Oil Updates — Crude steady; Myanmar to import Russian oil; Phillips 66 offers to buy pipeline operator DCP Midstream

Oil Updates — Crude steady; Myanmar to import Russian oil; Phillips 66 offers to buy pipeline operator DCP Midstream
Brent crude futures climbed 10 cents, or 0.1 percent, to $93.75 a barrel by 0347 GMT.  (Shutterstock)
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Updated 18 August 2022

Oil Updates — Crude steady; Myanmar to import Russian oil; Phillips 66 offers to buy pipeline operator DCP Midstream

Oil Updates — Crude steady; Myanmar to import Russian oil; Phillips 66 offers to buy pipeline operator DCP Midstream

RIYADH: Oil prices were little changed on Thursday as investors grappled with falling stockpiles in the US, rising output from Russia and worries about a potential global recession.

Brent crude futures climbed 10 cents, or 0.1 percent, to $93.75 a barrel by 0347 GMT. 

US crude futures gained 10 cents, or 0.1 percent, to $88.21 a barrel.

Myanmar to import Russian oil, military says

Military-ruled Myanmar plans to import Russian gasoline and fuel oil to ease supply concerns and rising prices, a junta spokesperson said, the latest developing country to do so amid a global energy crisis.

The Southeast Asian country has maintained friendly ties with Russia, even as both remain under a raft of sanctions from Western countries — Myanmar for a military coup that overthrew an elected government last year, and Russia for its invasion of Ukraine, which it calls a “special military operation.”

Russia is seeking new customers for its energy in the region as its biggest export destination, Europe, will impose an embargo on Russian oil in phases later this year.

“We have received permission to import petrol from Russia,” military spokesperson Zaw Min Tun said during a news conference on Wednesday, adding that it was favored for its “quality and low cost.”

Fuel oil shipments are due to start arriving from September, according to media.

Phillips 66 offers to buy pipeline operator DCP Midstream

US refiner Phillips 66 on Wednesday offered to acquire the public units of DCP Midstream in a deal that would value the pipeline operator at a $7.2 billion deal and bulk up Phillip’s natural gas liquids business.

A deal would mark the first major move by Mark Lashier, who took over as the CEO of Phillips 66 last month. Earlier this year, the company acquired the public units in the transportation and storage business Phillips 66 Partners.

Canadian pipeline operator Enbridge, which owned 50 percent of DCP’s general partner, said it would reduce its stake in the company to 13.2 percent from 28.3 percent. It received a $400 million cash payment from Phillips 66 as part of the deal.

Enbridge will, in turn, take over as operator and more than double its stake in the Grey Oak pipeline, previously operated by Phillips 66. The Grey Oak pipeline transport crude oil from West Texas to the Gulf Coast.

Phillips 66’s economic interest in the Gray Oak pipeline will fall to 6.50 percent from 42.25 percent.

Aker Energy postpones Ghana oilfield plan amid Lukoil’s involvement

Norway’s Aker Energy said on Wednesday it would postpone the submission of a development plan for its Pecan oilfield off Ghana amid concern the project could face sanctions over the war in Ukraine due to the involvement of Russian oil firm Lukoil.

Aker Energy, controlled by Aker ASA, owns 50 percent in the deepwater block off Ghana where the Pecan field is located, while Lukoil holds 38 percent, Ghana National Petroleum Corporation has 10 percent and Fueltrade 2 percent.

The partners will not submit a development plan to Ghanaian authorities “until the challenges have been resolved,” Aker ASA CEO Oeyvind Eriksen told a call with analysts.

Russia invaded Ukraine in February in what it calls “a special military operation,” prompting unprecedented Western sanctions on Moscow and a breakup of economic relations.

“We are continuing a dialogue with Lukoil and Ghanaian authorities about possible solutions,” Eriksen told Reuters, adding that one option was for Lukoil to divest from the project.

Aker said Ghanaian authorities have extended a deadline to submit the plan until Sept. 30.

(With input from Reuters)


Saudi riyal unflinching while Fed hikes harm major global currencies

Saudi riyal unflinching while Fed hikes harm major global currencies
Updated 20 sec ago

Saudi riyal unflinching while Fed hikes harm major global currencies

Saudi riyal unflinching while Fed hikes harm major global currencies

RIYADH: The US Federal Reserve’s most aggressive interest hikes since the 1980s have pulled several currencies across the world to new lows, while the Saudi riyal seems unflinching.

The Kingdom’s currency has dipped just 0.2 percent against the US dollar compared to the same date last year, in contrast to other markets.

On Sept. 21, the US Federal Reserve hiked the short-term interest rates by 75 basis points to 3 to 3.25 percent.

Since the announcement, several investors took their money out of other markets to invest in the US, thus pulling global financial markets to a state of volatility.

The Chinese onshore yuan is sliding toward 7.2 per dollar, down 10.9 percent from the same date last year, while the People’s Bank of China is setting up defenses to protect the currency, according to Reuters data.

On Sept. 26, the Indian rupee plunged 8.7 percent year-to-date to an all-time low of 81.67 against the US dollar.

Soon after the Fed hike, the British pound started falling, and it reached an all-time low on Sept. 26 before starting to show signs of recovery. The fall of the British pound is also due to the tax cuts announced by the new Liz Truss government.

At one point on Monday, the pound sank as low as $1.0327, surpassing the previous record low reached in 1985, before recovering some of its value. 

The Pakistan rupee also nosedived following the Fed hike, with one US dollar now equal to 233.79 Pakistani rupees.

Other major currencies like the Egyptian pound and the Australian dollar fell 19.5 percent and 11.1 percent year-to-date respectively.

Meanwhile, Chicago Fed President Charles Evans said on Tuesday the Federal Reserve will need to raise interest rates to a range between 4.50 percent and 4.75 percent.


Riyad REIT Fund invests $17m in private real estate fund

Riyad REIT Fund invests $17m in private real estate fund
Updated 4 min 19 sec ago

Riyad REIT Fund invests $17m in private real estate fund

Riyad REIT Fund invests $17m in private real estate fund

RIYADH: Riyad REIT Fund has invested SR62 million ($17 million) in a private closed-end real estate fund that is income-generating and Shariah-compliant, according to a bourse filing.

The private fund, which is managed by Riyad Capital, seeks to achieve stable current income and long-term capital growth by investing in top-tier institutional real estate assets located in prime Saudi Arabian locations.

The private real estate fund has a target size of SR3 billion, and the initial closing amount is SR315 million.

The fund has a term of 20 years that can be extended for an additional five years.

The investment will generate 8.5 percent per year in return over a five-year period if it is invested semi-annually, it added.


Zain KSA integrates latest Huawei 5G technology into its network 

Zain KSA integrates latest Huawei 5G technology into its network 
Updated 23 min 14 sec ago

Zain KSA integrates latest Huawei 5G technology into its network 

Zain KSA integrates latest Huawei 5G technology into its network 

RIYADH: Mobile telecom operator Zain KSA has collaborated with Chinese mobile technology firm Huawei to integrate the third generation of 5G solutions into its network across the Kingdom. 

This new RAN product MetaAAU technology integration will enable Zain KSA to offer a wide range of services to its customers through expanding coverage and capacity and increasing the network speed.

As MetaAAU uses extremely large antenna array architecture, multi-channel technology, and innovative algorithms, Huawei's most advanced products are able to offer double the scale of arrays compared with the previous-generation AAU.

This solution can improve network performance while slashing energy consumption, the company said in a press release. 

This comes as Zain KSA looks to support more 5G use cases, including cloud computing, the internet of things, artificial intelligence and machine learning solutions while continuing to deliver better user experiences. 

“This new upgrade to our 5G network serves our strategic goal to deliver world-class 5G experiences that match up to Saudi Vision 2030’s goals of transforming the Kingdom into a digital economy hub powered by Industry 4.0 and supporting a high quality of life for its communities,” Chief Technology Officer at Zain KSA, Abdulrahman Al-Mufadda said. 

He added: “Building on our elaborate 5G infrastructure, we launched the 5G carrier aggregation feature in 2020, achieving ultra-fast Internet speeds of 2.4 Gbps.” 

Now with the accelerating industry ecosystem development, and as more and more 5G smartphones support this feature, Al-Mufadda said they are extending the population coverage of 5G dual carriers and bringing the ultra-fast user experience to more customers.

President of Huawei 5G Product Line, Ritchie Peng said, “We will continue to provide innovative solutions to help Zain KSA to build the leading performance network and provide a better user experience to end users.”


SAPTCO wins $23m bus transportation project with Taif Municipality

SAPTCO wins $23m bus transportation project with Taif Municipality
Updated 26 min 36 sec ago

SAPTCO wins $23m bus transportation project with Taif Municipality

SAPTCO wins $23m bus transportation project with Taif Municipality

RIYADH: The Saudi Public Transport Co. has been awarded an SR88 million ($23 million) bus project with Taif Municipality.

The five-year project will have a positive impact on the company's revenues during the first half of 2023, it said in a bourse filing.

Founded in 1979, SAPTCO operates urban buses in Riyadh, Jeddah, and Mecca; intercity buses; and international buses to the UAE, Egypt, Jordan, and Bahrain.


Capital Market Authority approves amending business list of BNP Paribas Saudi Arabia

Capital Market Authority approves amending business list of BNP Paribas Saudi Arabia
Updated 37 min 12 sec ago

Capital Market Authority approves amending business list of BNP Paribas Saudi Arabia

Capital Market Authority approves amending business list of BNP Paribas Saudi Arabia

RIYADH: Saudi Arabia’s Capital Market Authority has approved the request of BNP Paribas Investment Co. to amend the list of businesses it is licensed to practice.

Following the amendment, the investment service provider will be authorized to conduct dealing, keeping, arranging, and advising in securities business, according to a statement. 

Established in 2009, BNP Paribas Investment Co. Saudi Arabia is a private limited company based in Riyadh.

Operating in the investment services sector, the organization is owned by French-based enterprises.

In March 2021, BNP Paribas appointed Reema Al-Asmari as head of territory for Saudi Arabia, to bolster the French bank’s corporate and investment banking presence in the Kingdom.

This comes in line with the Kingdom’s Vision 2030’s reform plan, as Saudi Arabia aims for female participation in the labor force to be at 30 percent by 2030, a target it has now achieved ahead of schedule.

The appointment came following a report by the global ratings agency Moody’s that found that rising female participation in the labor force has the potential to boost Saudi Arabia’s non-oil growth and improve average household incomes.