Iraq eyes deal on Kurdistan oil exports within weeks

Iraq eyes deal on Kurdistan oil exports within weeks
Under the terms of the deal announced in April, sales of Kurdish oil are to go through the Iraqi National Oil Co., and no longer exclusively through the authorities in Iraqi Kurdistan. (AFP)
Short Url
Updated 03 May 2023

Iraq eyes deal on Kurdistan oil exports within weeks

Iraq eyes deal on Kurdistan oil exports within weeks
  • US crude stockpiles fall, gasoline builds as demand weakens: EIA

BAGHDAD, NEW YORK: Iraq’s oil minister expressed hope on Wednesday his government can reach an agreement soon on the resumption of crude exports from the autonomous Kurdistan region to Turkiye.

Ankara stopped importing oil from Iraqi Kurdistan in March after the International Chamber of Commerce ruled the federal government in Baghdad was the only entity authorized to manage exports.

Baghdad and the Kurdish authorities in Irbil signed last month a provisional agreement establishing an export mechanism that would be supervised by the federal government, but some issues remain unresolved.

“Regarding the agreement with Iraqi Kurdistan, within a week or two maximum we will reach a final agreement for the resumption of crude exports,” Iraqi Oil Minister Hayan Abdel Ghani said, adding the indications were “positive.”

Abdel Ghani said tests had been carried out on Turkish pipelines to avoid potential oil leaks, after a deadly and devastating earthquake hit Turkiye on Feb. 6.

Under the terms of the agreement announced in April, sales of Kurdish oil are to go through the Iraqi National Oil Co., and no longer exclusively through the authorities in Iraqi Kurdistan.

In addition, revenues from Kurdish exports are to be paid into an account managed by Irbil and supervised by Baghdad.

US inventories

US crude oil inventories fell for a third week in a row, while gasoline stockpiles unexpectedly rose last week as demand weakened, the Energy Information Administration said on Wednesday.

Crude inventories fell by 1.3 million barrels in the week ending April 28 to 459.6 million barrels, compared with analysts’ expectations in a Reuters poll for a 1.1-million-barrel drop.

Crude in the Strategic Petroleum Reserve declined 2 million to 364.9 million barrels, its lowest since October 1983. Levels dropped for the third week in a row as part of a congressionally mandated sale of 26 million barrels. “Overall, hydrocarbon inventories are declining at the same time that the US continues with its Strategic Petroleum Reserve release,” said Andrew Lipow, president of Lipow Oil Associates in Houston.

Gasoline stocks rose by 1.7 million barrels to 222.9 million barrels, the EIA said, compared with forecasts for a 1.2-million-barrel drop.

Demand for the motor fuel ahead of the peak summer driving season fell significantly, down 9.4 percent to 8.6 million bpd.

Crude prices extended their losses after the data showed weakness in the fuel sector.

US crude oil futures fell $2.93, or 4.1 percent, to $68.73 a barrel by 11 a.m. ET (1600 GMT). Brent crude fell $2.70, or 3.6 percent, to $72.64.

Distillate stockpiles, which include diesel and heating oil, also fell by 1.2 million barrels to 110.3 million barrels, versus expectations for a 1.1-million-barrel drop, the EIA data showed.


EV maker Lucid Group plans to raise $3bn, mainly from Saudi PIF 

EV maker Lucid Group plans to raise $3bn, mainly from Saudi PIF 
Updated 11 sec ago

EV maker Lucid Group plans to raise $3bn, mainly from Saudi PIF 

EV maker Lucid Group plans to raise $3bn, mainly from Saudi PIF 

RIYADH: Lucid Group plans to raise $3 billion through a stock offering, 66 percent of which will come from Saudi Arabia’s Public Investment Fund. 

The California-based EV maker said Ayar Third Investment Co., which is its majority stockholder and an affiliate of the PIF, has agreed to buy as much as 265.7 million shares in a private placement for an estimated $1.8 billion, 

It said the remainder will be raised from a public offering of 173.5 million shares of common stock.  

The private placement is expected to close on June 26 of this year. A private placement is a process whereby stocks are sold privately to investors selected beforehand.  

Following these purchases, Ayar Third Investment Co. anticipates maintaining its 60.5 percent ownership of Lucid’s outstanding common stock.  

From Lucid’s perspective, the proceeds will be utilized for general corporate purposes including capital expenditures and working capital, among others.  

Last year, Lucid signed a deal for the construction of a plant in the Kingdom that will produce 150,000 electric vehicles per year.   

The company signed agreements with the Ministry of Investment of Saudi Arabia, the Saudi Industrial Development Fund, and the Economic City at King Abdullah Economic City.  

The American luxury vehicles company is expected to receive financing and incentives of up to $3.4 billion over the next 15 years to build and operate the manufacturing facility in the Kingdom.  

Located in King Abdullah Economic City, AMP-2 is the PIF-backed EV manufacturer’s first production facility outside the US.  

“We are keen to achieve high and sustainable human capital localization in line with Vision 2030,” Global Vice President and Managing Director at Lucid Faisal Sultan told Arab News in April.  

“With our recently launched Lucid Future Talent program — in collaboration with the Human Resources Development Fund — we plan to provide the right training to enrich and prepare local talent to fill future job opportunities in the Kingdom,” Sultan explained. 

 


Closing bell: Saudi main index closes flat as trading turnover hits $1.34m 

Closing bell: Saudi main index closes flat as trading turnover hits $1.34m 
Updated 27 min 26 sec ago

Closing bell: Saudi main index closes flat as trading turnover hits $1.34m 

Closing bell: Saudi main index closes flat as trading turnover hits $1.34m 

RIYADH: Saudi Arabia’s Tadawul All Share Index was steady on Thursday, as it edged up 0.82 points, or 0.01 percent, to close at 11,014.95.  

A day earlier, the benchmark index had shed 125.85 points, primarily driven by a fall in oil prices.  

While parallel market Nomu gained 134 points to close at 21,415.33, the MSCI Tadawul Index shed 5.73 points to 1,458.68.  

The total trading turnover of the benchmark index was SR5.03 billion ($1.34 billion) as 113 stocks advanced, while 100 retreated. 

The top performer of the day was The Co. for Cooperative Insurance. The firm’s share price rose by 6.33 percent to SR121.  

Alkhaleej Training and Education Co. and Electrical Industries Co. also performed well, as their share prices rose by 5.36 percent and 5.32 percent, respectively.  

Saudi Enaya Cooperative Insurance Co. emerged as the worst performer, as its share price dropped by 9.87 percent to SR12.42.  

On the announcements front, Obeikan Glass Co. appointed Ibrahim Mohammad Al-Hammad as its new CEO. Al-Hammad will replace the outgoing CEO Fayez bin Jameel Abdulrazzaq.  

In a Tadawul statement, Obeikan Glass said that the new appointment will be effective from June 30. The company’s share price dipped by 0.91 percent to SR78.  

Meanwhile, Bank Aljazira announced its intention to establish a domestic riyal-denominated Tier 1 sukuk issuance program of up to SR5 billion.  

According to a Tadawul statement, the bank has mandated AlJazira Capital as the sole arranger for the establishment of the proposed sukuk program and the potential offer.  

It noted that the offer has been made to strengthen the capital base of the bank and to support its financial and strategic needs. The bank’s share price dropped by 0.34 percent to close at SR17.48.


Saudi Arabia in deal with Brazilian company to boost food security

Saudi Arabia in deal with Brazilian company to boost food security
Updated 55 min 41 sec ago

Saudi Arabia in deal with Brazilian company to boost food security

Saudi Arabia in deal with Brazilian company to boost food security

RIYADH: The Kingdom’s sovereign wealth fund-owned Saudi Agricultural and Livestock Investment Co. and South American firm Marfrig Global Foods SA have committed to buying shares in a potential new offering worth $900 million by BRF SA, Brazil’s biggest poultry producer. 

BRF said in a bourse filing that SALIC offered to subscribe to 50 percent of the total offer or 500 million new shares. 

Marfrig Global Foods SA, which owns 33 percent of BRF, pledged to buy the remaining 250 million shares, reported Reuters. 

Under the terms of the proposed transaction, the offer must be priced at no more than 9 reais ($1.8) per share, which would represent a 23.8 percent premium over its closing price of 7.27 reais on Tuesday, BRF said in a securities filing. 

BRF’s board of directors has already approved engaging a financial adviser to analyze the move. 

The poultry producer’s shares surged as much as 15.7 percent, making it the top gainer on Brazil’s benchmark stock index Bovespa while Marfrig stock rose around 5 percent. 

The Kingdom has been keen to empower its food security while playing a significant role in global agricultural and livestock supply. 

Such investments hold strategic significance for the Kingdom, considering its substantial demand for Brazilian meat products. 

Moreover, BRF and PIF-owned SALIC signed a memorandum of understanding last year to establish a joint venture focused on chicken production in Saudi Arabia, further strengthening their collaboration in the poultry sector. 

Furthermore, SALIC holds a significant 33.83 percent ownership stake in Minerva Foods, a prominent Brazilian meat company, underscoring the significance of foreign investments in ensuring global food security. 


Saudi merchandise imports drop 4.9% to $49bn in Q1: GASTAT    

Saudi merchandise imports drop 4.9% to $49bn in Q1: GASTAT    
Updated 23 min 47 sec ago

Saudi merchandise imports drop 4.9% to $49bn in Q1: GASTAT    

Saudi merchandise imports drop 4.9% to $49bn in Q1: GASTAT    

RIYADH: Saudi Arabia’s merchandise imports dropped 4.9 percent to SR186.4 billion ($49 billion) in the first quarter of 2023, compared to SR196 billion recorded in the previous quarter, the latest data from the Kingdom’s General Authority for Statistics showed.

However, when compared with the SR157.9 billion worth of imports recorded in the first quarter of 2022, the Kingdom’s merchandise imports surged 18.1 percent in the first three months of this year.

It was driven by machinery and mechanical appliances, electrical equipment, and parts which collectively accounted for 20.9 percent of the total merchandise imports. The imports of transport equipment and parts accounted for 16.1 percent of the total value. 

China remains Saudi Arabia’s top origin for imports with SR40 billion worth of merchandise, representing 21.5 percent of the Kingdom’s total imports during the period.  

Jeddah Islamic Port facilitated SR54.6 billion worth of imports in the first quarter of 2023, reflecting 29.3 percent of the total value during the period.  

Among the other major ports of entry were King Abdulaziz Port in Dammam and King Khalid International Airport in Riyadh, which accounted for 19.3 percent and 12.2 percent of the total value of imports, respectively, in the first quarter of 2023. 

Meanwhile, King Abdulaziz International Airport accounted for 6.5 percent of the total value of imports while King Fahad International Airport in Dammam accounted for 6 percent.  

Together, those five ports accounted for 73.3 percent of the total merchandise imports of the Kingdom in the first quarter of this year.  

On the other hand, overall merchandise exports decreased by 14.6 percent in the first three months of 2023 when compared to the same period of last year.  

The value of exports amounted to SR313.5 billion in the same period, down from SR367.1 billion in the corresponding period a year ago.  

The drop in exports is mainly attributed to the decrease in oil exports which fell by 14.9 percent to SR245.4 billion in the first quarter of 2023, compared to SR288.5 billion recorded during the same period last year.  

The GASTAT report further disclosed that exports to China amounted to SR51.5 billion, reflecting 16.4 percent of total exports, as the East Asian country remains the Kingdom’s main destination for exports.  

However, Saudi Arabia’s exports are likely to grow at nearly 5 percent annually to hit $418 billion by 2030, a new report by Standard Chartered predicted. 

It attributed this to Saudi Arabia’s strategic location which the Kingdom is looking to leverage on to drive trade and export.  

“The Kingdom aspires to become the next global logistics hub and has pledged to make its economy more sustainable and innovative,” Mazen Al-Bunyan, CEO of Standard Chartered in Saudi Arabia, said.  

Leveraging its strategic location at the center of Asia, Africa and Europe, he said Saudi Arabia is enhancing its shipping networks to connect these regions and is continuously liberalizing international trade of goods and services. 


With various initiatives across the logistics, sustainability and innovation fronts, Al-Bunyan said, “Saudi Arabia is poised to lead the Gulf and wider Middle East into a new era of trade and economic prosperity.”


UAE In-Focus – Abu Dhabi launches initiatives to boost smart manufacturing in SME sector

UAE In-Focus – Abu Dhabi launches initiatives to boost smart manufacturing in SME sector
Updated 01 June 2023

UAE In-Focus – Abu Dhabi launches initiatives to boost smart manufacturing in SME sector

UAE In-Focus – Abu Dhabi launches initiatives to boost smart manufacturing in SME sector

RIYADH: The Abu Dhabi Department of Economic Development launched two initiatives that will prepare small and medium enterprises to meet the objectives of the emirate’s industrial strategy, reported the state-run news agency WAM.

The department launched the Smart Manufacturing Competence Center, which will act as a catalyst for local and global industry stakeholders to establish an innovative and sustainable ecosystem.

It also launched the Smart Manufacturing Incentive Program. It aims to assist SMEs in the industrial sector in their transformation toward smart manufacturing.

The program will implement the six transformational programs of Abu Dhabi Industrial Strategy: Industry 4.0, Circular Economy, Talent Development, Ecosystem Enablement, Homegrown Supply Chain, and Value Chain Development.

Abu Dhabi aims to invest 10 billion dirhams ($2.7 billion) across these initiatives to double the size of its manufacturing sector to 172 billion dirhams, create 13,600 jobs and increase the country’s non-oil exports to 178.8 billion dirhams by 2031.  

Scheduled to begin operations in the first quarter of 2024, the SMCC will facilitate stakeholder collaboration, consolidate innovative manufacturing services and promote knowledge sharing.

MoIAT offers career opportunities in the industrial sector  

The UAE’s Ministry of Industry and Advanced Technology has launched a new initiative to offer 500 training and job opportunities to local talent.

In collaboration with the Emirati Talent Competitiveness Council and the Ministry of Human Resources and Emiratization, the program aims to equip Emiratis with skills to join the industrial sector.

The program will be specially designed and structured by leading institutes, including the Center of Excellence for Applied Research and Training and Abu Dhabi Vocational Education and Training Institute, WAM reported.

More than 70 industrial companies from the UAE will participate in offering these training and employment opportunities through the Nafis platform.

Tabby raises debt facility to $350m  

UAE-based fintech company Tabby upsized its debt facility to $350 million after closing a financing round by US-based Partners for Growth along with Atalaya Capital Management and CoVenture.

Last August, Tabby secured $150 million in debt funding to facilitate its “Buy Now Pay Later” offering further.

The company will use the additional financing to serve more customers and retailers. Tabby claims to have 4 million customers and 15,000 retailers.