Kuwait Airways to lay off 1,500 foreign employees

Kuwait Airways said it would lay off 1,500 expatriate employees due to “significant difficulties” caused by the coronavirus pandemic. (File: Reuters)
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Updated 29 May 2020

Kuwait Airways to lay off 1,500 foreign employees

  • Gulf aviation sector hit hard as long haul travel hubs feel bigger impact from lockdowns

KUWAIT CITY: State-owned Kuwait Airways said it would lay off 1,500 expatriate employees due to “significant difficulties” caused by the coronavirus pandemic on Thursday.

The loss-making national carrier, which has a total of 6,925 employees, has struggled amid the regional and worldwide downturn in air travel.

“In dealing with the coronavirus crisis and its negative impact on commercial operations ... Kuwait Airways announces the termination of around 1,500 non-Kuwaiti employees (contracts)” the airline said on Twitter.

It said the decision came as part of a “comprehensive plan” to deal with the pandemic’s economic impacts which meant the company is facing “significant difficulties.”

Kuwait, like other oil-rich Gulf states, has been severely hit by a slump in oil revenues and the economic impacts of coronavirus.

Kuwait Airways, which has a fleet of 30 aircraft, has been mostly grounded like almost all airlines in the Middle East due to lockdowns.

It did, however, operate over 200 flights in late April and early May to repatriate some 30,000 Kuwaiti citizens from abroad.

The carrier’s losses are paid by the government, which has not yet announced any special compensation.

The International Air Transport Association (IATA) forecast last month that air traffic in the Middle East and North Africa (MENA) was set to tumble by more than a half.

The IATA said that the MENA  region’s airlines’ revenues in 2020 would be slashed by $24.5 billion compared to last year, and warned that the area’s aviation shutdown threatened some 1.2 million jobs.

Private companies in Kuwait have fired hundreds of employees  in the past few weeks, but Kuwait Airways is the first government agency to take such action.

The Kuwait Municipality has said it would soon sack at least half of its 900 expatriate employees.

Around 3.4 million foreigners live and work in Kuwait, making up some 70 percent of the Gulf state’s population.

Oil steady as virus fears counter positive factory data

Updated 04 August 2020

Oil steady as virus fears counter positive factory data

  • Fears over rising COVID-19 cases weigh on market; euro zone manufacturing activity expands modestly

LONDON: Oil prices steadied on Monday as rising COVID-19 cases around the globe and oversupply worries fueled by the prospect of OPEC and its allies winding back output cuts were offset by positive industry data in Europe and Asia.

Brent crude rose 5 cents, or 0.1 percent, to $43.57 a barrel by while US West Texas Intermediate crude gained 6 cents, or 0.1 percent, to $40.33.

Over the past month, Brent has been trading in a range between $41 and almost $45.

“Oil continues to trade in an incredibly rangebound manner,” said Warren Patterson, ING’s head of commodities strategy.

“Speculators appear to be getting more nervous about the demand recovery, with the path much more gradual than market expectations coming into the second half of the year.”

Coronavirus cases have continued to climb in the United States and have reached almost 18 million globally, with more countries imposing new restrictions or extending existing curbs in an effort to control the pandemic. While fuel demand recovers slowly in the face of the resurgence of the virus, investors are also worried about oversupply as the Organization of the Petroleum Exporting Countries (OPEC) and its allies, a group known as OPEC+, prepare to ease oil supply cuts from August.

“Concerns appear to be developing that a rise in OPEC+ production will coincide with uneven recovery in oil demand due to localized setbacks following secondary waves of COVID outbreaks,” said Harry Tchilinguirian, head of commodity research at BNP Paribas.

OPEC+ members have been cutting output since May by 9.7 million barrels per day (bpd). From this month cuts will officially taper to 7.7 million bpd until December.

Russian oil and gas condensate output increased to 9.8 million bpd over Aug. 1-2, from 9.37 million bpd in July, a source familiar with data said on Monday.

Oil prices fell earlier in the session but found some support after a survey showed manufacturing activity across the eurozone expanded last month for the first time since early 2019. 

Positive manufacturing data in Asia also helped to support oil prices.

A Reuters poll on Friday indicated that oil is set for a slow crawl upwards this year as the gradual easing of coronavirus-led restrictions buoys demand, though a second COVID-19 wave could slow the pace of a recovery.