Pakistan Oil & Gas: Wider Oil price swings are here to stay
- Crude price forecasts have been described as a swinging pendulum, shifting from bullish to bearish, which off-late has accelerated to a point where volatility is the new norm as forecasts shift at a rapid pace, often on shifty data points and comments made by key decision makers.
- Moreover, heightening tensions from global trade tussles, particularly between the US and China, cloud global growth outlooks with noticeable declines in global consumer confidence and moderating PMI data dampen bullish sentiments in Crude.
- Citing recent weakness in crude benchmarks as a sign of possible weakness to continue, we highlight the potential for improved macros (US$5/bbl reduction in Crude saves US$1.1bn in the trade bill), while domestic refiners could benefit from shifting dynamics in international cracks for mid distillates.
- Advocating a 'buy-on-dips' stance for domestic E&Ps, where any indication of major cuts in the upcoming OPEC meeting (6th Dec) could signal another rally we reiterate our BUY call on OGDC (TP of PkR180/sh) providing total return potential of 32% (inclusive of 7.7% FY19 D/Y).
Oil and Gas Development Company is a petroleum exploration and production (E&P) company in the Pakistan oil and gas sector. Co.'s principal activity is to explore, develop, produce and sell oil and gas resources and related activities. Co. also manufactures Gas, Liquefied Petroleum Gas, Crude Oil, and Sulphur. Co.'s major fields contributing in the aforesaid production of crude oil include Nashpa, Kunnar/KPD, Pasakhi, Sinjhoro and Rajian and for gas include Qadirpur, Uch, KPD, Nashpa and Dakhni. Co. carries out exploration and development activities on its own as well as in joint ventures with other oil companies.
AKD Securities Ltd. is one of the leading securities firm in Pakistan, providing a comprehensive range of investor focused services, including equity brokerage, economic and securities research, investment banking and financial advisory services. AKD Securities accounts for more than 6% of the average daily value of the Karachi Stock Exchange. AKD Securities was the first brokerage house to launch an online trading platform in Pakistan in November 2002 and now has the largest market share with over 6000 customers. This has helped diversify and expand the retail investor base in the country and ushered in a whole new universe of investors to the stock market.
AKD Securities Ltd. caters to a diversified group of domestic and international institutional investors, high net worth individuals and upscale retail clients, including expatriate Pakistanis. With high quality research, unparalleled execution and distribution capability for both regular and large block trades, AKD Securities Ltd. has earned an outstanding reputation in the Pakistani securities industry.Outside of commercial banks, AKD Securities Ltd. is one of the biggest capital market firms in the country. AKD Securities is the leader in raising and providing risk capital in underwriting, market making and mergers and acquisitions in Pakistan. Good corporate governance and professionalism are emphasized throughout the firm and AKD Securities Ltd. is amongst the very few companies to have introduced a firm-wide comprehensive CODE of ETHICS, overseen by an independent compliance manager.Ultimately, our success is based on the quality of service we provide to our customers and the trust and confidence reposed in us by them. Our focus, therefore, remains on customer satisfaction at all levels in the company.
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