Oil Updates — crude up; Iraq decides to trade oil for Iranian gas

Oil Updates — crude up; Iraq decides to trade oil for Iranian gas
Brent futures were up 20 cents to $79.60 a barrel at noon Saudi time, while US West Texas Intermediate crude also edged up 20 cents to $75.03 a barrel. (Shutterstock)
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Updated 12 July 2023
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Oil Updates — crude up; Iraq decides to trade oil for Iranian gas

Oil Updates — crude up; Iraq decides to trade oil for Iranian gas

RIYADH: Oil benchmark Brent futures breached $80 a barrel for the first time since May on Wednesday after US inflation data suggested the interest rate hike cycle in the world’s biggest economy is set to finally cool.

Data released on Wednesday showed US consumer prices rose modestly in June and registered their smallest annual increase in more than two years as inflation continued to subside.

Brent futures were 51 cents up at $79.91 a barrel at 03:56 p.m. Saudi time, having risen as high as $80.05 earlier. US West Texas Intermediate crude was up 62 cents at $75.45 a barrel.

Top producer Saudi Arabia pledged last week to extend a production cut of 1 million barrels per day in August, while Russia will cut exports by 500,000 bpd. 

Azerbaijan oil output at 15.2m metric tons in H1 

Azerbaijan’s oil output reached 15.2 million metric tons between January and June this year, the country’s Energy Minister Parviz Shahbazov said on Wednesday on Twitter, a decline of 8 percent from the year-earlier period. 

Oil production in Azerbaijan has been declining as the output at the Azeri–Chirag-Gunashli complex of offshore oilfields, operated by BP, has passed its peak. 

The minister also said it exported 12.7 million metric tons of oil in the first half of the year. 

Qatar expects record volume of LNG offtake signings this year​ 

Qatar will sign record volumes of long-term liquefied natural gas offtake contracts this year, Energy Minister Saad Al-Kaabi said on Tuesday at a conference in Vancouver. 

About 40 percent of new global LNG output will come from Qatar by 2029, Al-Kaabi said at the LNG 2023 conference. 

Iraq to trade crude oil for Iranian gas to settle power debt 

Iraq will begin trading crude oil for Iranian gas to end the recurring payment delays to Tehran due to the need for US approval, Iraqi Prime Minister Mohammed Shia Sudani said. 

Sudani said Iran had cut gas exports to Iraq by more than 50 percent as of July 1 after Baghdad failed to secure US approval to disburse owed funds, but Tehran had now agreed to resume gas exports in exchange for crude oil. 

The deal was reached during talks with an Iranian delegation in Baghdad since Saturday, Sudani said in a televised speech. 

(With input from Reuters) 


Masdar City to lead $1.08bn innovation drive in energy and AI: CEO 

Masdar City to lead $1.08bn innovation drive in energy and AI: CEO 
Updated 12 min 19 sec ago
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Masdar City to lead $1.08bn innovation drive in energy and AI: CEO 

Masdar City to lead $1.08bn innovation drive in energy and AI: CEO 

RIYADH: Abu Dhabi’s Masdar City is gearing up to deliver energy and artificial intelligence projects with 4 billion dirhams ($1.08 billion) in investments, according to its CEO.

In an interview with the Emirates News Agency on the sidelines of the World Future Energy Summit in Abu Dhabi, Ahmed Baghoum unveiled ambitious plans for the development.

The conference, hosted by Abu Dhabi Future Energy Co., also known as Masdar, is taking place from April 16 to 18, bringing together global experts to devise sustainable solutions for tomorrow.

Baghoum said there are projects under the design phase with an investment cost ranging between 3 to 4 billion dirhams that target critical sectors like energy, artificial intelligence, and space, as well as life sciences and agriculture, according to WAM.

The CEO also outlined the current landscape of development at Masdar City. The ongoing construction projects, valued at approximately 1 billion dirhams, include the iconic Masdar City Complex and The Link, set to be completed by mid-2025.

According to Masdar City, The Link is an innovative 30,000 sq. m. development featuring the region’s first net-zero energy shared working and living facility.

“The Link will model a new kind of sustainable community by connecting shared working and living space with other elements of a thriving neighborhood, including places to shop, play, and relax, and local transportation,” the CEO said in a press release earlier last year.

He pointed out that it serves as a vital element in Masdar City’s blueprint for sustainable urban development.

Highlighting the strategic focus of Masdar City, Baghoum emphasized to WAM the significance of vital sectors, including energy and AI for Abu Dhabi and the broader UAE. 

The CEO also underscored the commitment to bolstering these industries by attracting top talent and fostering partnerships and discussed ongoing talks with foreign companies interested in relocating and setting up their research centers in Masdar City.

Additionally, Baghoum outlined the attractive incentives for companies considering relocation to Masdar City, saying: “Masdar City is a world-class business and technology hub, operating at the highest international standards. It offers companies a compelling package of advantages and incentives, including full foreign ownership, exemption from income tax, and unrestricted currency exchange.”


Egypt’s finance minister says cutting inflation is priority

Egypt’s finance minister says cutting inflation is priority
Updated 55 min 5 sec ago
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Egypt’s finance minister says cutting inflation is priority

Egypt’s finance minister says cutting inflation is priority

CAIRO: The Egyptian government’s main priority is to reduce inflation to within the central bank’s target, Finance Minister Mohamed Maait said on Tuesday, adding that economic growth was expected to rise in the financial year starting in July to 4.2 percent, from 2.8 percent this year, according to Reuters.

Maait also said the government aimed to sell more state assets, which would reduce the state’s role in the economy, allow the private sector more ownership, increase productivity and generate revenue to reduce Egypt’s debt.

Egypt’s economy has been hurt over the last half year by the crisis in Gaza, which has slowed tourism growth and cut into Suez Canal revenue, two of the country’s biggest sources of foreign currency.

Revenue from the waterway has fallen by more than 60 percent, Maait said, speaking during the IMF Governor Talks series in Washington.

The challenges prompted the IMF to expand financial support to Egypt to $8 billion, while Egypt sharply devalued its currency, made its latest pledge to move to a flexible exchange rate, and struck a record $35 billion investment deal with a UAE sovereign wealth fund.

Inflation dipped to 33.3 percent in March from a record 38 percent in September, far higher than the central bank’s long-standing target of between 5 percent and 9 percent.

Egypt generated growth over the last decade by financing giant state projects, including a new $58 billion capital in the desert, through a borrowing spree abroad that quadrupled its foreign debt.

The government hopes to lower interest rates to reduce interest payments on debt, Maait said. The central bank so far this year has raised its overnight interest rates by 800 basis points.

The government has put a limit of 1 trillion Egyptian pounds ($20.6 billion) on all public investment, including that of the military, Maait said. The private sector should make up at least 65-70 percent of the economy, he added.

“Giving the main role to the private sector to lead the country is in the benefit of the state. Why? Because we have close to 1 million young people coming to the labor market looking for jobs every year,” Maait said.

“Who will be able to create that? The government cannot create more than 100,000 new jobs. An economy led by the private sector can create 900,000 — even more — jobs, but we have to give them the opportunity.”


Oil Updates – prices dip as demand worries outweigh Mideast supply fears

Oil Updates – prices dip as demand worries outweigh Mideast supply fears
Updated 17 April 2024
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Oil Updates – prices dip as demand worries outweigh Mideast supply fears

Oil Updates – prices dip as demand worries outweigh Mideast supply fears

TOKYO/SINGAPORE: Oil prices extended losses on Wednesday as worries about global demand due to weak economic momentum in China and a likely rise in US commercial stockpiles outweighed supply fears from heightened tensions in the Middle East, according to Reuters.

Brent futures for June fell 40 cents, or 0.44 percent, to $89.62 a barrel by 9:32 a.m. Saudi time, while US crude futures for May fell 48 cents, or 0.56 percent, to $84.88 a barrel.

Oil prices have softened so far this week as economic headwinds pressured investor sentiment, curbing gains from geopolitical tensions, with market’s eyeing on how Israel might respond to Iran’s attack over the weekend.

“With oil prices highly sensitive to geopolitical risks, the past week has seen some wait-and-see consolidation in place as Israel’s response will determine if there may be a wider regional conflict, which could significantly impact oil supplies,” said IG market strategist Yeap Jun Rong.

“For now, the near-term weakness in oil prices may reflect some expectations that tensions may still be contained and that other key oil producer such as Saudi Arabia may jump in to mitigate any global supply shock,” Yeap added.

In China, the world’s biggest oil importer, the economy grew faster than expected in the first quarter, but several March indicators, including property investment, retail sales and industrial output, showed that demand at home remains frail, weighing on overall momentum.

“Apart from that, a build-up in US crude inventories overnight and a mixed set of economic data out of China also offered some reservations, alongside near-term overbought technicals which prompts some profit-taking,” Yeap said.

US crude oil inventories rose last week more than expected by analysts polled by Reuters, according to market sources citing American Petroleum Institute figures on Tuesday. Official data from the Energy Information Administration, the statistical arm of the US Department of Energy, is due on Wednesday at 5:30 p.m. Saudi time.

In the Middle East, a third meeting of Israel’s war cabinet set for Tuesday to decide on a response to Iran’s first-ever direct attack was put off until Wednesday, as Western allies eyed swift new sanctions against Tehran to help dissuade Israel from a major escalation.

Analysts however do not expect Iran’s unprecedented missile and drone strike on Israel to prompt dramatic sanctions action on Iran’s oil exports from the Biden administration.

Meanwhile, the US government could reimpose oil sanctions on Venezuela on Thursday — which in turn could tighten supplies in the market.

Prices could trade sideways in the meantime because of these current market drivers, analysts say.

WTI price movements in the short term are likely to be trapped in a sideways range between $83.20 and $87.70 due to conflicting factors such as China’s disappointing retail sales in March and geopolitical risk premium still remaining intact, said OANDA senior market analyst Kelvin Wong.


Saudi Fund for Development, St. Kitts and Nevis sign energy loan agreement

Saudi Fund for Development, St. Kitts and Nevis sign energy loan agreement
Updated 16 April 2024
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Saudi Fund for Development, St. Kitts and Nevis sign energy loan agreement

Saudi Fund for Development, St. Kitts and Nevis sign energy loan agreement
  • $40 million will finance the expansion of St. Kitts and Nevis’ power generation capabilities through the establishment of a dual-fuel power generation station with a capacity of 18 megawatts

RIYADH: Saudi Arabia on Tuesday signed a loan agreement with St. Kitts and Nevis for $40 million to support the Caribbean nation’s energy sector, Saudi Press Agency reported.

The agreement was signed by the CEO of the Saudi Fund for Development, Sultan bin Abdulrahman Al-Murshid, and the deputy prime minister of St. Kitts and Nevis, Geoffrey Hanley, on the sidelines of spring meetings of the Bank Group and the International Monetary Fund in Washington DC.

The $40 million will finance the expansion of St. Kitts and Nevis’ power generation capabilities through the establishment of a dual-fuel power generation station with a capacity of 18 megawatts.

The project will contribute to providing a flexible hybrid power generation platform to improve efficiency and burn clean fuel and to support the transition to a sustainable energy future.

The agreement is part of the SDF’s mission to support countries and small island developing states around the world to overcome developmental challenges.


Saudi air cargo volumes witness 7% rise: GACA

Saudi air cargo volumes witness 7% rise: GACA
Updated 16 April 2024
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Saudi air cargo volumes witness 7% rise: GACA

Saudi air cargo volumes witness 7% rise: GACA

RIYADH: The volume of air cargo handled by airports in Saudi Arabia saw an annual rise 7 percent in 2023 to reach 918,000 tonnes, official data showed. 

In its latest report, the General Authority for Civil Aviation said that the Kingdom’s aviation sector strongly rebounded in 2023, with airports witnessing a 26 percent rise in passenger transportation compared to 2022. 

GACA said that flight facilities in Saudi Arabia transported 112 million passengers last year, which also represented a rise of 8 percent compared to 2019.

The report revealed that the number of flights through the Kingdom’s airports in 2023 reached about 815,000, an increase of 16 percent compared to 2022.

In 2023, airports in Saudi Arabia handled 394,000 international and 421,000 domestic journeys, the authority added. 

Fueled by significant growth in the Kingdom’s travel and tourism sector, 61 million international visitors and 51 million domestic passengers traveled through the region’s airports in 2023. 

King Abdulaziz International Airport topped the list of the leading Saudi airports in terms of the number of flights, at a rate of 30 per hour. 

KAIA was followed by King Khalid International Airport in Riyadh, which operated an average of 27 flights per hour, while King Fahd International Airport operated 11 carriers in an hour. 

In February, Mohammed Al-Khuraisi, the executive vice president of strategy and business intelligence at GACA, said that Saudi Arabia’s aviation sector is expanding rapidly to meet the goal of reaching 250 destinations globally. 

He also added that the Kingdom jumped 14 places in the International Air Transport Association Air Connectivity Index in 2023, along with achieving the highest level of air connectivity during the year 2023 by reaching 149 destinations.

Earlier this month, GACA, through its Air Transport and International Cooperation Sector, authorized China Southern Airlines to operate journeys between Riyadh and three cities in the Asian nation. 

As a part of the authorization, the Chinese air carrier will operate flights from Beijing, Guangzhou, and Shenzhen to the Saudi capital. 

This initiative is part of GACA’s continuous efforts to strengthen connectivity and broaden the Kingdom’s air transport network as part of the objectives of Saudi Vision 2030.