Oil Updates — Crude posts gain; Qatar, UAE ministers say gas needed for long time 

Oil Updates — Crude posts gain; Qatar, UAE ministers say gas needed for long time 
Brent crude futures settled at $85.28 a barrel, up by $1.25, or 1.5 percent. (Shutterstock)
Short Url
Updated 15 January 2023

Oil Updates — Crude posts gain; Qatar, UAE ministers say gas needed for long time 

Oil Updates — Crude posts gain; Qatar, UAE ministers say gas needed for long time 

RIYADH: Oil prices settled more than a dollar a barrel higher on Friday, notching their biggest weekly gains since October, as the US dollar dropped to a seven-month low and more indicators pointed toward growing demand from top oil importer China. 

Brent crude futures settled at $85.28 a barrel, up by $1.25, or 1.5 percent. West Texas Intermediate crude futures rose for the seventh-straight session to settle at $79.86a barrel, up by $1.47, or 1.9 percent. 

Brent gained 8.6 percent this week, while WTI rose by 8.4 percent, recouping most of the previous week’s losses. 

Qatar, UAE energy ministers say gas will be needed for long time 

The world will need natural gas for a long time and more investment is required to ensure supply security and affordable prices during the global energy transition, energy ministers of Qatar and the UAE said on Saturday.

Saad Al-Kaabi, Qatari state minister for energy, told the Global Energy Summit in Abu Dhabi that gas “is not a transition fuel” but a destination fuel, adding it was unfair for some in the West to say African countries should not be drilling for oil and gas. 

UAE Energy Minister Suhail Al-Mazrouei, speaking on the same panel, agreed that “for a very long time, gas will be there” and that while more renewable energy would be installed, more investment was needed in gas as a base load. 

Guyana’s oil exports double, with Europe taking half of cargo 

Guyana’s oil exports jumped 164 percent last year, boosted by growing output and demand for the newest Latin American oil producer’s light sweet crudes, particularly in Europe, where thirsty refiners ramped up imports to replace Russian supplies. 

Since a consortium led by Exxon Mobil began pumping in late 2019, Guyana’s shipments have soared, bringing the South American nation’s oil export income to $1.1 billion last year, according to official figures provided to Reuters. 

The government’s $1.1 billion share of oil revenue was up sharply from a combined $409 million in profit and royalties in 2021. High global prices pushed its take above the country’s initial revenue forecast of $958 million. 

Guyana, among the smallest and most underdeveloped nations in South America, plans to use its oil wealth to industrialize, adding a gas-fired power plant, new roads and solar energy projects. 

Following the startup of Exxon’s second floating production vessel last February, output ramped up and exports flowed as European refiners were searching for alternatives to Russian oil in the aftermath of the Ukraine invasion. 

Guyana is producing about 360,000 barrels per day of oil and aims to raise output to 1.64 million bpd by end of the decade. 

Guyana’s exports averaged 265,693 bpd last year, more than double the 100,645 bpd in 2021, according to shipping data from Refinitiv Eikon. Europe was the largest receiver, taking 49 percent of the cargo. Its volumes outpaced Asia, which had been the first destination previously, taking 34 percent last year. 

(With input from Reuters) 

 


SEVEN and Hasbro join to develop Play-Doh themed centers in Saudi Arabia 

SEVEN and Hasbro join to develop Play-Doh themed centers in Saudi Arabia 
Updated 12 sec ago

SEVEN and Hasbro join to develop Play-Doh themed centers in Saudi Arabia 

SEVEN and Hasbro join to develop Play-Doh themed centers in Saudi Arabia 

RIYADH: Play-Doh themed play centers are on their way to the Kingdom after Saudi Entertainment Ventures reached a deal with Hasbro Inc.

The Saudi group, known as SEVEN, has announced that within the next decade the Play-Doh centers will be in its entertainment destinations in eight locations in the Kingdom.  

The centers will feature multi-level playscapes, creativity stations and sensory discovery activity spaces, as well as a café spot for parents to pass their time, stated the official release.    

“Our Play-Doh themed entertainment centers will inspire the creative minds and imaginations of children across the Kingdom. Children will be able to learn while having fun at our Play-Doh centers located at SEVEN entertainment destinations,” stated the SEVEN’s chairman Abdullah AlDawood.  

SEVEN’s CEO Essam Al Jubair and Hasbro MENA’s Commercial Director Devrim Anadol signed the contract to officiate the partnership.  

SEVEN - owned by the Public Investment Fund – joined with Thinkwell Group, a global strategy, experience design, and production agency, to foster the Play-Doh themed centers. 

By investing over SR50 billion ($13.3 billion) into 21 entertainment destinations, SEVEN is cultivating the Kingdom’s entertainment sector through innovative topnotch entertainment experiences and international collaboration.  

The 65-year Play-Doh brand is currently the number one reusable modeling compound across 80 different countries worldwide.  

“Play-Doh has always been synonymous with imagination; it provides kids the creative freedom to express themselves and brings families together for an engaging and fun activity that is beloved across generations,” added the press release announcing the development.


Closing bell: TASI rises 141.6 points on recovering oil prices

Closing bell: TASI rises 141.6 points on recovering oil prices
Updated 25 min 39 sec ago

Closing bell: TASI rises 141.6 points on recovering oil prices

Closing bell: TASI rises 141.6 points on recovering oil prices

RIYADH: Saudi Arabia’s Tadawul All Share Index increased 141.62 points on Tuesday – or 1.39 percent – to close at 10,359.74, from 10,218.12, thanks to oil price rise, extending a recovery.

MSCI Tadawul 30 Index also increased 1.64 percent to 1,410.74, and the parallel market, Nomu, edged down by 0.21 percent closing at 18,928.89.  

TASI’s total trading turnover of the benchmark index was SR4.9 billion ($1.3 billion) as 176 stocks of the listed 224 advanced and 38 receded.    

Arab Sea Information System Co. was the top gainer of the day, closing the trading session up 6.40 percent at SR70.70.

The second-best performer was Thimar Development Holding Co., increasing 9.92 percent to SR48.75 flat.  

Perfect Presentation for Commercial Services Co. was the third-best performer, rising 7.67 percent - or 31 points – to SR435, compared to its opening at SR404. It also announced a tremendous increase in net profit by 63.06 percent to SR131.4 million. The company’s shares closed 9.71 up at SR192.

Other top performers of the day were Saudi Industrial Export and Saudi Advanced Industries Co.

The biggest faller of the day was Yamama Cement Co., slipping by 3.19 percent to SR30.3.  

Elm Co. is the next worst performer of the day, after being the third top performer the day before, decreasing by 2.07 percent to SR426.

The third poor performer was Almarai Co., which drops by 2.01 percent, closing at SR53.6.

The other poor performers were Al-Rajhi Company for Cooperative Insurance and Al Jouf Cement Co.

Riyadh Cement Co, announced its annual financial results for 2022, posting an 11.18 percent decrease in its net profit to SR189.8 million compared to the same period at SR213.7 million in 2021. The company’s share price on the other hand,

Riyadh Cement said in a statement that the decrease in net profit is driven by a decrease in sales, despite the decrease in the general and administrative expenses and zakat expenses.

Alkhorayef Water and Power Technologies Co reported a net profit of SR107.4 million in 2022, up 4 percent from SR103 million in 2021, closing at SR131.8 per share

Saudi Company for Hardware incurred a ­­major loss in net profit by 400.1 percent to SR142.5 million. The drop was mainly due to a drop in sales by 11.7 percent in 2022, increasing inventory provision by SR38.5 million and booking impairment loss on non-financial assets by SR29.7 million. The company’s share price dropped by 1.25 percent to close at SR27.65 per share. 

Alinma Tokio Marine Co. announced its annual financial results for 2022, posting a total comprehensive profit for the current year of SR8.6 million, up from a loss of SR14.8 million. Alinma’s share price closed at SR14.62, up 0.97 percent.

Al Alamiya for Cooperative Insurance Co. reported a net comprehensive loss for the current year of SR52.8 million compared to SR36.8 million in the previous year, which is an increase of 43.32 percent. Al Alamiya’s share price edged up 0.17 percent to close at SR12.02.

Middle East Paper Co. on the other hand, posted a 22.58 percent increase in net profit to SR270.7 million in 2022 compared to SR220.5 million in the previous year. The increase in net profit was attributed to growth in revenues by 12 percent to SR130 million. The share price also increased by 0.98 percent closing at SR30.75

National Gas and Industrialization Co. also announced its annual financial results for 2022 posting a 6.3 percent increase in net profit to SR214.1 million. Yet, the company’s share price decreased by 0.53 percent to close at SR56.

Jahez International Company for Information System Technology reported a major decrease in net profit of SR58.9 million, down 49.62 percent compared to 2021. Jahez attributed the decrease to an increase in the segment net profit by 56 percent to SR180.4 million from SR115.9 million and an increase in Zakat expenses. However, the share price increased by 0.15 percent to close at SR664 per share.

Furthermore, Banan Real Estate Co. announces positive annual financial results for 2022, reporting a 52.39 percent rise in net profit to SR37.4 million from SR24.3 million in 2021. However, its share price slightly decreased by 1.40 percent closing at SR56.5.

The company said in a statement that the increase is due to a rise in rental revenues, driven by the acquisition of a hotel apartment building in the Sulaymaniyah district and the Plaza 46 building in the Qurtoba district.

Aldawaa Medical Service Co. also posted a notable increase of 27.73 percent in net profit of 2022 to SR305.4 million compared to SR227.7 million in the previous year. The medical services company’s share price increased by 1.51 percent, closing at SR74.1.

“The reason is mainly due to the increase in sales and the rationing of expenses with resulted in improving the gross profit and operating profit,” Aldawaa said in a bourse filing.

The Medical services company, Mouwasat, also reported a 3.63 percent increase in net profit in 2022 at SR599 million, due to an increase in the number of visits in the outpatient sector and the increase in occupancy rates in the internal departments. The share price increased 2.35 percent, closing at SR200.

On the other hand, Arriyadh Development Co. achieved a net profit of SR300.4 million during the current period, indicating an almost 6 percent drop. This is mainly due to a 16 percent decrease in Tanal’s revenues, which is an associate company.


Global renewables capacity grew by 10% last year: IRENA

Global renewables capacity grew by 10% last year: IRENA
Updated 44 min 48 sec ago

Global renewables capacity grew by 10% last year: IRENA

Global renewables capacity grew by 10% last year: IRENA

LONDON: Global renewable energy capacity grew by 9.6 percent last year but needs to grow by three times the current rate to limit global warming, the International Renewable Energy Agency said on Tuesday.

IRENA's annual report on renewable energy statistics said global renewable energy capacity amounted to 3,372 gigawatts at the end of last year, some 295 GW or 9.6 percent higher than the previous year.

Some 83 percent of all new power capacity last year was from renewables.

"This continued record growth shows the resilience of renewable energy amidst the lingering energy crisis," IRENA’s Director General Francesco La Camera said.

"But annual additions of renewable power capacity must grow three times the current level by 2030 if we want to stay on a pathway limiting global warming to 1.5C," he added.

Solar and wind energy dominated the renewable capacity expansion, jointly accounting for 90 percent of all net renewable additions in 2022, the report said.

Almost half of the new capacity was added in Asia. China was the largest contributor, adding 141 GW to Asia's new capacity.

Renewables in Europe and North America grew by 57.3 GW and 29.1 GW respectively, while the Middle East recorded its highest increase in renewables on record, with 3.2 GW of new capacity commissioned in 2022, an increase of 12.8 percent from the previous year.

On Monday, a report by the UN's Intergovernmental Panel on Climate Change said emissions must be halved by the mid-2030s if the world is to have any chance of limiting temperature rise to 1.5 degrees Celsius above pre-industrial levels — a key target enshrined in the global climate pact the Paris Agreement.


Bank stocks steady after Swiss rescue as focus turns to Fed

Bank stocks steady after Swiss rescue as focus turns to Fed
Updated 21 March 2023

Bank stocks steady after Swiss rescue as focus turns to Fed

Bank stocks steady after Swiss rescue as focus turns to Fed

LONDON: Investors stepped cautiously into bank stocks on Tuesday, emboldened by the rescue of Credit Suisse, with share prices inching tentatively higher amid continuing concerns about smaller US lenders and further financial market ructions, according to Reuters

After a tumultuous 10 days which culminated in the 3 billion Swiss franc ($3.2 billion) Swiss-regulator-engineered takeover of Credit Suisse by its rival UBS, attention has now shifted to this week’s meeting of the US Federal Reserve.

As concern over the health of US mid-sized lenders lingers, Treasury Secretary Janet Yellen plans to tell bankers later on Tuesday that the country’s banking system is stabilizing after strong actions from regulators.

But she will also say further steps to protect bank depositors may be warranted if smaller institutions suffer deposit runs that threaten more contagion.

“The steps we took were not focused on aiding specific banks or classes of banks. Our intervention was necessary to protect the broader US banking system,” Yellen said in excerpts of prepared remarks to an American Bankers Association conference.

Yellen said she believed the actions by the Federal Deposit Insurance Corp., the US Federal Reserve and the Treasury had reduced the risk of further bank failures.

The demise of 167-year-old Credit Suisse was triggered by the collapse of US lenders Silicon Valley Bank and Signature Bank, and investors are concerned about potential bombs ticking elsewhere in the financial system.

The European Central Bank’s top banking supervisor said euro zone banks should watch their sources of funding or risk being “caught off guard” by rising interest rates.

“Increasing interest rates and quantitative tightening require banks to sharpen their focus on liquidity and funding risks,” said Andrea Enria, in remarks the ECB said were drafted in February, before recent global banking upheavals.

The effects of these were felt on German investor sentiment, which tumbled in March as concerns about a new financial crisis ended a five-month streak of consecutive increases, the ZEW economic research institute said on Tuesday.

“The international financial markets are under strong pressure,” and the high level of uncertainty is reflected in the economic expectations, said ZEW President Achim Wambach.

In Switzerland, the Bankers Association said that credit supply would not be restricted by the demise of Credit Suisse, adding it was convinced the Swiss banking sector still had a “prosperous future.”

Credibility “is not destroyed, but it’s not good,” the association’s chairman Marcel Rohner told a news briefing.

As the rescue of Credit Suisse assuaged the worst fears of systemic contagion, European bank shares rose, while Asian stocks lifted off their lows.

And in a sign of business continuity, Credit Suisse kicked off its three-day annual Asian Investment Conference in Hong Kong, which draws top executives at regional companies.

Shares of beaten-down regional lenders climbed in premarket trade, including First Republic Bank, while big US banks such as JPMorgan, Citigroup and Bank of America also rose before the bell.

’Near Death'
Another burning question among traders and investors is whether the Fed’s relentless rate hikes, which some have blamed for sparking the biggest meltdown in the banking sector since the global financial crisis, might be at an end.

Policymakers from Washington to Europe have repeatedly stressed that the current turmoil is different from the global financial crisis 15 years ago, pointing to banks being better capitalized and funds more easily available.

But the sudden shock means traders have now increased their bets the US central bank will pause its hiking cycle on Wednesday to try to ensure financial stability, although they remain split over whether the Fed will raise its benchmark policy rate.

“The banking sector’s near-death experience over the last two weeks is likely to make Fed officials more measured in their stance on the pace of hikes,” said Standard Chartered head of G10 FX research, Steve Englander.

Top central banks promised at the weekend to provide dollar liquidity to stabilize the financial system to prevent the banking jitters from snowballing into a bigger crisis.

In a global response not seen since the height of the pandemic, the Fed said it had joined central banks in Canada, Britain, Japan, the euro zone and Switzerland in a co-ordinated action to enhance market liquidity.

Meanwhile, JPMorgan Chase & Co. CEO Jamie Dimon is leading talks with other big banks on new efforts to stabilize First Republic Bank, which last week had a $30 billion capital infusion, the Wall Street Journal reported.
First Republic and JPMorgan declined to comment on the report, which cited people familiar with the matter.

A spokesperson for First Republic pointed to an earlier statement where the bank said it was “well-positioned to manage short-term deposit activity.”

In Europe, the investor focus has shifted to the massive blow some Credit Suisse bondholders will take, prompting euro zone and UK banking supervisors to try to stop a rout in the market for convertible bank bonds.

The regulators said owners of this type of debt would only suffer losses after shareholders have been wiped out — unlike at Credit Suisse, whose main regulators are in Switzerland and whose AT1 prospectus made clear that hybrid (AT1) holders would not recover any value.

Nevertheless, lawyers are talking to a number of AT1 bond holders about possible legal action, law firm Quinn Emanuel Urquhart & Sullivan said on Monday.

Danske Bank has advised its private clients not to invest in high yield bonds, citing the risk of substantial capital losses as credit conditions tighten.

The category of high yield bonds includes both corporate and bank bonds, including the AT1 bonds that Credit Suisse will have to write down to zero on the orders of the Swiss regulator as part of the bank’s rescue merger with UBS.
 


Saudi Arabia’s Agricultural Development Fund approves $610m in investment loans

Saudi Arabia’s Agricultural Development Fund approves $610m in investment loans
Updated 21 March 2023

Saudi Arabia’s Agricultural Development Fund approves $610m in investment loans

Saudi Arabia’s Agricultural Development Fund approves $610m in investment loans

RIYADH: Farmers in Saudi Arabia saw their funding from a dedicated investment organization rise by 167 percent year-on-year in the first three months of 2023, it has been revealed.

The Saudi Agricultural Development Fund signed off on development and investment loans worth more than SR2.3 billion ($610 million) from January to March of this year, compared to the SR861 million handed out in the same period of 2022. 

The sectors financed range from small farmer and breeders to poultry sector projects in Hail and Asir, as well as the governorates of Shaqra, Al Aflaj, Tathleeth, Nairiyah, Rabigh, Al Ghat, and Al Olaya village.  

There was also funding for greenhouse projects in the Makkah Al-Mukarramah region and Al-Muzahimiyah governorate, for breeding and producing fish in inland waters in the Al-Dawadmi governorate, and for marketing agricultural products in the Khamis Mushayt governorate.

The Saudi Agricultural Development Fund has already handed out half as much money as it did throughout 2022, where SR4.2 billion was awarded. 

The approval of these loans and funding requests by the fund's General Manager, Munir bin Fahd Al-Sahil, underlines the fund's objective to boost its developmental and financing role for agricultural activity by its strategic objectives. 

The approval is also in alignment with the policies of the Ministry of Environment, Water, and Agriculture and the food security strategy in supporting and developing the agricultural sector and related logistical services, assisting in the coverage of agricultural supply chains, and contributing to the enhancement of agricultural supply chains.