Oil prices dip on mixed supply and demand outlook

Downward pressure has been exerted by the decision of the OPEC and its allies, known as OPEC+, to increase supplies by 2 million barrels per day between May and July. (AFP)
Downward pressure has been exerted by the decision of the OPEC and its allies, known as OPEC+, to increase supplies by 2 million barrels per day between May and July. (AFP)
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Updated 10 April 2021

Oil prices dip on mixed supply and demand outlook

Oil prices dip on mixed supply and demand outlook
  • Downward pressure has been exerted by the decision of OPEC+ to increase supplies by 2 million barrels per day between May and July

LONDON: Oil prices edged lower on Friday on rising supplies from major producers and concerns over a mixed picture on the COVID-19 pandemic’s impact on fuel demand.

Brent crude futures for June fell 37 cents, or 0.59 percent, to $62.83 a barrel while US West Texas Intermediate (WTI) crude for May was at $59.24, down 36 cents.

Both contracts are on track for a 2-3 percent drop this week but still far from a low of $60.47 hit two weeks ago.

Downward pressure has been exerted by the decision of the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, to increase supplies by 2 million barrels per day between May and July.

Analysts expect global oil inventories to continue to fall, but predict fuel demand will accelerate in the second half of the year as the global economic recovery gathers steam.

“A lot of destocking is going on, so we are well into the rebalancing process,” said Energy Aspects analyst Virendra Chauhan.

Physical markets will still need to pick up before prices and inter-month spreads can rally, he added.

For all the optimism, renewed lockdowns in some parts of the world and problems with vaccination programs could threaten the oil demand picture.

Stephen Innes, chief global markets strategist at Axi, said oil prices are expected to trade in a range between $60 and $70 as investors weigh these factors.

“Oil is currently in a wait-and-see mode, with market participants looking at the vaccination pace to understand when oil demand will recover further and at nuclear talks in Vienna to see when more Iranian barrels might come back,” said UBS commodity analyst Giovanni Staunovo.

Talks to bring Iran and the US fully back into the 2015 nuclear deal are making progress, delegates said on Friday, but Iranian officials indicated disagrement with Washington over which sanctions it must lift.

“If a fulsome framework can be crafted in the coming weeks, significant quantities of Iranian oil will likely hit the market in H2 2021,” RBC Capital analyst Helima Croft said in a note this week.


Jeddah Economic City: 90% of road, landscaping work done

Jeddah Economic City: 90% of road, landscaping work done
Updated 24 June 2021

Jeddah Economic City: 90% of road, landscaping work done

Jeddah Economic City: 90% of road, landscaping work done
  • The project will consist of three sectors: A financial district, a residential district and Al-Balad

JEDDAH: Jeddah Economic City — one of Saudi Arabia’s flagship megaprojects, which will include the world’s tallest tower — is nearing completion on all road construction and landscaping work, according to a senior executive on the project.

Speaking at the Urban Landscape Saudi 2021 event this week, Fady Nassim, executive head of urban planning for Jeddah Economic City, said the main goal of the 5.3-million-square-meter project is to create a habitable, economically beneficial and environmentally friendly space. “Ninety percent of the work on road construction and landscaping in the city is done,” he told delegates.

The city will consist of 210 towers that will be over 30 floors high, the centerpiece being Jeddah Tower, which will be around 1 km tall and will take over from Dubai’s Burj Khalifa as the world’s tallest building.

The project will consist of three sectors: A financial district, a residential district and Al-Balad, which will be a contemporary recreation of the old quarter of Jeddah.

Nassim said the landscaping will be done in a way that ensures plenty of green space and room for pedestrians, with less emphasis on cars and traffic.

Also speaking at the event, which was organized by the Saudi Contractors Authority, was Abdurahman Medallah, general manager for urban studies and policies at the Sharqia Development Authority.

He highlighted the fact that the rapid expansion of urban areas in the Kingdom is impacting agricultural land.

Medallah also highlighted the recently announced Saudi Green initiative, which aims to enhance rural areas and expand green areas in the Kingdom.

“Some of these targets are to increase the share of renewables, to reduce carbon emissions, to plant around 50 million trees, and to raise the percentage of protected areas to around 30 percent,” he said.


Egypt-UK trade up 8% to $722m in Q1 2021

Egypt-UK trade up 8% to $722m in Q1 2021
Updated 24 June 2021

Egypt-UK trade up 8% to $722m in Q1 2021

Egypt-UK trade up 8% to $722m in Q1 2021

CAIRO: Trade between Egypt and Britain increased 8 percent year-on-year to £519 million ($722 million) in the first quarter of 2021, said Nasser Hamed, director of the EU Administration at the Egyptian Commercial Office.

Egypt’s exports to the UK during the first quarter of 2021 amounted to about £219 million, down 1.8 percent year-on-year, while its imports from Britain amounted to about £300 million, down about 14 percent, according to the Middle East News Agency.

Hamed said British investment in Egypt amounted to about $5.3 billion, accounting for 33 percent of total European investments.

He added that Britain is the third-largest investing country in Egypt after the UAE and Saudi Arabia.

Hamed said despite the impact of the coronavirus pandemic on exports over the last year, Egyptian food exports to Britain surged by about 76 percent to £24 million, consisting mainly of molasses, vegetable oils and fats, chocolate, vegetables, fruits, nuts and spices.

He added that with gross domestic product of about £1.9 trillion and total imports in 2020 of £493 billion, the British economy offers great potential for Egyptian exporters.

Hamed said following Brexit, the terms of the Egyptian-British partnership agreement is the same as those of the European partnership agreement, except for minor differences on issues related to quotas or export seasons for some products such as grapes and strawberries.


Catalyst Partners ready to raise more funds: CEO

Catalyst Partners ready to raise more funds: CEO
Updated 24 June 2021

Catalyst Partners ready to raise more funds: CEO

Catalyst Partners ready to raise more funds: CEO

DUBAI: Mubadala-backed fund Abu Dhabi Catalyst Partners is ready to raise more capital after investing close to $1 billion over the last 18 months, its chief executive said.

The fund was set up by Abu Dhabi state fund Mubadala and US alternative asset manager Falcon Edge Capital in 2019 with $1 billion in capital.

CEO James Munce told Reuters Catalyst Partners had so far made 21 investments with an average ticket size of $50 million, with some deals investing up to $100 million.

“The plan is to go again. I think we have gone faster than expected,” Munce said in reference to adding more capital.

No decision had been made on when or how much more capital would be committed, he said.

“My view on it is this can grow to be another $1 billion and we have $2 billion deployed over the next 18 months from here. That will be a four year-track record of a $2 billion fund and we would start to get some relevance in the region,” he said.

Catalyst Partners was set up to support the development of Abu Dhabi’s ADGM financial center, which opened in 2015, while also achieving financial returns, according to its website.

Its investments have included an American financial technology startup developing blockchain tools for banks and an Abu Dhabi-based aircraft leasing firm. 


Yemeni riyal drops as Houthis renew ban on new banknotes

Yemeni riyal drops as Houthis renew ban on new banknotes
Updated 24 June 2021

Yemeni riyal drops as Houthis renew ban on new banknotes

Yemeni riyal drops as Houthis renew ban on new banknotes
  • Economists are now warning that the Houthis will use the latest measures to snoop into exchange firms and people’s lives

ALEXANDRIA: Yemen’s currency on Thursday reached a new low after the Iran-backed Houthi militia renewed its ban on banknotes printed by the Yemeni government and banned people from moving cash from government-controlled areas to their territories, Yemeni officials and economists said.

Local currency dealers said the Yemeni riyal traded at 940 against the US dollar in the black market on Thursday compared to 930 last week, shortly after the Houthi-controlled Central Bank in Sanaa circulated an order that warned people against using new money that looks like the old banknotes available in their territories.

To evade the Houthi ban and address the shortage of cash in the market, the Aden-based Central Bank of Yemen has recently pumped into the market billions of large 1,000-riyal banknotes similar to the banknotes used by the Houthis.

Local media reported that the Houthis stepped up security at their checkpoints, searching for the new banknotes.

On Thursday, Hamed Rezq, a journalist loyal to the Houthis, accused the US of launching an economic war on the Yemeni economy by allowing printing and circulating new banknotes.

“This is part of the US economic war on Yemen after Washington ran out of military options and (its) deception and political pressures have failed,” he tweeted. 
In December 2019, the Houthis banned the use of banknotes printed by the legitimate and internationally recognized government, giving residents a month to hand over their cash or face punishment.

The Houthi decision sparked outrage across Yemen, pushed up transfer charges from government-controlled areas to Houthi-ruled areas, and led to a halt in the payment of salaries to thousands of public servants.

Travelers from government-controlled areas to Sanaa told Arab News that they were forced into buying Saudi riyals or exchanging the new banknotes with old ones at inflated prices.

Economists are now warning that the Houthis will use the latest measures to snoop into exchange firms and people’s lives.

“This step will allow the Houthi group to interfere more in the work of banks, exchange companies and even ordinary citizens. Using its security grip, the group will find a justification for confiscating money and interfering in people's privacy in search of ‘fake currency’ as it describes it,” Mustafa Nasr, director of the Economic Media Center, said.

He added that the current economic war between the legitimate government and the Houthis would have implications on the country’s troubled economy and people’s lives.

Nasr also criticized the Yemeni government for printing money without coverage and its loose grip on the exchange market in the liberated provinces.

“The injection of the new cash by the Central Bank aggravates the problem in terms of inflation and it weakens the currency,” he said, advising the government to increase revenues and curb speculative activities by local money dealers in areas under its control.

“The fall of the riyal in areas under the control of the legitimate government is caused by currency speculation and corruption, not due to a real demand for currency,” Nasr said.


Saudi bourse’s 2020 net profit surged ahead of listing

Saudi bourse’s 2020 net profit surged ahead of listing
Updated 24 June 2021

Saudi bourse’s 2020 net profit surged ahead of listing

Saudi bourse’s 2020 net profit surged ahead of listing
  • Net profit rose 227 percent in 2020 from a year earlier

DUBAI: Saudi Tadawul Group, the owner and operator of the country’s stock market, said its net profit rose 227 percent in 2020 from a year earlier, while revenue more than doubled with a boost from trading commissions.
It posted a profit after zakat or Islamic tax of 500.5 million riyals ($133.5 million), it said in a statement.
Unlisted Tadawul gave a peak of its earnings ahead of a planned initial public offering later this year that will allow it to expand and strengthen its position globally.
Saudi Arabia’s stock exchange has converted itself into a holding company ahead of the listing.
Tadawul is the ninth largest exchange in the world in terms of market capitalization which stood at around $2.6 trillion, partly boosted by the listing oil giant Saudi Aramco in 2019.