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Monday, 8 December 2014

Kuwait Plans $7 Billion Heavy-Oil Project Amid Cheaper Crude - Bloomberg

Kuwait Plans $7 Billion Heavy-Oil Project Amid Cheaper Crude - Bloomberg:

"Kuwait, the third-largest producer in OPEC, plans to spend about $7 billion to develop heavy-oil fields even with crude prices near five-year lows.

The first phase of the Lower Fars heavy-oil project will cost $4.2 billion, with contracts to be awarded by the end of this year, Hashem Hashem, chief executive officer of state-owned Kuwait Oil Co., said today at a conference in Kuwait City. KOC, which plans to drill 900 wells and pump 60,000 barrels a day by 2018 in the project’s first phase, targets output of 180,000 barrels a day by 2025 and 270,000 by 2030, Hashem said.

Production from Lower Fars and the Ratqa field “will open the door for development of other heavy oil fields in Kuwait,” he said."

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Rival central bank governors vie for control of Libya’s oil earnings -

Rival central bank governors vie for control of Libya’s oil earnings -

"The divisions opened up by Libya’s civil war have left it not only with two governments fighting for power but also with rival central bank governors — paving the way for a potential struggle over control of oil revenue and foreign currency reserves.

The central bank in Tripoli is run by Saddek Omar El-Kaber, even though he was sacked as governor in September by the internationally recognised parliament, which has since fled to Tubruq in the country’s east.

Mr El-Kaber, who is fighting his dismissal in the courts, has continued to disburse state salaries and subsidies across Libya but has blocked other spending from the budget that was agreed before the government split."

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Angry Saudi football clubs pinpoint Gulf labor market contradictions - MIDEAST

Angry Saudi football clubs pinpoint Gulf labor market contradictions - MIDEAST:

"Mounting anger among Saudi football clubs at their subjugation to quotas - designed to encourage employment of Saudi nationals and reduce dependence on foreign labor - illustrates the problems encountered by wealthy Gulf countries in balancing contradictory demands. These include labor markets, often lopsided demographics, social contracts involving a cradle-to-grave welfare state that creates unrealistic employment expectations, and organizations’ need to hire personnel on the basis of nationality rather than merit.

The clubs, many of which are owned by members and associates of the ruling al-Saud family but publicly funded, warned that a Labor Ministry decision to include them in a quota system intended to force the private sector to hire a larger number of Saudi nationals could disadvantage them by preventing them from hiring foreign talent. The clubs’ complaint mirrors problems across the Gulf with government efforts to encourage preferential employment of nationals. The complaint is particularly stark given that the kingdom, unlike smaller Gulf states like Qatar and the United Arab Emirates, still boasts a population in which nationals constitute a majority, if only a slim one. Qataris, for example, account for a mere six percent of the Qatari labor market, making the country wholly dependent on foreign labor with no prospect of altering the market balance.

As a result, labor quota systems may encourage nationals to consider a wider range of employment opportunities but are unlikely to resolve the underlying demographic problem. The quotas also at times force organizations to hire nationals who may be less qualified or motivated than foreigners – a concern among football clubs where foreign talent plays a key role. The problem of Saudi clubs is compounded by the kingdom’s reluctance to encourage Saudi players to garner experience by playing abroad for foreign clubs. The anger of Saudi clubs at the Labor Ministry decision comes at a time when Gulf states - with Qatar and the UAE in the lead - are under mounting pressure to abolish restrictive labor systems that put foreign employees at the mercy of their employers. Human rights and trade union activists, who have targeted Qatar after it won the right to host the 2022 World Cup, have in recent months expanded their campaign to include various Gulf states."

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Iraq’s oil deal with Kurds is good for everyone | The National

Iraq’s oil deal with Kurds is good for everyone | The National:

"Patience, strategic vision and win-win agreements are in short supply in Iraq. But last week’s oil deal between the autonomous Kurdish region and the federal government in Baghdad could be a rare exception.

The arrangement calls for the Kurdish region to export 250,000 barrels per day (bpd) of its own oil production, and 300,000 bpd from the Kirkuk fields. These remain notionally under federal authority, but the Kurds took control in the wake of ISIL’s seizure of Mosul in June.

The oil will be marketed by the state organisation Somo, not by the Kurds themselves, as they had originally demanded. But they will receive 17 per cent of the federal budget – a number previously trimmed, then entirely cut off, by Baghdad – as well as half the expenses for their Peshmerga military."

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Double-digit growth boosts Islamic economy | The National

Double-digit growth boosts Islamic economy | The National:

"These are heady days for the Islamic economy – from Tayyab foods to sukuk issuance, halal industries are experiencing double-digit growth, a new report from Thomson Reuters and DinarStandard says.

The UAE has the second-most developed Islamic industries after Malaysia, according to the report, which was released yesterday. Dubai aims to be the capital of the global Islamic economy by 2016.

The UAE leads Malaysia in cosmetics and fashion but trails in finance, food, pharmaceuticals and travel excluding the Hajj and Ummrah, the report said. Malaysia has a Muslim population of approximately 17 million."

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The war for the Wharf -

The war for the Wharf -

"When the Qatar Investment Authority first called Songbird Estates last month to say it wanted Canary Wharf, it was given short shrift. Not even last week’s sweetened bid has changed Songbird’s tune — yet.

The war for Britain’s second largest financial district, 70 per cent owned by Songbird, began with a phone call.

The telephoned request for a meeting in early November was not unusual. The QIA, one of the world’s most powerful sovereign wealth funds, is Songbird’s biggest shareholder with 28 per cent and has two representatives on the board."

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Strong dollar comes to a head - YouTube

Strong dollar comes to a head - YouTube: ""

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Meet Putin’s New, and Poor, Neighbors in the Debt Market - Bloomberg

Meet Putin’s New, and Poor, Neighbors in the Debt Market - Bloomberg:

"Just how much has President Vladimir Putin’s Ukraine incursion eroded investor confidence in Russia?

Consider the names that the country is now surrounded by in the market where bondholders buy protection against default: Lebanon, El Salvador and war-torn Iraq. With investors charging 3.8 percent a year to insure against a halt in Russian debt payments, those three countries -- all of which either have junk ratings or none at all -- trade at the closest levels to Putin’s government in the credit-default swaps market.

The cost of Russian credit-default swaps rose for the 10th straight day to a five-year high of 381 basis points on Dec. 5, the longest run of increases since May 2012, according to data compiled by Bloomberg. The country is heading toward recession as U.S. and European Union sanctions over Putin’s actions in Ukraine crimp access to foreign funding, while crude oil, the nation’s chief export earner, plunges into a bear market."

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Iran Budget Faces Short-Term Oil-Price Strain, Rouhani Says - Bloomberg

Iran Budget Faces Short-Term Oil-Price Strain, Rouhani Says - Bloomberg:

"Iran expects oil prices at five-year lows will put “short-term pressure” on the government’s budget even as it strives to contain inflation, President Hassan Rouhani said.

Crude prices have declined about 40 percent from a June peak amid overproduction and slower demand growth. The Organization of Petroleum Exporting Countries decided on Nov. 27 to maintain its production target, prompting a drop in European benchmark Brent crude to less than $70 a barrel for the first time since May 2010.

“The price of Brent has fallen from $110 to less than $70, a decline little before seen,” Rouhani said yesterday in a speech to the country’s parliament in Tehran, according to the semi-official Iranian Students’ News Agency. “It’s necessary for next year’s budget to be adjusted with caution.”"

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MIDEAST STOCKS-Oman tumbles on pain of lower oil prices; Gulf weak | Reuters

MIDEAST STOCKS-Oman tumbles on pain of lower oil prices; Gulf weak | Reuters:

"Oman's stock market sank on Sunday after Standard & Poor's cut its outlook for the country's sovereign rating and local cement firms said natural gas prices would double - examples of the pain which the weaker Gulf oil exporters may face because of the slide in oil prices.

Brent crude slipped 0.8 percent to $69.07 a barrel on Friday after Saudi Arabia slashed its oil prices for Asian and U.S. buyers. With Oman estimated to need an average price of over $100 to balance its state budget, the government is casting about for ways to raise revenues next year.

One method is to cut state subsidies.

Shares in both Raysut Cement and Oman Cement tumbled their daily 10 percent limit on Sunday after the companies said the state-guided price they paid for gas would double next year."

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