PIF explores acquisition of Saudia to boost tourism efforts: Bloomberg 

The Public Investment Fund is considering adding Saudia to its aviation portfolio as early as next year, with plans to invest billions of dollars, Bloomberg reported. 
The Public Investment Fund is considering adding Saudia to its aviation portfolio as early as next year, with plans to invest billions of dollars, Bloomberg reported. 
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Updated 17 March 2024
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PIF explores acquisition of Saudia to boost tourism efforts: Bloomberg 

PIF explores acquisition of Saudia to boost tourism efforts: Bloomberg 

RIYADH: Saudi Arabia’s sovereign wealth fund is in early talks to buy the Kingdom’s flagship airline as part of transforming the country into a tourist destination.

The Public Investment Fund is considering adding Saudia to its aviation portfolio as early as next year, aiming to invest billions of dollars, according to Bloomberg.

Based on insider knowledge, the PIF would take over the airline from the government to increase profitability and efficiency, as reported by Bloomberg.

Additionally, the carrier may then be put up for sale or combined with Riyadh Air, which the wealth fund is now establishing.

The valuation of Saudia by PIF remains uncertain. Saudia operates a fleet of 142 aircraft and serves over 90 destinations globally.

Final decisions have yet to be made as talks are still in their early stages, and the idea could be postponed or discarded. Representatives from the airline and PIF declined to comment.

Saudi Arabia aims to establish Riyadh as a central business hub and compete with Gulf airlines for global transfer traffic.

Riyadh Air, established by PIF, aims to expand its network and compete with regional airlines such as Emirates and Qatar Airways.

Meanwhile, Saudia, the Kingdom’s largest airline, is shifting its attention to religious pilgrimages.

In 2023, the two Saudi carriers ordered 78 Boeing 787 Dreamliners worth over $37 billion, as evaluated by the White House.

The Kingdom aims to attract 150 million tourists annually by 2030 to diversify its economy and increase foreign currency inflow to reduce reliance on oil.

PIF plays a central role in this strategy, overseeing the redevelopment of Riyadh’s airport into a major global hub. 

It has also initiated ventures such as an aircraft leasing company and a helicopter firm and has invested in Saudia’s engineering subsidiary.

Saudi Arabia has secured $13 billion in private sector investments for its tourism industry, aiming to distribute the costs involved in becoming a top destination, Princess Haifa Al-Saud, the Kingdom’s vice minister for tourism, said. 

According to the minister, the investments are expected to increase the number of hotel rooms by 150,000 to 200,000 within the next two years. 

Saudi Arabia aims to raise tourism revenue to $85 billion this year, up from approximately $66 billion in 2023, Princess Haifa said in an interview with Bloomberg.

“The current GDP (gross domestic product) contribution is 4.5 percent and we aim to get that to 10 percent by 2030. We started from 3.2 percent when we opened up for tourism,” she said.


Malaysia preparing to join BRICS economic group, media report says

Malaysia preparing to join BRICS economic group, media report says
Updated 4 sec ago
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Malaysia preparing to join BRICS economic group, media report says

Malaysia preparing to join BRICS economic group, media report says

KUALA LUMPUR: Malaysia is preparing to join the BRICS group of emerging economies, Prime Minister Anwar Ibrahim said in an interview with Chinese media outlet Guancha, Reuters reported.

The BRICS group of nations originally included Brazil, Russia, India, China, and South Africa, which gave it the acronym.

The group last year began to expand its membership as it looks to challenge a world order dominated by Western economies, with Saudi Arabia, Iran, Ethiopia, Egypt, Argentina and the UAE joining and more than 40 countries expressing interest.

“We have made a decision, we will be placing the formal procedures soon ... we are just waiting for the final results from the government in South Africa,” Anwar said, according to a video of the interview posted by Guancha on Sunday.

A representative from Anwar’s office on Tuesday confirmed his comments to Reuters.

During the interview, he did not provide further details on the application process.

Anwar’s comments came ahead of a three-day visit by Chinese Premier Li Qiang this week, as part of celebrations marking the 50th year of diplomatic relations between Malaysia and China.

Malaysia and China are expected to sign several deals during Li’s visit, including renewing a five-year trade and economic cooperation agreement.


Oil Updates – crude edges down amid cautious demand outlook

Oil Updates – crude edges down amid cautious demand outlook
Updated 28 min 55 sec ago
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Oil Updates – crude edges down amid cautious demand outlook

Oil Updates – crude edges down amid cautious demand outlook

SINGAPORE/HOUSTON: Oil prices edged down in Asian trade on Tuesday, after posting gains in the previous session, as markets remained cautious about global demand growth prospects amid expectations of stronger supplies, according to Reuters.

Global benchmark Brent crude futures slipped 12 cents, or 0.14 percent, to $84.13 per barrel at 9:15 a.m. Saudi time. US West Texas Intermediate crude futures fell 14 cents, or 0.17 percent, to $80.19 a barrel.

Both benchmarks gained around 2 percent on Monday, closing at their highest since April.

“The oil market shifted its focus back to fundamentals, which have been soft for some time,” said BoFA commodity and derivatives strategist Francisco Blanch in a client note, adding that global crude oil inventories and refined product storage in the US and Singapore, among other places, was higher.

Meanwhile, global oil demand growth decelerated to 890,000 barrels per day year-on-year in the first quarter, and data suggests consumption growth likely slowed further in the second quarter, he said in the note.

China’s oil refinery output slipped 1.8 percent from year-ago levels in May, statistics bureau data showed on Monday, as refiners undertook planned maintenance overhauls and processing margins were pressured by rising crude costs.

Markets were also looking out for further clues on interest rates, and how the US demand situation would pan out, as several US Federal Reserve representatives will be speaking later on Tuesday.

Some analysts remained bullish on the price impact of an extension by the OPEC+ group of supply cuts in the near-term.

“The latest guidance provided by OPEC+, as well as their unchanged 2.25 million barrels per day demand growth outlook, signals a stagnation in oil supply growth for 2024 and an apparent downside risk to production in 2025,” said Patricio Valdivieso, Rystad Energy vice president and global lead of crude trading analysis.

“Under these conditions — and the disconnect between the OPEC+ demand outlook and all other agencies — it is hard to remain fully bearish when global oil supply growth appears decimated,” he added.

Recent rebounds in complex refining margins, particularly in Europe and Asia, were also supportive to markets, said Sparta Commodities analyst Neil Crosby.

Refining margins at a typical complex refinery in Singapore averaged at $3.60 a barrel for June so far, compared with $2.66 a barrel in May. 


Saudi Arabia climbs to 16th place in World Competitiveness Index

Saudi Arabia climbs to 16th place in World Competitiveness Index
Updated 37 min 32 sec ago
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Saudi Arabia climbs to 16th place in World Competitiveness Index

Saudi Arabia climbs to 16th place in World Competitiveness Index

RIYADH: Saudi Arabia’s ongoing economic diversification efforts have propelled the country to the 16th spot in the World Competitiveness Index 2024, up from 17th place the previous year.

According to a report from the Switzerland-based International Institute for Management Development, the Kingdom was ranked 24th in 2022 and 32nd in 2021.

The ascent, supported by Saudi Arabia’s Vision 2030 program, is attributed to significant progress in economic performance, government efficiency, and a business-friendly environment.

The report also highlighted that Saudi Arabia ranked higher than several of its G20 peers, including India, the UK, and Japan, as well as other countries like Italy, Argentina, Indonesia, Brazil, and Turkiye.


Saudi Arabia’s crude production rose to 8.99m bpd in April: JODI

Saudi Arabia’s crude production rose to 8.99m bpd in April: JODI
Updated 17 June 2024
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Saudi Arabia’s crude production rose to 8.99m bpd in April: JODI

Saudi Arabia’s crude production rose to 8.99m bpd in April: JODI

RIYADH: Saudi Arabia’s crude production increased by 13,000 barrels per day in April to reach 8.99 million, according to an analysis from the Joint Organizations Data Initiative. 

The data indicated that exports over the same month saw a decline despite this growth, dipping by 445,000 bpd to 6 million compared to March.

The Kingdom’s direct burn of crude oil, which involves using oil without substantial refining processes, increased by 93,000 bpd in April compared to the previous month – an 11 percent year-on-year growth. 

The decline in the Kingdom’s crude exports and a marginal rise in production can be attributed to the voluntary cuts adopted by members of the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+.

In March, Saudi Arabia announced the extension of its 1 million bpd cut, initially implemented in July 2023, until the end of 2024. 

Earlier this month, the Kingdom’s Minister of Energy Prince Abdulaziz bin Salman said Saudi Arabia will increase its oil production capacity from 2025 to 2027 before returning to a production level of 12.3 million bpd in 2028. 

“In 2025, we will have an incremental increase. We will have a bigger incremental increase in 2026 and 2027. And then we will go back to our 12.3 million bpd production in 2028,” said the energy minister. 

According to JODI Data, total oil demand in India, one of the largest crude consumers in Asia, slipped by 156,000 bpd in April compared to March. 

Similarly, the Asian nation’s total product exports also edged down by 85,000 bpd in April. 

On the other hand, India’s overall crude imports rose by 510,000 bpd, marking an 8.1 percent year-on-year increase. 

Earlier this month, OPEC said that oil demand globally would rise by 2.25 million bpd in 2024, driven by growth in markets such as China, India, the Middle East and Latin America. 

On June 6, speaking at the International Economic Forum in St. Petersburg, Haitham Al-Ghais, secretary-general of OPEC, said that the world will witness continued oil demand growth in the coming years. 

“Last year, OPEC’s forecast for oil demand was the best. And all those who criticized OPEC’s forecast kept adjusting their number throughout the year,” said Al-Ghais.

However, the International Energy Agency forecast oil demand growth to slow as the world continues its energy transition journey, although it noted that there would be growth of 1 million bpd in 2024. 


Saudi developer Al-Othaim Investment launches new cruise ship in Hail 

Saudi developer Al-Othaim Investment launches new cruise ship in Hail 
Updated 17 June 2024
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Saudi developer Al-Othaim Investment launches new cruise ship in Hail 

Saudi developer Al-Othaim Investment launches new cruise ship in Hail 

RIYADH: A five-star hotel is part of a new cruise ship set for Saudi Arabia’s Hail region, local real estate developer Al-Othaim Investment has announced.

The new project, also referred to as Al-Othaim Cruise Hail, is built on a total area of ​​77,000 sq. m. and includes a shopping mall, 276 residential units, 16 luxurious palaces, and multiple entertainment spaces. 

Moreover, the planned hotel on the ship contains 120 rooms and 156 apartments, as well as office spaces on six floors covering an area of over 9,000 sq. m. 

The company said in a post on X that this move falls in line with its expansion strategy, which aims to launch several projects in various regions of the Kingdom.     

“Our staff of 4,000 young Saudi men and women serve the passengers the recreational services,” the company said in its post.  

 

 

The new development is also projected to contribute significantly to sustainable development, achieving the nation’s Vision 2030 goals and enhancing Saudi Arabia’s position as a leading global investment center.  

Additionally, the planned cruise ship aligns well with the ongoing encouragement of Prince Abdulaziz bin Saad, the governor of the Hail region, to support the growth and development process in the area and to enhance its position as a leading investment destination.   

The project also occurs alongside the continuous support for the private sector from the Saudi Minister of Municipal and Rural Affairs and Housing, Majid bin Abdullah Al-Hogail, and his dedication to creating an attractive investment environment throughout the Kingdom’s various regions and cities.

In May, Saudi Tourism Investment Co.’s CEO revealed that the Kingdom’s northwestern city of Hail would home to the firm’s fifth destination development.    

Speaking to Arab News on the sidelines of the Future Hospitality Summit at the time, Fahad bin Mushayt announced the plan, which comes after the activation of the company’s projects in Al-Baha, Yanbu, Al-Ahsa, and Taif.  

Mushayt noted that the initiatives were launched within a year of the unveiling of the Public Investment Fund-owned firm Asfar.

The CEO also highlighted at the time that the company is mandated to invest in new projects and develop attractive travel destinations, incorporating hospitality, tourist attractions, retail, and food and beverage offerings in cities across Saudi Arabia.

Bin Mushayt said at the time: “In almost one year, Asfar is already playing in four destinations, with Hail coming soon, so I can reveal that.”