EU’s Michel to discuss energy on Doha trip this week, says Qatari official

EU’s Michel to discuss energy on Doha trip this week, says Qatari official
European Council President Charles Michel is expected to visit Qatar on Tuesday. (File)
Short Url
Updated 04 September 2022

EU’s Michel to discuss energy on Doha trip this week, says Qatari official

EU’s Michel to discuss energy on Doha trip this week, says Qatari official

DOHA: European Council President Charles Michel will hold talks with major gas producer Qatar on Europe’s energy crisis during a visit to Doha this week, a Qatari government official said on Sunday.

Michel is expected to visit Qatar on Tuesday, according to his official schedule.

European governments have been seeking alternatives to gas from main supplier Russia since Moscow ordered troops into Ukraine in late February, with Europe’s power costs surging as Russian flows dropped.

State-owned QatarEnergy, one of the world’s top natural gas exporters, has been negotiating with several European buyers for months, but no new deals have been announced.

“Charles Michel will meet several high-level officials to discuss and review regional and international issues including the Russia-Ukraine crisis, energy crisis, in addition to a number of other issues like Afghanistan, Iran, and Palestine-Israel,” the Qatari official told Reuters.

European leaders, already struggling to manage soaring gas prices, fear winter gas shortages as Russia announced plans to keep its major gas pipeline to Europe shut. Russia typically provides 40 percent of Europe’s natural gas. Most current volumes of Qatari natural gas are locked into long-term contracts, mainly with buyers in Asia, which Qatar has said it will honor.

However, QatarEnergy could begin supplying Germany with gas from the Golden Pass natural gas plant in Texas, in which it owns a majority stake, as early as 2024, Qatar’s deputy prime minister told a German newspaper in May.

Additionally, Qatar is seeking new customers for a major expansion of its gas output which will boost its exports by some 63 percent and is set to come online in early 2027.


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 38 min 17 sec ago

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.


Saudi Arabia, China contemplate energy security through petrochemical JVs

Saudi Arabia, China contemplate energy security through petrochemical JVs
Updated 04 June 2023

Saudi Arabia, China contemplate energy security through petrochemical JVs

Saudi Arabia, China contemplate energy security through petrochemical JVs

RIYADH: Saudi Arabia and China are collaborating to ensure safe energy supplies in their markets by planning to establish petrochemical joint ventures.

Saudi Minister of Energy Abdulaziz Al-Saud held a meeting with the chairman of the National Energy Authority of the Republic of China, Zhang Jianhua, in Riyadh to discuss JVs that will transform crude oil into petrochemicals and develop innovative uses of hydrocarbons, nuclear energy and fuel. 

Both nations are working to increase collaboration in the energy sector’s supply chains. 

Al-Saud and Zhang also discussed ways to boost ties between the countries in numerous energy fields, which will help achieve the goals outlined in Saudi Vision 2030 and China’s Belt and Road Initiative. 

Further collaborations between both countries are anticipated as the Kingdom is set to host the 10th session of the Arab-Chinese Business Conference and the eighth Investment Symposium. 

Set to take place between June 11 and 12 in Riyadh, the conference is expected to be the largest Arab-Chinese gathering for business and investment. 

It will host over 2,000 participants, including high-level government representatives, senior officials, CEOs, investors and entrepreneurs.

“Collaborating for Prosperity” aims to boost cooperation in the economy, trade and investment to achieve solutions of mutual interest to Arab nations and China through strategic collaboration. 

It is organized by the Kingdom’s investment and foreign affairs ministries in partnership with the Chinese Council for the Promotion of International Trade and several government agencies. 

Saudi Investment Minister Khalid Al-Falih said that trade and cultural ties between Arab countries and China extended over 2,000 years and that the conference reflected that historical relationship. 

He added that Saudi-Chinese relations had developed, especially following King Salman’s visit to China in 2017 and the two historic visits by Crown Prince Mohammed bin Salman to Beijing in 2016 and 2019. 

Trade in 2022 between the Arab countries and China reached SR1.6 trillion ($430 billion), a 31 percent increase from the previous year. 

Saudi Arabia led the way with trade between the countries reaching around SR400 billion ($106 billion), a 30 percent increase over 2021.