LNG: No Decision Yet on Pakistan / Qatar LNG Deal Renegotiation: Malik
No decision has yet been made on whether to initiate LNG renegotiation talks with Qatar next year, according to Pakistan's petroleum minister Musadik Malik cited by Reuters.
- Malik was reacting to a quote in local newspaper The News that "the Qatar agreement is costly, and we will negotiate better terms next year."
- "One provision was price renegotiation could take place at the 10th year of the Qatar LNG deal," he said referring to an existing LNG deal, but Pakistan has a year to "figure out its options".
- Pakistan's biggest LNG deal for 3.75m tons of LNG a year for 15 years was signed in 2016 between Pakistan State Oil and Qatar's Qatargas-2 but with a cancellation option at 11 years if a new price cannot be agreed.
- In December, Malik said Pakistan had deferred buying 5 LNG cargoes from Qatar and is in talks to defer another 5 cargoes in 2025 amid low power consumption due to an economic crisis.
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EUROZONE: ECB Sees Less Positive NGEU Impact On Potential Growth
Updated estimates on the impact of the EU’s NextGenerationEU programme “indicate a smaller impact on potential output over the period 2020 to 2030 than estimated in 2022”, the European Central Bank said in a paper on its Economic Bulletin.
- The estimated impact on eurozone potential output by 2024 is only 0.2% --rather than the expected 0.5%-- and the long-term impact of 1.3% is expected to materialise in 2033 instead of in 2030.
- "The smaller expected impact on potential growth also reflects the fact that the previously anticipated effects of investments hardly materialised in 2022-2023, with 2024 being a transition year. From 2025 onwards, a pick-up in the impact on potential growth is expected as structural reforms start having an effect on potential growth. In the most recent update, however, this impact is also estimated to be slower. Overall, the lower and delayed impact stemming from investments and the lower impact coming from structural reforms leads to a smaller impact on the near-term potential growth profile than in the initial estimates."
BUNDS: Best traded Volumes since Mid December in Bund to start 2025
- No surprises in seeing a decent start of the Year in Bund and EGB's given the Busy Week on the Data front and heavy supply.
- Risks Events and Trump have also provided further liquidity.
- This Week's volumes in Bund have been the best since the 12th December, and the contract has only seen 4 sessions for the December Expiry with higher volumes, but we still haven't had the US NFP on Friday yet.
STIR: Dec Hawkish Extreme In Year-End BoE Pricing Holds, Before Fade To 49bp
The hawkish repricing in Dec ’25 BoE-dated OIS stopped at the hawkish extreme seen in December, pricing ~44bp of cuts through year-end, before a fade back to ~49bp.
- These levels probably look enticing for those that have a received bias, although continued worry surrounding the UK fiscal situation could limit dovish moves.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference vs. Current Effective SONIA Rate (bp) |
Feb-25 | 4.540 | -16.0 |
Mar-25 | 4.506 | -19.4 |
May-25 | 4.403 | -29.7 |
Jun-25 | 4.380 | -32.0 |
Aug-25 | 4.310 | -39.0 |
Sep-25 | 4.281 | -41.9 |
Nov-25 | 4.233 | -46.8 |
Dec-25 | 4.213 | -48.7 |
