Eastern Med gas club could grow further, says Egyptian LPG chief

Eastern Med gas club could grow further, says Egyptian LPG chief
The discovery of vast gas reserves in the Eastern Mediterranean is rapidly reshaping the global energy landscape. (File/AFP)
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Updated 10 March 2021

Eastern Med gas club could grow further, says Egyptian LPG chief

Eastern Med gas club could grow further, says Egyptian LPG chief
  • Egypt, Israel, Cyprus and Greece, Jordan, Palestine and Italy are members of the club

RIYADH: Lebanon, Libya and Algeria could all eventually become members of the EastMed Gas Forum according to a top Egyptian industry official.
Mohamed Saad El-din, chairperson of the Liquefied Petroleum Gas (LPG) Investors Association said the Eastern Mediterranean holds more than 200 million cubic feet of gas and that the addition of more members would strengthen the organization’s global reach, Al Arabiya reported.
The discovery of vast gas reserves in the Eastern Mediterranean is rapidly reshaping the global energy landscape and reviving the economic fortunes of countries such as Egypt and Israel. However it has also sparked intense regional rivalries and disputes over maritime drilling rights.
El-din said that the EastMed Gas Forum had grown in stature and compared the organization to OPEC in its potential to maintain order in the industry.
Cairo is hosting the meeting of the EastMed Gas Forum for the first time. Egypt, Israel, Cyprus and Greece, Jordan, Palestine and Italy are its members.


Riyadh-based Nitros eases shipping woes for online retailers

Twitter: (@gonitros)
Twitter: (@gonitros)
Updated 23 January 2022

Riyadh-based Nitros eases shipping woes for online retailers

Twitter: (@gonitros)

LONDON: Entrepreneur Awsim Asmi has started a business that sets out to ease the logistical headache of sending a product thousands of miles from a small online retailer to a customer’s doorstep.
The CEO of the Riyadh-based platform Nitros saw the firm spring out of the COVID-19 pandemic, which saw significant changes in shopping behavior from consumers stuck under lockdown restrictions.
Around 209 million extra customers in the Middle East and North Africa, as well as Pakistan, — a region known as MENAP — have begun shopping online since the pandemic broke out in March 2020, according to a recent report by global payments company Checkout.com.
Asmi said his platform is a Gulf equivalent of online shipping business Shippo in the US, SendCloud in Europe and ShipRocket in India, which allows small merchants “to automate their shipping operations.”
Asmi founded the business last August, after spending five years as an avionics engineer on projects for Boeing and Airbus when he graduated with an electrical engineering degree from Central Michigan University.
But he said his work now is to streamline deliveries, rather than airplanes.
He told Arab News: “Our mission is to simplify shipping, while lowering shipping costs to the absolute minimum for e-commerce companies and individuals.
“During the pandemic, normal retailing was almost brought to a halt due to lockdown restrictions when everything had to be shipped. Some shipping firms couldn’t keep up with demand, and couriers could barely handle existing volumes, let alone take on more business.”
“I figured that online sellers were looking for a solution that would take care of the technical integration, from e-store through to customer delivery.”“We offer a service that lets customers compare shipping rates, create labels, generate international customs documents, track shipments and make and receive money transfers. All for a small subscription fee, or pay as you go.”
Nitros is currently available in Saudi Arabia and the other five Gulf Cooperation Council nations, and plans to expand into Egypt by the end of this year.
Asmi said he launched the firm as a “bootstrap operation” with his own savings but received a major boost last December with a SR1.1 million ($300,000) pre-seed investment from US venture capital firm 500 Global and OQM Investments, a Saudi Arabian fund.
Asmi added Nitros is growing at 50 percent a month and forecasts 10,000 users by the end of the year, from an existing user base of 820. The business employs nine staff, all of whom have stock options.
But with such rapid expansion, why does Nitros require outside finance, which normally dilutes stock and comes with strings attached?
“Rather than organic growth, the goal for ambitious startups like us is to grow exponentially,” Asmi said.
“I see Nitros becoming the leading shipping aggregator in the MENA region and we plan an initial public offering within five years. In order to achieve that, we have to reinvest all of our revenue back into the company. And even that would not be enough. Venture capital investment propels a startup like us to the next stage.”
Asmi believes this is the right time to start a business in Saudi Arabia, as the Kingdom moves to reduce its dependence on oil, in part by adopting a more entrepreneurial diversified economy.
He said: “This is becoming a very dynamic place for entrepreneurs. We chose to base ourselves in Riyadh because Saudi Arabia is a massive market with an influx of foreign investment and talent – and logistics is a pillar of that economy.”


Cyber security jobs top list of fastest-growing roles in Saudi Arabia

The research claims that nearly 85 percent of workers feel confident enough to push for a promotion or new job opportunities at work. (Getty Images)
The research claims that nearly 85 percent of workers feel confident enough to push for a promotion or new job opportunities at work. (Getty Images)
Updated 23 January 2022

Cyber security jobs top list of fastest-growing roles in Saudi Arabia

The research claims that nearly 85 percent of workers feel confident enough to push for a promotion or new job opportunities at work. (Getty Images)
  • A slew of new government policies in the region have impacted the data published by LinkedIn

RIYADH: Cybersecurity specialists, talent acquisition experts, and back end developers are among the fastest-growing jobs in Saudi Arabia, according to new data from global professional networking firm LinkedIn.
The pandemic, digitalization and a slew of new government policies in the region have all impacted the list published by the company this year, which reveals that a staggering 9 in 10 MENA professionals feel confident in their current role. This increased confidence is in turn driving a desire among the workforce to change jobs, with 72 percent of professionals in KSA considering a switch this year.
Skills such as network security and user interface design are also some of the fastest growing skills in the region, as technology continues to hold center stage in the region’s agenda.
It was found that the desire to consider a new job role seems to decrease with age with nearly nine in 10 — 87 percent — of Gen Z surveyed looking for a change compared to the 71 percent of boomers and Gen X.
Ali Matar, head of LinkedIn MENA and EMEA Venture Markets said: “A staggering 8 in 10 professionals in the UAE and KSA are considering changing their jobs.
“This is part of a larger global trend that has also seen companies revamp policies and benefits to not just hire, but also retain quality talent.
“Candidates are being increasingly selective about the organizations they choose to apply for — citing flexibility, compensation, and company culture as critical factors.”
The research also claims that nearly 85 percent of workers feel confident enough to push for a promotion or new job opportunities at work, while almost half — 48 percent — of the workers surveyed in Saudi Arabia think their confidence in their role will only get better in 2022.
Competition in the Kingdom was found to have dropped by around 29 percent, and job seekers across markets are in a stronger position to negotiate salaries and terms that benefit their ideal world of work.
One of the key motivators of this surge in worker confidence is the increase in flexible working, with 51 percent of the workforce saying that it has made them more confident to think about trying a new career.


Saudi Aramco balances competing priorities

Saudi Aramco balances competing priorities
Updated 23 January 2022

Saudi Aramco balances competing priorities

Saudi Aramco balances competing priorities
  • New and existing energy sources need to act in parallel for a long time, says CEO

LONDON: The focal point of the forthcoming Saudi Aramco’s In-Kingdom Total Value Add Forum will be the company’s initiative, launched in 2015, to further develop a local supply chain. 
In Aramco’s own words, the intention is to “transform and diversify the Kingdom’s economy through partnership and collaboration, creating high-skilled jobs for the Saudi population (and building) a resilient economy for the future.” 
The IKTVA program opens many opportunities for both companies and workers in Saudi Arabia, and reflects the objectives of the Kingdom’s Vision 2030 — but what of Aramco itself?
As the world’s leading crude oil supplier, with an output of some 10 million barrels per day, Aramco currently has a daily turnover of SR32.6 billion ($8.7 billion). That adds up to some $317.5 billion per annum, up from gross revenue of $205 billion and net revenues of $49 billion in the financial year 2020 — the last full year reported. 
With an income of such magnitude, Aramco would seemingly have little to worry about.
However, broader global issues require Aramco to come up with innovative strategies to overcome both present and future headwinds.
The 2021 United Nations Climate Change Conference, better known as COP26, articulated an “anti-oil” sentiment held by many countries, with a broad consensus to transition the global economy away from fossil fuels in favor of more environmentally friendly energy sources including solar, wind, tidal and geothermal. 
There is a shift, which began in earnest by Tesla and now includes legacy auto manufacturers such as VW, Volvo and Mercedes, from petrol/diesel engines to battery-powered electric vehicles. This trend is growing at an exponential pace, with Forbes reporting that almost 20 percent of cars purchased in China in the fourth quarter of 2021 were electric. This is likely the shape of things to come for the rest of the world.
These developments put Aramco in the spotlight as a giant of the carbon fuel sector, alongside a possible danger of becoming the world’s leading supplier of a gradually redundant commodity. 
However, the reality behind the headlines is that global oil demand is actually on an upward tangent, as the world emerges from an industrial dip caused by the two-year COVID-19 pandemic. 
According to a report from the US Energy Information Administration released on Jan. 11: “Rising economic activity and the easing of pandemic-related restrictions on other activities resulted in global oil consumption rising by 5.5 percent in 2021 from 2020.”
The same report goes on to state that with oil consumption outpacing production, the fourth quarter of 2021 saw significant increases in prices of the commodity, with Brent crude oil spot increasing from an average of $43 per barrel in the third quarter of 2020 to an average of $79 per barrel in the fourth quarter of 2021. 
Current oil prices are even higher, with the various grades of Arabian crude hovering between $87 and $89 per barrel.

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The EIA predicts that total world petroleum consumption of 96.9 million barrels per day in 2021 will slightly increase to 100.5 mbpd in 2022.  Is that level of demand sustainable? Aramco, for one, believes the answer is yes. 
“(Energy) alternatives are nowhere near ready to carry a big enough load, so new and existing energy sources will need to operate in parallel for a long time,” Aramco CEO Amin H. Nasser declared at the World Petroleum Council Congress, held in Houston in December 2021. 
Nasser went on to say that while “Aramco is committed to a net-zero economy … there are still no truly viable alternatives to conventional fuels in aviation, shipping, and even trucking.”
He added: “Oil and gas will be needed for decades to come, and accelerating the reduction in their emissions is a strategic and urgent necessity for climate goals to be met. We are not short of opportunities, such as producing lower carbon products like blue hydrogen and blue ammonia; developing more efficient and lower emission internal combustion engines; and making the Circular Carbon Economy that G20 world leaders endorsed last year a reality.”  
In short, Aramco seeks to maintain its dominant position in the global oil sector while aiming to emerge as a future leading producer of clean fuels — a two-pronged approach that is evident in several recent deals in both Europe and Asia.
With regards to oil supply, in the past fortnight Aramco acquired a range of assets from Poland’s state-owned energy corporation Orlen PKN, including a major oil refinery and hundreds of petrol stations, in a deal worth $288 million. A contract was also signed for Aramco to supply Orlen with 200-337,000 barrels of oil per day, adding more purchases to those agreed earlier. 
In terms of “new” energy, Aramco has also recently entered into agreements with two large South Korean entities — Korea Electric Power Corporation and the S-Oil Corporation — to conduct feasibility studies for the future supply of blue hydrogen, a petrol substitute with far lower carbon emissions.   
As Saudi Aramco balances these competing global priorities, it is simultaneously playing an active role in the diversification of the Saudi economy — ironically, away from a dependence on oil and its derivatives, and with an emphasis on small-to-medium sized enterprises as opposed to major conglomerates.
The company has a lot on its plate and the IKTVA Forum will no doubt offer a platform to further clarify its strategy and philosophy going forward.


Germany's Lufthansa is set to buy 40% stake in Alitalia successor ITA

Germany's Lufthansa is set to buy 40% stake in Alitalia successor ITA
Updated 22 January 2022

Germany's Lufthansa is set to buy 40% stake in Alitalia successor ITA

Germany's Lufthansa is set to buy 40% stake in Alitalia successor ITA
  • Germany’s Lufthansa is set to buy a 40 percent stake in state-owned Alitalia’s successor ITA Airways

MILAN: Germany’s Lufthansa is set to buy a 40 percent stake in state-owned Alitalia’s successor ITA Airways and a deal could be unveiled next week, Italian daily Il Foglio reported on Saturday.

ITA Airways started flying on Oct. 15 with nearly 2,300 employees and a fleet less than half the size of that operated by Alitalia, the 75-year old former national carrier which passed through a dizzying succession of restructurings and changes of ownership.

The newspaper did not give a price for any deal, but said the two companies were very close to agreeing over some key terms, such as the role of Rome’s Fiumicino airport as a hub for direct flights to Africa and some routes to the Americas.

An ITA spokesperson said on Saturday that the airline’s top management would present a strategic plan to the company’s board on Jan. 31. A data room would be opened in the following days, he added, allowing a potential bidder or partner to have access to key financial documents to assess the value of the company.

Lufthansa declined to comment.

The report comes after sources told Reuters on Jan. 12 that ITA was in contact with Lufthansa, British Airways and United States-based Delta Air Lines for an equity partnership, saying that formal talks could start by the end of March.

A Lufthansa spokesperson said at that time that the German carrier was open to the possibility of a partnership with ITA, whereas Delta denied it planned to invest in ITA.

The German government currently holds 14 percent of Lufthansa shares following a bailout at the height of the coronavirus pandemic in 2020 and aims to sell its stake by October 2023 at the latest.

The group was saved from bankruptcy by Germany, Switzerland, Austria and Belgium with $10.21 billion in financial support approved by the European Commission.

A German economy ministry spokesperson declined to comment on the Italian newspaper report.

A deal with ITA would be subject to a European Union competition approval, Il Foglio said.


US Stocks post worst week since start of pandemic as Netflix disappoints investors

US Stocks post worst week since start of pandemic as Netflix disappoints investors
Updated 22 January 2022

US Stocks post worst week since start of pandemic as Netflix disappoints investors

US Stocks post worst week since start of pandemic as Netflix disappoints investors
  • Wall Street’s main indexes ended sharply lower on Friday as Netflix shares plunged after a weak earnings report

New York: Wall Street’s main indexes ended sharply lower on Friday as Netflix shares plunged after a weak earnings report, capping a brutal week for stocks that saw the S&P 500 and Nasdaq log their biggest weekly percentage drops since the onset of the pandemic in March 2020.

The benchmark S&P 500 posted its third straight week of declines, ending 8.3 percent down from its early January record high.

Losses also deepened for the Nasdaq after the tech-heavy index earlier in the week confirmed it was in a correction, closing down 14.3 percent from its November peak.

Netflix shares tumbled 21.8 percent, weighing on the S&P 500 and the Nasdaq, after the streaming giant forecast weak subscriber growth. Shares of competitor Walt Disney fell 6.9 percent, dragging on the Dow, while Roku also slid 9.1 percent.

“It has really been a continuation of a tech rout,” said Paul Nolte, portfolio manager at Kingsview Investment Management. “It’s really a combination of a rotation out of technology as well as very poor numbers from Netflix that I think is the catalyst for today.”

The Dow Jones Industrial Average fell 450.02 points, or 1.3 percent, to 34,265.37, the S&P 500 lost 84.79 points, or 1.89 percent, to 4,397.94 and the Nasdaq Composite dropped 385.10 points, or 2.72 percent, to 13,768.92.

For the week, the S&P 500 fell 5.7 percent, the Dow dropped 4.6 percent and the Nasdaq declined 7.6 percent.

The Dow fell for a sixth straight session, its longest streak of daily declines since February 2020.

The S&P 500 closed below its 200-day moving average, a key technical level, for the first time since June 2020.

“When markets get like they’ve gotten this week, the emotion is what takes over,” said Jim Paulsen, chief investment strategist at The Leuthold Group. “Until it finds support, no one’s going care about anything fundamental.”

Stocks are off to a rough start in 2022, as a fast rise in Treasury yields amid concerns the Federal Reserve will become aggressive in controlling inflation has particularly hit tech and growth shares.

Investors are keenly focused on next week’s Fed meeting for more clarity on the central bank’s plans to tighten monetary policy in the coming months, after data last week showed U.S. consumer prices in December had the largest annual rise in nearly four decades.

“Between the Fed meeting and earnings, there is a lot that the market could be worried about next week,” said Anu Gaggar, global investment strategist at Commonwealth Financial Network.

Apple, Tesla and Microsoft are among the large companies due to report next week in a busy week of earnings results.