Kingdom ranks second in terms of SWF assets

Updated 27 August 2013
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Kingdom ranks second in terms of SWF assets

Saudi Arabia ranked second globally and first at the Arab level in terms of the assets of sovereign wealth funds (SWFs), local media said quoting a report released by the SWF Institute.
According to the report, assets and foreign holdings of the Saudi Arabian Monetary Agency (SAMA), or the Kingdom’s central bank, stood at $675.9 billion in August of the current year compared to $532.8 billion in June.
Norway, represented by the Government Pension Fund, occupied the first rank globally on holding the biggest SWF assets valued at $737.2 billion, the report said.
The UAE, represented by Abu Dhabi Investment Authority (ADIA), came in the third position at $627 billion, followed by China Investment Corporation at $575.2 billion, SAFE Investment Company (China) at $567.9 billion, and Kuwait Investment Authority (KIA), in the sixth rank, at $386 billion.
Meanwhile, experts said the Kingdom’s enormous SWF assets send good and positive indications on the Saudi economy, which will remain attractive to foreign capitals and boost confidence of investors and denoting that the (Saudi) economy will remain safe even in case that oil revenues drop in a manner that will allow the government use such reserves, if necessary, Al-Riyadh daily quoted the experts as saying.
The Kingdom’s reserves (assets) are evidence that oil revenues are properly managed and appropriated in an effective and economic way where part of them is invested internally through supporting the general budget while surpluses are invested externally in semi-guaranteed government bonds, they said. The fund focuses on low-risk fixed income investments.
Based on the SWF Institute data, the volume of sovereign wealth funds is approaching $6 trillion in assets where increases in stock markets globally have helped lift the value of sovereign wealth assets.
SWF Institute President Michael Maduell said sovereign wealth funds are rising globally and springing up from Africa to certain states in the United States.
Asia and the Middle East are reportedly holding the bulk of sovereign wealth fund assets globally accounting for 40 percent and 35 percent respectively, whereas Europe has 17 percent of global totals, Africa and the two Americas have 3 percent for each while the remaining 2 percent went to other parts of the world.


Brent crude oil rises for a sixth day as supplies tighten amid strong demand

Updated 24 April 2018
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Brent crude oil rises for a sixth day as supplies tighten amid strong demand

  • US West Texas Intermediate crude futures were at $68.98 a barrel, up 34 cents
  • The potential of renewed US sanctions against Iran is pushing prices higher

SINGAPORE: Brent crude oil rose for sixth day on Tuesday, passing $75 a barrel, on expectations that supplies will tighten because fuel is rising at the same time the US may impose sanctions against Iran and OPEC-led output cuts remain in place.
Brent crude oil futures climbed to as high as $75.20 a barrel in early trading on Tuesday, the highest since Nov. 27, 2014. Brent was still at $75 a barrel at 0311 GMT up 29 cents, or 0.4 percent, from its last close.
Brent’s six-day rising streak is the most since a similar string of gains in December and it is up by more than 20 percent from its 2018 low in February.
US West Texas Intermediate (WTI) crude futures were at $68.98 a barrel, up 34 cents, or 0.5 percent from their last settlement. On Thursday, WTI rose to as high as $69.56, the most since Nov. 28, 2014.
Markets have been lifted by supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC) which were introduced in 2017 with the aim of propping up the market.
The potential of renewed US sanctions against Iran is also pushing prices higher.
Stephen Innes, head of trading for Asia/Pacific at futures brokerage OANDA said new sanctions against Tehran “could push oil prices up as much as $5 per barrel.”
The US has until May 12 to decide whether it will leave the Iran nuclear deal and re-impose sanctions against OPEC’s third-largest producer, which would further tighten global supplies.
“Crude prices are now sitting at the highest levels in three years, reflecting ongoing concerns around geopolitical tensions in the Middle East, which is the source of nearly half of the world’s oil supply,” ANZ bank said.
“Oil strength is coming from Saudi Arabia’s recent commitment to get oil back up to between $70 to $80 per barrel as well as inventory levels that are back in the normal range,” said William O’Loughlin, investment analyst at Australia’s Rivkin Securities.
OPEC’s supply curtailments and the threat of new sanctions are occurring just as demand in Asia, the world’s biggest oil consuming region, has risen to a record as new and expanded refineries start up from China to Vietnam.
One of the few factors that has limited oil prices from surging even more is US production, which has shot up by more than a quarter since mid-2016 to over 10.54 million barrels per day (bpd), taking it past Saudi Arabia’s output of around 10 million bpd.
As a result of its rising output, US crude is increasingly appearing on global markets, from Europe to Asia, undermining OPEC’s efforts to tighten the market.