Egypt raises domestic fuel prices for first time since subsidy reform

Egypt raises domestic fuel prices for first time since subsidy reform
Egyptians have been converting their vehicles to run on natural gas as fuel prices rose. (Reuters)
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Updated 23 April 2021

Egypt raises domestic fuel prices for first time since subsidy reform

Egypt raises domestic fuel prices for first time since subsidy reform
  • Egypt lowered fuel prices in October 2019 following protests
  • Egypt phased out fuel subsidies on the advice of the IMF

RIYADH: Egypt’s price-setting committee raised domestic fuel prices on Friday for the first time since it was formed in October 2019 following the completion of subsidy reforms, the petroleum ministry said in a statement.

Prices were last raised in July 2019 when Egypt, a net oil importer, finished phasing out subsides on fuel products as part of a reform program backed by the International Monetary Fund. Prices had remained stable over the past year after being lowered in April 2020 and October 2019.

The prices of 80-octane, 92-octane, and 95-octane fuel were raised by 0.25 Egyptian pounds each, to 6.25 Egyptian pounds ($0.40), 7.5, and 8.5 pounds per liter, respectively, the statement said.

The pricing committee’s mechanism links energy prices to international markets, and takes into account the exchange rate as well as the impacts of the coronavirus pandemic, the statement said.

Egypt lowered fuel prices in October 2019 following several rounds of price hikes as part of an austerity program that triggered discontent, including protests against President Abdel Fattah El-Sisi.


GCC chemical projects worth $71bn amid pandemic recovery

GCC chemical projects worth $71bn amid pandemic recovery
Updated 3 min 22 sec ago

GCC chemical projects worth $71bn amid pandemic recovery

GCC chemical projects worth $71bn amid pandemic recovery
RIYADH: Gulf petrochemical projects worth $71 billion are expected to become operational between 2020 and 2024, Al Eqtisadiah reported, citing the Gulf Petrochemicals and Chemicals Association (GPCA).
Regional chemical production expanded 1.5 percent last year compared to a global decrease of 2.6 percent, it said.
Increased demand for raw materials used in medical equipment helped the industry navigate through the pandemic.
This enabled companies to maintain stable operating rates of 93 percent, as commercial activity started to recover in the third quarter of the year.
Still, the regional industry has posted a two-year decline in revenues, said GPCA secretary general Abdulwahab Al-Sadoun.
He said the challenges facing the sector have been exacerbated by supply chain disruptions related to the closure of ports in China and increases in freight rates up to three times the market price before the epidemic, he explained.
This increase has eroded the profits of GCC producers who were already operating on thin margins, he said.

How the pandemic helped 3D printing became mainstream

How the pandemic helped 3D printing became mainstream
Updated 13 May 2021

How the pandemic helped 3D printing became mainstream

How the pandemic helped 3D printing became mainstream
  • Demand in the Kingdom is coming from critical sectors, such as oil, gas, defense, and utilities

JEDDAH: The global uncertainty created by the coronavirus disease (COVID-19) pandemic was a challenging time for many industries. However, for some, such as Zoom or Amazon, it was a blessing in disguise and a catalyst for accelerated growth.

The 3D printing sector also saw a rapid surge in demand.

Dubai-headquartered Immensa Technology Labs reported that its business grew by nearly 400 percent in 2020, as global supply chains were disrupted, and operators scrambled to find an alternative.

“The pandemic was probably one of the biggest propellers for this technology, the year of COVID-19 is the year that 3D printing grew up and became mainstream,” CEO and founder of Immensa, Fahmi Al-Shawwa, told Arab News.

“3D printing saved the day,” he said, adding: “Whether it was in the medical sector, where we started producing components for hospitals to utilize, or things as big as old refineries, where there had been components that failed, and they could not resource the spare parts, we produced them.”

As one of the biggest markets in the region, Saudi Arabia was an obvious target for expansion. In April, Immensa was the first company in the Kingdom to be awarded an additive manufacturing — or 3D printing — license by the Saudi Ministry of Investment.

Immensa launched into the Saudi market in November through its acquisition of two Saudi 3D printing startups, Shakl3D and LayLabs. Shakl3D was established in 2016 and LayLabs two years later. By combining with Immensa, the larger entity is aiming to scale globally and target opportunities in Europe and North America.

“By acquiring their existing setups and investing in what they have started, we can expedite the development of the industrial 3D-printing sector in the Kingdom and provide both teams with the international platform of Immensa,” Al-Shawwa said.

HIGHLIGHTS

● In April, Immensa was the first company in the Kingdom to be awarded an additive manufacturing — or 3D printing — license by the Saudi Ministry of Investment.

● Immensa launched into the Saudi market in November through its acquisition of two Saudi 3D printing startups, Shakl3D and LayLabs.

● The company has also acquired a 10,000 square foot industrial facility in Dammam and is planning to establish a network of other 3D printing hubs across Saudi Arabia.

The company has also acquired a 10,000 square foot industrial facility in Dammam and is planning to establish a network of other 3D printing hubs across Saudi Arabia.

3D printing is a production method in which materials such as plastic or metal are stacked in layers to create products. It is also known in the industry as additive manufacturing or rapid prototyping.

Immensa is focused on industrial 3D printing, making mechanical and functional parts for the oil and gas, utilities, power, and water treatment sectors. Al-Shawwa is planning to expand the company’s reach to other sectors and industries.

“We already have our plastics and polymer machinery up and running,” he said, adding that its “metal facility will be operating in the coming weeks.”

As part of its overall strategy, the CEO said he is planning a big investment drive in the Kingdom. “Over the next three years, I think we will be investing significantly.”

According to Statista, the global 3D printing market was valued at around $13 billion in 2020 and is forecast to grow at a rate of 26 percent per annum between 2022 and 2024.

At the same time, in its latest report issued late last year, research firm UnivDatos Market Insights said the 3D printing industry in the Middle East and North Africa was valued at $521.4 million in 2018, which is expected to rise to $1.374 billion by 2025.

“Globally, the adoption of 3D printing is growing at around 30 percent per year. I think what we are going to see in Saudi Arabia is it growing by more than four times that, of 150 to 200 percent per year,” Al-Shawwa said.

Demand in the Kingdom is coming from critical sectors, such as oil, gas, defense, and utilities. These sectors pave the way for other sectors, as other industries are slowly adopting the technology in areas like tooling and injection molding, he explained.

The company boasts eight full-time engineers in Saudi Arabia, with plans to increase that to over 20 this year. Al-Shawwa said one of the reasons for their focus on Saudi Arabia was the availability of local engineers.

“The pool of talent in Saudi Arabia is phenomenal,” Al-Shawwa said.

“One of the reasons why we are shifting to Saudi because we don’t have to rely on expat talents. You can actually rely on local talent.”

Al-Shawwa envisions Immensa eventually becoming a Saudi-American company in the next five years. Its primary base will be in the Kingdom, servicing the rest of the Gulf, which has been the company’s main focus market for the last two years. However, it has recently expanded to the US, which will focus on clients in Asia and northern Europe.


Oil industry spending cuts hammer services firm CGG

Oil industry spending cuts hammer services firm CGG
Updated 13 May 2021

Oil industry spending cuts hammer services firm CGG

Oil industry spending cuts hammer services firm CGG
  • A recent pick up in oil prices helped Europe’s major energy companies to post big increases in first quarter earnings

GDANSK: French oil services group CGG posted a 71 percent plunge in first quarter core profit on Wednesday, reflecting a year of drastic spending cuts by the oil industry in the pandemic and sending its shares sharply lower.

In a call with analysts, CEO Sophie Zurquiyah said the quarter had been slow as expected, but predicted more spending in the second half of 2021, noting a resumption of commercial business and contract awards in March and higher oil prices.

“I believe we will see the need for our clients to increase their activity to not only catch up on the work postponed from 2020, but also to compensate for the depletion of their existing reservoirs,” she told analysts in a call.

Zurquiyah confirmed the firm’s 2021 targets.

A recent pick up in oil prices helped Europe’s major energy companies to post big increases in first quarter earnings.

That could bode well for CGG, which cut jobs and sold out of businesses last year as companies such as BP, Total, and Equinor slashed spending.

The Organization of the Petroleum Exporting Countries (OPEC) on Tuesday stuck to its prediction of a strong recovery in world oil demand in 2021, as growth in China and the US counters the coronavirus crisis in India.

OPEC and its allies, known as OPEC+, agreed in April to gradually ease oil output cuts.

CGG posted a first quarter core profit of $36 million, while its multi-client business — which offers seismic data and geological studies — had just one active project in offshore Brazil. Its stock was down over 9 percent at 0725 GMT, the worst performer on France’s SBF 120 index.


SoftBank joins top earners with $37bn Vision Fund profit

SoftBank joins top earners with $37bn Vision Fund profit
Updated 13 May 2021

SoftBank joins top earners with $37bn Vision Fund profit

SoftBank joins top earners with $37bn Vision Fund profit
  • SoftBank has hiked its committed capital in the second fund to $30 billion from $10 billion

TOKYO: SoftBank Group Corp. on Wednesday reported a record fourth quarter 4.03 trillion yen ($36.99 billion) Vision Fund unit profit from an investment gain on Coupang, putting it among the world’s biggest earning firms a year after an unprecedented loss.

Group net profit was 4.99 trillion yen ($45.88 billion) in the year ended March, beating the $42.5 billion made by Warren Buffett’s Berkshire Hathaway Inc. in its last business year.

It also compares with a 962 billion yen loss a year earlier after teetering tech bets depressed the value of Softbank’s portfolio.

“It’s clearly validation of Masa’s thesis,” Navneet Govil, Vision Fund’s chief financial officer, told Reuters in an interview, referring to company founder and CEO Masayoshi Son.

Market enthusiasm for tech stocks drove the public listing of SoftBank-backed e-commerce firm Coupang and used-car trading platform Auto1 Group and the rising share price of ride-hailing firm Uber during the quarter.

To sustain Softbank’s position among the global corporate elite, Son will have to replicate that fourth quarter performance with other yet-to-list companies in the Vision fund portfolio. Son has likened that to laying golden eggs.

Candidates including ride-hailing firm Didi, TikTok owner Bytedance and truck service platform Full Truck Alliance have strong revenue growth, healthy market share and a clear path to profitability, according to Govil.

These companies are “sizeable investments with significant value to be unlocked,” he said.

Much of Vision Fund’s gain, however, is on paper with the value of the portfolio locked up in the stock market amid concern over frothy valuations and a boom in special purpose acquisition vehicles (SPACs), which has drawn regulatory scrutiny.

The total fair value of the first $100 billion Vision Fund and the smaller second fund was $154 billion at the end of March, with SoftBank distributing $22.3 billion to limited partners.

SoftBank has hiked its committed capital in the second fund to $30 billion from $10 billion, reflecting the breadth of investment opportunities, Govil said.

Two of SoftBank’s highest profile bets, space sharing firm WeWork and ride-hailing firm Grab, have outlined plans to list via SPAC mergers, with Vision Fund reportedly in talks to use its own such vehicle to list portfolio company Mapbox. The Grab deal offers further upside for the Vision Fund should the transaction go through, Govil said.

The group’s trading arm, SB Northstar, is expanding deal making this week leading a $1 billion investment in acquisitive e-commerce firm THG.

SB Northstar and the broader group recorded a 233 billion yen loss on investments in listed stocks and derivatives as efforts to work cash reserves outside the Vision Fund sputter.

SoftBank has completed a 2.5 trillion yen buyback program launched last year, which pushed the stock price to two-decade highs in March. The end of the buyback pulls support at a time when shares are sliding in line with weakness in US tech stocks.


Global demand for diamonds rebounds

Global demand for diamonds rebounds
Updated 13 May 2021

Global demand for diamonds rebounds

Global demand for diamonds rebounds
  • Sales by the state-controlled company totaled $1.6 billion for the first four months of 2021

MOSCOW: Russia's Alrosa, the world’s largest producer of rough diamonds, said on Wednesday its April sales of rough and polished stones rose by 12 percent month-on-month to $401 million after demand for diamond jewelry strengthened in the main markets.

Global demand for precious stones has been recovering from the impact of the coronavirus disease (COVID-19) pandemic since the second half of 2020.

Sales by the state-controlled company totaled $1.6 billion for the first four months of 2021. At the height of the pandemic in April 2020, Alrosa’s sales were only $15.6 million. 

They rose to $357 million in March this year.

Alrosa, which competes with Anglo American unit De Beers, is gradually restoring its production after last year's 22 percent reduction. It plans to return to its usual annual output of 36-37 million carats within 2-3 years from 31-32 million carats in 2021.

Rough diamonds account for the bulk of Alrosa’s sales, although it polishes those of rare colors or of large size for sale in auctions.

“Our April sales were well supported by the successful results delivered by auctions of high-quality large rough, as well as by strong sales of polished diamonds,” Evgeny Agureev, its deputy chief executive, said in a statement.

A 100.94 carat stone called the Alrosa Spectacle — the largest polished diamond ever cut in Russia — will be auctioned by Christie’s in Geneva on Wednesday.