OPEC forecasts ‘robust’ increase in global oil demand in 2025

OPEC adjusted its production figures lower to reflect the exit from the group of Angola, announced by Luanda last month.
OPEC adjusted its production figures lower to reflect the exit from the group of Angola, announced by Luanda last month.
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Updated 17 January 2024
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OPEC forecasts ‘robust’ increase in global oil demand in 2025

OPEC forecasts ‘robust’ increase in global oil demand in 2025
  • Oil producers’ group keeps 2024 projection unchanged at 2.25 million bpd

RIYADH: The Organization of the Petroleum Exporting Countries on Wednesday stuck to its forecast for relatively strong growth in global oil demand in 2024 and said 2025 will see a “robust” increase in oil use, led by China and the Middle East, in an earlier than usual prediction.

In its monthly report, the oil producers’ group said the global oil demand will rise by 1.85 million barrels per day in 2025. For 2024, OPEC sees demand growth of 2.25 million bpd, which was unchanged from last month.

The 2025 prediction is OPEC’s first in its monthly report. OPEC said publishing it earlier than usual is aimed at providing long-term guidance for the market.

“The undertaking to reach beyond the previously established time horizon of short-term forecasting serves to support the understanding of market dynamics,” OPEC said in the report.

It has consistently forecast stronger demand growth for 2024 than other forecasters, such as the International Energy Agency. The two have clashed in recent years over issues such as long-term demand and the need for investment in new supplies.

The OPEC report also noted that the group’s oil production rose slightly in December led by Nigeria, despite ongoing output cuts by the wider OPEC+ alliance to support the market.

OPEC adjusted its production figures lower to reflect the exit from the group of Angola, announced by Luanda last month.

On the supply side, non-OPEC liquids production in 2024 is forecast to grow by 1.3 mbd to average 70.4 mbd, including 50,000 barrels a day in processing gains, the report said. The US, Canada, Guyana, Brazil, Norway and Kazakhstan are expected to be the main drivers, it added.

In addition to the US shale basins which account for about 49 percent of expected non-OPEC liquids supply growth, offshore projects — mainly in Latin America — are expected to substantially support growth this year.


Oil Updates – prices rise on bigger-than-expected drop in US crude stocks

Oil Updates – prices rise on bigger-than-expected drop in US crude stocks
Updated 18 July 2024
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Oil Updates – prices rise on bigger-than-expected drop in US crude stocks

Oil Updates – prices rise on bigger-than-expected drop in US crude stocks

SINGAPORE: Oil prices extended gains from the previous session on Thursday, buoyed by a bigger-than-expected decline last week in crude stocks in the US, the world’s largest oil consumer, according to Reuters.

Brent futures rose 58 cents, or 0.7 percent, to $85.66 a barrel by 8:30 a.m. Saudi time, while US West Texas Intermediate crude gained 75 cents, or 0.9 percent, to $83.60.

Both contracts settled higher on Wednesday.

US crude inventories fell by 4.9 million barrels last week, the latest data from the US Energy Information Administration showed. That exceeds a decline of 30,000 barrels forecast by analysts in a Reuters poll and a drop of 4.4 million barrels in a report from the American Petroleum Institute trade group.

“Healthy demand signals from the US outweighs concerns from modest Chinese growth last week,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.

“Hopes of a Fed easing, which can boost economic growth, and current summer travel in the US are ensuring enough traction in oil demand from the world’s largest economy,” Sachdeva said.

The prospects of cuts in interest rates in coming months in the both the US and Europe helped to support the market.

Federal Reserve officials said on Wednesday the US central bank is “closer” to cutting interest rates given inflation’s improved trajectory and a labor market in better balance, possibly setting the stage for a reduction in borrowing costs in September.

Also, US economic activity expanded at a slight to modest pace from late May through early July with firms expecting slower growth ahead.

The European Central Bank, meanwhile, is all but certain to keep interest rates unchanged on Thursday, but signalled that its next move is likely to be a cut.

Investors are also awaiting policy news from a key leadership gathering in China that is to end on Thursday.

The dollar eased on Thursday for a third straight session. A weaker dollar can boost demand for oil by making greenback-denominated commodities like oil cheaper for holders of other currencies. 


Saudi Aramco completes issuance of international bonds worth $6bn 

Saudi Aramco completes issuance of international bonds worth $6bn 
Updated 18 July 2024
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Saudi Aramco completes issuance of international bonds worth $6bn 

Saudi Aramco completes issuance of international bonds worth $6bn 

RIYADH: Energy giant Saudi Aramco has completed the issuance of a $6 billion US dollar-denominated international bond, marking the state oil firm’s return to the debt market after a hiatus of three years.  

In a Tadawul statement, the company revealed that the offerings, which began on July 9 under the firm’s Global Medium Term Note program, will be traded on the London Stock Exchange. 

The last time Aramco tapped the debt market was in 2021 when it raised $6 billion from a three-tranche sukuk, or Islamic bond. 

Governments and companies operating in the Middle East region have been eager to leverage debt markets this year amidst declining global interest rates. As part of this trend, Saudi Arabia issued $12 billion in dollar-denominated bonds in January. 

Aramco Executive Vice President of Finance & CFO, Ziad T. Al-Murshed, said: “We are pleased with the strong interest and level of engagement from investors globally, both existing and new. Our order book exceeded $33 billion at its peak, reflecting Aramco’s exceptional financial resilience and fortress balance sheet.”  

He added: “Achieving a negative issue premium across all tranches is a testament to our unique credit proposition. We have consistently demonstrated our financial discipline, while delivering on shareholder value and business growth, and we aim to maintain a strong investment-grade credit rating across business cycles.” 

Aramco disclosed that the bonds will have a minimum subscription of $200,000. 

These financial instruments have three $2 billion senior notes, which are expected to provide a yield of 5.25 percent, 5.75 percent, and 5.87 percent for bonds maturing in 10, 30, and 40 years, respectively.  


Saudi Arabia’s tourist expenditure hits $40bn in H1, says minister

Saudi Arabia’s tourist expenditure hits $40bn in H1, says minister
Updated 18 July 2024
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Saudi Arabia’s tourist expenditure hits $40bn in H1, says minister

Saudi Arabia’s tourist expenditure hits $40bn in H1, says minister

RIYADH: Tourist spending in Saudi Arabia reached approximately SR150 billion ($40 billion) in the first half of 2024, reflecting a 10 percent increase in both traveler numbers and expenditure compared to the same period the previous year, as revealed by a top minister. 

At a conference convened to review the 2024 summer tourism program, the Kingdom’s Minister of Tourism Ahmed Al-Khateeb reiterated that his country will launch a tourist visa next month to attract more international visitors and bolster the sector’s growth.

This comes as Saudi Arabia has set an ambitious target to host 150 million tourists annually by 2030, underscoring its commitment to transforming the Kingdom into a premier global tourism destination. 

The country’s passenger air traffic surged by 17 percent in the first half of 2024, reaching 62 million compared to 53 million in the same period last year, according to statistics released by the General Authority of Civil Aviation.  

This growth was supported by a 12 percent increase in flights, with 446,000 recorded compared to 399,000 in the first half of 2023. 

Al-Khateeb shared statistics from the first half of the year, stating: “We achieved 60 million visits and approximately SR150 billion in tourist spending.” 

The minister added that this reflects a 10 percent rise in both visitor numbers and expenditure compared to the same period last year.

He described the country as a “continent,” highlighting its vast natural beauty and varied landscapes, including mountains, resorts, Red Sea beaches, and vibrant cities.  

This diversity, he noted, positions Saudi Arabia uniquely to offer a wide array of tourism products to global travelers. 

Outlining initiatives aimed at enhancing opportunities and training for Saudis, he said: “We’ve raised salaries and conducted over 100,000 training courses annually.” 

This underscores the ministry’s proactive stance in encouraging private-sector investment in Saudi human capital.

Al-Khateeb noted the crucial role of the private sector in shaping the tourism landscape. “The tourism and travel sector worldwide is primarily managed by the private sector, and we recognize its pivotal role in our sector’s development,” he affirmed. 

Al-Khateeb also pointed out the substantial impact of the Tourism Development Fund on building the country’s infrastructure.

Launched in June 2020, the fund has already financed over 100 projects totaling SR35 billion, encompassing a mix of small to medium-sized ventures and larger-scale initiatives. 

“In Asir (region) alone, the Tourism Development Fund has allocated SR1 billion to 10 projects, reflecting a significant focus on enhancing hospitality offerings in the region,” stated Al-Khateeb, showcasing the Kingdom’s commitment to regional development through strategic investment. 

To enhance transparency and support stakeholders, the minister announced the launch of comprehensive tourism statistics on the ministry’s website. “An annual report will provide valuable insights for the media and investors, detailing every statistic and figure relevant to Saudi Arabia’s tourism sector,” he added.

According to the latest data released by the ministry, the total number of tourists reached 109.3 million in 2023, with 81.9 million being local tourists and 27.4 million international visitors. 

In terms of economic impact, expenditure by international tourists totaled SR141.2 billion last year, while local tourists spent SR114.4 billion, bringing the total tourism expenditure to SR255.6 billion in 2023.

“We achieved 153 percent growth in tourism compared to 2019. Asir received 8 million tourists last year, who spent around $3 billion,” the minister said.


Egypt achieves record primary surplus of $18.14bn in fiscal year 2023/24

Egypt achieves record primary surplus of $18.14bn in fiscal year 2023/24
Updated 17 July 2024
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Egypt achieves record primary surplus of $18.14bn in fiscal year 2023/24

Egypt achieves record primary surplus of $18.14bn in fiscal year 2023/24

RIYADH: Egypt’s budget recorded a preliminary surplus of 875 billion Egyptian pounds ($18.14 billion) for the fiscal year 2023/2024, compared to 164 billion during the previous period, a top official revealed.

During a Cabinet meeting chaired by Egypt’s Prime Minister Mostafa Madbouly, Minister of Finance Ahmed Kouchouk highlighted that this improvement came despite economic activity shocks.

The North African country’s economy has witnessed blows over the last year due to the ongoing crisis in Gaza, which has slowed tourism growth and cut into Suez Canal revenue, two of Egypt’s biggest sources of foreign currency.

To help alleviate the inflationary effects that have been burdening the Egyptian public, the government in April increased the amount of funding required in its 2024/2025 budget by over 2.8 trillion pounds ($59 billion).

Kouchouk stated that revenues represented an annual growth of about 59.3 percent during the fiscal year 2023/2024.

The budget also achieved a total deficit that was about 706 billion pounds lower than what was listed in the revised budget.

Kouchouk noted the reduction in the overall deficit in the general budget during 2023/2024, which amounted to about 505 billion Egyptian pounds, compared to a deficit of about 610 billion pounds in the previous fiscal year – a decrease of 17 percent.

Despite the deficit shrinking, there were sectors that exceeded their allocated budgets. 

Education required around 256 billion pounds in funding, compared to around 230 billion pounds in the original budget.

Health sector needs totaled about 180 billion pounds, against an initial allocation of about 148 billion pounds.

The public treasury paid the Insurance and Pensions Fund’s dues, which amounted to 185 billion pounds, and settled all fees related to food subsidy support, amounting to 133 billion pounds, compared to about 128 billion pounds in the original budget.

He noted that this, alongside increasing wages and salaries of government employees and providing adequate allocations for various support items and social protection programs, contributed to an annual expenditure growth rate of 37.4 percent.

Kouchouk emphasized the continued efforts to improve the expenditure structure, which was generally achieved for all budget chapters, pointing out that the debt service bill remains high, and efforts are underway to reduce it.

The Minister of Finance reviewed the rates and developments regarding allocations for subsidies, grants, and social benefits, especially those related to supporting industrial production, export incentives, as well as social protection programs, and the health and education sectors.

Kouchouk also discussed the future budget estimates for the fiscal year 2024/2025, explaining that the Ministry of Finance aims to reduce the budget’s debt and place it on a downward trajectory.

Despite the difficulties the public treasury faced in the fiscal year 2023/2024 as a result of regional geopolitical unrest, high rates of inflation, and social programs put in place to protect citizens and pensioners, Kouchouk reiterated that the ministry was able to achieve strong financial performance by taking the required steps to mobilize revenues and control public finances.


Closing Bell: Saudi main index closes in green at 12,157

Closing Bell: Saudi main index closes in green at 12,157
Updated 17 July 2024
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Closing Bell: Saudi main index closes in green at 12,157

Closing Bell: Saudi main index closes in green at 12,157

RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Wednesday, gaining 77.24 points, or 0.64 percent, to close at 12,157.61. 

The total trading turnover of the benchmark index was SR7.37 billion ($1.96 billion) as 157 of the listed stocks advanced, while 64 retreated.    

The MSCI Tadawul Index increased by 6.82 points, or 0.45 percent, to close at 1,520.39. 

The Kingdom’s parallel market Nomu decreased by 31.22 points, or 0.12 percent, to close at 25,887.91. This comes as 36 of the listed stocks advanced, while as many as 32 retreated. 

The best-performing stock of the day was AYYAN Investment Co., with its share price surging by 9.97 percent to SR19.42. 

Other top performers include the Miahona Co. and Al Sagr Cooperative Insurance Co., whose share prices soared by 9.88 percent and 9.41 percent, to stand at SR42.25 and SR24.88, respectively. 

National Gas and Industrialization Co. and Al-Baha Investment and Development Co. were also amongst the top gainers.  

The worst performer was the Mediterranean and Gulf Insurance and Reinsurance Co. whose share price dropped by 2.46 percent to SR31.70. 

Other underperformers included Baazeem Trading Co. and Arabian Pipes Co., with their share prices declining by 1.53 percent to SR64.30 and 1.20 percent to SR131.40, respectively.

Saudi Public Transport Co. and Red Sea International Co. also experienced declines in their stock prices.

Value Capital Co., serving as the financial advisor and lead manager, announced that Tharwah Co. intends to offer 705,735 ordinary shares, representing 15 percent of its total shares post-offering. The company’s shares will be listed on Nomu. 

Tharwah Co.’s application for listing on the parallel market. was approved by the Saudi Exchange on May 19, and the Capital Market Authority approved the offering on June 3. The price per share for subscribers will be determined after the book-building period. The one-week offering period is scheduled to commence on Aug. 4. 

Alkhabeer Capital, a Shariah-compliant investment and financial services firm, has announced the listing and commencement of trading for the Alkhabeer Diversified Income Fund 2030 on the Saudi Exchange. 

In an official statement, the fund reported successful participation from a diverse group of investors, including individuals and institutions, during its initial public offering.  

The IPO concluded on June 13, attracting 144,132 subscribers and raising a total of SR305.4 million.