Oil Updates — Crude slips; BP says Ukraine war will accelerate transition to clean energy 

Oil Updates — Crude slips; BP says Ukraine war will accelerate transition to clean energy 
Brent crude futures fell 31 cents, or 0.36 percent, to $86.35 a barrel at 08.20 a.m. Saudi time. (Shutterstock)
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Updated 30 January 2023

Oil Updates — Crude slips; BP says Ukraine war will accelerate transition to clean energy 

Oil Updates — Crude slips; BP says Ukraine war will accelerate transition to clean energy 

RIYADH: Oil prices edged lower on Monday, even as Beijing pledged over the weekend to promote a consumption recovery that would support fuel demand. 

Brent crude futures fell 31 cents, or 0.36 percent, to $86.35 a barrel at 08.20 a.m. Saudi time, while US West Texas Intermediate crude was at $79.45 a barrel, down 23 cents, or 0.29 percent. 

On Saturday, China’s cabinet said it would promote a consumption recovery as the major driver of the economy and boost imports, state broadcaster CCTV reported. 

Ukraine war to accelerate shift to clean energy: BP 

Russia’s war in Ukraine is expected to weigh on long-term energy demand and accelerate the world’s shift to renewables and low-carbon power as countries boost domestic energy supplies, oil giant BP said in its latest report. 

In its benchmark 2023 Energy Outlook, BP said the Ukraine war will slow global economic activity by 2035 by around 3 percent compared with last year’s forecast due to higher food and energy prices as well as reduced trade activity. 

BP lowered its oil and gas demand forecast in 2035 by 5 percent and 6 percent, respectively, under its central forecast scenario that is based on governments’ current energy transition plans. The changes are focused mostly in Europe and Asia which rely heavily on energy imports, BP said. 

Under its three scenarios, global energy demand peaks between the late 2020s and 2035, according to BP, whose Chief Executive Bernard Looney aims to rapidly grow the company’s renewables business and slash oil and gas output by 2030. 

Put together, BP expects primary energy consumption in 2035 to be lower by 2 percent compared with last year’s outlook, with half of the decline due to gains in energy efficiency and half due to lower economic activity. 

“The increased focus on energy security as a result of the Russia-Ukraine war has the potential to accelerate the energy transition as countries seek to increase access to domestically produced energy, much of which is likely to come from renewables and other non-fossil fuels,” BP Chief Economist Spencer Dale said in the report. 

Oil demand is set to start declining rapidly after 2030 under BP’s three scenarios, but will continue to play a major role in the global energy system, with world demand reaching 70 to 80 million barrels per day by 2035, compared with today’s consumption of around 100 million bpd. 

Carbon emissions in 2030, under BP’s central scenario, are 3.7 percent lower than in the previous outlook. 

TotalEnergies says well drilling in Lebanon’s offshore Block 9 to begin in Q3 

TotalEnergies is keen to start work on Lebanon’s offshore Block 9 “as soon as possible,” with assessments to begin early next month and well-drilling to launch in the third quarter of 2023, its CEO Patrick Pouyanne said on Sunday. 

Pouyanne was speaking at a joint news conference in Beirut after signing a three-way consortium deal with QatarEnergy and Eni to explore oil and gas in two maritime blocks off the coast of Lebanon known as Blocks 4 and 9. 

Following months of talks, QatarEnergy has taken a 30 percent stake in the consortium, leaving TotalEnergies and Eni with 35 percent each. 

Lebanon hopes discoveries will help it reverse a crippling economic crisis that has cost the local currency more than 97 percent of its value, eroded the country’s foreign reserves and caused rolling blackouts across towns and cities. 

Pouyanne said a vessel would arrive in Lebanese waters on Feb. 6 to carry out an environmental survey in Block 9, “and we plan to drill during the third quarter of the year.” 

The CEO of Eni, Claudio Descalzi, said the exploration could offer a “big opportunity” for Lebanon as the world was facing a major lack of gas. 

“From a geological point of view, I am positive” about a discovery in Lebanon’s Block 9, Descalzi told reporters. 

“We have to hope and pray that it is a real and material one,” he said. 

Pouyanne and Qatar’s energy minister Saad Al-Kaabi, also the CEO of QatarEnergy, said they were discussing possible coordination on renewable energy in Lebanon. 

(With input from Reuters) 


74% of online shoppers prefer local e-commerce over cross-border platforms

Waleed Al-Saud, CEO of Mukatafa
Waleed Al-Saud, CEO of Mukatafa
Updated 03 June 2023

74% of online shoppers prefer local e-commerce over cross-border platforms

Waleed Al-Saud, CEO of Mukatafa

RIYADH: Saudi Arabia’s retail sector is eyeing significant growth on the back of its e-commerce market, as 74 percent of online shoppers in the Kingdom are expected to shift from global to local platforms.
In its recent report, leading global management consulting firm Kearney and Saudi consulting company Mukatafa noted that local and hybrid players are making strong headway against their international counterparts from China, the Gulf Cooperation Council, Europe and the US.
Valued at SR19.3 billion ($5.14 billion), the Kingdom’s e-commerce market is 6 percent of the overall SR347.2 billion retail market. It is expected to further grow to SR34.7 billion to reach 7.5 percent of the overall retail market by 2026, according to the report.
An expanding e-commerce ecosystem will pave the way for innovation, job creation and private-sector growth in line with the Kingdom’s Vision 2030 objectives.

It is a strong sign that local e-commerce businesses are gaining more traction in the market. We must make sure that these businesses are supported to thrive as well as cross-border accounts.

Waleed Al-Saud, CEO of Mukatafa

“This flourishing e-commerce ecosystem empowers citizens to use innovative digital payment options, in line with government initiatives under Vision 2030 to guide private sector investments to provide critical pillars for the sector’s growth, such as increasing cashless transactions and expanding the geographical coverage of e-commerce delivery beyond the Kingdom’s major cities,” said Mohammed Dhedhi, partner at Kearney Middle East.
He added: “The growth of the local and hybrid e-commerce players will contribute to protecting consumer interest and promoting local investments with strong potential for job creation.” The report revealed that cross-border online shopping is expected to generate less income as local and hybrid companies gain traction.

FASTFACTS

• The report noted that local and hybrid players are making strong headway against their international counterparts from China, the GCC, Europe and the US.

• Valued at SR19.3 billion, the Kingdom’s e-commerce market is 6 percent of the overall SR347.2 billion retail market.

Cross-border online shopping is likely to decrease from 59 percent of all e-commerce revenue in 2021 to 49 percent by 2026.
The report noted that more assistance should be provided to create a level playing field for all e-commerce participants, safeguarding consumer interests and encouraging domestic investment.
“It is a strong sign that local e-commerce businesses are gaining more traction in the market. We must make sure that these businesses are supported to thrive as well as cross-border accounts,” Waleed Al-Saud, CEO of Mukatafa, said. He added: “Thresholds on import quantities could be introduced, and local quality standards could be mandated for cross-border players. It is these types of initiatives that will need to be addressed if we are to create a level playing field for all e-commerce players. As it stands, current regulations in the market favor cross-border players, and until that changes, cross-border sales will continue to hold a major share of the e-commerce market compared to local players.”

 

 


‘Women in Tech’ competition brings Saudi female entrepreneurs to the fore

Doaa Aref, CEO of Chefaa
Doaa Aref, CEO of Chefaa
Updated 03 June 2023

‘Women in Tech’ competition brings Saudi female entrepreneurs to the fore

Doaa Aref, CEO of Chefaa
  • Sahm app claims first place and received $25k, Nqoodlet bags second position with a prize of $15k

CAIRO: Going by the success of the “Women in Tech” competition, it is evident that female-led startups are set to revolutionize Saudi Arabia’s technology sector.  

The competition that was recently held in Riyadh saw entrepreneurs undergo an eight-week incubator program, showcasing innovative ideas in various sectors, including fintech, health tech, property tech and edutainment.
In collaboration between global banking group Standard Chartered and Saudi-based investment firm Falak Investment Hub, the program hosted eight startups with the top three being awarded a total of $50,000 in equity-free grants.   

The most significant shift in our landscape in KSA will be the change in sentiment, investment appetite and innovation, says Adwa Al-Dakheel
CEO of Falak Investment Hub

Sahm, a stock trading app, claimed first place and received $25,000. Nqoodlet, a fintech company, bagged second position with a prize of $15,000, and Chefaa, a health-tech platform, secured third place and received $10,000.  
Speaking with Arab News, Jawaher Al-Yahya, the CEO of Sahm, said that the company will continue to optimize and refine its product to achieve the right market fit.  

HIGHLIGHTS

• The competition that was recently held in Riyadh saw entrepreneurs undergo an eight-week incubator program, showcasing innovative ideas in various sectors, including fintech, health tech, property tech and edutainment.

• In collaboration between global banking group Standard Chartered and Saudi-based investment firm Falak Investment Hub, the program hosted eight startups with the top three being awarded a total of $50,000 in equity-free grants.

She further added that women faced difficulty in gaining experience in leadership positions in addition to a lack of funding and resources.  
Sahm will utilize its funding to invest in marketing initiatives to increase brand awareness as well as enhance product capabilities, Al-Yahya reiterated.  
Replying to a question regarding hurdles women in the technology sector are faced with, CEO of Falak Investment Hub Adwa Al-Dakheel attributed the pursuit of perfection as the major barrier for women entering the tech scene.
“Seeking perfection in innovation and startups means not launching in the right market timing and waiting for extreme validation instead of building upon continuous yet smaller validations,” Al-Dakheel told Arab News.  
Doaa Aref, CEO of Chefaa, and Mai Abdulwahab, founder of Nqoodlet, both said that lack of funding is the main barrier for women in tech globally.
Awards were distributed during a special event, under the patronage of the Small and Medium Enterprises General Authority, known as Monsha’at, in the presence of its Deputy Gov. Saud Al-Sabhan.  
Al-Sabhan delivered a speech during the event about the importance of women entrepreneurs stating that Monsha’at contributed to increasing the number of female-led enterprises to more than 467,000.  
“The most significant shift in our landscape in the Kingdom will be the change in sentiment, investment appetite and innovation. Top founders will move to Saudi Arabia to grow and start their businesses here, and the world’s biggest investors will follow,” Al-Dakheel said. 

 


Respite for oil market amid rate hike worries

Respite for oil market amid rate hike worries
Updated 01 June 2023

Respite for oil market amid rate hike worries

Respite for oil market amid rate hike worries
  • Oil markets may have been oversold in the last two trading days, says analyst

RIYADH: Oil steadied on Thursday as a potential pause in US interest rate hikes and the passing of a crucial vote on the US debt ceiling bill were offset by a report of rising inventories in the world’s biggest oil consumer.

US Federal Reserve officials on Wednesday suggested interest rates could be kept on hold this month and the US House of Representatives passed a bill suspending the government’s debt ceiling, improving the chance of averting a disastrous default.

Brent crude futures fell 10 cents, or 0.14 percent, to $72.50 a barrel by 1339 GMT while US West Texas Intermediate crude rose 7 cents, or 0.1 percent, to $68.16. Both benchmarks fell on Tuesday and Wednesday.

“Oil markets may have been oversold in the last two trading days,” said CMC Markets analyst Tina Teng. “Sentiment rebounded amid the debt bill’s passage in the House and (the) Fed’s rate hike pause signal.”

HIGHLIGHTS

Market sources citing American Petroleum Institute figures on Wednesday said that US crude inventories rose by about 5.2 million barrels last week.

• Brent crude futures fell 10 cents, or 0.14 percent, to $72.50 a barrel by 1339 GMT while US West Texas Intermediate crude rose 7 cents, or 0.1 percent, to $68.16.

Mixed demand indications from China, the world’s biggest oil importer, have nonetheless weighed on the market, as has industry data showing a rise in US crude inventories.

Market sources citing American Petroleum Institute figures on Wednesday said that US crude inventories rose by about 5.2 million barrels last week.

“The current mood is one of pessimism,” said Tamas Varga of oil broker PVM. “Investors have been pragmatic and risk averse of late.”

Also in focus is the June 4 meeting of the OPEC+ producer group, in which the Organization of the Petroleum Exporting Countries and allies including Russia will discuss whether or not to cut oil production further.

Barclays forecast

British multinational bank Barclays has slashed the average price of its Brent crude forecast for this year from $92 to $87 a barrel. The bank also slashed its price forecast of Brent for 2024 as it cut the average projected price to $87 a barrel from $97. 

Chinese company in Brazil 

China’s CNOOC Ltd. has begun production at the Buzios5 well off the coast of Brazil, the company said in a statement on Thursday. 

The well is the fifth phase of the Buzios oil field off Brazil’s southeast coast. At an average water depth of 1,900 meters to 2,200 meters, the field is the world’s largest deep-water pre-salt oil field, with daily production of 600,000 barrels, the company said. 

CNOOC’s Brazilian subsidiary owns 7.34 percent of the Buzios shared reservoir, which is 88.99 percent owned by Brazilian state-owned oil and gas company Petrobras.  CNOOC paid $1.9 billion to Petrobras last year to secure a 5 percent stake in a production sharing agreement at the field. 


UAE’s in-country value projects driving billions to local firms

UAE’s in-country value projects driving billions to local firms
Updated 02 June 2023

UAE’s in-country value projects driving billions to local firms

UAE’s in-country value projects driving billions to local firms

ABU DHABI: More than $27.23 billion has been redirected to the local economy since the UAE Ministry of Industry and Advanced Technology (MoIAT) and ADNOC launched major in-country value programs to support domestic industries.

Speaking at the Make in the Emirates Forum, Abdulla Al-Shamsi, Assistant Undersecretary of MoIAT, said more than $14.43 billion of investment was redirected to the local economy last year alone, an increase of 25 percent year-on-year.

“The National In-Country Value Program is a nationwide program that speaks one language across many different sectors,” Al-Shamsi said. “It’s one methodology and this is something we’re very proud of because it benefits the private sector and when the private sector sees this it helps them prepare, invest, and spend.”

The forum heard how the National ICV Program is “functionating well and accelerating.”

The forum also heard how industrial zones are playing a critical role in the in the country’s sustainable industrial development and broader economic prospects. Local industrial leaders described how they are utilizing alternative energy resources such as solar and hydrogen to reduce their carbon footprint.

The second edition of the Make it in the Emirates Forum concluded on Thursday with the UAE showcasing its unique value proposition to international investors.

Investors were invited to explore opportunities and competitive advantages, with panel discussions focusing on the National In-Country Value (ICV) Program, the role of industrial zones, competitive financing as a key enabler and local talent in the private sector.

The UAE’s industrial exports reached $47.6 billion in 2022, growing 49 on 2021. The industrial sector's contribution to GDP rose to $49.5 billion in 2022, a 38 percent increase on 2020.

The Make it in the Emirates Forum is organized by the Ministry of Industry and Advanced Technology in partnership the Abu Dhabi Department of Economic Development (ADDED) and ADNOC.

On the first day of the forum, the UAE government announced $2.7 billion in industrial offtake agreements, building on the $29.9 billion of offtake agreements announced at the 2022 edition of the forum.


Saudi fintech firm secures $3.2m in seed funding

Saudi fintech firm secures $3.2m in seed funding
Updated 01 June 2023

Saudi fintech firm secures $3.2m in seed funding

Saudi fintech firm secures $3.2m in seed funding

RIYADH: EdfaPay, a Saudi-based fintech startup that helps companies use their smartphones for payment, has raised $3.2 million in a seed funding round.

The funding round was led by Sanabil 500 MENA, Nufud Wealth International, Atmiid Investment, Basmah Commercial Investment, and a group of local and international angel investors.

EdfaPay aims to utilize the capital to strengthen its operations in the Kingdom and expand to Pakistan and South American countries.

Founded in 2022 by Ghormallah Alghamdi and Nedal Sabbah, it uses NFC technology to allow companies to collect payments through smartphones.

In February 2022, the firm secured $1.6 million in a pre-seed funding round led by Nuwa Capital, InspireUs VC, and Wallan Investment Group.

The fintech channeled its acquired funds into launching its financial services across the Kingdom and supported its market-entry efforts.

The Kingdom’s fintech investments reached $400 million in 2022, recording a 79 percent increase compared to 2021.

The Saudi Central Bank, also known as SAMA, is one of the country’s key players in enabling fintech across all subsectors.

Earlier this week, SAMA granted licenses to Spotii and Madfu, two fintech companies that aim to offer consumer financing options.