Oil slides 1% on fears over higher OPEC supply, slower China demand

Oil slides 1% on fears over higher OPEC supply, slower China demand
The chimneys of the Total Grandpuits oil refinery, southeast of Paris, France. (Reuters)
Updated 02 March 2021

Oil slides 1% on fears over higher OPEC supply, slower China demand

Oil slides 1% on fears over higher OPEC supply, slower China demand

Oil prices slid more than 1 percent on Tuesday as expectations that OPEC would agree to raise oil supply in a meeting this week weighed on sentiment, already hit by concerns over slowing Chinese demand.
Brent crude dropped 80 cents, or 1.3 percent, to $62.89 a barrel in early London trading, after losing 1.1 percent the previous day. US West Texas Intermediate (WTI) crude fell 69 cents, or 1.1 percent, to $59.95 a barrel, having lost 1.4 percent on Monday.
They both touched the lowest in more than 6 days, extending losses that started late last week.
Expectations that the Organization of the Petroleum Exporting Countries and its allies, a group known as OPEC+, would boost oil output from April are pushing prices lower, said Satoru Yoshida, a commodity analyst with Rakuten Securities.
“Concerns over an increase in OPEC+ supply and an end of Saudi Arabia’s voluntary cut of 1 million barrels per day (bpd) this month weighed on oil prices,” he said.
The group meets on Thursday and could discuss allowing as much as 1.5 million barrels per day (bpd) of crude back into the market.
OPEC oil output fell in February as a voluntary cut by Saudi Arabia added to reductions agreed to under the previous OPEC+ pact, a Reuters survey found, ending a run of seven consecutive monthly increases.
Russian oil and gas condensate output fell to 10.1 million bpd in February from 10.16 million bpd in the previous month, despite plans to boost it, according to Reuters calculations based on an Interfax report citing official data.
OPEC+ is monitoring global inventories and the rate of drawdowns will be a factor discussed on Thursday.
“Oil prices may stay under pressure as investors are making position adjustments ahead of the OPEC meeting,” said Hiroyuki Kikukawa, general manager of research at Nissan Securities.
Market sentiment was also dampened by weak manufacturing data out of China, Kikukawa said.
China’s factory activity growth slipped to a nine-month low in February, which may curtail Chinese crude demand and pressure oil prices.


Lebanon’s president says new maritime claim needs government approval

Lebanon’s president says new maritime claim needs government approval
Updated 22 min 36 sec ago

Lebanon’s president says new maritime claim needs government approval

Lebanon’s president says new maritime claim needs government approval
  • Aoun's decision could significantly delay the process
  • Israeli Energy Minister said Monday Lebanon's expanded claim would derail talks

BEIRUT: Lebanon’s president said on Tuesday a draft decree expanding its maritime claims in a dispute with Israel must be approved by the caretaker government, rejecting a request to grant it swift presidential approval.
The dispute with Israel over the maritime boundary has held up hydrocarbon exploration in a potentially gas-rich area of the eastern Mediterranean.
The decree, approved by Lebanon’s caretaker prime minister, defense minister and minister of public work on Monday, would add around 1,400 square km (540 square miles) to an exclusive economic zone in the eastern Mediterranean claimed by Lebanon.
Caretaker Prime Minister Hassan Diab’s office said the decree should be approved by President Michel Aoun so that the new maritime coordinates setting out Lebanon’s claim could be submitted to the United Nations.
But the presidency said it should be approved by Diab’s full cabinet, even though the government resigned eight months ago following a devastating explosion in Beirut, because of the gravity of the issue.
The draft decree “needs a collective decision from the council of ministers..., even under a caretaker government, due to its importance and the consequences,” a statement from Aoun’s office said.
Aoun’s decision could significantly delay the process. Since the government resigned in August it has referred all issues for exceptional approval by the president, leaving them to get formal endorsement when a new government is finally agreed.
Negotiations were launched in October to try to resolve the dispute with Israel yet the talks, a culmination of three years of diplomacy by the United States, have since stalled.
Israel already pumps gas from offshore fields but Lebanon has yet to find commercial gas reserves in its own waters.
Israeli Energy Minister Yuval Steinitz said on Monday Lebanon’s expanded claim would derail the talks rather than help work toward a common solution, warning that Israel would implement “parallel measures.”
Lebanon, in the throes of a deep financial meltdown that is threatening its stability, is desperate for cash as it faces the worst economic crisis since its 1975-1990 civil war. But political leaders have failed to bridge their differences and form a new government.


Ramadan in Lebanon limited due to high inflation, virus restrictions

Ramadan in Lebanon limited due to high inflation, virus restrictions
A woman checks Ramadan decorations at a shop ahead of the holy fasting month of Ramadan, in Sidon, Lebanon, April 10, 2021. (REUTERS)
Updated 27 min 25 sec ago

Ramadan in Lebanon limited due to high inflation, virus restrictions

Ramadan in Lebanon limited due to high inflation, virus restrictions
  • Iftar events banned as new curfew goes into effect and donations are fleeting during the holy month

BEIRUT: The social events, traditions and gatherings usually celebrated during Ramadan will be very different this year in Lebanon as the country continues to grapple with unprecedented economic collapse and a coronavirus (COVID-19) surge.

Leading up to the holy month, preparations for Ramadan were slight in Beirut as only a few signs reminding people to donate could be seen in the city’s main streets. Charity foundations usually rely on the month of Ramadan every year to collect donations but the country’s ability to give is fleeting.

“More than 50 percent of the Lebanese now live under the poverty line,” World Bank Group Vice President for Middle East and North Africa Farid Belhaj said on April 4.

In an attempt to combat the spread of the virus, the National Disaster Management Operations Room imposed a new curfew that applies during Ramadan from 9 p.m. until 5 a.m. It has also banned all iftar events.

Charitable organizations can distribute food to houses, but only after obtaining a permit from the electronic platform. The capacity of worshippers at mosques will be limited to 30 percent while restaurants and cafes, which have already endured several months of lockdown, will be closed again during the holy month.

The price inflation has become a daily nightmare for the Lebanese, and with the arrival of Ramadan, the prices of essential goods, like vegetables and fruits, have increased even further due to the high demand.

“The price of one kilo of beef has increased to between 60 and 70,000 pounds and a kilo of taouk chicken was sold at 50,000 pounds on the first day of Ramadan,” Abbas Ali Salim, a butcher shop owner in Beirut’s southern suburbs, told Arab News.

“People ask me about the prices, and when I answer, they seem very unhappy. Some even beg me to give them lower prices. But the truth is, I am one of these people. I am suffering just like them. The black market is trading the state-subsidized meat, monopolized by traders who are controlling the prices.”

Due to inflation, the cost of a typical iftar meal — lentil soup, fattoush salad, a main dish of chicken and rice, a half a cup of yogurt and a single date — has reached more than 60,000 Lebanese pounds, according to the crisis observatory at the American University of Beirut.

By those estimates, a full month of iftar meals for a family of five would cost 1.8 million pounds, which is much higher than the Lebanese minimum wage of 675,000 pounds. This cost does not even cover the juices, desserts, gas, electricity or cleaning material used for cooking.

Researchers at the observatory said a fattoush salad for a small family that cost 6,000 pounds during Ramadan last year, now costs 18,500 pounds. This means that the cost of a daily salad during this year’s Ramadan would be about 82 percent of the minimum wage.

The observatory feared that families might cope with the inflation by “cutting quantities or opting for cheaper alternatives to replace vegetables and meat, which would result in malnutrition.”

Mohammad Chamseddine, a researcher from the independent studies and statistics company Information International, said: “The prices of basic goods in Ramadan have increased by between 25 and 100 percent, with a significant reduction in sales, as the purchasing power of the Lebanese, especially those getting paid in Lebanese pounds, has eroded.”

Ramadan has also been affected by the country’s slow COVID-19 vaccination plan, which started in February. Lebanon's Health Minister Hamad Hassan said on Tuesday that “over 20 percent of the Lebanese people have developed immunity, either through infection or vaccination.”

 


SABIC unit aims to ramp up investment support for industrial SMEs

SABIC unit aims to ramp up investment support for industrial SMEs
Faisal Al-Buhair
Updated 48 min 40 sec ago

SABIC unit aims to ramp up investment support for industrial SMEs

SABIC unit aims to ramp up investment support for industrial SMEs
  • Nusaned program has potential to create more than 2,000 jobs

JEDDAH: Nusaned Investment, the localization initiative from Saudi Basic Industries Corp (SABIC), was set up in 2018 as part of the Kingdom’s Vision 2030 plan to diversify the non-oil economy by encouraging the growth of local companies and small and medium-sized enterprises (SMEs) in the industrial sector.

“We connect potential investors to the program,” Faisal Al-Buhair, vice president local content and business development and CEO of Nusaned, told Arab News. “Once they register with the Entema platform, which is the opportunity gate at Nusaned, we take them through the investor’s journey.”

Last year 106 Saudi entrepreneurs qualified for Nusaned’s program. The screening of proposed investments is an important step in ensuring that the program focuses on the right candidates and those with the ability to scale up and have national impact.

“An important criteria in our screening process is that the investment needs to support the National Industry Strategy sectors and thereby add value to Saudi Vision 2030,” Al-Buhair said. “In any case, an investor who shows a high level of commitment, knowledge, and readiness will have a higher chance of success.”

He was optimistic about the year ahead after the challenges the Kingdom had faced because of the pandemic in 2020.

Nusaned is aiming to increase its investments in companies that are considered to be strategic and critical industries for the Kingdom, such as automotive, aviation, food processing and pharmaceutical/medical manufacturing.

“We are keen on investments that offer differentiated solutions, specialized applications, and advanced technology to help the Kingdom enhance its competitiveness in local and export markets,” Al-Buhair said.

So far the program has more than 33 investments in the execution phase, of which 14 are already in operation. These investments have an expected annualized gross domestic impact of over $500 million and the potential to create more than 2,000 jobs.

This week Nusaned signed an investment agreement with the Saudi Pallet Manufacturing Company (SPMC) to promote the local production of plastic pallets. The funding will help SPMC to accelerate its product development, ramp up production, and expand its product reach regionally and globally.

“The partnership with SABIC will enable SPMC to serve the fast-moving consumer goods market by producing technologically advanced and patented multi-use plastic pallets from its manufacturing facility in Dammam,” Omar Al-Shawaf, SPMC CEO, said in a press statement.


Russia backs Egypt on Nile water rights

Russia backs Egypt on Nile water rights
Egypt's President Abdel-Fattah al-Sisi and Russia's Foreign Minister Sergei Lavrov attend a meeting in Cairo, Egypt April 12, 2021. (REUTERS)
Updated 59 min 1 sec ago

Russia backs Egypt on Nile water rights

Russia backs Egypt on Nile water rights
  • Sergey Lavrov: Russia is looking forward to reaching a solution for all parties, Egypt, Sudan and Ethiopia, on the filling and operation of the dam through negotiations

CAIRO: Visiting Russian Foreign Minister Sergey Lavrov has told Egyptian President Abdel Fattah El-Sisi that Moscow will oppose any interference in Egypt’s historical water rights in the Nile.

Ethiopia is building the Grand Ethiopian Renaissance Dam on the Nile River’s main tributary, which Egypt and Sudan deem a major threat if it is filled and operated without a legally binding agreement.

In a meeting with the Egyptian leader on Monday, Lavrov highlighted Russia’s firm position rejecting any interference in Egypt’s historical water rights in the Nile, and rejected unilateral actions in this regard.

He also voiced appreciation for Egypt’s efforts to resolve the issue.

Lavrov said that Russia is looking forward to reaching a solution for all parties, Egypt, Sudan and Ethiopia, on the filling and operation of the dam through negotiations.

El-Sisi said the lack of resolution of this issue would affect the security and stability of the region.

El-Sisi also discussed the Egyptian efforts to support the new interim government in Libya at various bilateral, regional and international forums, stressing the need to clear Libya of mercenaries.

Illegal foreign interference in Libyan affairs is fueling the crisis, he said.

Lavrov underlined Cairo’s role, especially the president’s personal efforts, to prepare a political pathway in Libya.

He said that this underlined Egypt’s role in regional security and stability, adding that Russia seeks to continue cooperation and coordination with Cairo on the issue.

Egyptian Foreign Minister Sameh Shoukry briefed Lavrov on the recent consultations over the dam held in Kinshasa in the presence of the foreign ministers of Egypt, Sudan and Ethiopia.

He said that communication will continue with Russia over the issue as it is an active member of the UN Security Council, and because of its diplomatic capabilities and its impact in the international arena.

 


Saudi Arabia's crown prince receives call from Qatar emir

Saudi Arabia's crown prince receives call from Qatar emir
Updated 13 April 2021

Saudi Arabia's crown prince receives call from Qatar emir

Saudi Arabia's crown prince receives call from Qatar emir

RIYADH: Saudi Arabia’s Crown Prince Mohammed bin Salman received a phone call from the Emir of Qatar, Sheikh Tamim bin Hamad, Saudi Press Agency reported on Tuesday.
During the call, Sheikh Tamim congratulated the crown prince on the advent of the Muslim holy month of Ramadan.
Prince Mohammed also exchanged well wishes on the occasion.