Oil rises as threat recedes of Iran supply resuming soon

Oil rises as threat recedes of Iran supply resuming soon
Some members of the OPEC+ have been withholding output to support prices amid the pandemic. (Shutterstock)
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Updated 15 June 2021

Oil rises as threat recedes of Iran supply resuming soon

Oil rises as threat recedes of Iran supply resuming soon
  • Indirect discussions between the US and Iran resumed on Saturday in Vienna and were described as “intense” by the EU

TOKYO: Oil prices rose on Tuesday, with Brent gaining for a fourth consecutive session, as the prospect of extra supply coming to the market soon from Iran faded with talks dragging on over the United States rejoining a nuclear agreement with Tehran.
Brent crude was up by 17 cents, or 0.2 percent, at $73.03 a barrel by 0347 GMT, having risen 0.2 percent on Monday. US oil gained 15 cents, or 0.2 percent, to $71.03 a barrel, having slipped 3 cents in the previous session.
Indirect discussions between the United States and Iran, along with other parties to the 2015 deal on Tehran’s nuclear program, resumed on Saturday in Vienna and were described as “intense” by the European Union.
A US return to the deal would pave the way for the lifting of sanctions on Iran that would allow the OPEC member to resume exports of crude.
It is “looking increasingly unlikely that we will see the US rejoin the Iranian nuclear deal before the Iranian presidential elections later this week,” ING Economics said in a note.
Other members of the Organization of Petroleum Exporting Countries (OPEC) along with major producers including Russia — a group known as OPEC+ — have been withholding output to support prices amid the pandemic.
“Additional supply from OPEC+ will be needed over the second half of this year, with demand expected to continue its recovery,” ING said.
Still, prices were off their highs earlier in the day with US crude briefly tripping into negative territory.
“Daily technical indicators are currently pointing to crude oil in overbought territory and a pullback may be due,” said Avtar Sandu, senior manager commodities at Phillip Futures.
Investors and traders are also watching the outcome of the US Federal Reserve meeting that starts later on Tuesday for signals on when it will scale back monetary stimulus, he said.
The Fed is getting ready to starting debating how and when to start tapering a massive asset-purchase program that helped helped support the US economy during the pandemic.


New Saudi committee tasked to regulate foreign investments as Kingdom opens up

New Saudi committee tasked to regulate foreign investments as Kingdom opens up
Updated 16 sec ago

New Saudi committee tasked to regulate foreign investments as Kingdom opens up

New Saudi committee tasked to regulate foreign investments as Kingdom opens up
  • Chaired by the investment minister, the new committee will also set the limit for foreign ownership in local companies

RIYADH: Saudi Arabia has formed a new committee to regulate foreign investments and protect the Kingdom's critical sectors such as utilities.

The committee is tasked to create and implement a criterion for foreign investors, identifying a list of companies, individuals, and activities excluded from foreign investment, Argaam reported, citing a cabinet's decision.

Chaired by the investment minister, the new committee will also set the limit for foreign ownership in local companies.

“The setup of this committee is a sagacious decision which reflects the fast pace of change in the economic structure with the participation from foreign investors,” Mohammed Al-Suwayed, chief of Razeen Capital, said.

The committee comes as more foreign entities take an interest in entering the Saudi market as part of the government’s push to modernize its economy.

Saudi analyst Al-Suwayed said: “The committee is made to deal with the implications of national security and national resources including natural and critical types of resources.”

He said the decision to create the committee will protect the Kingdom from “broader political risk” if critical services such as utilities are controlled by foreign businessmen.

“Businessmen in Saudi have more access to public policymaking than any other stakeholders, and after allowing foreign businessmen to join the boards of Commercial Chambers, they're expecting to enjoy the same access and influence policymaking as well,” he explained.

Ministers of commerce, economy, planning, communications and information technology, heads of the Local Content Authority and the Capital Market Authority will also be part of the committee. 


Wind power systems project to contribute 15% to Al Yamamah Steel’s revenue, its president says

Wind power systems project to contribute 15% to Al Yamamah Steel’s revenue, its president says
Updated 6 min 39 sec ago

Wind power systems project to contribute 15% to Al Yamamah Steel’s revenue, its president says

Wind power systems project to contribute 15% to Al Yamamah Steel’s revenue, its president says
  • he project was announced last February, with an investment of around SR300 million, and is expected to be completed by the second quarter of 2023

The new wind energy systems project of Al Yamamah Steel is expected to generate 15 percent of its total revenue, the company’s president Youssef Bazaid said.

The project was announced last February, with an investment of around SR300 million, and is expected to be completed by the second quarter of 2023.

It is part of the company’s renewable energy transition, following the creation of a solar energy system in 2019, Bazaid told Al-Arabiya in an interview.

The new project will have a capacity of 520 megawatts (MW) per year, which only covers 35 percent of its 1600 (MW) target in the coming years.

It will only initially serve domestic demand, Bazaid said.


Institutional part of ACWA Power IPO oversubscribed within minutes

Institutional part of ACWA Power IPO oversubscribed within minutes
Updated 9 min 46 sec ago

Institutional part of ACWA Power IPO oversubscribed within minutes

Institutional part of ACWA Power IPO oversubscribed within minutes
  • Less than 10 minutes into the offering, which will end on Sept. 27, requests from private institutions exceeded some 81.2 million shares

The public offering of Saudi Arabia’s ACWA Power drew strong demand from local and international institutional investors  just minutes after the bidding started, CNBC reported, citing banking sources.

Less than 10 minutes into the offering, which will end on Sept. 27, requests from private institutions exceeded some 81.2 million shares, the source added

The Saudi utility company earlier announced the price range for the offering, as it aims to raise $1.2 billion.

Half-owned by the Kingdom’s Public Investment Fund, the company is selling 81.2 million shares in a range of SR51-SR56 per share or an 11.1 percent stake.

The listing will value ACWA at up to $11 billion – making it the biggest offering in Riyadh since Saudi Aramco’s listing.

Its chairman, Mohammed Abunayyan, earlier said investors, including Americans and Europeans, expressed strong interest in investing ACWA Power.


IPO will cement ‘solutions by stc’ position as region’s top digital enabler: CEO

IPO will cement ‘solutions by stc’ position as region’s top digital enabler: CEO
Updated 13 min 47 sec ago

IPO will cement ‘solutions by stc’ position as region’s top digital enabler: CEO

IPO will cement ‘solutions by stc’ position as region’s top digital enabler: CEO
  • Solutions by STC recently announced it will go public, offering 20 percent of the company’s shares

DUBAI: The planned initial public offering of Saudi Arabia’s Solutions by STC will cement the company’s position as a top digital enabler in the region, its Chief Executive Officer Omar Al-Noamani said.

A unit of the Saudi Telecom Company, Solutions by STC recently announced it will go public, offering 20 percent of the company’s shares.

The move is expected to increase the company’s capital, Al-Noamani said in an interview with CNBC Arabia, and to explore expansion opportunities in other markets.

“We are in a very good financial standing,” the CEO said, noting the 31 percent increase of the company’s cumulative average of net revenue in the last three years.

Net profit also increased by 13 percent in the same period, he added.

He said this strong financial solvency will allow the company to distribute IPO proceeds directly as divided to shareholders.

The dividend policy, which is yet to be announced, will depend on performance evaluation and growth rates, Al-Noamani said.


Telecom giants finalize Indonesia merger in $6bn deal

Telecom giants finalize Indonesia merger in $6bn deal
Updated 12 min 38 sec ago

Telecom giants finalize Indonesia merger in $6bn deal

Telecom giants finalize Indonesia merger in $6bn deal

DUBAI: Two top telecommunications companies in Indonesia have reached an agreement to merge their businesses — pegged to be one of the largest telecom deals in Asia valued at $6 billion.

Ooredoro and CK Hutchison will merge their telecoms businesses to form “a larger, commercially stronger, and more competitive world-class telecoms and internet company,” the pair said in a statement.

The new company will be called Indosat Ooredoo Hutchison.

Under the deal, assets and infrastructure of both companies will be shared, as well as their expertise in international markets such as Europe, and the Middle East and North Africa region.

“This merger is a landmark deal for Asia and for Ooredoo Group. It furthers our strategy to drive more value from our portfolio and accelerate digitalization across our global footprint,” Faisal bin Thani Al-Thani, chairman of the Ooredoo Group, said.

The deal will give CK Hutchison newly issued shares in Indosat Ooredoo, amounting to 21.8 percent, and PT Tiga Telekomunikasi Indonesia, working out to 10.8 percent.

It will also acquire 50 percent shares in Ooredoo Asia, and an additional 16.7 percent stake from Ooredoo Group for a cash consideration of $387 million.

Both companies will each own 50 percent of Ooredoo Asia, set to be renamed Ooredoo Hutchison Asia, which will retain a controlling 65.6 percent ownership stake in the merged company.

The new company will remain listed on the Indonesian Stock Exchange, with the Indonesian government retaining 9.6 percent in shares.