APICORP posts 67% profit surge in H1 to $52m

Earlier this year, APICORP created the first A/B loan program in the region to encourage international debt financing for projects in the region.
Earlier this year, APICORP created the first A/B loan program in the region to encourage international debt financing for projects in the region.
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Updated 02 August 2022

APICORP posts 67% profit surge in H1 to $52m

APICORP posts 67% profit surge in H1 to $52m

RIYADH: The Arab Petroleum Investments Corp. has reported a 67 percent jump in first-half profit to $52 million. 

APICORP’s net income from operations rose sharply to $97.9 million in the first half, from $40.7 million in the same period last year, while treasury assets reached $2.9 billion, a 32 percent increase, according to a statement.

It attributed the growth to the opportunities available in money market placements and the lower costs of short-term borrowing.

“APICORP has continued to deliver robust and consistent results in the first half of 2022, despite growing market volatility and inflation concerns,” Chairman Aabed Al-Saadoun said.

“Our structural and strategic resilience has facilitated exceptional performance in all our business segments,” he added.

Earlier this year, APICORP created the first A/B loan program in the region to encourage international debt financing for projects in the region.

In April, it received “A2” sustainability rating from Moody’s, representing its successful integration of environmental, social and governance factors into its strategy, operations, and risk management.

APICORP was rated “AA-“ by S&P Global in March, reflecting its solid financial performance and low risk levels.


Saudi Arabia to build commercial project worth $1bn in Baghdad

Saudi Arabia to build commercial project worth $1bn in Baghdad
Updated 26 sec ago

Saudi Arabia to build commercial project worth $1bn in Baghdad

Saudi Arabia to build commercial project worth $1bn in Baghdad

RIYADH: Saudi Arabia has signed a contract with Iraq to establish a commercial project worth $1 billion in Baghdad, bolstering the economic ties between the two nations, reported the Iraqi News Agency. 

Abdulaziz Al-Shammari, the Saudi ambassador to Iraq, revealed that the Kingdom inked a contract with Iraq to develop a massive commercial project near Baghdad International Airport, according to the INA. 

Dubbed Baghdad Avenue, the project is expected to become the largest shopping mall in Iraq, encompassing coffee shops, restaurants and commercial offices. Additionally, it will house 4,000 apartments and 2,500 villas. 

“Baghdad Avenue will be a distinguished project and a surprise to all Iraqis. It is the largest mall in Iraq and will include cafes and restaurants with large areas and commercial offices for major Iraqi companies,” Al-Shammari said.
“Iraqi and Saudi relations are witnessing a wonderful stage,” he added. 

Al-Shammari highlighted the recent visit of the King Salman Medical Center’s team to Baghdad, stating that the knowledge exchange between Iraqi and Saudi doctors epitomizes the strong relations between the two countries. 

“Today, we started reaping its real fruits through the visit of the King Salman Medical Center team to Baghdad, which is the first specialized and practical visit through which we witness the exchange of experiences between the best-skilled doctors in the Kingdom, as well as the best Iraqi doctors, to exchange experiences in fields and subspecialties, which is the first fruit,” he said. 

Al-Shammari also noted that both countries would soon host meetings featuring economic and cultural discussions. He stated: “The subsequent phase will witness significant momentum in activities occurring between the two nations.” 

In March, Saudi Public Investment Fund created a new company to invest in various industries across Iraq, with a capital of $3 billion. 

The Saudi-Iraqi Investment Co. will invest in infrastructure, mining, agriculture, real estate development and financial services, CEO Muteb Al-Shathri said during the Saudi-Iraqi Coordination Council held in the Kingdom. 


Oil Updates — crude prices up on Saudi Arabia’s production cut decision

Oil Updates — crude prices up on Saudi Arabia’s production cut decision
Updated 05 June 2023

Oil Updates — crude prices up on Saudi Arabia’s production cut decision

Oil Updates — crude prices up on Saudi Arabia’s production cut decision

RIYADH: Oil prices were up nearly $1 a barrel on Monday after Saudi Arabia pledged to cut production by another 1 million barrels per day from July. 

Brent crude futures were at $77.07 a barrel, up 94 cents, or 1.23 percent, at 9:05 a.m. Saudi time, while US West Texas Intermediate crude climbed 96 cents or 1.34 percent to $72.70 a barrel. 

The contracts extended gains of over 2 percent on Friday after the Saudi energy ministry said the Kingdom’s output would drop to 9 million barrels per day in July from around 10 million bpd in May. The cut is Saudi Arabia’s biggest in years. 

The voluntary cut pledged by Saudi on Sunday is on top of a broader deal by the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, to limit supply into 2024 as the group seeks to boost flagging oil prices. 

OPEC+ pumps around 40 percent of the world’s crude and has cuts of 3.66 million bpd in place, amounting to 3.6 percent of global demand. 

Russia fully enforces its oil output cuts, Novak says 

Russian Deputy Prime Minister Alexander Novak told Rossiya-24 TV channel on Sunday following a meeting of the OPEC+ group that Russia is fulfilling its oil output cut obligations. 

“The result of the discussions was the extension of the deal until the end of 2024,” Novak said. 

Separately, Novak’s office said that Russia would tweak its crude oil production level to 9.828 million bpd from Jan. 1, and considering earlier announced additional voluntary reduction of 500,000 bpd, its output target will stand at around 9.3 million bpd. 

Novak also said the market is more or less balanced, and demand is rising. However, the group would monitor interest rate decisions by global central banks, including the US Federal Reserve, for clues on the economy that could influence fuel consumption. 

“That’s the indicator (interest rate decisions), which is having an impact on investments, on demand for oil and oil products,” he said. 

Novak also said that OPEC+ could adjust its decisions if necessary. 

He said the data from secondary sources related to the OPEC+ voluntary cuts starting from May would emerge in the middle of this month. 

(With input from Reuters) 


UAE’s non-oil outlook positive despite slight PMI dip in May  

UAE’s non-oil outlook positive despite slight PMI dip in May  
Updated 05 June 2023

UAE’s non-oil outlook positive despite slight PMI dip in May  

UAE’s non-oil outlook positive despite slight PMI dip in May  

RIYADH: The UAE’s non-oil private sector growth outlook remained positive in May, even as the seasonally adjusted S&P Global Purchasing Managers’ Index fell to 55.5 compared to 56.6 in April.  

The S&P Global report noted that improved operating conditions drove business confidence to its strongest levels since October 2021.  

According to the index, PMI readings above 50 show non-oil private sector growth, while those below 50 signal contraction.  

“The UAE PMI pointed to another strong performance across the non-oil sector midway through the second quarter of 2023. Despite slipping from April’s six-month high of 56.6, the latest headline reading of 55.5 signaled a robust improvement in business conditions, driven by marked upturns in activity and new work,” said David Owen, senior economist at S&P Global Market Intelligence.  

He added: “The Future Output Index showed optimism rising to the highest level since October 2021, with firms pinning their hopes on projections that the strong run of demand momentum will continue.” 

 


Saudi Arabia’s non-oil sector growth steady as PMI clocks 58.5 in May

Saudi Arabia’s non-oil sector growth steady as PMI clocks 58.5 in May
Updated 05 June 2023

Saudi Arabia’s non-oil sector growth steady as PMI clocks 58.5 in May

Saudi Arabia’s non-oil sector growth steady as PMI clocks 58.5 in May

RIYADH: Saudi Arabia’s non-oil sector posted substantial momentum in May according to a business survey, as the Kingdom’s economic diversification strategy continues to progress. 

The latest Riyad Bank Saudi Arabia Purchasing Managers’ Index report, formerly the S&P Global Saudi Arabia PMI, revealed that the Kingdom’s PMI stood at 58.5 in May, well above the 50 reading, indicating economic growth. 

This was a slight drop compared to the 59.6 figure in April. 

Naif Al-Ghaith, chief economist at Riyad Bank, said despite the small decrease the high figure reinforces the view that overall economic activity in Saudi Arabia is “holding up well.”

He added: “The Kingdom’s non-oil GDP (gross domestic product) is likely to have notably grown in the second quarter this year thanks to the healthy state of the private sector. 

“While a slower oil economy and rising interest rates will create a challenging environment for some establishments, most Saudi firms are in good shape and experiencing robust business conditions.”

The report pointed out that new order inflows at non-oil private sector businesses in the Kingdom significantly gained momentum in May after growth quickened to its highest in just over eight-and-a-half years in April. The rate of expansion, however, slowed slightly despite a renewed upturn in sales from foreign clients. 

According to the report, the rise in new orders positively impacted the tourism and construction sectors in Saudi Arabia, which ultimately resulted in a rise in job creation in May. 

“New orders grew considerably, reflecting a strong demand growth, particularly in tourism activities and construction. This led to the joint-fastest rate of job creation since 2018 which allowed firms to work through backlogs at a quicker pace this month,” added Al-Ghaith. 

He further noted that higher employment and activity levels drove wages to rise at the second-fastest pace in seven years, leading to a “sustained markup in prices charged to consumers.” 

According to the report, business expectations for the next 12 months eased slightly in May, but firms are anticipating improved market conditions, strong sales and supportive government economic policy to aid growth prospects. 

Al-Ghaith noted that the development of giga-projects in the country aimed at diversifying the economy will continue driving the growth of the private sector for the remaining months of this year. 

“The government continues to implement large-scale diversification policies and accelerate the development of giga-projects, aiming to boost the private sector, the engine for job creation. Therefore, we are confident that the non-oil sector will play a predominant role in driving growth this year, supported by increased investments and robust demand,” said Al-Ghaith.


Saudi Arabia to cut oil output in July, extend OPEC+ voluntary cut until end of 2024

Saudi Arabia’s Minister of Energy Prince Abdulaziz bin Salman arrives for an OPEC meeting in Vienna, Austria, June 3, 2023.
Saudi Arabia’s Minister of Energy Prince Abdulaziz bin Salman arrives for an OPEC meeting in Vienna, Austria, June 3, 2023.
Updated 04 June 2023

Saudi Arabia to cut oil output in July, extend OPEC+ voluntary cut until end of 2024

Saudi Arabia’s Minister of Energy Prince Abdulaziz bin Salman arrives for an OPEC meeting in Vienna, Austria, June 3, 2023.
  • OPEC+ member countries agreed a new output target of 40.46 million bpd from 2024

RIYADH: Saudi Arabia will extend its voluntary cut of 500,000 bpd until the end of December 2024, in coordination with some countries participating in the OPEC+ agreement, the Kingdom’s energy ministry said on Sunday.

This voluntary reduction from the required production level was agreed upon at the OPEC+ meeting held on Sunday, the ministry added.

The ministry also announced an additional voluntary oil output cut of 1 million bpd for July, which could be extended further.

This would mean that the Kingdom’s production becomes 9 million bpd, and its total voluntary cut will be 1.5 million bpd in July, Saudi Press Agency reported.

The ministry said the additional voluntary cut comes to reinforce the precautionary efforts made by OPEC+ countries that aim to support the stability and balance of oil markets.

OPEC+ member countries also agreed a new output target of 40.46 million bpd from 2024, a statement issued by the group said.