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Saturday, 5 December 2009

Qatar Says ‘Gas OPEC’ to Discuss Unstable Gas Price

The Gas Exporting Countries Forum meeting next week will discuss ways of stabilizing natural-gas prices, said Qatar’s Oil Minister Abdullah bin Hamad al-Attiyah.

Natural gas futures for delivery at the Henry Hub in Louisiana have fallen 19 percent this year to $4.566 a million British thermal units on the New York Mercantile Exchange. Prices sank as low as $2.409 in September.

“Limiting the supplies in most of the contracts is impossible because they are long-term contracts,” al-Attiyah told reporters in Cairo today. “But we are going to see and discuss how to stabilize the gas price. Gas should have a premium, it is a clean fuel, it’s a choice fuel.”

Dubai, Kuwait to Lag Behind in Mideast Recovery, Goldman Says

Dubai and Kuwait will lag behind other Gulf Arab states as the region’s economies recover, Goldman Sachs’ economist Ahmet Akarli said.

“The hydrocarbon-heavy Saudi Arabia, Qatar and presumably Abu Dhabi, which also have exceptionally strong sovereign balance sheets, will probably recover strongly,” Akarli wrote in a report yesterday. “The overleveraged Dubai and Kuwait will be lagging behind as they struggle to iron out the financial excesses they have accumulated over the years.”

Economies of the oil-rich Gulf Arab states were hit last year as crude prices plummeted, international credit dried up and companies struggled to refinance debt. Oil producers such as Saudi Arabia say their economies are recovering after crude rose to about $75 a barrel, more than double its December low. Goldman Sachs forecasts oil at $90 in 2010 and $110 in 2011.

IMF Says Dubai Debt Fallout Contained, Events Still Unfolding

Following Dubai’s jolting announcement on November 25 that it would seek a standstill on the debt of Dubai World, the emirate’s flagship holding company, the government has taken several steps to contain the fallout. But the event still has significant implications for the region, says IMF Middle East and Central Asia Department Director Masood Ahmed.

“The Central Bank’s announcement on November 29 to introduce a supplementary liquidity facility and to reaffirm that it stands behind banks in the United Arab Emirates has been very helpful, especially because these banks hold some of the Dubai World and the Dubai Government debt,” Ahmed said in a conference call with press.

Ahmed told reporters that Dubai World’s announcement to initiate a constructive engagement with its creditors and clarify the size and scope of the debt to be restructured had helped to reduce market uncertainty. In the November 30 statement, the company announced that it would restructure debt amounting to $26 billion—$6 billion of which is related to Nakheel, Dubai World’s real estate subsidiary.

Transcript of a conference call on Dubai by Masood Ahmed, Director of Middle East and Central Asia Department, IMF

Saudi market to reopen amid Gulf uncertainty

The Saudi stock market faces selling pressure when it reopens on Saturday for the first time since the Dubai debt crisis erupted even though the kingdom has little real exposure to it, analysts said.

Closed since November 25 for the Muslim holidays of Eid al-Adha, the Gulf's largest bourse could take its cue from sharp plunges in Dubai, Abu Dhabi, Kuwait and Qatar, said Paul Gamble of Jada Investment.

Those steep losses came after Dubai's government announced a six-month freeze on debt payments by Dubai World, a state-owned conglomerate whose 59 billion dollars in liabilities the emirate said it would not guarantee.

Lower Saxony to hold up to 22 pct in VW-Porsche

Lower Saxony will hold a stake of up to 22 percent in a combined Volkswagen-Porsche group (VOWG.DE: Quote, Profile, Research) (PSHG_p.DE: Quote, Profile, Research), giving it a blocking minority stake in Europe's largest auto maker, state premier Christian Wulff said on Friday.

Lower Saxony, where Volkswagen is headquartered, currently holds a stake of just over 20 percent in Volkswagen's voting shares ahead of a multi-stage merger between the two auto makers.

Wulff said the Porsche's current owners, the Piech and Porsche families, are set to hold just over 30 percent in the combined group.

‘Qatar building real economy, not to take advantage of Dubai’s crisis’

Qatar’s Deputy Premier and Minister of Energy and Industry HE Abdullah bin Hamad al-Attiyah (pictured) yesterday said Qatar would not work to take advantage of Dubai’s debt crisis.
“In Qatar, we never take advantage of anyone. We are building a real economy,” based on natural gas, petrochemicals and oil, he said. “We are having a very concrete strategy,” al-Attiyah said on arrival in Cairo for a conference of the Organisation of Arab Oil Exporting Countries.
HE said Dubai’s crisis would not impact oil prices, which last year had overcome an international financial meltdown. “It had an affect for two days as a psychological factor but then (oil prices) recovered,” al-Attiyah said.

Members of the Organisation of Petroleum Exporting Countries shouldn’t change output when they meet this month, he said.

“There are a lot of things to do in Angola, I think the market is very stable and the demand is very efficient, I don’t think there will be any change for the time being,” al-Attiyah said.

Bondholders stand firm on repayment this month

Lawyers representing holders of sukuk bonds from Nakheel, the real estate unit of Dubai World, are expected to reject any attempt by the government-owned holding company to call a standstill on its debts.

After a conference call held yesterday, Ashurst, the firm representing the bondholders, is expected to write to Dubai World saying that more than 25 per cent of bondholders expect full repayment of $4bn by December 14 or, after a two-week grace period, on December 28.

One bondholder said: "We are not going to give the government the luxury of a standstill that avoids default. We expect full repayment, so we are keeping the pressure as high as possible."