Tenth of world trade halted as container ship blocks Suez Canal

Tenth of world trade halted as container ship blocks Suez Canal
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Officials monitor the container ship Ever Green ship which was hit by strong wind and ran aground in Suez Canal, Egypt March 24, 2021. (Suez Canal Authority via Reuters)
Tenth of world trade halted as container ship blocks Suez Canal
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The container ship Ever Green sits with its bow stuck into the wall on Wednesday, March 24, 2021, after it turned sideways in Egypt’s Suez Canal. (Suez Canal Authority via AP)
Tenth of world trade halted as container ship blocks Suez Canal
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Bloomberg reported it had caused a build-up of more than 100 ships seeking to transit the canal. (Twitter)
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Updated 29 March 2021

Tenth of world trade halted as container ship blocks Suez Canal

Tenth of world trade halted as container ship blocks Suez Canal
  • Vessels carrying oil, gas and retail goods at a standstill in key waterway

CAIRO: More than 10 percent of global trade was at a standstill on Wednesday after a giant container ship ran aground in the Suez Canal and blocked the waterway.

Eight tug boats worked all day trying to free the 400-meter, 224,000-ton Ever Given, a Taiwan-owned vessel carrying cargo from Yantian in China to Rotterdam in the Netherlands.
The Ever Given, one of the world’s largest container ships, ran aground early on Tuesday after its crew lost the ability to steer amid high winds and a dust storm. The ship was stuck at a diagonal angle across the southernmost stretch of the waterway, between the Great Bitter Lake and the Red Sea port of Suez, with other vessels unable to pass.
Tracker maps showed at least 30 ships blocked to the north of the Ever Given, and three to the south. Several dozen ships were also grouped around the northern and southern entrances to the canal, where more than 50 vessels a day, nearly 19,000 a year, normally pass through.
Vessels carrying crude oil, liquefied natural gas (LNG) and retail goods were unable to sail through the canal on Wednesday, potentially disrupting supplies to global markets.
Oil analytics firm Vortexa said 10 tankers carrying 13 million barrels of crude could be affected. Oil prices rose more than 2 percent. Five LNG tankers were blocked, according to data intelligence firm Kpler. Of the five, three were bound for Asia and two for Europe, said Kpler analyst Rebecca Chia. She said that if the congestion persisted until the end of this week, it would affect the transit of 15 LNG tankers.
“It increases the risk that we might see additional port congestion in European ports in the next week,” said Lars Jensen, chief executive at SeaIntelligence Consulting.
About 30 percent of global container ship traffic and 12 percent of world trade by volume passes through the canal each day, carrying everything from fuel to consumer goods, and it is a major source of hard currency for Egypt. The main alternative route for ships traveling between Asia and Europe, around the African cape, takes a week longer to navigate.
Osama Rabie, chairman of the Suez Canal Authority, said the authority was trying to keep traffic flowing between waiting areas as best it could while refloating efforts continued. “Once we get this boat out, then that’s it, things will go back to normal. God willing, we’ll be done today,” he said.
The authority said it was trying to rebalance the ship, and efforts could shift toward digging the vessel out if the tug boats were unable to release it.


ArcelorMittal takes over TAQA’s JESCO

ArcelorMittal takes over TAQA’s JESCO
Updated 01 August 2021

ArcelorMittal takes over TAQA’s JESCO

ArcelorMittal takes over TAQA’s JESCO
  • With the deal, JESCO’s 100 percent ownership has been transferred to AMTPJ

RIYADH: Saudi Arabia’s Industrialization and Energy Service Co. (TAQA) on Sunday sold all its shares in Jubail Energy Services Co. (JESCO) to ArcelorMittal Tubular Products Jubail (AMTPJ).
With the deal, JESCO’s 100 percent ownership has been transferred to AMTPJ, TAQA said in an emailed statement, without disclosing the value of the deal.
Commenting on the sale of stocks, TAQA Chairman Ahmed Al-Zahrani said: “The divestiture of JESCO is in line with TAQA’s 2021 strategy to become a major player in Vision 2030 realization by maximizing the value of local investment and creating a more diverse and sustainable economy. The transaction will result in a much stronger industry in the steel sector serving not only the Kingdom but also the rest of the world.”
The company’s mandate is to lead the way in localizing industries in the Kingdom, supplying specialized equipment, and development of oil and gas resources in the Middle East and North Africa (MENA).
TAQA CEO Khalid Nouh said: “The divestiture of non-core businesses such as JESCO allows TAQA to expand its portfolio through acquisitions of additional services and technologies.” 


Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend

Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend
Updated 01 August 2021

Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend

Bitcoin tops $41,000 as cryptocurrencies rally after weeks-long downtrend
  • Bitcoin is currently trading above $41,000 and up more than 15 percent over the past week

RIYADH: Bitcoin, the leading cryptocurrency in trading internationally, traded higher on Sunday, rising by 0.02 percent to $41,447.73 at 4:41 p.m Riyadh time.

Ether, the second most traded cryptocurrency, traded at $2,580.98.76, up 5.33 percent, according to data from Coindesk.

Here is a rundown of major crypto news:

Bitcoin is currently trading above $41,000 and up more than 15 percent over the past week. The uptrend continues after the massive sell-off in May and two months of consolidation above the $30K support level, according to CoinDesk.

Germany plans to allow some institutional funds to invest billions of dollars in crypto assets for the first time, Bloomberg has reported.

A law effective Monday will allow so-called Spezialfonds with fixed investment rules to put up to 20 percent of their holdings in Bitcoin and other crypto assets. The funds, which can only be accessed by institutional investors, currently manage about $2.1 trillion.

“Most funds will initially stay well below the 20%,” said Tim Kreutzmann, an expert on crypto assets at BVI, Germany’s fund industry body.

In Ukraine, President Volodymyr Zelensky has signed the Law on Payment Services adopted by the Verkhovna Rada on June 30, the President's administration announced this week.

The new legislation aims to “modernize and further develop” the payment services market, and encourage innovation in the financial sector, according to a press statement.

The National Bank of Ukraine has also given the power to issue its own digital currency.

In an interview with Bloomberg on Thursday, Henri Arslanian, crypto leader at accounting and financial services firm PricewaterhouseCoopers (PWC), explained that crypto firms have high valuations due to the entry of major investors.

He mentioned investment firms and family offices are backed by major venture capitalists, private equity funds, and even some pension funds, and noted smaller venture capital firms are not satisfied with the trend.

Over to the US, Lael Brainard, a member of the Federal Reserve Board of Governors, highlighted the urgent need to develop a digital dollar, speaking to the Aspen Institute’s Economic Strategies Group on Friday.

He cited several reasons for creating a digital version of the US dollar, while the central bank agreed that it will have both international and domestic applications.


Saudi Arabia’s real estate price index rises by 0.4% in Q2

Saudi Arabia’s real estate price index rises by 0.4% in Q2
Updated 01 August 2021

Saudi Arabia’s real estate price index rises by 0.4% in Q2

Saudi Arabia’s real estate price index rises by 0.4% in Q2
  • The report said a 1 percent hike in the prices of residential plots jacked up the prices of residential properties

RIYADH: The real estate price index in Saudi Arabia rose by 0.4 percent in the second quarter of 2021 compared to the same period of the previous year, official data showed on Sunday.
The statistics issued by the General Authority for Statistics showed a 0.8 percent increase in the residential real estate prices in the second quarter while prices of commercial and agriculture properties declined by 0.5 percent and 0.2 percent respectively.
The report said a 1 percent hike in the prices of residential plots jacked up the prices of residential properties.
Meanwhile, the Wafi program, which regulates off-plan property activity in the Kingdom, issued a report highlighting its performance during the first half of the year.
Wafi issued 55 licenses for off-plan sales projects providing 24,328 housing units during the first half of 2021.
Off-plan property sales represent a growing sector of the Saudi real estate market, but some consumers are still wary of developers’ abilities to deliver quality homes on time.
The sector has been steadily increasing its share of total residential sales and data from the Wafi program.
According to real estate consultancy company, Knight Frank, off-plan units represent around 9 percent of total existing housing stock, but a massive 60 percent of total future supply in Saudi Arabia.
Saudi Arabia’s real estate sector is a key and effective economic driver for the country’s gross domestic product (GDP) and is connected to at least 120 industries.
Mortgage lending in Saudi Arabia increased 27 percent this year through May, as interest rates decreased to between 1 percent and 4.9 percent, compared to about 6 percent early last year.
Residential real estate financing contracts offered to individuals by local banks reached 133,006 through May, with a value of SR69.5 billion ($18.5 billion), according to data from the Saudi Central Bank (SAMA).
Real estate financing grew by 50 percent compared with the same period in 2020 when SR46.6 billion was lent via 104,000 contracts.


Saudi net foreign assets jump in June, central bank data shows

Saudi net foreign assets jump in June, central bank data shows
Updated 01 August 2021

Saudi net foreign assets jump in June, central bank data shows

Saudi net foreign assets jump in June, central bank data shows
  • Data from the Saudi Central Bank (SAMA) showed the assets rising by 34 billion riyals ($9.1 billion)

DUBAI: Saudi Arabia’s net foreign assets rose over 2 percent in June, as the global oil industry gradually recovers from the impact of COVID-19.

Data from the Saudi Central Bank (SAMA) showed the assets rising by 34 billion riyals ($9.1 billion) to 1.65 trillion riyals in June from the month before.

Total assets increased by 16.18 billion riyals to 1.842 trillion riyals, the central bank said.


Saudi Arabia’s economy likely to grow in 2021 and 2022, says report

Saudi Arabia’s economy likely to grow in 2021 and 2022, says report
Updated 01 August 2021

Saudi Arabia’s economy likely to grow in 2021 and 2022, says report

Saudi Arabia’s economy likely to grow in 2021 and 2022, says report
  • Capital Economics' forecast a further evidence that the Saudi economic recovery has taken off in 2021

RIYADHH Saudi Arabia’s economy is poised to grow from 2.2 percent to 4.8 percent in 2021 and from 4.1 percent to 6.3 percent in 2022, said a Capital Economics report.

The new forecasts are further evidence that the Saudi economic recovery has taken off in 2021.

At the start of the year, the Kingdom’s Ministry of Finance said that it expected 3.2 percent growth this year — reversing the pandemic-driven downturn of 2020. The International Monetary Fund forecast just 2.1 percent growth two months ago.

The Saudi economy is expected to maintain growth in the second half of the year. The expansion is also backed by higher oil output amid an OPEC+ agreement.

The Kingdom’s finance, insurance, real estate, and business sectors are likely to expand by 9 percent annually and their relative share to overall economic activity will grow by 12.7 percent.

Meanwhile, the services sector is also likely to grow about 10 percent annually on average, implying that its relative gross domestic product (GDP) share will climb to almost 40 percent in 2030.