Oil Updates — Oil hits lowest in more than a year; OPEC+ to stick to production cut

Update Oil Updates — Oil hits lowest in more than a year; OPEC+ to stick to production cut
Brent crude futures climbed 90 cents, or 1.16 percent, to $78.35 a barrel at 10.40 a.m. Saudi time. (Shutterstock)
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Updated 15 March 2023

Oil Updates — Oil hits lowest in more than a year; OPEC+ to stick to production cut

Oil Updates — Oil hits lowest in more than a year; OPEC+ to stick to production cut

RIYADH: Oil extended its slide on Wednesday, falling 4 percent and hitting its lowest in more than a year as unease over Credit Suisse spooked world markets and offset hopes of a Chinese oil demand recovery.

Brent crude fell $3.26, or 4.21 percent, to $74.19 a barrel at 04.50 p.m. Saudi time, after touching $74.01 for its lowest since December 2021.

US West Texas Intermediate crude was down $3.26, or 4.57 percent, at $68.07, having also hit its lowest since December 2021.

The OPEC on Tuesday further raised its forecast for Chinese oil demand growth in 2023 due to the relaxation of the country’s COVID-19 curbs, although it left total global demand steady, citing potential downside risks for world growth.

OPEC+ to stick to production cut, Saudi minister tells Energy Intelligence

Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman told Energy Intelligence in an interview on Tuesday that the OPEC+ alliance will stick until the end of the year to production cuts agreed in October.

Earlier in October, OPEC+ had agreed to cut output by 2 million barrels per day, which equals to about 2 percent of world demand, from November until the end of 2023.

“There are those who continue to think we would adjust the agreement ... I say they need to wait until Friday, Dec. 29, 2023, to demonstrate to them our commitment to the current agreement,” said the minister.

Prince Abdulaziz also said global demand growth would outpace current global spare capacity while emergency reserves were at a historic low.

He added: “That is why it is crucial that policies are put in place to support investments needed to increase spare capacity in a timely manner and that global emergency stocks are maintained at an adequate and comfortable level.”

Canada’s Pembina Pipeline’s Cedar LNG project gets environmental approval

Pembina Pipeline Corp. said on Tuesday that its Cedar LNG project had received British Columbia’s environmental approval.

Cedar also received its first permit from the province’s energy regulator for about 8.5-kilometer pipeline that will connect the project to the Coastal GasLink pipeline.

Pembina Pipeline said the project also entered into a memorandum of understanding with oil and gas producer ARC Resources Ltd. for 20-year liquefaction services and they are working to finalize a supply deal for 1.5 million tons of LNG per annum.

Cedar LNG is a partnership between the indigenous group the Haisla Nation and Pembina Pipeline to develop a floating LNG facility in Kitimat, British Columbia with the capacity to export 3 MTPA of LNG.

(With input from Reuters) 


Standard Chartered agrees to sell business in Jordan

Standard Chartered agrees to sell business in Jordan
Updated 8 sec ago

Standard Chartered agrees to sell business in Jordan

Standard Chartered agrees to sell business in Jordan
  • Bank said in April that it was seeking to narrow its focus to faster-growing markets in the region, such as Saudi Arabia and Egypt.

DUBAI: Standard Chartered plans to sell its Jordanian business to Arab Jordan Investment Bank (AJIB), the two parties said on Sunday, as the emerging markets-focused lender presses ahead with plans to exit seven markets in Africa and the Middle East.
The bank entered into an agreement with AJIB, subject to central bank approval, which will see Standard Chartered’s corporate, commercial and institutional banking, consumer lending and private banking businesses migrated to AJIB.
All Standard Chartered Bank employees in Jordan will be transferred to AJIB, it said an emailed statement.
Standard Chartered’s Africa and Middle East CEO Sunil Kaushal said the agreement is aligned with the banks global strategy “to deliver efficiencies, reduce complexity, as well as redirect resources within the Africa Middle East region to areas with the greatest potential to drive scale, grow and better support clients.”
AJIB said the purchase falls within the Jordanian lender’s strategy to grow its market share in the country, which continues to grow after it acquired HSBC’s banking business in Jordan in 2014 and National Bank of Kuwait’s banking business in Jordan in 2022.
Standard Chartered in April 2022 said it plans to leave seven markets, consisting of Angola, Cameroon, Gambia, Jordan, Lebanon, Sierra Leone and Zimbabwe.
The bank said at the time it was seeking to exit markets where it is sub-scale and narrow its focus to faster-growing markets in the region, such as Saudi Arabia and Egypt.


Closing bell: Saudi benchmark index continues upward movement on promising market conditions

Closing bell: Saudi benchmark index continues upward movement on promising market conditions
Updated 52 min 57 sec ago

Closing bell: Saudi benchmark index continues upward movement on promising market conditions

Closing bell: Saudi benchmark index continues upward movement on promising market conditions

RIYADH: Saudi Arabia’s Tadawul All Share Index continued its upward trajectory on Sunday as it went up by 12.97 points or 0.93 percent to close at 10,459.36. The promising market conditions resulted in a rise in investor confidence, pushing the market up.

The parallel market, Nomu, also rose by 174.79 points or 0.92 percent to close at 19,231.63, while the MSCI Tadawul 30 Index gained 0.02 percent to reach 1,423.63 on Sunday. Total trading turnover of the benchmark index was SR4.05 billion ($1.08 billion).

On Thursday, during the first session of Ramadan month, the main index gained 95.88 points and closed at 10,446.39.

Arab Sea Information System Co. emerged as the top gainer, as its share prices went up by 9.96 percent to SR78.40 followed by Al Kathiri Holding Co. whose share prices surged by 9.88 percent to SR55.60.

Zain KSA which reported a net profit of SR550 million in 2022, saw its shares surge 9.83 percent to SR11.84.

Thimar Development Holding Co. was the worst performer, dropping 9.95 percent to SR43.45, followed by Al Sagr Cooperative Insurance Co. whose share prices went down by 6.08 percent to SR12.66.

Meanwhile, Horizon Food Co., affiliated with Tabuk Agriculture Development Co. began trading on Nomu on Sunday with an opening price of SR37 per share and closed the session at SR44.95, up 21.49 percent.

On Sunday, Amwaj International Co. announced its financial results for 2022. In a statement issued to Tadawul, the company revealed that it recorded a 2.7 percent rise in net profit to SR29.02 million in 2022, compared to SR28.26 million in the year-ago period.

Sure Global Tech Co. reported a net profit of SR24.07 million in 2022, up 33 percent from SR18.12 million in 2021. In a bourse statement, the company attributed the rise in profit to a 12 percent increase in revenues driven by the product segment, adequately supported by the expansion of the customer base.

Sure Global Tech Co. also added that net profit increased in 2022 due to the revenue growth in infrastructure, professional and digital services segments. Despite the rise in net profit, the company’s share prices fell by 1.67 percent to close at SR53.10.

Arabian Pipes Co., also known as APC turned profitable in 2022, as the company reported a net profit of SR8.9 million, versus a net loss of SR60.1 million in 2021. According to a bourse statement, the net profit of the company rose in 2022 due to an increase in sales which went up by 37 percent.

Driven by the rise in profits, the share prices of Arabian Pipes Co. went up by 9.52 percent to SR42.

Another company that reported its financial results on Sunday was Saudi Ground Services Co. In 2022, the company trimmed its net losses to SR244.48 million, compared to SR254.41 million in 2021. Even though the company performed well in 2022 compared to 2021, its share prices dropped by 4.76 percent to SR22.


Saudi REDF deposits over $246m in Sakani accounts for housing projects  

Saudi REDF deposits over $246m in Sakani accounts for housing projects  
Updated 26 March 2023

Saudi REDF deposits over $246m in Sakani accounts for housing projects  

Saudi REDF deposits over $246m in Sakani accounts for housing projects  

RIYADH: Saudi Arabia’s Real Estate Development Fund deposited more than SR925 million ($246.2 million) in the accounts of Sakani beneficiaries in March 2023.  

The Sakani program was launched in 2017 by the REDF to facilitate homeownership in the Kingdom, by developing new housing stock, allocating plots and homes to nationals and financing their purchase. 

The deposit, which also comes from the Ministry of Municipal, Rural Affairs and Housing and the REDF, is in line with the Kingdom’s Vision 2030 which aims to increase the proportion of citizens who own a home to 70 percent.  

Mansour bin Madi, CEO of REDF, stated that the total amount deposited in the accounts of Sakani beneficiaries since the announcement of the transformation program in June 2017 until March 2023, exceeded SR46.2 billion.  

He also said that the total fund for the current month of March was allocated to support the profits of various housing contracts.  

Bin Madi explained that the fund launched the second phase of product governance and provided an electronic service that allows the beneficiaries with self-construction projects to update the stages of building their homes.  

This is to emphasize the importance of the beneficiaries' commitment to direct the stages of building their housing and follow up on the stages.  

He added this is to ensure that the fund supports and facilitates are provided to the beneficiaries during the time period specified in the financing contracts and housing support regulations. 


IMF says risks to financial stability have increased, calls for vigilance

IMF says risks to financial stability have increased, calls for vigilance
Updated 26 March 2023

IMF says risks to financial stability have increased, calls for vigilance

IMF says risks to financial stability have increased, calls for vigilance

RIYADH: International Monetary Fund chief Kristalina Georgieva said on Sunday that risks to financial stability have increased and called for continued vigilance although actions by advanced economies have calmed market stress.

Speaking during the first day of the China Development Forum, Georgieva noted that 2023 poses yet another challenging and thought-provoking year with an expected global growth rate slowing to below 3 percent.  

This is mainly attributed to the repercussion of the pandemic, the Russia-Ukraine war, as well as monetary tightening, the IMF chief explained.  

Even though progressive economies have attempted to compose market stress, the overall outlook for 2024 remains weak with the growth rate estimated to stand below the historic average of 3.8 percent, she pointed out.

"So, we continue to monitor developments closely and are assessing potential implications for the global economic outlook and global financial stability," Georgieva reassured. 

Moreover, when it comes to vulnerable and low-income countries with high levels of debt, she emphasized that the IMF is paying close attention to those in order to further support them.  

In addition to this, there is a risk of the world splitting into rival economic blocs, resulting in "a dangerous division that would leave everyone poorer and less secure," as a consequence of geo-economic fragmentation, Georgieva warned. 

That said, China has a significant role to play with regard to minimizing the risks of financial instability. It has been forecasted that every one percentage point boost in China’s gross domestic product results in a 0.3 percentage point rise in growth in other Asian economies, she said. 

Consequently, policymakers in China are urged to focus on further raising productivity while rebalancing the economy and shifting away from investment while moving towards more sturdy consumption-driven growth.

According to conjectures, such reforms are capable of lifting real GDP by as much as 2.5 percent by 2027, and by around 18 percent by 2037, explained. 

The China Development Forum is an annual high-level global conference held in China right after the National People's Congress and the Chinese People's Political Consultative Conference each year. 

This year, the forum is taking place from March 25 up until March 27 under the theme “Economic Recovery: Opportunities and Cooperation.” 

The conference poses an opportunity for participants to connect with political, economic, and significant decision-makers in the Asian country. 

  

  


Aramco forms JV with Chinese entities to construct refinery, petchem complex 

Aramco forms JV with Chinese entities to construct refinery, petchem complex 
Updated 26 March 2023

Aramco forms JV with Chinese entities to construct refinery, petchem complex 

Aramco forms JV with Chinese entities to construct refinery, petchem complex 

RIYADH: Global energy giant Saudi Arabian Oil Co. has inked a deal with China’s Norinco Group and Panjin Xincheng Industrial Group to form a joint venture to construct a refinery and petrochemical complex in the Asian giant’s Liaoning province. 

Saudi Aramco will own 30 percent stakes in the joint venture called Hujain Aramco Petrochemical Co., while Norinco Group and Panjin Xincheng Industrial Group will hold 51 percent and 19 percent shares respectively, said a press release.

It noted that the facility in the city of Panjin will combine a 300,000 barrels per day refinery and a petrochemical plant with an annual production capacity of 1.65 million metric tons of ethylene and 2 million metric tons of paraxylene. 

“We see a major win-win opportunity to build a world-leading, integrated downstream sector in China, with special emphasis on the high conversion of liquids directly into chemicals as part of our broader liquid-to-chemicals business expansion plans,” said Aramco CEO Amin Nasser. 

He added: “This important project will support China’s growing demand across fuel and chemical products. It also represents a major milestone in our ongoing downstream expansion strategy in China and the wider region, which is an increasingly significant driver of global petrochemical demand.”

Aramco will supply up to 210,000 barrels per day of crude oil feedstock to the Liaoning refinery project. The construction of this new refinery will begin in the second quarter of 2023, and it is expected to be fully operational by 2026.

Norinco Group Deputy General Manager Zou Wenchao said that the new venture will “play an important role in deepening economic and trade cooperation between China and Saudi Arabia and achieving common development and prosperity.”

“The project is of great significance for Panjin to promote increasing chemicals and specialty products, strengthening the integration of the refining and chemical industry. It is a symbolic project for Panjin as it seeks to accelerate the development of an important national petrochemical and fine chemical industry base,” said Jia Fei, Panjin Xincheng chairman of the board.