Oil prices may drop to near $20 a barrel this year as the global glut of crude persists into 2017, Abu Dhabi’s largest lender said.

U.S. benchmark West Texas Intermediate crude should trade in a range between $25 a barrel and $45 a barrel for the rest of the year, “although a very brief spike down towards $20 is possible,” the National Bank of Abu Dhabi PJSC wrote in its Global Investment Outlook 2016 report on Sunday. Prices at the lower end of the range will stimulate demand growth, it said.

“For at least the next few years there do appear to be solid fundamental reasons why oil prices are likely to remain in a trading range,” NBAD analysts wrote in the report. Producers have sold less of their crude this year through forward transactions than in past years, and forward-selling would likely accelerate if prices rallied much above $40 a barrel, the bank said.

Abu Dhabi is the capital of the United Arab Emirates, which holds about 6 percent of the world’s oil reserves. Almost all regional oil exporters are set to register “twin deficits” on both their current and fiscal accounts for last year and this year, NBAD said. WTI prices dropped about 40 percent in the past year.

 Courtesy of ©2016 Bloomberg

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DOHA A decade ago, Foad Fanaei packed his belongings and left sanction-hit Iran in the hope that the family's engineering firm would thrive in Qatar.

Starting up in the Gulf Arab state proved to be hard for a 27-year-old outsider who had to grapple with Qatar's complex business laws and navigate the international financial constraints imposed over Iran's nuclear programme.

Since then Fanaei has endured years of financial losses but kept the business going in the hope that one day the nuclear-related sanctions would be lifted. Cherishing the same hope, his father continued to run a parent company in Iran.

Now that day has come, Fanaei believes his hard work is about to be rewarded.

"I came here with experience and new technology. I met with many companies but it was tough. We missed out on a lot of deals," he explained. "Now, though, politics is in the past. It took a long time, but we are moving forward."

Fanaei is blazing a trail that other Iranian businesses are likely to follow.

His company, Reign Engineering & Trading Co, has forged a partnership with Abu Dhabi-based construction firm AlJaber Group which is set to enter an agreement with industrial group Siemens to start manufacturing high-specification electricity-saving devices.

If the deal goes ahead, Fanaei, one of a handful of Iranian businessmen in Qatar, will be involved in the development of the largest electronics factory in the country and, together with the AlJaber Group, will bid on tenders for multi-million dollar government infrastructure projects.

The venture will not be directly affected by the easing of sanctions - it relies on local manufacturers - but the prospect of being able to transfer money in and out of Iran, travel more freely and sign contracts with Western companies - all curtailed under sanctions - Fanaei says, will allow him and other Iranians to thrive in the region.

"We invested heavily in Qatar and honestly we lost a lot of money, but we still had hope," he said.

Arab firms too stand to benefit from Iran's opening.

The likely surge in business between Iran and other countries in the Gulf will be just one part of the boom in business expected following the lifting of the nuclear-related sanctions on Jan. 18.

The deal with world powers that ended Iran's international isolation, in exchange for restrictions on Tehran's nuclear programme, restored its access to tens of billions of dollars in frozen assets, reopened the country to foreign investment and allows it to sell oil again on world markets.

President Hassan Rouhani, who championed the deal, says Iran needs $30-$50 billion a year in foreign investment to meet its economic growth target of eight percent. He has ordered a sharp increase in oil output and, in a sign of the size of the business opportunities that are up for grabs, Iran has said it wants to buy more than 100 Western planes.

Some companies have moved quickly to gain or regain access to a country that is rich in natural resources and has a young, well educated population of about 80 million.

European and Asian firms have a head start as some U.S. sanctions remain, tying the hands of American companies.

But many international banks, businesses and investors are not rushing in because of the risk of falling foul of the residual U.S. sanctions and legal uncertainties.

Some are also concerned that a diplomatic incident could flare between Iran and the United States, undermining the nuclear deal, and that the U.S. presidential election this year might bring to power an opponent of the deal.

WAITING GAME

For some foreign companies, it has been a waiting game. They stayed in Iran when the sanctions hit and, like Fanaei in Qatar, put up with the bad times in the hope that the good times would eventually return.

Landi Renzo, an Italian producer of autogas and compressed natural gas kits for cars, saw annual revenues in Iran sink from about 35 million euros to about 3 million when sanctions hit, said Pierpaolo Marziali, the firm's head of mergers and acquisitions.

There were no Western banks ready to offer guarantees and letters of credit, and the sharp decline of Iran's currency under sanctions made matters worse.

"But we stayed the course and never stopped producing, albeit at minimal levels, and that's put us in a strong position now since we have a kind of preferential channel. Our staff is regularly in Tehran and we're looking forward to relaunching production," Marziali said.

Another Italian company that stuck it out was SABAF, which makes components for household cooking appliances, although its annual sales in Iran fell from about 10 billion euros to around 3 million, Administrative Director Gianluca Beschi said.

"We've already started talks in the country and we hope to be able to boost our sales in 2016 to get back to pre-sanction times," she said.

Italy hopes its trade with Iran will now surge and sees the best opportunities in oil and gas, cars and transport, and construction and furniture. But China, India, Russia and Brazil have kept or gained a foothold in Iran since sanctions were imposed, and Beijing is the top exporter to Tehran.

For some companies, the race has already begun.

Senior Iranian officials said on Sunday that Iran plans to buy more than 114 aircraft from European plane maker Airbus as soon as March, and is looking for other deals.

The trucks division of German automobile maker Daimler quickly signed letters of intent with joint venture partners in Iran and India's state-run National Aluminium Co Ltd (NALCO) said it was sending experts to Iran to explore the possibility of setting up a $2-billion smelter complex.

Russia's second-largest state-controlled bank, VTB, said it hoped to carry out its first banking operations with Iran within months. And a British investor, Dominic Bokor-Ingram, launched a joint venture fund with an Iranian investment fund on Jan. 19 - two decades after he took a suitcase of cash onto the floor of the Moscow stock exchange to buy up shares after the end of communist rule.

But many other banks and firms, ranging from international oil companies to small investors, are treading carefully because of legal uncertainties and making sure they will not face heavy fines by violating the residual U.S. sanctions.

LOOKING FOR OPPORTUNITIES

Small firms face similar concerns to bigger companies as they weigh up the risks and opportunities. Like their bigger counterparts, some had been preparing for years for the opening of Iran.

"I have friends in Iran who have been waiting for the sanctions to end so they can come and invest here," Fanaei said in his office in Qatar.

Iranian businessmen have for decades been travelling to Gulf Arab states that provide access to Gulf waters and free-trade zones in cities such as Dubai, re-exporting goods and circumventing sanctions. Their number should now grow.

"Qatar is an ideal market for us. There is rapid growth ahead of the World Cup (to be hosted by Qatar in 2022). Local partners here appreciate Iran's expertise in industry and technology," Fanaei said.

Fanaei's new business partner, Mohammed Sultan Al-Jaber, who is chairman of the AlJaber Group, said "political issues" such as a rift between Iran and Saudi Arabia would not impede Arab-Iran business partnerships.

"Iran has so many things that Qatar needs. Qatar used to import a lot of materials from Iran like cement, ceramics and soil. It was halted," said Al-Jaber.

Looking ahead to more cooperation in the post-sanctions era, he said: "I see no reason why it won't resume."

(Stephen Jewkes reported from Milan; Writing by Tom Finn and Timothy Heritage; Editing by Janet McBride)

Turkey's prime minister dismissed on Monday any suggestion Ankara should apologize for downing a Russian warplane in its airspace last week, after winning strong NATO support for the right to defend itself.

Six days after NATO member Turkey shot down the Russian fighter jet in the first known incident of its kind since the Cold War, calls for calm have gone largely unheeded as Ankara refuses to back down and Russia responds with sanctions.

"No country should ask us to apologize," Prime Minister Ahmet Davutoglu told reporters following a meeting with NATO's secretary general at the alliance headquarters in Brussels.

"The protection of our land borders, our airspace, is not only a right, it is a duty," he said. "We apologize for committing mistakes, not for doing our duty."

Russian President Vladimir Putin said on Nov. 26 he is waiting for an apology after Turkey's air force shot down the Su-24 fighter jet along the Turkey-Syria border.

Following the meeting with NATO chief Jens Stoltenberg in which he won the alliance's firm support for the right to self-defense, Davutoglu also warned that such incidents continued to be a risk as long as Russia and the U.S-led coalition bombing Islamic State in Syria worked separately.

"If there are two coalitions functioning in the same airspace against ISIL, these types of incidents will be difficult to prevent," Davutoglu said, referring to Islamic State militants.

Moscow's surprise intervention in the four-year-old Syrian civil war in September wrong-footed the West and put Turkey, which shares a long border with Syria, directly at odds with Russian support for the Assad regime there.

NATO's Stoltenberg echoed Western calls for calm, while Israeli Defence Minister Moshe Yaalon on Sunday underscored the coordination with Russia that allowed Israel to avoid flare-ups after a Russian warplane operating in Syria strayed into Israeli-controlled airspace. It turned back after the two countries conferred.

The downing of the Russian warplane has wrecked both Turkish-Russian relations and the French-led diplomatic effort to bring Moscow closer into the fold of nations seeking to destroy Islamic State through military action in Syria.

While Russia says it is also targeting Islamic State, most of its air strikes have been against other Assad opponents, including groups actively supported by Turkey.

(Additional reporting by Dan Williams in Jerusalem; Editing by Tom Heneghan)

"world market capitalization has fallen back below $60 trillion for the first time since February 2014 as it appears the world's central planners' "print-or-die" policy to create wealth (and in some magical thinking - economic growth) has failed - and failed dramatically".

CHANNEL SUPPORT = 1860

FIBONACCI 38.2% = 1837
FIBONACCI 50.0% = 1743

LONG TERM REGRESSION	TRADED WEIGHTED $ spx

"Where is the Fed “put”, and what would such a “put” look like? It is very early in the process and lots will depend on global policy responses and data outcomes, but I am happy to declare my view: the next Fed “put” is not likely until the S&P 500 is trading in the 1500s at least (so more likely to be a Q1 2016 item rather than Q4 2015); and in terms of what the Fed could do, clearly QE4 has to be in the Fed’s toolkit. However, considering the failure of global QE to generate sustainable global growth and inflation, and considering the Fed’s starting point, 2016 could be the year when we see negative Fed Funds as a way of getting money velocity moving up rather than down.

... while I think a US recession is merely possible rather than probable, the evidence is growing in my view that a global recession is more probable than possible. Certainly the global trade data are pointing to meaningful global growth weakness, backed by weak data from EM and large parts of DM too. And a quick look at credit markets, in particular the HY markets in the US and Europe as well as the EM credit space support my view of a global growth recession being probable and not just possible. So if a global growth recession is more probable than possible, then it seems clear to me that neither risk assets nor core rates markets are accurately reflecting this at this time – instead, they reflect the “more possible” scenario rather than “more probable”. In other words, financial markets are NOT yet pricing for a recession, rather they are merely flirting with the idea. I suspect this largely reflects faith/hope in policymakers within market participants. The events of the past few weeks, both going into and after the most recent BOJ and FOMC meetings, should give those heavily invested in policymaker faith/hope a lot of food for thought."

Source- Vox.com

While military power is necessary, it is not sufficient to resolve the situation in Syria. Lasting stability can only take hold when the people of Syria forge an agreement to live together peacefully. The United States is prepared to work with any nation, including Russia and Iran, to resolve the conflict. We must recognize that there cannot be, after so much bloodshed, so much carnage, a return to the prewar status quo.

President Obama's impassioned United Nations address: below the full speech