Oil highest since 2014 as Turkey outage adds to tight supply outlook

Oil highest since 2014 as Turkey outage adds to tight supply outlook
GettyImages
Short Url
Updated 19 January 2022

Oil highest since 2014 as Turkey outage adds to tight supply outlook

Oil highest since 2014 as Turkey outage adds to tight supply outlook


SINGAPORE:  Oil prices rose for a fourth day on Wednesday as an outage on a pipeline from Iraq to Turkey increased concerns about an already tight supply outlook amid worrisome geopolitical troubles in Russia and the United Arab Emirates.
Brent crude futures rose 87 cents, or 1 percent, to $88.38 a barrel at 0543 GMT, adding to a 1.2 percent jump in the previous session. The benchmark contract climbed to as much as $89.05, its highest since Oct. 13, 2014.
U.S. West Texas Intermediate crude futures climbed $1.03, or 1.2 percent, to $86.46 a barrel, adding to a 1.9 percent gain on Tuesday. WTI earlier jumped to a high of $87.08, its highest since Oct. 9, 2014.
Turkey's state pipeline operator said it put out a blaze following an explosion that cut oil flow at the Kirkuk-Ceyhan pipeline, adding that it would be operational "as soon as possible". The cause of the explosion is not known.
The pipeline carries crude out of Iraq, the second-largest producer in the Organization of the Petroleum Exporting Countries, to the Turkish port of Ceyhan for export.
The loss comes as analysts are forecasting tight oil supply in 2022, driven in part by demand holding up much better than expected as the highly contagious Omicron coronavirus variant spreads, with some predicting the return of $100 oil.
Concerns over Russia, the world's second-largest oil producer, and the UAE, OPEC's third-largest producer, are adding to the supply fears.
The UAE late on Tuesday called for a meeting of the United Nations Security Council to condemn an attack on Abu Dhabi on Monday by Yemen's Houthi movement, which has threatened further attacks.
Meanwhile, Russian troops are lined up on the border of Ukraine, with the White House calling the crisis extremely dangerous and saying Russia could invade at any point.
The tensions raise the prospect of supply disruptions at a time when OPEC, Russia and their allies, together called OPEC+, are already having difficulty meeting their agreed target to add 400,000 barrels per day of supply each month.
"OPEC+ is falling short of hitting their production quotas and if geopolitical tensions continue to heat up, Brent crude might not need much of a push to get to $100 a barrel," OANDA analyst Edward Moya said in a note.
Jet fuel consumption is rising with growth in international flights, while road traffic is much higher than the same time last year, Commonwealth Bank commodities analyst Vivek Dhar said in a note.
"OPEC+ supply constraints and the ongoing increase in global oil demand will likely keep oil prices well supported in coming months," Dhar said.
OPEC officials have told Reuters that oil's rally may continue in the next few months due to recovering demand and limited capacity in OPEC+, and prices could break $100 a barrel.


Saudi Arabia is an emerging destination for the games of the future, says Futurous CEO

Saudi Arabia is an emerging destination for the games of the future, says Futurous CEO
Updated 22 min 36 sec ago

Saudi Arabia is an emerging destination for the games of the future, says Futurous CEO

Saudi Arabia is an emerging destination for the games of the future, says Futurous CEO

 

DUBAI: Esports technology platform provider Futurous sees Saudi Arabia as an emerging destination for competitive multiplayer video games that will spur modernization in the region, said its CEO, Philippe Blanchard.

Speaking on the sidelines of the Top CEO event held in Dubai, Blanchard told Arab News that he saw Kingdom’s Vision 2030 blueprint and its leadership as a springboard that will propel sports beyond physical activity or an economic driver in the region.

“The crown prince of Saudi Arabia understands that sports are much more than physical activity, economic development, or health factors; sports can serve as a vector for modernizing a nation without becoming too Westernized,” said Blanchard.

Blanchard, the former director of the International Olympic Association, met Princess Reema bint Bandar Al Saud in 2019 to understand the Kingdom’s vision for sports and has engaged with the government experts to harness the potential of esports and the like.

The company was initially slated to organize the first edition of “Games of the Future” in Russia in 2023. However, the tournament was called off due to the ongoing Russia-Ukraine crisis.

The idea was to launch a technological platform designed to link live and virtual sports using its dedicated social network and online video service.

According to a company statement, “Games of the Future” was meant to showcase over 15 high-tech disciplines, including esports, drone racing, mobility, exoskeletons, augmented and virtual reality.

Blanchard’s main objective is to introduce these games in the region and possibly relocate the activities and infrastructure they created in Switzerland to the Kingdom.


TASI gains on strong earnings season: Opening bell

TASI gains on strong earnings season: Opening bell
Updated 31 min 45 sec ago

TASI gains on strong earnings season: Opening bell

TASI gains on strong earnings season: Opening bell

RIYADH: Saudi stocks opened in a positive territory after the earnings season finished with strong results, with listed companies reporting 73 percent profit growth in the first quarter, wiping away investor worries.

As of Wednesday’s opening bell, TASI gained 0.31 percent to reach 12,339, while the parallel market, Nomu, added 0.14 percent to 22,282, as of 10:09 a.m. Saudi time.

Saudi Industrial Export Co. gained 9.83 percent, leading the market gainers; Jabal Omar Development Co. fell 3.35 percent, leading the laggards.

Among the gainers on the list, ACWA Power Co. rose 1.44 percent, and Al Moammar Information Systems Co., or MIS, improved 1.75 percent.

In the financial sector, the Kingdom’s largest valued bank Al Rajhi edged up 0.44 percent, while Alinma Bank climbed 0.69 percent.

Telecom giants stc and Zain KSA were both up by 0.77 percent and 0.15 percent respectively.

In the pharma sector, Aldawaa Medical Services Co. gained 0.26 percent, while Nahdi Medical Co. shed 0.39 percent.

Saudi Aramco, the largest player on the Saudi oil market, opened today’s trading up 0.75 percent.

The energy market saw Brent crude traded at $114.74 a barrel and US West Texas Intermediate crude reached $110.93 a barrel, as of 10:28 p.m. Saudi time.


Glencore pays up to $1.5bn to resolve corruption claims

Glencore pays up to $1.5bn to resolve corruption claims
Updated 15 min 43 sec ago

Glencore pays up to $1.5bn to resolve corruption claims

Glencore pays up to $1.5bn to resolve corruption claims
  • The US Department of Justice said its case against the company related to “a decade-long scheme by Glencore and its subsidiaries to make and conceal corrupt payments and bribes”

Commodities firm Glencore says it has reached deals with authorities in the United States, Britain and Brazil to resolve corruption allegations in return for penalties totaling up to $1.5 billion.

The Anglo-Swiss company said late Tuesday that it will pay $700 million to resolve a US bribery probe and a further $486 million in connection with allegations of market manipulation.

Glencore said that about $166 million in fines agreed with the US authorities will be credited to a parallel investigation by the UK Serious Fraud Office, where it has indicated that it will plead guilty to bribery at a hearing next month.

Separately, the company is paying $40 million to resolve a bribery probe in Brazil.

The US Department of Justice said its case against the company related to “a decade-long scheme by Glencore and its subsidiaries to make and conceal corrupt payments and bribes” to foreign officials in Africa and Latin America.

“The scope of this criminal bribery scheme is staggering,” US Attorney Damian Williams for the Southern District of New York was quoted as saying. “Glencore paid bribes to secure oil contracts. Glencore paid bribes to avoid government audits. Glencore bribed judges to make lawsuits disappear.”

“At bottom, Glencore paid bribes to make money — hundreds of millions of dollars,” Williams said. “And it did so with the approval, and even encouragement, of its top executives.

“Glencore today is not the company it was when the unacceptable practices behind this misconduct occurred,” chairman Kalidas Madhavpeddi said in a statement, adding that Glencore was committed to “act ethically and responsibly across all aspects of its business.”

Glencore said that it “does not currently anticipate” the total payments to differ materially from the $1.5 billion it has set aside so far.

The company remains subject of investigations in Switzerland and the Netherlands.


Venture capital as a concept is Shariah-compliant, hints Vision 3 chairman 

Venture capital as a concept is Shariah-compliant, hints Vision 3 chairman 
Updated 42 min 6 sec ago

Venture capital as a concept is Shariah-compliant, hints Vision 3 chairman 

Venture capital as a concept is Shariah-compliant, hints Vision 3 chairman 

RIYADH: With the rise of entrepreneurs in the Middle East and North Africa region, venture funding has been critical for small businesses and startups to thrive in an emerging market.

In an exclusive interview with Arab News during the Top CEO event in Dubai, Khalid Abdulla Janahi, chairman at Vision 3, said that Islamic finance and ethical finance complement one another in an entrepreneurial ecosystem.

“Venture capital is the same thing as its Shariah-compliant, and it’s ethical. Because you’re taking risks, the rewards could be very high, but you could lose them too. So, I think that aspect is what’s happening today,” Janahi explained.

He added that countries with mature entrepreneurial ecosystems like the US have no Shariah compliance but invest money in entrepreneurs and sometimes celebrate failure before success, indicating that venture capitals share the risk with the entrepreneur.

Janahi stressed on the double-digit unemployment rate under 30 in Saudi Arabia, saying that for the Kingdom's ecosystem to flourish the unemployment rate must be a one-digit number which could be accomplished with a robust entrepreneurial ecosystem.

 “I see international venture capitals investing in startups in Saudi Arabia, be it Sequoia or Tiger Global. They’re coming in. So interestingly, they are doing the Musharaka side by putting money into the country,” he explained.

Janahi added that most people are going to venture capitals, and as long as investments are going into Halal businesses, it is Shariah-compliant.  


Saudi-listed companies start the year on a positive note with 73% rise in profits

Saudi-listed companies start the year on a positive note with 73% rise in profits
Updated 25 May 2022

Saudi-listed companies start the year on a positive note with 73% rise in profits

Saudi-listed companies start the year on a positive note with 73% rise in profits

RIYADH: Companies listed on Saudi Arabia's stock market reported 73 percent growth in their first quarter — the fifth straight quarter of positive results, driven by solid performance across most sectors.

The Tadawul-listed companies profits rose to SR184.71 billion ($49 billion) in the first quarter, from SR106.83 billion in the year-ago period, according to data by argaam.

Oil giant Saudi Aramco led the list of companies that reported a profit, followed by Saudi Basic Industries Corporation, SABIC and Kingdom Holding.

The growth was driven largely by improved performance in the energy, materials, and banks sectors, which increased by 80 percent, 52 percent, and 22 percent, respectively, compared to last year.

The quarter saw 135 companies report profits, of which 13 turned profitable, 70 recorded profit growth, while 52 reported profit declines when compared with the first quarter of last year.

Meanwhile, 50 companies experienced losses in the first quarter, of which 16 incurred losses, 21 deepened losses, and 13 trimmed their losses compared to quarter one of 2021.