Oil Updates — Prices fluctuate; China’s crude oil imports hit 10-month high

Oil Updates — Prices fluctuate; China’s crude oil imports hit 10-month high
US crude futures clawed back earlier losses and were steady from the previous close at $74.25 a barrel. (Shutterstock)
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Updated 07 December 2022

Oil Updates — Prices fluctuate; China’s crude oil imports hit 10-month high

Oil Updates — Prices fluctuate; China’s crude oil imports hit 10-month high

RIYADH: Oil prices continue fluctuating on Wednesday after Brent crude earlier fell close to its lowest in 2022, as hopes of higher Chinese demand offset concerns about recession and eased fears that a Western cap on Russian oil prices would curb supply.

China announced on Wednesday the most sweeping changes to its anti-COVID regime since the pandemic began, loosening rules that curbed the spread of the virus but hobbled the world’s second largest economy and sparked protests.

Brent crude was down 11 cents at $79.24 a barrel by 04.00 p.m Saudi time. It touched $77.74 earlier, the lowest since Jan. 3.

US West Texas Intermediate crude added .03 cents, or 0.04 percent, to $74.28, after touching $72.75 a barrel, the lowest since late December.

China November crude oil imports hit 10-mth high 

China’s crude oil imports in November rose 12 percent from a year earlier to their highest in 10 months, data showed on Wednesday, as companies replenished stocks with cheaper oil and new plants started up. 

The world’s largest crude importer brought in 46.74 million tons of crude oil last month, equivalent to 11.37 million barrels per day, according to data from the General Administration of Customs. 

That was up from 10.16 million bpd in October and 10.17 million bpd in November 2021. 

Chinese state refiners stepped up purchases of US crude oil, taking advantage of arbitrage opportunities, while maintaining high imports of Russian oil ahead of the Dec. 5 European embargo and imposition of an oil price cap. 

Independent traders last month also moved a record amount of deeply discounted Iranian crude passed off as oil sourced from Malaysia, Oman or elsewhere in the refining hub of Shandong province, according to tanker tracker Vortexa Analytics. 

The higher imports resulted in a crude oil stock build of 41 million barrels over the month, Vortexa estimated. 

Imports for the first 11 months of the year totaled 460.26 million tons, or about 10.06 bpd, down 1.4 percent from last year’s corresponding period. 

Wednesday’s data also showed fuel exports reached 6.144 million tons, the highest since June 2021 and up from 4.456 million tons in October, reflecting Beijing’s additional release of quotas. 

Year-to-date exports, at 46 million tons, remained 19 percent below year-ago levels due to a broad curb on fuel exports earlier in the year. 

Turkish straits tanker delays not due to Russia oil price cap: official 

Disruptions in tanker traffic from Russia’s Black Sea ports to the Mediterranean result from a new Turkish insurance rule, not the price cap on Russian oil agreed by a coalition of Group of Seven countries and Australia, an official with the group said on Tuesday. 

Of the 20 loaded crude oil tankers facing delays in the region, all but one appear to be carrying Kazakh — not Russian — origin oil and would not be subject to the price cap “under any scenario,” the official said. 

“There should be no change in the status of their insurance from Kazakh shipments in previous weeks or months,” the official added. 

Markets are closely watching the impact of a G7-led price cap on Russian seaborne oil that took effect on Monday, but G7 officials say the measure did not cause the backup in Turkiye’s Bosphorus and Dardanelles straits into the Mediterranean. 

 “The price cap policy does not require ships to seek unique insurance guarantees for each individual voyage, as required under Turkiye’s rule,” the official said. “These disruptions are the result of Turkiye’s rule, not the price cap policy.” 

(With input from Reuters)  

Egypt fintech firm MNT-Halan securing $400m in new finance

Egypt fintech firm MNT-Halan securing $400m in new finance
Updated 9 sec ago

Egypt fintech firm MNT-Halan securing $400m in new finance

Egypt fintech firm MNT-Halan securing $400m in new finance

CAIRO: Egyptian microfinance lending and payments company MNT-Halan is securing $400 million in new equity and finance, bringing its valuation to more than $1 billion, the company said in a statement on Wednesday.

The investments include an equity stake of at least 20 percent of MNT-Halan worth more than $200 million taken by private equity firm Chimera Abu Dhabi. Another $60 million in primary capital is being secured from international investors, the statement said.

These investors include the International Finance Corporation, according to data on the IFC's website.

MNT-Halan obtained $140 million in financing by securitizing part of its loan book, the statement said.

MNT-Halan provides small- and micro-business lending, payments, consumer finance and e-commerce, the company said. It has more than 5 million customers in Egypt, of which 3.5 million are financial clients and 2 million are borrowers. About 1.3 million of the customers are active monthly.

New legislation and regulatory changes in Egypt, the Arab world's most populous country, have been helping attract a surge in new fintech investments and change the way the country's largely unbanked citizens do business.

"Following the completion of these investments, MNT-Halan’s valuation will exceed $1 billion," the statement added.

Previous investors in MNT-Halan include Cairo-based Lorax Capital Partners, and Middle Eastern venture capitalists Algebra Ventures, DisrupTech, Endeavor Catalyst, Egypt Ventures, MEVP and Wamda.

UAE's DFM net profit up 41.7% to $40m in 2022 

UAE's DFM net profit up 41.7% to $40m in 2022 
Updated 12 min 51 sec ago

UAE's DFM net profit up 41.7% to $40m in 2022 

UAE's DFM net profit up 41.7% to $40m in 2022 

RIYADH: Dubai Financial Market Co. reported an increase of 41.7 percent in net profit to 147.1 million dirhams ($40 million) for the fiscal year ending on Dec. 31, 2022, compared to 103.8 million dirhams in 2021. 

The company recorded a total revenue of 351.2 million dirhams, up 19 percent compared to the previous year’s 294.6 million dirhams. 

In the fourth quarter of 2022, DFM posted a net profit of 58.1 million dirhams compared to 65.7 million dirhams in the corresponding period of 2021, according to a press release. 

Its total revenue for the period reached 113.4 million dirhams, compared to 111.5 million dirhams in the fourth quarter of 2021.  

Helal Al Marri, chairman of DFM said: “Our relentless focus on our capital markets development strategy has borne fruit, making DFM one of the most active markets globally for new IPOs and listings with the successful listing of 5 IPOs for leading government-related and private companies.” 

The company’s board of directors also recommended the distribution of a cash dividend of 134.7 million dirhams, equivalent to 1.68 percent of the capital and 100 percent of the total retained earnings available for distribution, it added.  

Moreover, the board also resolved to submit a recommendation to the annual general meeting to adopt a new fixed dividend policy, stipulating that the company annually distributes a minimum of 50 percent of its net profit as opposed to the current practice of cash dividend every two years. 

DFM ended the year on a strong note with trading value increased by 24.5 percent to 90 billion dirhams compared to 2021, and the market capitalization of listed securities increased by 41.4 percent to 582 billion dirhams.  

Over the past year, DFM has attracted 167,332 new investors, registering 23 times jump compared to 2021.  

Saudi National Bank 2022 net profit surges 47% to $4.96bn 

Saudi National Bank 2022 net profit surges 47% to $4.96bn 
Updated 13 min 53 sec ago

Saudi National Bank 2022 net profit surges 47% to $4.96bn 

Saudi National Bank 2022 net profit surges 47% to $4.96bn 

RIYADH: Saudi National Bank reported a 46.7 percent increase in net profit in 2022 to SR18.6 billion ($4.96 billion) from SR12.7 billion in 2021, spurred by higher operating income and a decline in provisions for expected credit losses. 

The Kingdom’s biggest bank, which last year acquired a 9.88 percent stake in the troubled Swiss investment institution Credit Suisse, also booked a 61 percent surge in net profit in the fourth quarter of 2022 to SR4.8 billion from SR2.96 billion during the same period in 2021. 

The results beat the average analyst estimate of SR18.2 billion, according to Refinitiv data. 

The bank said in a statement to the Saudi Stock Exchange that total operating income grew 16.9 percent to SR33 billion in 2022 from SR28.23 billion in 2021.  

Its net special commission income jumped 18.4 percent to SR26.29 billion between January and December 2022 from SR22.21 billion in 2021. 

“Total operating income increased mainly due to higher net special commission income by 18.4 percent, fee income from banking services by 21.1 percent, and lower other operating expenses by 12.4 percent,” the bank said in a statement to Tadawul. 

Moreover, total operating expenses, including impairments, were lower by 15.2 percent, mainly due to a 13.5 percent decline in other general and administrative expenses and a 57.4 percent fall in a net impairment charge for expected credit losses. 

Earnings per share clocked an impressive 46.7 percent increase to SR4.15 in 2022 from SR2.83 in 2021. 

SNB’s total assets also increased 3.43 percent to SR945.46 billion in 2022 from SR914.15 billion in 2021, even as loans and advances gained 9.6 percent to SR543.31 billion to SR497.57 billion during the period under review. 

Customer deposits, however, dropped 3.45 percent to SR568 billion in 2022 compared to SR588.57 in 2021. 

Last month, SNB announced its intention to raise its paid-up capital by SR15.22 billion to boost its financial position. Its board recommended that shareholders approve the increase in capital by about 34 percent, from SR44.78 billion to SR60 billion riyals, through the issuance of bonus shares. 

“The recommendation is aimed to strengthen the bank’s financial position, which contributes to achieving its strategic objectives,” the bank said in a statement to Tadawul. 

The bank will issue about one bonus share for every three owned by shareholders, it said. 

“The eligibility of the bonus shares shall be for shareholders owning shares by the end of the trading day of the bank’s extraordinary general assembly meeting, which will be announced at a later date,” the bank said.

UAE’s national digital economy to touch $140bn by 2031: report

UAE’s national digital economy to touch $140bn by 2031: report
Updated 01 February 2023

UAE’s national digital economy to touch $140bn by 2031: report

UAE’s national digital economy to touch $140bn by 2031: report

RIYADH: The UAE’s national digital economy is expected to surge from $38 billion today to $140 billion by 2031, as the Emirate successfully pursues its digital transformation journey, according to a new report. 

The forecast, released by the Dubai Chamber of Digital Economy – one of three chambers operating under Dubai Chambers – noted that it plans to attract over 300 digital startups and 100 tech experts to Dubai by 2024. 

Dubai Chambers is also eyeing implementing new laws and policies, organizing a conference, promoting digital transformation, and enhancing the business environment to attract global digital firms to the Emirate, state news agency WAM reported. 

The UAE’s Minister of State for Artificial Intelligence, Digital Economy, and Remote Work Applications and Chairman of the Dubai Chamber of Digital Economy, Omar Sultan Al Olama, said that Dubai aims to become a key technological hub in the region. 

He added that the goal is to double the contribution of the digital economy to the UAE’s gross domestic product from 9.7 percent now to over 20 percent by 2031. 

Al Olama also emphasized the vitality of developing world-class digital infrastructure and supporting the dynamic startup ecosystem to drive digital transformation and sustainable business growth in the UAE. 

He further stressed the importance of raising awareness about challenges and future trends in the technological space, and also highlighted the necessity of embracing digital technology for sustainable business growth.

In April 2022 the UAE Cabinet approved a new Digital Economy Strategy, which includes more than 30 initiatives and programs targeting six sectors and five new areas of growth. 

Saudi Real Estate Refinance looks to debut dollar sukuk in Q2

Saudi Real Estate Refinance looks to debut dollar sukuk in Q2
Updated 01 February 2023

Saudi Real Estate Refinance looks to debut dollar sukuk in Q2

Saudi Real Estate Refinance looks to debut dollar sukuk in Q2

DUBA: The Saudi Real Estate Refinance Co., the kingdom's equivalent of US mortgage finance business Fannie Mae, plans to issue debut dollar-denominated sukuk between the end of the first and second quarters of this year, its chief executive said.

The company, a regular issuer of local currency Islamic bonds, initially aimed to issue its inaugural dollar sukuk last year.

SRC, owned by the sovereign Public Investment Fund, is working to help Saudi Arabia reach its goal of boosting Saudi home ownership to 70 percent as part of Vision 2030 reforms to reduce the economy's reliance on oil.

Some of the documentation for the dollar issuance "needed to be revamped, readjusted with some discussions with some of our stakeholders," SRC CEO Fabrice Susini told Reuters, without giving details.

SRC will raise at least $500 million, Susini said. JPMorgan, Societe Generale, GIB, HSBC and Islamic Development Bank, which set up the dollar issuance programme, will arrange the debt sale, he added.

"We were a bit lucky ... not having to issue internationally" last year, he said, as the US Federal Reserve hiked rates at a rapid clip to tame decades-high inflation, with the Saudi Central Bank closely mirroring the moves despite lower inflation, as the riyal is pegged to the dollar.

Issuance in local currency will remain "alive and active," Susini said, adding the firm could eventually issue euro-denominated bonds "if at one point the rates are attractive enough and interest is there," while hedging would also be a consideration.

The impact of rising rates on SRC has been "limited" as roughly 70 percent to 80 percent of its mortgages are fixed rate, Susini said.

New residential mortgages provided by banks fell 23.4 percent last year to 154,392, having already dropped 10.5 percent in 2021 from 2020, data from SAMA showed.

"There is the cost for mortgage borrowers that could put some of them off buying. And then there is also perhaps a slight slowdown with the banks which see these prices going up and not being sure of what conditions they will refinance themselves," Susini said.

SRC has no plans currently in place for an initial public offering but it "could make sense" in the coming years, Susini said, adding PIF would keep at least a 51 percent stake.