Brent tops $85 as Saudi oil minister vows to stick to output plan

Brent tops $85 as Saudi oil minister vows to stick to output plan
Such has been the success of OPEC+, other commodity markets should adopt similar arrangements (Getty Images)
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Updated 15 October 2021

Brent tops $85 as Saudi oil minister vows to stick to output plan

Brent tops $85 as Saudi oil minister vows to stick to output plan
  • Oil could reach $100 a barrel as demand rises, Russian President Vladimir Putin said

RIYADH: Brent crude passed $85 a barrel and WTI was headed for an eighth consecutive weekly advance as Saudi Oil Minister Abdulaziz bin Salman Al Saud insisted OPEC+ will stick to its plan to increase output at a steady pace in the coming months.

Brent gained 1 percent to $84.82 a barrel at 3:33 p.m. Riyadh time, headed for a 3 percent weekly gain. They earlier touched $85.10, a three-year high. West Texas Intermediate (WTI) also gained 1 percent, to $82.12, 3.5 percent higher on the week.

OPEC+, the alliance of OPEC and non-OPEC producers led by Saudi Arabia and Russia, would be adding 400,000 barrels per day (bpd) in November, and then again in the following months, the Kingdom’s energy minister told delegates at Russian Energy Week on Thursday.

While the market is tight today, it is set to be return to balance by the end of the year and be in surplus during 2022, according to OPEC forecasts.

The benefits of the approach OPEC+ has taken can be seen in the steady increase in the price of oil this year compared with the wild price swings in other markets, he said.

“What we see in the oil market today is an incremental (price) increase of 29 percent, vis-à-vis 500 percent increases in (natural) gas prices, 300 percent increases in coal prices, 200 percent increases in NGLs (natural gas liquids) ...,” he said. OPEC+ has done a “remarkable” job acting as “so-called regulator of the oil market.”

Such has been the success of OPEC+, other commodity markets should adopt similar arrangements, he said.

“Gas markets, coal markets, and other energy sources need to be regulated, people need to copy and paste what OPEC has done and what OPEC+ has achieved,” the Saudi minister added.

Saudi Arabia has proposed that Russia consider the possibility of cooperating in the natural gas market, Russian Deputy Prime Minister Alexander Novak said on Thursday, according to TASS news agency.

Oil prices were also supported by a bullish demand forecast from the International Energy Agency on Thursday, which predicted the energy crunch will boost crude demand by 500,000 barrels per day.

That would result in a supply gap of around 700,000 bpd through the end of this year, until the OPEC+ adds more supply as planned in January.

The structure of Brent crude oil futures is showing a “scarcity premium” that has widened to the most since 2013 this week, a sign of the tight market underpinning oil’s rally amid a wider energy crunch as economies recover from the COVID-19 pandemic.

The premium of the immediate Brent crude contract to the December 2022 price stood at $8.13 a barrel on Friday after reaching $8.30 on Monday. The value on Monday was the highest since 2013, according to Refinitiv Eikon data.

Also at Russian Energy Week, Putin said it was “quite possible” oil prices could climb above $100 as energy demand rises.

He also used an interview at the forum to deny Russia is using gas as a geopolitical weapon and instead is ready to help Europe with additional energy supplies.


SAMI launches JV with French firm to build aerostructure components in Kingdom

SAMI launches JV with French firm to build aerostructure components in Kingdom
Updated 04 December 2021

SAMI launches JV with French firm to build aerostructure components in Kingdom

SAMI launches JV with French firm to build aerostructure components in Kingdom

JEDDAH: The Saudi Arabian Military Industries, a wholly owned subsidiary of the Public Investment Fund, on Saturday launched a joint venture with French company Figeac Aero and the Saudi Arabian Industrial Investments Co., Dussur, to build a high-precision manufacturing facility in the Kingdom to produce aerostructure components, SAMI said on Saturday.

The company said that the joint venture’s revenue would reach $200 million by 2030 and the ownership would be divided among the two countries. Fifty-one percent would be owned by Saudi Arabia and 49 percent by France.

SAMI also signed an agreement with Airbus to form a joint project specialized in military aviation services and maintenance, the statement said. As per the deal, the Kingdom would own 51 percent of the joint venture with the European planemaker holding the other 49 percent.

 


Egypt to increase cotton gins capacity, says official report

Egypt to increase cotton gins capacity, says official report
Updated 04 December 2021

Egypt to increase cotton gins capacity, says official report

Egypt to increase cotton gins capacity, says official report

RIYADH: Egypt aims to increase cotton gins capacity to 4.4 million kantars annually up from 1.5 million kantars, according to a government report issued on Saturday.

A kantar is the official Egyptian weight unit for measuring cotton. It corresponds to the US hundredweight, and is roughly equal to 99.05 pounds, or 45.02 kg. It is equal to either 157 kg of seed cotton or 50 kg of lint cotton.

The Egyptian government is trying to breath a new life into the country’s textile industry, which contributes almost 3 percent to the gross domestic product, employs one-third of the industrial labor and generates exports worth $2.6 billion annually. 

According to reports, the country’s cotton production rose by 30 percent during 2021.

Egypt increased the cultivated area this year to 236,000 feddans (one feddan equals 1.038 acres or 0.42 hectare) compared to 182,000 feddans last year.

In its annual report on Egypt’s cotton on March 31, 2021, the US Department of Agriculture said that “cotton area harvested in Egypt was forecast to increase seven percent to 70,000 hectares (ha), from 65,000 ha in MY 2020/21.” It added that Egypt’s production is estimated to increase to 250,000 bales this year compared to 215,000 bales in the previous year.


Bitcoin falls by a fifth, cryptos see $1bn worth liquidated

Bitcoin falls by a fifth, cryptos see $1bn worth liquidated
Updated 04 December 2021

Bitcoin falls by a fifth, cryptos see $1bn worth liquidated

Bitcoin falls by a fifth, cryptos see $1bn worth liquidated

NEW YORK: Bitcoin shed a fifth of its value on Saturday as a combination of profit-taking and macro-economic concerns triggered nearly a billion dollars worth of selling across cryptocurrencies.

Bitcoin was 12 percent down at 0920 GMT at $47,495. It fell as low as $41,967.5 during the session, taking total losses for the day to 22 percent.

The broad selloff in cryptocurrencies also saw ether, the coin linked to the ethereum blockchain network, plunge more than 10 percent.

Based on cryptocurrency data platform Coingecko, the market capitalization of the 11,392 coins it tracks dropped nearly 15 percent to $2.34 trillion. That value had briefly crossed $3 trillion last month, when bitcoin hit a record $69,000.

The plunge follows a volatile week for financial markets. Global equities and benchmark US bond yields tumbled on Friday after data showed US job growth slowed in November and the omicron variant of the coronavirus kept investors on edge.

Justin d'Anethan, Hong Kong-based head of exchange sales at cryptocurrency exchange EQONEX, said he had been watching the increase in leverage ratios across the cryptocurrency markets as well how large holders had been moving their coins from wallets to exchanges. The latter is usually a sign of intent to sell.

“Whales in the crypto space seem to have transferred coins to trading venue, taken advantage of a bullish bias and leverage from retail traders, to then push prices down,” he said.

The selloff also comes ahead of testimony by executives from eight major cryptocurrency firms, including Coinbase Global CFO Alesia Haas and FTX Trading CEO Sam Bankman-Fried, before the US House Financial Services Committee on Dec. 8.

The hearing marks the first time major players in the crypto markets will testify before US lawmakers, as policymakers grapple with the implications of cryptocurrencies and how to best regulate them.

Last week, the US Securities and Exchange Commission (SEC) rejected a second spot-bitcoin exchange-traded fund proposal from WisdomTree.

Data from another platform Coinglass showed nearly $1 billion worth of cryptocurrencies had been liquidated over the past 24 hours, with the bulk being on digital exchange Bitfinex.

A plunge in bitcoin funding rates — the cost of holding bitcoin via perpetual futures which peaked at 0.06 percent in October — also showed traders had turned bearish.

The funding rate on cryptocurrency trading platform BitMEX fell to a negative 0.18 percent from levels of 0.01 percent for most of November.


Saudi, French firms sign 27 MoUs as Macron visits the Kingdom

Saudi, French firms sign 27 MoUs as Macron visits the Kingdom
Updated 38 min 50 sec ago

Saudi, French firms sign 27 MoUs as Macron visits the Kingdom

Saudi, French firms sign 27 MoUs as Macron visits the Kingdom

JEDDAH: A group of leading Saudi and French companies signed 27 memorandum of understanding at an investment forum in Jeddah as French President Emmanuel Macron met with Crown Prince Mohammed bin Salman today during his official trip to the Gulf region, where he is visiting Saudi Arabia, the UAE and Qatar between Dec. 3 and 4.

Around 101 Saudi companies and 84 French companies attended six workshops at the forum, which was opened by Khalid Al Falih, Minister of Investment, Saudi Arabia and Franck Riester, Minister Delegate for Foreign Trade and Economic Attractiveness.

"The memorandums of understanding signed today were a cause for optimism and satisfaction," Al Falih said in a tweet after the event.

Represenatives of French companies and banks including EDF Renewables, Engie, Sanofi, and BNP Paribas are meeting with chairmen and CEOs of leading Saudi firms including ACWA Power, Banque Saudi Fransi, Riyad Bank, and Saudi Military Industries Co. Officials from the Public Investment Fund and Royal Commission of AlUla among others are also participating in the forum. 

 

Below is the agenda for the one-day forum:  


Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4

Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4
Updated 03 December 2021

Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4

Saudi Arabia to start mandatory e-invoicing first phase on Dec. 4

RIYADH: Saudi Arabia will start implementing the mandatory application of the first phase of e-invoicing “fatoorah” on Saturday Dec. 4, Argaam reported.

An e-invoice, according to regulations, is a tax invoice that is issued electronically by each taxpayer subject to value-added tax in the Kingdom

The first phase requirements consist of ensuring that there is a technical e-invoicing solution compatible with the relevant requirements. This means no handwritten invoices or invoices written through text editors or number analysis applications on computers.

A fine of SR5,000 ($1,332) will be applied for not issuing and saving the invoices electronically.

The fine for not including the QR Code in the e-invoice and not reporting any malfunction in the issuing of the e-invoice to the authority starts with a warning. The fine for violating the deletion or modification of e-invoice starts from SR10,000.

The second phase of e-invoicing will be implemented in a phased manner, starting from January 1, 2023, to establish integration between e-systems of taxpayers and the authority’s regulations, Argaam said.