Oil Updates – crude extends recovery to cap volatile week

Oil Updates – crude extends recovery to cap volatile week
Brent crude futures rose by 34 cents, or 0.5 percent, to $72.31 per barrel by 6:22 a.m. Saudi time. Shutterstock
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Updated 13 September 2024
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Oil Updates – crude extends recovery to cap volatile week

Oil Updates – crude extends recovery to cap volatile week

NEW YORK/SINGAPORE: Oil prices rose on Friday, extending a rally sparked by output disruptions in the US Gulf of Mexico, where Hurricane Francine forced producers to evacuate platforms before it hit the coast of Louisiana.

Brent crude futures rose by 34 cents, or 0.5 percent, to $72.31 per barrel by 6:22 a.m. Saudi time. US West Texas Intermediate crude futures rose by 39 cents, or 0.6 percent, to $69.36 a barrel.

If those gains hold, both benchmarks will break a streak of weekly declines, despite a rough start that saw Brent crude dip below $70 a barrel on Tuesday for the first time since late 2021. At current levels, Brent is set for a weekly increase of about 1.7 percent, and WTI is set to gain over 2 percent.

“A previous dip to an almost three-year low called for some near-term breather to end the week, as market participants price (in) for the disruptions to short-term oil supplies caused by Hurricane Francine,” said IG market strategist Yeap Jun Rong in an email.

Oil producers assessed damage and conducted safety checks on Thursday as they prepared to resume operations in the US Gulf of Mexico, as estimates emerged of the loss of supply from Francine.

UBS analysts forecast output in the region in September will fall by 50,000 barrels-per-day month over month, while FGE analysts estimated a 60,000 bpd drop to 1.69 million bpd.

Official data showed nearly 42 percent of the region’s oil output was shut-in as of Thursday.

“But if production delays were to prove to be short-lived and damages to oil platforms were to be minimal, those gains may be unwound, as the broader demand outlook continues to serve as a key headwind to limit any sustained recovery,” Yeap said.

Demand expectations remained dismal as both OPEC and the International Energy Agency this week lowered their demand growth forecasts, citing economic struggles in China, the world’s largest oil importer.

“The recent run of weaker Chinese economic data suggests that oil demand in the world’s second-largest economy may remain subdued for longer, while demand has been soft in other countries outside of China as well,” said IG’s Yeap.

China’s crude oil imports averaged 3.1 percent lower this year from January through August compared to the same period last year, customs data showed on Tuesday.

“Flagging domestic oil demand in China has become a hot topic and was further underlined by disappointing August trade data,” FGE analysts said in a note to clients.

Demand concerns have grown in the US as well. US gasoline and distillate futures traded at multi-year lows this week, as analysts highlighted weaker-than-expected demand in the top petroleum consuming country.

US oil and fuel stocks rose last week as demand declined sharply, data from the US Energy Information Administration showed on Wednesday. 


Oil Updates – crude steadies after sharp fall, Middle East uncertainty persists

Oil Updates – crude steadies after sharp fall, Middle East uncertainty persists
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Oil Updates – crude steadies after sharp fall, Middle East uncertainty persists

Oil Updates – crude steadies after sharp fall, Middle East uncertainty persists

SINGAPORE: Oil prices inched higher on Wednesday amid uncertainty over what may happen next in the Middle East conflict, after demand concerns knocked the market to its lowest since early October in the previous session.

Brent crude oil futures rose 19 cents, or 0.3 percent, to $74.44 a barrel by 9:30 a.m. Saudi time. US West Texas Intermediate crude futures climbed 24 cents, or 0.3 percent, to $70.82 per barrel.

Oil prices tumbled more than 4 percent to a near two-week low on Tuesday due to a weaker demand outlook and after a media report said Israel would not strike Iranian nuclear and oil sites, easing fears of a supply disruption.

However, concerns about an escalation in the conflict between Israel and Iran-backed militant group Hezbollah persist, with the US on Tuesday saying it opposed the scope of Israel’s air strikes in Beirut over the past few weeks.

“Following the recent retracement in prices, we may expect some room for prices to stabilize in the near term, as market participants reassess further developments on the geopolitical front,” said Yeap Jun Rong, market strategist at IG.

“More clarity over China’s fiscal policy awaits as well, and the lack of specifics seems to cast some uncertainties over the eventual impact on its oil demand outlook,” said Yeap.

China may raise an additional 6 trillion yuan ($850 billion) from special treasury bonds over three years to stimulate a sagging economy, local media reported, though that failed to revive sentiment in the country’s stock market.

On the oil demand side, both OPEC and the International Energy Agency this week cut their forecasts for global oil demand growth in 2024, with China accounting for the bulk of the downgrades.

For now, the market will be looking out for the latest US oil inventory data, with the American Petroleum Institute’s weekly report due later on Wednesday and Energy Information Administration data to come on Thursday. The reports are coming a day later than normal following a federal holiday.

Analysts polled by Reuters expected crude stockpiles rose by about 1.8 million barrels in the week to Oct. 11.


Closing bell: Saudi main index rises to 12,002; trading turnover at $1.96bn

Closing bell: Saudi main index rises to 12,002; trading turnover at $1.96bn
Updated 15 October 2024
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Closing bell: Saudi main index rises to 12,002; trading turnover at $1.96bn

Closing bell: Saudi main index rises to 12,002; trading turnover at $1.96bn
  • Parallel market Nomu gained 474.42 points to close at 25,919.34
  • MSCI Tadawul Index increased by 6.87 points to 1,503.56

RIYADH: Saudi Arabia’s Tadawul All Share Index rebounded on Tuesday, as it gained 41.96 points, or 0.35 percent, to close at 12,001.63. 

The total trading turnover of the benchmark index was SR7.34 billion ($1.96 billion), with 144 of the listed stocks advancing and 81 declining. 

The Kingdom’s parallel market Nomu gained 474.42 points to close at 25,919.34, while the MSCI Tadawul Index also increased by 6.87 points to 1,503.56.

The best-performing stock on the main market was CHUBB Arabia Cooperative Insurance Co. The firm’s share price surged by 8.17 percent to SR45.

Other top performers were Saudi Public Transport Co. and Fawaz Abdulaziz Alhokair Co., whose share prices soared by 6.06 percent and 5.74 percent to SR23.12 and SR13.64, respectively.

The worst performer on the main index was Al-Baha Investment and Development Co. as the firm’s share price slipped by 8.57 percent to SR0.32. 

On the announcements front, Al Rashid Industrial Co. said it completed the purchase deal worth SR9.2 million for the facility site of the International Factory for Jewel Boxes in Qassim 1st. Industrial City. 

According to a Tadawul statement, the entire purchase was self-financed and said that the deal was part of the company’s expansion plans to increase production capacity and market share in the packaging industry, both locally and internationally. 

The company added that the financial impact of the deal is expected to be visible in 2025. 

Al Rashid Industrial Co.’s share price climbed 2.40 percent on Tuesday to SR42.70. 

Almuneef Co. for Trade, Industry, Agriculture, and Contracting announced that it signed a contract valued at SR3.75 million with National Agricultural Development Co. to purchase 1,500 tons of first-generation certified wheat seeds for 2024. 

The firm said that the financial impact of the four-month contract will be visible in the company’s fiscal performance in the fourth quarter of this year. 

The share price of Almuneef Co. for Trade, Industry, Agriculture, and Contracting edged up by 0.78 percent to SR51.90. 


SVC invests $15m in Vision Ventures to fuel startups 

SVC invests $15m in Vision Ventures to fuel startups 
Updated 15 October 2024
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SVC invests $15m in Vision Ventures to fuel startups 

SVC invests $15m in Vision Ventures to fuel startups 

RIYADH: Startups in the Kingdom are set to benefit after Saudi Venture Capital Co. committed $15 million to Saqr 2 Fund, which targets early-stage investments across the region. 

The $90 million fund, managed by Saudi-based Vision Ventures, targets businesses from pre-seed to pre-series B stages, spanning various sectors in the Kingdom and the broader Middle East and North Africa region, according to the Saudi Press Agency. 

Nabeel Koshak, CEO and board member of SVC, said: “The investment in Vision Ventures’ venture capital fund is part of our fund investment program.”  

He added: “It aligns with our strategy to stimulate the establishment of funds that invest in Saudi startups and small and medium-sized enterprises at various growth stages. Additionally, we aim to encourage these funds to provide added value to the startups and SMEs.” 

Vision Ventures, a key player in the venture capital ecosystem, expressed confidence in the collaboration.  

“SVC’s continued commitment to our venture capital funds is a privilege for us,” said Kais Al-Essa, co-founder and CEO of Vision Ventures, adding: “We are proud to have SVC as a key investor in our funds once again, reaffirming the company’s ability to provide investors with exceptional performance and returns, attracting investors alongside other leading institutional investors like SVC.” 

This investment is part of SVC’s broader initiative to stimulate venture capital activity in Saudi Arabia and foster the growth of startups and SMEs in the region.


Deals worth $28bn across various sectors expected at FII8, says Attias

Deals worth $28bn across various sectors expected at FII8, says Attias
Updated 15 October 2024
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Deals worth $28bn across various sectors expected at FII8, says Attias

Deals worth $28bn across various sectors expected at FII8, says Attias

RIYADH: Deals worth $28 billion are expected to be announced at this year’s Future Investment Initiative, said FII Institute CEO Richard Attias.

He spoke at a pre-event press conference on Tuesday to announce details about the eighth edition of the event scheduled to be held on Oct. 29-31 in the Saudi capital.

Attias noted that the event will bring together entrepreneurs and startups from around the world, serving as a bridge of communication among them.

Regarding the potential deals, he mentioned that the number of partnerships expected to be announced at FII8 is growing, stating, “we are still finalizing several agreements.”

He emphasized that the summit will be more than just a gathering of thought leaders, focusing on driving tangible outcomes across key sectors. “This year, we expect record-breaking announcements across  sectors including renewable energy, cybersecurity, food security, and entertainment,” he said.

The summit is committed to fostering positive change through effective solutions across various domains, including global connectivity, mining, AI, health-tech, sports, the circular economy, food, economies of the future, art, culture, and other key areas.

Highlighting the success of the previous event, Attias noted that, despite the current global and regional situation, 7,100 participants from around the world are registered for the upcoming event. “It is 1,000 more than last year,” he said.

“We are trying to be doers, not just talkers. At FII, we bring real investments, with over $128 billion worth of deals sealed across past editions. If you divide that by seven, it’s much more than $10 billion (worth) of deals which happen during FII,” Attias added.

The CEO explained that one of the core pillars of the FII Institute is “Act,” a division that focuses on investing in startups that align with the institute’s mission of driving impactful and innovative solutions for humanity. “We have already invested in seven portfolio companies,” he said.

Attias emphasized that the FII Institute believes in game changers and helps innovative investors bring about positive change in the world. He pointed out that FII’s influence extends beyond investment, releasing indexes such as the FII Priority Compass, which helps shape global conversations by identifying and tracking key priorities for industries and economies.

During the conference, Attias highlighted the importance of showcasing the positive impact of investments made through the FII Institute.

He stated that investment is not just a financial transaction but has broader effects, particularly in areas like job creation and ecosystem development. The CEO emphasized that the FII Institute has become a membership-based movement, attracting individuals and organizations committed to creating an impact.


Saudi Arabia, Italy enhance mining ties through investment talks

Saudi Arabia, Italy enhance mining ties through investment talks
Updated 15 October 2024
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Saudi Arabia, Italy enhance mining ties through investment talks

Saudi Arabia, Italy enhance mining ties through investment talks
  • Official trip aims to bolster industrial and mining cooperation and explore joint opportunities aligned with the Kingdom’s National Industrial Strategy

JEDDAH: Saudi-Italian mining relations are set to strengthen following meetings between senior officials in Rome focused on sustainable solutions, clean energy, and attracting investment to the Kingdom’s expanding exploration sector. 

Saudi Minister of Industry and Mineral Resources Bandar Alkhorayef commenced his three-day visit on Oct. 14, meeting with Italy’s Minister of Environment and Energy Security Gilberto Pichetto Fratin. 

The meeting, attended by Prince Faisal bin Sattam bin Abdulaziz, Saudi ambassador to Italy, and Saleh Al-Sulami, CEO of the National Industrial Development Center, emphasized the importance of collaborative development and the strategic partnership between the two nations across various sectors, the Saudi Press Agency reported. 

The official trip aims to bolster industrial and mining cooperation and explore joint opportunities aligned with the Kingdom’s National Industrial Strategy. 

This comes on the back of Saudi Arabia’s increasing non-oil exports to Italy, which reached SR2.8 billion ($747 million) in 2023, while total non-oil imports from Italy amounted to SR21.8 billion. 

In a post on his X account, Alkhorayef said: “At the beginning of my visit to Italy, I met the minister of environment and energy security, and we talked about the important partnership between Saudi Arabia and Italy in various sectors.” 

He underscored the “mutual desire” to strengthen collaboration for the benefit of both countries. 

During the talks, Alkhorayef outlined the promising prospects within the Kingdom’s mining sector, detailing all stages from exploration to processing. He highlighted Saudi Arabia’s untapped mineral resources, estimated at approximately $2.5 trillion, and emphasized the availability of 80 years’ worth of geological data to support informed investment decisions. 

The minister also explored opportunities to enhance collaboration, share expertise, and attract joint investments in renewable energy, stressing the need for improved supply chain integration to meet local, regional, and global demands. He encouraged Italian companies to expand their operations in the Kingdom, urging the private sector to leverage significant developmental projects. 

Alkhorayef extended an invitation to Fratin to attend the International Mining Conference in Riyadh in early 2025, anticipating substantial participation from Italy given its crucial role in the global mining sector. 

The Italian Ministry of Environment and Energy Security expressed its commitment to supporting the transition to a low-carbon economy while promoting sustainable mineral resource management, SPA reported. 

On the same day, Alkhorayef engaged in bilateral meetings with major Italian and global companies, focusing on localizing electric vehicle manufacturing opportunities, enhancing cooperation in the aviation and shipbuilding sectors, and exploring smart manufacturing solutions. 

Discussions highlighted the unique opportunities presented by 12 strategic sectors central to the National Industrial Strategy and incentives designed to attract global investors, facilitating value creation for the national economy. 

In his meeting with the founder and CEO of Swiss electric vehicle manufacturer Piech, Alkhorayef discussed the potential for transferring advanced automotive manufacturing technologies to the Kingdom. 

He emphasized the country’s commitment to nationalizing this industry, referencing the Lucid project, which aims to produce 155,000 electric vehicles annually by 2027, and the Ceer company, targeting 170,000 vehicles by 2034. 

The minister outlined Arabian Tiger Holding Co.’s plans to localize aviation manufacturing technologies in the Kingdom during discussions with its CEO, focusing on establishing a facility for aircraft component production after acquiring Piaggio Aerospace, a leader in commercial and drone aircraft. 

Alkhorayef also met with officials from Fincantieri, an Italian shipbuilding firm, to explore collaboration in the maritime industry, addressing all stages of the value chain from design to delivery. 

In a meeting with the international market director at AlmavivA, he discussed the latest automation solutions for industrial facilities aimed at enhancing productivity and promoting smart manufacturing cooperation between the Kingdom and Italy, with a particular focus on integrating robotics into manufacturing processes. 

Alkhorayef also engaged in talks with Yousef Al-Mimni, vice chairman of the Saudi-Italian Business Council, commending the Council’s role in strengthening trade and economic ties between the Kingdom and Italy. 

He encouraged Italian private sector companies to invest in promising sectors in Saudi Arabia, particularly in industrial and mining.