gallon.

Saudi to maintain Feb Oil volumes to Asia in line with OPEC production quota.

FT Alphaville » Paying the piper.

The Arabtec-Aabar deal which will dilute current investors to (40%) and struck at 26% discount to prevailing market price, is indicative of serious problems within the Real Estate market in the region.  It smells of desperation.

On the other side, GCC Banks only made provisions last year of US$ 9.4 billion yet the size of the UAE Real Estate market, according to some analyst, is above US$ 200 billion.  You do not need to be a credit analyst to see that additional write offs and provisions are in the offing.  The regulators remain un-decisive in that regard to push the Banks for greater transparency and objective provisioning.  This only add to current standoff between the investors, borrowers and banks in an enviroment of opaque bankruptcy & foreclosure laws.

You can pray for rain or recovery but this does not help the region perception by International investors and will only delay growth and recovery. Something has to give. As Bob Dylan once sang “You don’t need a weatherman to know which way the wind blows”