Oil Updates — Crude bounces back; OPEC general-secretary dies; US investors form venture eyeing Venezuelan oil

Oil Updates — Crude bounces back; OPEC general-secretary dies; US investors form venture eyeing Venezuelan oil
Brent crude futures rose as much as $3.08, or 2.9 percent, to $105.85 a barrel in early trade (Shutterstock)
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Updated 06 July 2022

Oil Updates — Crude bounces back; OPEC general-secretary dies; US investors form venture eyeing Venezuelan oil

Oil Updates — Crude bounces back; OPEC general-secretary dies; US investors form venture eyeing Venezuelan oil

RIYADH: Oil prices rose nearly 3 percent on Wednesday before paring some gains as investors piled back into the market after a heavy rout in the previous session.

Brent crude futures rose as much as $3.08, or 2.9 percent, to $105.85 a barrel in early trade after plunging 9.5 percent on Tuesday, the biggest daily drop since March. 

It was last up 92 cents, or 0.9 percent, at $103.69 a barrel at 0243 GMT.

US West Texas Intermediate crude climbed to a session high of $102.14 a barrel, up $2.64, or 2.7 percent, after closing below $100 for the first time since late April. It was last up 46 cents, or 0.5 percent, at $99.96 a barrel.

OPEC general secretary Mohammad Barkindo dies at 63

OPEC secretary-general Mohammad Barkindo has died at Abuja, Nigeria at the age of 63, Arab News learned.

He will be buried in his home town Yola, a source confirmed.

The news of Barkindo’s death was confirmed by Mele Kyari, managing director of Nigerian National Petroleum Corporation.

In a tweet, Kyari described Barkindo’s departure as a great loss to his immediate family, NNPC Nigeria, OPEC and the global energy community.

US investors form venture to pursue oil and gas projects in Venezuela

Two US investment funds on Tuesday said they formed a joint venture with a Venezuelan firm to pursue oil and gas exploration and production projects in the US-sanctioned South American country.

Gramercy Funds Management and Atmos Global Energy said their joint venture would work with an arm of Inelectra Group, a Caracas-based firm that holds a stake in the Gulf of Paria East oil project off Venezuela’s eastern coast, where it found oil in 2001.

US companies are barred from doing business with Venezuelan state-run oil firm PDVSA, a policy begun in 2018 by the Trump administration and continued under US President Joe Biden.

The companies did not disclose the size of their investment in the oil venture. Spokespeople did not immediately reply to requests for comment.

Any effort is subject to approvals by the US and Venezuela, the companies said.

Ali Moshiri, a US executive and former chief of Chevron Corp’s Latin American operations, set up an investment fund in 2019 to pursue energy projects in Venezuela. The partners aim to “contribute to balancing oil supply and demand,” he said in a statement.

The oil effort “will be beneficial to US interests in the region and the US economy by lowering fuel prices for American consumers,” said Matt Maloney, a partner at Connecticut-based emerging market investor Gramercy.

(With input from Reuters) 


Saudi Electricity secures $568m funding for interconnection project with Egypt

Saudi Electricity secures $568m funding for interconnection project with Egypt
Updated 14 sec ago

Saudi Electricity secures $568m funding for interconnection project with Egypt

Saudi Electricity secures $568m funding for interconnection project with Egypt

RIYADH: State-owned Saudi Electricity Co. has obtained $568 million in financing to fund the Saudi-Egypt electricity interconnection project.

The Fund, which has a term of 14 years, is backed by Swedish Export Credit Corporation, Standard Chartered Bank, and Sumitomo Mitsui Banking Corp., according to a bourse filing.

Saudi Arabia and Egypt signed an agreement to establish an electrical interconnection in 2012 for the purpose of being the main axis in the Arab electrical linkage, which aims to create an infrastructure for electricity trade between Arab countries.

In October of last year, the two countries signed contracts for a $1.8 billion electricity interconnection project to ensure an exchange of 3,000 MW of electricity between both nations.

In a separate announcement, the utility firm announced that it has also obtained a syndicated loan of $3 billion from a number of international banks.

As part of the five-year syndicated loan, the company will refinance an existing international syndicated facility. This will include, without limitation, capital expenditures.

The financing entities include Standard Chartered Bank, HSBC Bank, Intesa Sanpaolo, Mizuho Bank, MUFG Bank, Sumitomo Mitsui Banking Corporation, Industrial and Commercial Bank of China, and State Bank of India.

Following the announcement, shares of SEC opened Thursday's trading session 0.39 higher percent at SR26.

Established in 1999, Saudi Electricity produces electricity through 45 power plants and owns transmission and distribution networks throughout the Kingdom.

It is majority-owned by the government at 74.3 percent, while Saudi Aramco owns 6.9 percent.

In the last earnings report by the firm, it reported a 10 percent decline in profit to SR1.5 billion for the first quarter of 2022.


MG sells over 120,000 cars since its debut in Mideast

MG sells over 120,000 cars since its debut in Mideast
Updated 11 min 8 sec ago

MG sells over 120,000 cars since its debut in Mideast

MG sells over 120,000 cars since its debut in Mideast

RIYADH: British automotive company MG has sold over 120,000 cars in the Middle East alone since its debut in the region in 2014, according to a press release.

The company claimed that it is currently ranked sixth in the list of manufacturers in the region.

Meanwhile, MG also exported its one-millionth vehicle since it started overseas sales following its acquisition by SAIC Motor in 2007.

Tom Lee, managing director of MG, said: “This latest milestone illustrates the commitment MG has to its customers, both globally and regionally, ranging from the support provided by our Advanced Design Studio in London, our extended support team in headquarters to that delivered by our dedicated partners across the Middle East.”

It further noted that MG is ranked among the top 10 brands in 18 countries including Saudi Arabia, New Zealand and Australia. 


Oil demand rises as gas prices surge: IEA

Oil demand rises as gas prices surge: IEA
Updated 17 min 39 sec ago

Oil demand rises as gas prices surge: IEA

Oil demand rises as gas prices surge: IEA

PARIS: Global oil demand will rise more than previously forecast this year as heatwaves and soaring gas prices are prompting countries to switch fuels for power generation, the International Energy Agency said Thursday, according to AFP.

Oil prices have dropped by $30 per barrel from a peak in June due to growing supplies and “escalating concerns over the deteriorating economic outlook,” the Paris-based agency said in a monthly report.

Meanwhile, prices of natural gas and electricity have jumped to new records, prompting some countries to switch to oil use, the IEA said.

“With several regions experiencing blazing heatwaves, the latest data confirm increased oil burn in power generation, especially in Europe and the Middle East but also across Asia,” the agency said.

“Fuel switching is also taking place in European industry, including refining,” said the IEA, which advises developed countries on energy policy.

Consequently, the IEA raised its demand forecast by 380,000 barrels per day.

Demand is now seen rising by 2.1 million bpd to a total of 99.7 million bpd in 2022. It will reach 101.8 million bpd in 2023, exceeding pre-Covid levels.

The IEA said European oil deliveries are being boosted by “exceptional demand” for heat and power generation and in industry.

The report comes as a EU plan to cut gas consumption across the 27-nation bloc by 15 percent came into effect on Tuesday.

The effort is aimed at coping with the energy price crisis spurred by Russia’s war in Ukraine.

EU countries also fear Russia may cut gas supplies during winter in retaliation to Western sanctions over the war.

The IEA said the heatwaves and “the beginning of what may be a major rise in gas-to-oil switching under new EU guidelines in response to uncertainty surrounding gas supply from Russia are augmenting fuel oil and gasoil use.”


NEOM's subsidiary plans district cooling plant in OXAGON

NEOM's subsidiary plans district cooling plant in OXAGON
Updated 38 min 47 sec ago

NEOM's subsidiary plans district cooling plant in OXAGON

NEOM's subsidiary plans district cooling plant in OXAGON

RIYADH: ENOWA, NEOM’s subsidiary energy, water and hydrogen, plans to build a district cooling plant at OXAGON.

It is set to issue a request for proposals for the contract by November, reported MEED.
The planned cooling plant will have a capacity of 25,000 refrigeration tons. 

It will be connected to the district cooling network, which will be built separately, according to MEED. 

Earlier in June, ENOWA announced a partnership with Japan-headquartered Itochu and France’s Veolia to develop a desalination plant powered by renewable energy in OXAGON.

The new plant has a design capacity of 500,000 cubic meters and is expected to produce water as early as 2024.

The project is scheduled to become commercially operational in 2025 and is expected to meet around 30 percent of the total projected water demand in NEOM once completed.

In addition to using 100 percent renewable energy, the proposed plant will use membrane technology to produce separate brine streams.


Saudi PIF supported Lucid during times of supply crunch, says top official 

Saudi PIF supported Lucid during times of supply crunch, says top official 
Updated 45 min 14 sec ago

Saudi PIF supported Lucid during times of supply crunch, says top official 

Saudi PIF supported Lucid during times of supply crunch, says top official 

RIYADH: Saudi Arabia’s Public Investment Fund has been supportive of Lucid Group Inc. during times when the firm faced a supply crunch which led to two production target cuts, said a top official. 

Earlier this month, Lucid cut its production targets to 6,000 to 7,000 cars from an original target of 20,000 cars due to supply chain issues. 

Faisal Sultan, managing director of global operations at Lucid, said that PIF — which owns over 60 percent share in the electric car manufacturing firm — understands the challenges around supply chain issues and costs. 

“The PIF have been very supportive. When the world re-emerges from the pandemic and the supply chain catches up, we will be ready,” Sultan told Bloomberg TV. 

Sultan, however, noted that supply chain issues will be solved soon, and conditions will improve by the end of this year. 

“We’re a new company, so definitely there will be challenges in the next three-four months, but we’re hoping things will get better by the end of this year,” he added. 

In the first quarter of 2022, Lucid sold 360 cars to Saudi Arabian customers, and in April alone, 300 cars were delivered in the Kingdom. 

Lucid has inked a deal with Saudi Arabia to deliver 100,000 cars over the next decade, as the Kingdom continues its focus to achieve a sustainable future. 

Sultan noted that Lucid has huge opportunities in the Kingdom. 

“The government is very serious and they’ve been working very hard with us to make sure the environment is ready,” added Sultan.

On May 18, Lucid signed an agreement to build a production factory in King Abdullah Economic City, the western part of the Kingdom, with an annual capacity of 150,000 zero-emission electric vehicles.