Saudi Arabia’s energy minister Khalid Al-Falih talks Middle East industrialization at WEF MENA event

Saudi Arabia's energy minister Khalid Al-Falih spoke at the World Economic Forum for Middle East and North Africa about the Kingdom's new vision for industrialization in the Middle East region. (Screenshot)
Updated 07 April 2019
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Saudi Arabia’s energy minister Khalid Al-Falih talks Middle East industrialization at WEF MENA event

DEAD SEA, Jordan: Saudi Arabia's energy minister Khalid Al-Falih spoke at the World Economic Forum for Middle East and North Africa about the Kingdom's new vision for industrialization in the Middle East region.

The discussion with WEF founder Klaus Schwab opened with the Swiss thanking Al-Falih for the large Saudi delegation at the forum, and Al-Falih voiced his appreciation for Schwab's support for the Middle East region at the various WEF events.

Al-Falih thaned Schwab for WEF's ongoing support for the Middle East region at various, previous events and he echoed Crown Prince Mohammed bin Salman's assertion that the region "can become the new Europe."

The energy minister used the cases of Saudi Aramco and SABIC as examples of how Saudi Arabia can lead the way in advancing industrialization in the region and he mentioned how important tapping into the youth talent pool for development.

On the role of the private sector in the success of Saudi Arabia's Vision 2030 plans and economic diversification, Al-Falih said the Kingdom's government was making sure the private sector was encouraged to operate and invest in the Kingdom, citing examples of airports and ports, and facilities privatization in Saudi Arabia.

When asked by Schwab about the transition from fossil fuels to newer, renewable energy sources and its impact on Saudi Arabia's economy, Al-Falih said the process would take many decades, and that with population growth adding 2 billion people to the global population and the subsequent expansion of the 'middle class,' demand for all sources of energy — including oil and gas — will still exist well into the middle of the century.

Al-Falih highlighted Saudi Arabia's "heavy investment" in renewable energies, and how he advises the Saudi government as well as his clients that the use of oil and gas has to be "more effective", adding that both would peak by the middle of the century and saying "we will still need all solutions."

The energy minister was also positive about the future for the Kingdom in terms of youth employment and women empowerment in the workplace — stating the need for the private sector to be involved in the education of youth, of both genders, given they it benefits them when hiring graduates. It is something the education ministry in Saudi Arabia is concentrating on by revamping the curriculum to help graduates get into the private sector, Al-Falih said.

And Al-Falih said that, while Saudi Arabia's plan for women empowerment in the work force will come about differently to the way it works in other parts of the world, he was certain women in the Kingdom and the Middle East region as a whole will thrive.


Oil prices near 2019 highs after US ends all Iran sanction exemptions

Updated 2 min 15 sec ago
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Oil prices near 2019 highs after US ends all Iran sanction exemptions

  • Iran’s main oil buyers initially received sanction exemptions
  • US reiterates its goal to cut Iran oil exports to zero

SINGAPORE: Oil prices were near 2019 highs on Tuesday after Washington announced all Iran sanction waivers would end by May, pressuring importers to stop buying from Tehran.
Brent crude futures were at $74.40 per barrel at 0239 GMT, up 0.5 percent from their last close and not far off a 2019 peak of $74.52 reached on Monday.
US West Texas Intermediate (WTI) crude futures hit their highest level since October 2018 at $65.95 per barrel before edging back to $65.89 by 0239 GMT, which was still up 0.5 percent from their last settlement.
The United States on Monday demanded that buyers of Iranian oil stop purchases by May 1 or face sanctions, ending six months of waivers which allowed Iran’s eight biggest buyers, most of them in Asia, to continue importing limited volumes.
Before the reimposition of sanctions last year, Iran was the fourth-largest producer among the Organization of the Petroleum Exporting Countries (OPEC) at almost 3 million barrels per day (bpd), but April exports have shrunk well below 1 million bpd, according to ship tracking and analyst data in Refinitiv.
Barclay’s bank said in a note following the announcement that the decision took many market participants by surprise and that the move would “lead to a significant tightening of oil markets.”
The British bank added that Washington’s target to cut Iran oil exports to zero posed a “material upside risk to our current $70 per barrel average price forecast for Brent this year, compared with the year-to-date average of $65 per barrel.”
ANZ bank said in a note on Tuesday that “the decision is likely to worsen the ongoing supply woes being felt with Venezuelan sanctions, the OPEC supply cut, and intensifying conflict in Libya.”
The move to tighten Iran sanctions comes amid other sanctions Washington has placed on Venezuela’s oil exports and also as producer club OPEC has led supply cuts since the start of the year aimed at tightening global oil markets and propping up crude prices.
Ellen Wald, non-resident senior fellow at the Global Energy Center of the Atlantic Council, said the United States “seem to expect” Saudi Arabia and the United Arab Emirates to replace the Iranian oil, but she added “that this is not necessarily the way Saudi Arabia sees it.”
Saudi Arabia is the world’s biggest exporter of crude oil and OPEC’s de-facto leader. The group is set to meet in June to discuss its output policy.
“Should OPEC decide to end their supply cut program going into the second half of the year, this could limit oil’s upside in the coming months,” said Lukman Otunuga, analyst at futures brokerage FXTM.
Meanwhile, the Atlantic Council said the US move would hurt Iranian citizens.
“We’re going to see their currency collapse more, more unemployment, more inflation,” said Barbara Slavin, director for the Future of Iran Initiative at the Atlantic Council, adding that the US sanctions were “not going to bring Iran back to the (nuclear) negotiating table.”