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Thursday, 25 May 2017

A changing oil market threatens Saudi reform

A changing oil market threatens Saudi reform:

"Even five years ago, Saudi Arabia was in an economically enviable position. A few unsettling trends were unfolding: hybrid and electric cars were becoming more common and oil companies were driving wells across the shale basins of the US. But neither green vehicles nor shale oil was price competitive with their conventional predecessors, and Brent crude, the global oil price benchmark, was over $100. No one envies the Saudi Arabians now. Yes, the Brent price has rebounded from its of 2015-16 lows to stabilise over $50. At the Opec meeting in Vienna this week the delegates agreed to extend production curbs for another nine months. But the long-term supply and demand dynamics for oil continue to be at best unpredictable and at worst simply bearish. This is the reason for, and the greatest threat to, Saudi efforts to reform its unbalanced economy. Saudi Arabia must be weaned off oil; yet that process, which is causing domestic tension, can only be made palatable by oil money."



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Moody’s upgrades Abu Dhabi’s outlook | The National

Moody’s upgrades Abu Dhabi’s outlook | The National:

"Moody’s Investors Service said on Thursday it has upgraded Abu Dhabi’s credit outlook to stable from negative due to the emirate’s ability to diversify sources of revenue during the period of low oil prices as well as signs of a rebound in the economy. At the same time, the rating agency said that it had affirmed the long and short term issuer ratings for Abu Dhabi at Aa2/P-1, one of the agency’s highest credit ratings. "The weaker oil price and its impact on government finances and the economy has prompted a substantial acceleration in reforms containing fiscal pressures and supportive of the emirate’s diversification strategy," it said in a note."



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UAE excise tax ‘may lead to some products disappearing from shop shelves’ | The National

UAE excise tax ‘may lead to some products disappearing from shop shelves’ | The National:

"The introduction this year of excise taxes on sugary drinks and tobacco is expected to have a broad effect on importers, manufacturers and suppliers in the UAE, tax experts said. The Federal Tax Authority said on Tuesday that excise taxes would be introduced in the last quarter of this year at a rate of 100 per cent for tobacco and energy drinks and 50 per cent for sugary fizzy drinks. The authority will open tax registration in the third quarter of the year for companies that produce, import or store these products."



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Ex-Google Exec Gets $500 Million From STC for Mideast Tech Deals - Bloomberg

Ex-Google Exec Gets $500 Million From STC for Mideast Tech Deals - Bloomberg:

"Saudi Telecom Co. has created a $500 million technology fund to be run by ex-Google executive Abdulrahman Tarabzouni to invest in areas like artificial intelligence and virtual reality. STV, as the fund will be known, already has a pipeline of potential deals it is looking at and the first could be completed before the end of the year, Tarabzouni said at a press conference in Riyadh. The fund is looking to make investments over the next four to five years and more money could be allocated to it in the future, Saudi Telecom Chief Executive Officer Khaled Biyari said. Investor interest in the Middle East’s technology industry is picking up after Amazon.com Inc. paid $580 million to buy e-commerce firm Souq.com. Dubai-based business tycoon Mohamed Alabbar raised $1 billion to create an e-commerce company called Noon, and said he had separately raised $1 billion to make technology investments."



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Abu Dhabi's Masdar Starts Trash-Energy Venture in Nearby Sharjah - Bloomberg

Abu Dhabi's Masdar Starts Trash-Energy Venture in Nearby Sharjah - Bloomberg:

"Abu Dhabi’s renewable energy company Masdar formed a joint venture to build a power plant that runs on garbage as the United Arab Emirates seeks to diversify its sources of electricity. Masdar, as Abu Dhabi Future Energy Co. is known, created Emirates Waste to Energy Co. in partnership with Bee’ah, the government-owned waste management company in nearby Sharjah, the companies said Thursday in a statement. Their first project will be a 30-megawatt power plant to process 300,000 tons of solid waste a year."



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Saudi Aramco to spend $18 billion on growth in the Americas: Motiva | Reuters

Saudi Aramco to spend $18 billion on growth in the Americas: Motiva | Reuters:

"Saudi Aramco plans to spend $18 billion over the next five years to expand its operations in the Americas, focusing on its U.S. oil refining subsidiary Motiva Enterprises, Motiva said on Thursday. Motiva is exploring opportunities to increase refining capacity, branch into chemicals and expand its commercial operations, marketing and branded presence over the next five years, the company said in a statement. Motiva became a wholly owned subsidiary of Saudi Aramco on May 1 with the split of a 19-year partnership between Aramco and Royal Dutch Shell Plc (RDSa.L)."



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Crude Slumps Below $50 as Market Is Underwhelmed by OPEC Deal - Bloomberg

Crude Slumps Below $50 as Market Is Underwhelmed by OPEC Deal - Bloomberg:

"Oil fell below $50 after OPEC stuck to the most predictable outcome at a meeting in Vienna.

Futures closed 4.8 percent lower in New York as the Saudi Arabian-led group and its allies delivered only what had already been telegraphed for days: an agreement to extend output cuts for nine months, without deepening them or saying what will happen after March 2018.

"The Saudis have been trying to put a happy face on this thing," said John Kilduff, a partner at Again Capital, a New York-based hedge fund that focuses on energy. "But this is all they could get, and that’s disappointing to the market.""



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MIDEAST STOCKS-Qatar's Ezdan tumbles on delisting approval, Saudi set back by oil | Reuters

MIDEAST STOCKS-Qatar's Ezdan tumbles on delisting approval, Saudi set back by oil | Reuters:

"Shares of Qatar's largest property developer plunged 10 percent on Thursday after its shareholders gave preliminary approval to take the company private, while a dip in crude oil took the Saudi equity index lower in its final hour of trade. Ezdan Holding Group, with majority ownership by the ruling al Thani family, said shareholders who are against the de-listing, whether they attended the meeting or not, can exit their positions within 60 days. The company said it will hire an independent expert to look at it its assets and to assess the fair value of the company. The stock closed at 13.95 riyals on Thursday."



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EM bonds are rallying again | Markets

Opec agrees to extend historic supply cuts into 2018

Opec agrees to extend historic supply cuts into 2018:

"Opec will extend its production cuts into 2018, as the oil cartel and its allies attempt to end a three year supply glut that has hammered crude prices. The cartel agreed to prolong supply curbs for another nine months during a ministerial meeting on Thursday in Vienna, two Opec delegates familiar with the discussions said. The agreement, which is expected to be ratified later today by Russia and other producers outside Opec, will see the 1.8m barrel a day accord first agreed in late November extended to March 2018."



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Abu Dhabi co-pay hits Mediclinic revenue | The National

Abu Dhabi co-pay hits Mediclinic revenue | The National:

"Mediclinic International, which owns Abu Dhabi’s Al Noor Hospitals Group, said that its underlying earnings per share plunged by 19 per cent in the financial year that ended in March as the South African healthcare provider suffered from regulatory changes in the emirate. The London-listed group said in a statement that its underlying earnings per share dropped to 29.8 pence from 36.7 pence. Its shares fell by 5.64 per cent to £8.2 in afternoon trading. Abu Dhabi last year issued new insurance rules, where Emiratis were required to pay for a greater proportion of their private-sector treatment, starting from July, eroding earning potential of number of healthcare providers. But the emirate said this month it was reversing its policy for Emiratis in Abu Dhabi holding Thiqa health insurance cards, exempting them from paying 20 per cent of private treatment costs."



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Exclusive: Dubai looking into forming $1 billion shipping investment fund - sources | Reuters

Exclusive: Dubai looking into forming $1 billion shipping investment fund - sources | Reuters:

"Dubai is looking into creating a $1 billion investment fund focused on shipping to develop the Gulf city's maritime sector and ride out a global industry downturn, three finance sources familiar with the plans say.

The sources said the Dubai Maritime City Authority, the government entity responsible for developing the maritime industry in the emirate, was examining ways to establish a fund to provide financial investment support to Dubai-based firms.

"There is interest in this idea (from Dubai). At this stage it is fact finding," one source said."



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OPEC Poised for `Safe Bet' of Nine-Month Extension of Oil Cuts - Bloomberg

OPEC Poised for `Safe Bet' of Nine-Month Extension of Oil Cuts - Bloomberg:

"OPEC and its allies were poised to extend their production cuts for an additional nine months after last year’s agreement failed to clear a global supply glut or deliver a sustainable price recovery.

Nine months with the same level of production “is a very safe and almost certain option to do the trick,” Saudi Arabian Oil Minister Khalid Al-Falih said at the opening session at the meeting in Vienna. “It’s likely we’ll be balanced earlier than later.”  Six months after forming an unprecedented coalition of 24 nations and delivering output reductions that exceeded all expectations, some of the world’s largest oil producers faced the fact that they’d fallen well short of their goal. Oil prices fell after ministers arrived at the meeting venue."



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MIDEAST STOCKS-Qatar's Ezdan tumbles on initial plan to de-list, DXBE weighs on Dubai again | Reuters

MIDEAST STOCKS-Qatar's Ezdan tumbles on initial plan to de-list, DXBE weighs on Dubai again | Reuters:

"Shares of Qatar's largest listed real estate developer tumbled in early trade on Thursday after saying its shareholders had given preliminary approval to take the company private while DXB Entertainments continued to drag Dubai's index down. Ezdan Holding Group, which is owned mainly by government related parties, dropped 7.3 percent. The company said that disapproving shareholders, whether present or absent from the meeting, can exit their positions within 60 days of the preliminary decision. The company, which is a constituent of the MSCI emerging market index, said it had hired a company to reach a fair valuation of its assets, based on the closing price on April 3, which was 15.08 riyals. It will announce the result once the valuation process has been completed."



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Wednesday, 24 May 2017

MIDEAST STOCKS-Gulf weak as DXBE drags down Dubai; banks boost Egypt | Reuters

MIDEAST STOCKS-Gulf weak as DXBE drags down Dubai; banks boost Egypt | Reuters:

"Major Gulf stock markets weakened on Wednesday, with amusement park operator DXB Entertainments (DXBE) continuing to drag down Dubai while banking shares lifted Egypt in the wake of Sunday's interest rate hike.

DXB Entertainments slid by 3.1 percent to 0.782 dirhams, its lowest level since early 2015. The stock has tumbled 40 percent this year on low attendance figures at its parks, a wider net loss in the first quarter and a warning that attendance numbers could suffer further during the hot summer months.

Emaar Malls fell 1.9 percent after the retail arm of Emaar Properties said it would spend $151 million to buy a 51 percent stake in e-commerce fashion website Namshi from Global Fashion Group, a start-up established by Rocket Internet."



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Mediclinic beats profit forecasts but warns Middle East improvement will take years

Mediclinic beats profit forecasts but warns Middle East improvement will take years:

"FTSE 100 hospital operator Mediclinic reported better than expected profits for the year to March 31, but it warned that stabilising its troubled new business in Abu Dhabi is likely to take a number of years. Revenues rose by 30 per cent to £2.7bn thanks to the £1.4bn purchase of the Abu Dhabi business, in line with analyst expectations. Profit before tax increased 25 per cent to £307m, roughly in line with expectations, but the the company’s preferred performance measure – underlying earnings before interest, tax, depreciation and amortisation – came in ahead of consensus forecasts. Underlying ebitda rose 17 per cent compared to the previous year to £501m, compared to forecasts of £484m."



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Abu Dhabi economy shows signs of recovery | The National

Abu Dhabi economy shows signs of recovery | The National:

"Abu Dhabi’s economy is showing signs of recovery amid ­government spending on projects, says a senior economic official in the emirate.

"We are in the downturn of the economic cycle but we see some signs of recovery," said Khalifa bin Salem Al Mansouri, the Undersecretary at the Department of Economic Development. "The government is now spending. Those are signs of early recovery. We expect to see more signs of recovery this year and at the beginning of next year."


Mr Al Mansouri said the projects include a Dh7 billion spending plan announced by Abu Dhabi Municipality as well as tourism projects announced by the Government on Yas and Saadiyat islands."



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NBAD's Yasin Sees GCC Markets Going Sideways - Bloomberg

NBAD's Yasin Sees GCC Markets Going Sideways - Bloomberg:


"NBAD Securities Managing Director Mohammed Ali Yasin discusses the deals signed between the U.S. and Saudi Arabia and talks about his investment strategies. He speaks on "Bloomberg Markets: Middle East." (Source: Bloomberg)"



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Dubai's Emaar buys Namshi stake after Amazon buys Souq.com | Reuters

Dubai's Emaar buys Namshi stake after Amazon buys Souq.com | Reuters:

"Dubai's Emaar Malls will buy a 51 percent stake in e-commerce fashion website Namshi from Global Fashion Group (GFG), a start-up set up by Rocket Internet, for $151 million as competition for technology deals heats up in the Middle East. Coming two months after Amazon agreed to buy Souq.com, the transaction is expected to provide much-needed support for Emaar Properties founder and chairman Dubai billionaire Mohamed Alabbar's new technology vehicle Noon.com, a venture with Saudi Arabia's Public Investment Fund. The venture has seen a shake-up in recent weeks with the departure of Noon's chief executive and chief technology officer along with several staff. Alabbar said last week its venture still on track to start operations before end-2017."



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Singapore Convicts Fifth Person Involved in 1MDB-Related Cases - Bloomberg

Singapore Convicts Fifth Person Involved in 1MDB-Related Cases - Bloomberg:

"Kelvin Ang Wee Keng was fined S$9,000 ($6,477) after he admitted that he made a corrupt payment to an analyst in a Singapore case related to 1Malaysia Development Bhd investigations. Ang, 35, was a broker with Kim Eng Securities Pte until 2015 and made about S$100,000 annually in commissions, prosecutor Vincent Ong said in a Singapore State Court on Wednesday. He was charged a year ago for what authorities said was corruptly giving S$3,000 to a research analyst to speed up the preparation of a favorable valuation report. While the charge sheet at that time didn’t give further details, the city’s Attorney-General’s Chambers said he was “implicated in a number of illicit transactions” with former BSI SA wealth planner Yeo Jiawei. Yeo is appealing his conviction and 30-month jail term for obstructing justice in another case relating to the 1MDB probe. Ang, who is now unemployed, was Yeo’s friend, Ong said in court."



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MIDEAST STOCKS-DXBE, Emaar Malls underperform otherwise quiet region | Reuters

MIDEAST STOCKS-DXBE, Emaar Malls underperform otherwise quiet region | Reuters:

"Shares in companies linked to tourism underperformed in Dubai in an otherwise flat regional market in early trade on Wednesday. Dubai's theme park operator, and constituent of the MSCI emerging market benchmark, DXB Entertainments, lost 2.2 percent to 0.789 dirham, its lowest price since January 2015. Its shares been hit hard over the last few sessions, as investors expect Ramadan and hot summer weather may reduce footfall at its Dubai hotels and theme parks."



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Tuesday, 23 May 2017

UAE’s non-Muslim expats can now register for a will not governed by Sharia Law | The National

UAE’s non-Muslim expats can now register for a will not governed by Sharia Law | The National:

"Non-Muslim expatriates can now dictate where they want their assets to go when they die, after a decision to change rules governing wills. The changes will ensure there is no dispute or confusion over a deceased’s belongings and custody of children, and expats can register a will for about Dh500. Abu Dhabi has had no way of registering wills drafted in the UAE or an expat’s home country."



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Vanguard’s rise shows it is now time for UAE investors to have access low-cost funds | The National

Vanguard’s rise shows it is now time for UAE investors to have access low-cost funds | The National:

"UAE investors are calling on low-cost mutual fund managers such as Vanguard to enter the region to boost competition and drive down costs.

They say too many UAE residents continue to buy over-priced insurance-based investment plans and need cheaper and more flexible alternatives.

The entry of a major low-cost platform such as US-based Vanguard would shake up the UAE market, giving local investors more choice and lower charges."



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GCC Unified VAT, Selective Excise Taxation Agreements come into effect | GulfNews.com

GCC Unified VAT, Selective Excise Taxation Agreements come into effect | GulfNews.com:

"The Gulf Cooperation Council for Arab States’ (GCC) Unified Selective Excise Tax and the Unified Value Added Tax (VAT) agreements have come into effect after ratification by the UAE.

The General Secretariat of the GCC has received the UAE’s ratification documents for the two agreements. In a statement issued on Tuesday, the Secretariat, said: “The UAE is the second State to submit the two ratification documents to the Secretariat.” The two agreements have become effective when the second state submits the ratification documents to the Secretariat, it added. Hence, the GCC unified selective excise tax and the VAT agreements entered into force, the statement said."



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Former Gulf emirate officials sentenced in embezzlement case | Reuters

Former Gulf emirate officials sentenced in embezzlement case | Reuters:

"Two former senior officials of the Ras al-Khaimah Investment Authority (RAKIA) in the United Arab Emirates (UAE) have been sentenced in absentia to 15 years in prison for embezzlement, according to court documents released on Tuesday.

Khater Massaad and Gela Mikadze were sentenced on April 26 by a court in Ras al-Khaimah (RAK) for defrauding RAKIA of $17.2 million in 2011. A third man, George Janashia, was also sentenced to 15 years in prison in absentia.

Mikadze and Janashia, both citizens of the former Soviet republic of Georgia, were ordered to repay $12.8 million and $4.4 million respectively. The three defendants were also fined $17.2 million, according to the documents which were released by the RAK government."



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Blackstone, SoftBank Deals Put Saudi’s Sovereign Fund on the Map - Bloomberg

Blackstone, SoftBank Deals Put Saudi’s Sovereign Fund on the Map - Bloomberg:

"Saudi Arabia plans to expand its sovereign wealth fund into the world’s largest. The kingdom took a huge step toward that goal on Saturday when it signed billions of dollars of deals with Blackstone Group LP and SoftBank Group Corp. The Public Investment Fund, or PIF, is at the center of Saudi Arabia’s efforts to diversify revenue away from oil under an economic transformation plan known as Vision 2030. The fund could eventually control more than $2 trillion, according to Deputy Crown Prince Mohammed bin Salman. The sale of a less than 5 percent stake in oil giant Aramco to the public will provide funds for investment. “We want to be an investment powerhouse,” PIF managing director Yasir Alrumayyan said in a rare public appearance Saturday during an event that gathered top Saudi officials and American corporate titans, including JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon and Citigroup Inc. CEO Mike Corbat, in Riyadh. “Most of the investments we announced and will announce soon are international, but they will be in parallel with our investments in Saudi.”"



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Saudi Aramco plans up to $30 billion investment in Motiva by 2023 | Reuters

Saudi Aramco plans up to $30 billion investment in Motiva by 2023 | Reuters:

"Saudi Aramco [IPO-ARMO.SE] plans an investment of up to $30 billion in its U.S. subsidiary Motiva Enterprsies LLC [MOTIV.UL], the company said in an announcement on Saturday at a business summit in Saudi Arabia.

The company said that $12 billion would be the initial investment in a project to expand refining capacity at Motiva's Port Arthur, Texas, refinery and extend Motiva's operations in the petrochemical value chain.

A likely additional investment of $18 billion is expected into Motiva by 2023, it said."



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MIDEAST STOCKS-Egypt rebounds after tumble on rates, Gulf swept by profit-taking | Reuters

MIDEAST STOCKS-Egypt rebounds after tumble on rates, Gulf swept by profit-taking | Reuters:

"Egypt's stock market on Tuesday recovered some of the previous day's heavy losses while Gulf bourses were weaker as investors booked profits ahead of the holy month of Ramadan, when trading volumes and liquidity often decrease. Cairo's index rebounded 1.1 percent after tumbling 2.5 percent on Monday, its largest single-day decline since Jan. 19, after the central bank unexpectedly raised interest rates by 2 percentage points to fight sky-high inflation. The surprise move prompted heavy selling by local retail investors but several foreign fund managers said they did not expect a lasting impact on the market, partly because of the loose links between interest rates and the real economy in Egypt."



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Trump hits oil price with reported plan to sell half of strategic reserves

Trump hits oil price with reported plan to sell half of strategic reserves:

"Oil prices were weaker on Tuesday morning on reports that President Trump wants to sell half of the country’s strategic reserve to help balance the books. Brent, the global crude marker, fell 50 cents to $53.47, while West Texas Intermediate, the US benchmark, was 44 cents lower at $50.69 after details of the plan emerged. In budget documents, the White House said it would sell off half of the strategic petroleum reserve, the biggest in the world, to raise $16.5bn from October. The oil is held in heavily guarded underground caverns in Louisiana and Texas"



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OPEC's Worst Cheater Will Get Harder to Ignore as Curbs Falter - Bloomberg

OPEC's Worst Cheater Will Get Harder to Ignore as Curbs Falter - Bloomberg:

"OPEC’s second-biggest producer is also its biggest cheater. And if past is prologue, that lengthens the odds the group will be able to squeeze too many more price gains out of its output cuts. Iraq pumped about 80,000 more barrels of oil a day than permitted by Organization of Petroleum Exporting Countries curbs during the first quarter. If that deal gets extended to 2018, the nation will have even less incentive to comply because capacity at key southern fields is expanding and three years of fighting Islamic State has left it drowning in debt."



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Kuwait says OPEC to discuss 6 or 9-month output cut extensions | Reuters

Kuwait says OPEC to discuss 6 or 9-month output cut extensions | Reuters:

"Kuwait's oil minister said on Tuesday that global oil producers would discuss at their meeting this week whether to extend output cuts for six months or nine months, because not all were on board for nine. "We have agreed on the six months. Some of the countries have agreed to six months subject to a revision in November for an additional three months," Essam al-Marzouq told reporters before heading to Vienna for the Thursday meeting. "From what I have heard, some of the press releases, the Iraqi and Iranian ministers have declared that they prefer six months," he said, before adding: "For nine months not everybody (is) on board.""



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Oil Halts Advance After Four-Day Gain as OPEC Prepares to Meet - Bloomberg

Oil Halts Advance After Four-Day Gain as OPEC Prepares to Meet - Bloomberg:

"Oil halted its advance after a four-day gain before OPEC meets Thursday to decide on prolonging output cuts by the group and its partners.

July futures dropped 0.9 percent in New York after front-month prices Monday capped a 4.3 percent increase over four sessions. Iraq backed a proposal to extend production curbs into 2018, adding to growing support for longer cuts to clear a global glut. In the U.S., crude inventories probably slid by 2 million barrels last week, according to a Bloomberg survey before data from the Energy Information Administration Wednesday."



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MIDEAST STOCKS-Saudi falls on pre-Ramadan selling, MSCI stocks strong elsewhere in Gulf | Reuters

MIDEAST STOCKS-Saudi falls on pre-Ramadan selling, MSCI stocks strong elsewhere in Gulf | Reuters:

"Profit-booking swept across the Saudi Arabian bourse in early trade on Tuesday as investors cashed out ahead of Ramadan, while Abu Dhabi and Qatar were buoyed by gains among constituents of the MSCI emerging market index.

Riyadh's index fell 0.6 percent in the first 40 minutes as 151 shares declined and only eight rose.

"This is the cash-out before Ramadan, and it is not uncommon to see some unwinding ahead of the quieter period," said a Jeddah-based trader. Trading volumes often shrink during the holy month, which is expected to start this Saturday."



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Monday, 22 May 2017

Emirates to tap into China demand with A380 expansion on Beijing and Shanghai routes | The National

Emirates to tap into China demand with A380 expansion on Beijing and Shanghai routes | The National:

"Emirates plans to ramp up passenger numbers on its A380 services to Beijing and Shanghai from July, strengthening its mainland China offering.

The airline will upgrade its second daily flights on these routes to an A380 aircraft from the current Boeing 777-300ER.

In operation from July 1, the service will increase capacity on flights to both Beijing and Shanghai in China, where it also flies to Guangzhou, Yinchuan and Zhengzhou."



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NMC Health, Ashmore, Dallah weighing bids for Saudia medical unit-sources | Reuters

NMC Health, Ashmore, Dallah weighing bids for Saudia medical unit-sources | Reuters:

"UAE health operator NMC Health, asset manager Ashmore Group and Dallah Health are separately considering bids for the Jeddah-based medical services business of Saudi Arabian Airlines (Saudia) which could fetch $500 million, sources familiar with the deal said. Saudia has sent out a request for proposals for the sale of the business through its financial adviser Jadwa Investment as it seeks to reduce non-core assets, they said. Other Saudi healthcare companies may look at the business as well as healthcare groups such as Saudi German Hospital and Dr. Sulaiman Al Habib Medical Group, sources told Reuters. The sources declined to be identified because details of the bidding process are not public."



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MIDEAST STOCKS-Egypt hit by surprise rate hike, Qatar outperforms in quiet Gulf | Reuters

MIDEAST STOCKS-Egypt hit by surprise rate hike, Qatar outperforms in quiet Gulf | Reuters:

"Egypt's stock market tumbled in heavy trade on Monday after the central bank unexpectedly raised key interest rates overnight, while Qatar outperformed in an otherwise quiet Gulf.

Cairo's blue-chip index dropped 2.5 percent after the central bank hiked its overnight deposit rate and overnight lending rate by two percentage points - its first increase since a hike of three percentage points in November.

The motive for the hike was to combat Cairo's hyperinflation and it came at the recommendation of the International Monetary Fund. But the equity market was not prepared for such a move."



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Money flowing into sovereign wealth funds declines to $7.4tn

Money flowing into sovereign wealth funds declines to $7.4tn:

"Sovereign wealth funds are feeling the strain from lower oil prices and government raids on rainy-day funds, with the amount of money managed by state-backed investment vehicles falling slightly to $7.4tn. Between March 2015 and March 2017, the collective assets overseen by SWFs — which often owe their origins to money generated from a country’s excess oil revenues — decreased 0.5 per cent. That compares with the 14 per cent increase in the two years to March 2015, according to the Sovereign Wealth Fund Institute, a research organisation. The fall in assets has raised concerns that state funds will withdraw more money from external investment managers, which have already suffered several years of redemptions from these large investors."



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Arqaam's Meijer Says Deals Will Fuel Saudi GDP Growth - Bloomberg

Arqaam's Meijer Says Deals Will Fuel Saudi GDP Growth - Bloomberg:

"Jaap Meijer, managing director and head of equity research at Arqaam Capital, discusses the deals signed between the U.S. and Saudi Arabia. He speaks on "Bloomberg Markets: Middle East." (Source: Bloomberg)"



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MIDEAST DEBT-Oman front-loading funding requirements with planned dollar sukuk | Reuters

MIDEAST DEBT-Oman front-loading funding requirements with planned dollar sukuk | Reuters:

"Oman, which saw its debt rating cut to junk this month, appears to be borrowing money it needs far in advance of spending it in order to take advantage of market conditions and prevent investors worrying about its ability to fund itself. The Omani government is expected to offer as soon as this week as much as $2 billion of Islamic bonds, its first public offer of sukuk in the international market. It would be Oman’s second international bond issue this year, after a $5 billion conventional bond sale in March that was split into tranches of five, 10 and 30 years."



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Softbank-Saudi tech fund becomes world's biggest with $93 billion of capital | Reuters

Softbank-Saudi tech fund becomes world's biggest with $93 billion of capital | Reuters:

"The world's largest private equity fund, backed by Japan's Softbank Group and Saudi Arabia's main sovereign wealth fund, said on Saturday it had raised over $93 billion to invest in technology sectors such as artificial intelligence and robotics.

"The next stage of the Information Revolution is under way, and building the businesses that will make this possible will require unprecedented large-scale, long-term investment," the Softbank Vision Fund said in a statement.

Japanese billionaire Masayoshi Son, chairman of Softbank, a telecommunications and tech investment group, revealed plans for the fund last October and since then it has obtained commitments from some of the world's most deep-pocketed investors."



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From suspicion to engagement: OPEC, hedge funds and the Sistine Chapel | Reuters

From suspicion to engagement: OPEC, hedge funds and the Sistine Chapel | Reuters:

"It was an unconventional venue for an unusual encounter.

In the Vatican's Sistine Chapel in the summer of 2016, OPEC's new secretary general Mohammed Barkindo bumped into Citigroup's global head of commodities research Ed Morse.

Their chat, at an energy industry event held in the Chapel, led to a series of meetings that have reshaped the way the Organization of the Petroleum Exporting Countries interacts with the hedge funds and trading houses that influence world oil markets."



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Why the Permian Basin Is OPEC's New Headache: QuickTake Q&A - Bloomberg

Why the Permian Basin Is OPEC's New Headache: QuickTake Q&A - Bloomberg:

"A dry expanse straddling the Texas-New Mexico border has become such a bounty of energy that it’s now a threat to OPEC. Surging output from the Permian Basin, which has been described as a layer cake of oil and natural gas, is projected to help push U.S. crude production to a record next year, making it harder for members and partners of the Organization of Petroleum Exporting Countries to move prices higher and lower by controlling the supply to the world. As technology improves, and geologists learn more about what’s underground, estimates of Permian reserves steadily increase."



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Rouhani Win Seen Speeding Iran Oil-Deals Push Amid Trump Threat - Bloomberg

Rouhani Win Seen Speeding Iran Oil-Deals Push Amid Trump Threat - Bloomberg:

"Iranian President Hassan Rouhani is in a stronger position after his re-election to push through plans for wooing foreign investors the country needs to boost oil production, according to analysts at Cornerstone Global Associates and SVB Energy. Iran’s effort to attract about $100 billion to develop more than 50 oil and natural gas fields bogged down ahead of the May 19 presidential election. Political arguments stalled approval of the contract terms the government would offer, and U.S. financial sanctions -- and the potential threat of additional curbs -- continue to dissuade many would-be international investors. Rouhani defeated rivals in a landslide, winning about 57 percent of the vote. As his victory was announced on Saturday, U.S. President Donald Trump was in Saudi Arabia, Iran’s regional rival, bolstering a coalition of states opposed to the Islamic republic. Trump has said the nuclear accord that world powers reached with Iran is one of the worst deals he’s seen and is reviewing policy toward the country. "



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MIDEAST STOCKS-Egypt hit by surprise interest rate hike, Qatar leads in Gulf | Reuters

MIDEAST STOCKS-Egypt hit by surprise interest rate hike, Qatar leads in Gulf | Reuters:

"Egypt's stock market fell sharply in early trade on Monday after an unexpected move by the central bank to raise key interest rates while in the Gulf Qatar outperformed an otherwise quiet market.

All but three of the 30 most traded stocks in Egypt declined after 25 minutes of trade knocking the stock index 1.7 percent lower.

At a meeting of its Monetary Policy Committee, the central bank hiked its overnight deposit rate to 16.75 percent from 14.75 percent and its overnight lending rate to 17.75 from 15.75 percent. This was the bank's first increase in rates since an aggressive hike of 300 basis points in November."



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Sunday, 21 May 2017

MIDEAST STOCKS-Saudi basks in Trump glow, most of region moves little | Reuters

MIDEAST STOCKS-Saudi basks in Trump glow, most of region moves little | Reuters:

"Saudi Arabia's stock market outperformed a sluggish region on Sunday after U.S. and Saudi companies signed over $200 billion of deals during the visit to Riyadh by President Donald Trump. Few of the deals involved listed Saudi companies, and many had been previously announced, or were merely memorandums of understanding that might never lead to concrete projects. But the positive publicity around the agreements - and the warm welcome given to Trump amid talk of stronger diplomatic and economic ties between the countries - cheered some investors, and the Saudi stock index gained 0.8 percent."



'via Blog this'

Saudi wealth fund to back $40bn Blackstone infrastructure vehicle

Saudi wealth fund to back $40bn Blackstone infrastructure vehicle:

"The sovereign wealth fund of Saudi Arabia has unveiled plans to place $20bn with Blackstone, the alternative asset manager, becoming the anchor investor in a new $40bn infrastructure fund that will focus on mainly upgrading US assets.

The two sides announced the non-binding memorandum on Saturday, just hours after US president Donald Trump landed in Riyadh for his first foreign visit since inauguration.

However, both Saudi’s Public Investment Fund and Blackstone stated that the terms were not yet finalised and emphasised that the agreement was the culmination of talks that predated the US president’s election."



'via Blog this'

SoftBank Closes Funding For Record $93 Billion Investment Fund - Bloomberg

SoftBank Closes Funding For Record $93 Billion Investment Fund - Bloomberg:

"SoftBank Group Corp. and Saudi Arabia formally announced the first round of capital commitments for the largest-ever technology investment fund, as founder Masayoshi Son seeks to accelerate his financing of cutting-edge technologies and startups.

More than $93 billion has been secured from backers led by the Japanese company and Saudi Arabia’s Public Investment Fund, SoftBank said in a statement Saturday. Abu Dhabi’s Mubadala Investment Co., Apple Inc., Qualcomm Inc., Foxconn Technology Group and Sharp Corp. are also investing, and SoftBank aims to reach $100 billion with a final close within six months. Mubadala committed $15 billion, according to a separate statement.

The Vision Fund will allow the billionaire Son to cut even more ambitious deals than he’s been able to do with his highly leveraged company. He has used money from his domestic telecom operations to pay for investments in startups in China, India and the U.S. and for acquisitions of larger companies such as U.K. chipmaker ARM Holdings Plc and U.S. wireless operator Sprint Corp. Now he sees richer opportunities than ever before in areas like artificial intelligence and the Internet of Things.

"



'via Blog this'

Saudi Billionaire Says Companies Struggled to 'Absorb' Reforms - Bloomberg

Saudi Billionaire Says Companies Struggled to 'Absorb' Reforms - Bloomberg:

"Saudi Arabia lined up prominent officials and CEOs to promote plans to wean the economy off oil on the first day of President Donald Trump’s visit to Riyadh. Among them was one of the kingdom’s richest women.

Delivering rare public remarks in her home country, billionaire businesswoman Lubna Al-Olayan said companies have struggled with the magnitude of changes imposed by authorities in the first year of the so-called Vision 2030 plan. She, however, praised the “open discussion” between the government and the local business community."



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Saudi oil minister: continuing cuts, adding small producers to deal will reduce inventories | Reuters

Saudi oil minister: continuing cuts, adding small producers to deal will reduce inventories | Reuters:

"Saudi Arabia believes continuing an agreement among global oil producers to cut output, and adding one or two small producers to the deal, will reduce oil inventories sufficiently, energy minister Khalid al-Falih said on Sunday. "We believe that continuation with the same level of cuts, plus eventually adding one or two small producers...will be more than adequate to bring the five-year balance to where they need to be by the end of the first quarter 2018," he said. Falih was speaking at a news conference before this week's talks between global oil producers on whether to extend their output deal, which expires in June."



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Trump Toast of Town in Saudi Arabia as Talks Turn to Politics - Bloomberg

Trump Toast of Town in Saudi Arabia as Talks Turn to Politics - Bloomberg:

"U.S. President Donald Trump was feted again on Sunday, the second day of his trip to Saudi Arabia, as he began a series of meetings with Arab leaders that will focus on combating terrorism and containing Iran’s influence in the region. Sitting next to President Abdel-Fattah El-Sisi at the Ritz-Carlton hotel in Riyadh, Trump praised the Egyptian leader for what he said were successful efforts to fight terrorism under “trying circumstances.”"



'via Blog this'

MIDEAST STOCKS-Saudi, UAE bourses firm after oil price rebound | Reuters

MIDEAST STOCKS-Saudi, UAE bourses firm after oil price rebound | Reuters:

"Stock markets in Saudi Arabia and the United Arab Emirates rose in early trade on Sunday, with Saudi petrochemical shares particularly strong, after oil prices rebounded at the end of last week.

The Saudi stock index added 1.0 percent in the first 50 minutes as Saudi Basic Industries, the top petrochemical producer, gained by the same margin.

Mining company Ma'aden rose 2.9 percent. Among tens of billions of dollars worth of deals announced by U.S. companies on Saturday during President Donald Trump's visit to Riyadh, GE said it would provide technology to Ma'aden to reduce its energy costs and boost efficiency."



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Saturday, 20 May 2017

Rouhani Wins Re-election in Iran by a Wide Margin - The New York Times

Rouhani Wins Re-election in Iran by a Wide Margin - The New York Times:

"Riding a large turnout from Iran’s urban middle classes, President Hassan Rouhani won re-election in a landslide on Saturday, giving him a mandate to continue his quest to expand personal freedoms and open Iran’s ailing economy to global investors. Perhaps as important, analysts say, the resounding victory should enable him to strengthen the position of the moderate and reformist faction as the country prepares for the end of the rule of the 78-year-old supreme leader, Ayatollah Ali Khamenei. With most of the votes from Friday’s election counted, the Interior Ministry said Mr. Rouhani had won 22.8 million, soundly defeating his chief opponent, Ebrahim Raisi, who received 15.5 million. Iranian state television congratulated Mr. Rouhani on his victory. Turnout was heavy, with about 40 million of Iran’s 56 million voters, more than 70 percent, casting ballots."



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Friday, 19 May 2017

Central Bank turns attention to complaints of mis-selling investment products | The National

Central Bank turns attention to complaints of mis-selling investment products | The National:

"Bank customers in the UAE will now receive greater protection against the mis-selling of savings, investment or life insurance policies under the latest regulatory crackdown. The Central Bank of the UAE issued a circular this month advising banks and finance companies to resolve all outstanding mis-selling complaints "amicably" and within a deadline of just 90 days. It issued the circular in response to "an increasing number of complaints in relation to the savings and investment insurance/takaful products". The mis-selling complaints all have a common theme, with customers sold policies that are "complex in nature and are not well understood", according to the circular, seen by The National. These contractual and fixed-term savings or investment plans have been created by the largest global insurance companies and have been criticised by experts as the most expensive financial products available anywhere in the world. These plans have not been licensed to be sold to consumers for many years now in countries like the United Kingdom."



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Damac Properties managing director Ziad El Chaar resigns | The National

Damac Properties managing director Ziad El Chaar resigns | The National:

"Damac Properties, the Dubai property developer, said that its managing director and executive board member Ziad El Chaar has resigned.

The company did not say when the resignation takes or took effect, nor did it name a replacement. It said, however, in a regulatory filing to the Dubai stock exchange that Ossama Abbas would assume the responsibilities of general sales.

"We regretfully announce the departure of Mr El Chaar but wish to thank him wholeheartedly for the outstanding efforts during his time with Damac and the many achievements he spearheaded during this period," said Hussain Sajwani, the chairman of Damac Properties."



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Etihad Airways’ $4 Billion Expansion Plan Stalls - Bloomberg

Etihad Airways’ $4 Billion Expansion Plan Stalls - Bloomberg:

"In 2011, Etihad Airways Chief Executive Officer James Hogan hatched a bold strategy to catch up with the airline’s more established Persian Gulf rivals: buying stakes in smaller, cash-hungry carriers across three continents to cobble together enough passengers to propel the Abu Dhabi-based company into the ranks of the global aviation elite. But after more than $4 billion of share purchases, bond buyouts, and other investments, the wannabe airline superpower has little to show for its long-odds gamble.

“Etihad was seeking the equivalent of five years of organic growth overnight, but shortcuts in aviation rarely work,” says aviation analyst Mark Martin, who heads Dubai-based Martin Consultancy LLC. “Mostly you’re buying into bad debt, bad mistakes—and skeletons in the cupboard.”

That reality hit home on May 2 when Italy’s Alitalia SpA, in which Etihad holds a 49 percent stake after pouring in about €1 billion ($1.1 billion), filed for bankruptcy amid mounting losses. Meanwhile, Air Berlin Plc, the biggest beneficiary of Etihad’s largesse after receiving $2 billion, is bleeding red ink after being caught in a squeeze between lower-cost carriers and No. 1 German airline Deutsche Lufthansa AG."



'via Blog this'

Alabbar Noon Venture With Saudi Fund Said to Let Dubai Staff Go - Bloomberg

Alabbar Noon Venture With Saudi Fund Said to Let Dubai Staff Go - Bloomberg:

"Noon, the e-commerce venture of Dubai businessman Mohamed Alabbar partly funded by Saudi Arabia’s Public Investment Fund, let go of dozens of staffers in Dubai amid delays to rolling out the app, according to four people familiar with the matter. Members from all departments, as well as contractors and vendors were let go, the people said, asking not to be identified as they aren’t authorized to speak to the media. Two of them said that there is still some hiring taking place. “Due to the shift in our operational base and the need for even greater efficiencies, there have been nominal staff reallocations and changes,” Noon said in an emailed statement Thursday. “Any rumors to the contrary are exaggerated and incorrect.”"



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CORRECTED-UAE Exchange Group targets up to $300 mln in acquisitions | Reuters

CORRECTED-UAE Exchange Group targets up to $300 mln in acquisitions | Reuters:

"UAE Exchange Group, a global remittance and foreign exchange business, aims to spend between $250 million and $300 million on acquisitions to build its global market share, its chief executive said. The group aims to increase its share of the $575 billion global remittance industry to more than 10 percent by 2020, from 6.75 percent currently, Promoth Manghat said. "The group is exploring multiple bolt-on acquisition opportunities as well as strategic investments in remittances and payments space with a specific focus on fintech (and) digital," Manghat said."



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OPEC panel looking at deepening, extending oil cuts: sources | Reuters

OPEC panel looking at deepening, extending oil cuts: sources | Reuters:

"An OPEC panel reviewing scenarios for next week's policy-setting meeting is looking at the option of deepening and extending an OPEC-led deal to reduce oil output, OPEC sources said on Friday.

OPEC's national representatives - officials representing the 13 member countries - plus officials from OPEC's Vienna secretariat met on Wednesday and Thursday to discuss the market.

The meeting of the Economic Commission Board was scheduled to finish on Thursday but will conclude later on Friday, two OPEC sources said."



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Saudi-U.S. Ties Shift as Kingdom Turns to Trump for Investments - Bloomberg

Saudi-U.S. Ties Shift as Kingdom Turns to Trump for Investments - Bloomberg:

"Just a few years back, the business relationship between the U.S. and Saudi Arabia was pretty simple: The Americans bought oil, and the Saudis spent much of what they earned on equipment to keep the crude flowing and on planes, tanks, and missiles to protect their borders. With crude prices down by half over the past three years, U.S. domestic oil production up dramatically, and the kingdom embarking on unprecedented economic reforms -- including the sale of a stake in its state-owned oil company -- the leverage is shifting toward the Americans as the U.S. emerges as a rival energy exporter. The changing relationship will come into sharp focus this weekend, as American corporate titans visit Riyadh for an investment summit scheduled to coincide with Donald Trump’s first foreign trip as U.S. president. “At this point, the Saudis need the U.S. more than the reverse,” said Philippe Dauba-Pantanacce, global geopolitical strategist at Standard Chartered Plc in the U.K. “They need foreign direct investment to transform the economy, and the U.S. doesn’t need oil anymore.”"



'via Blog this'

Thursday, 18 May 2017

MIDEAST STOCKS-MSCI shares pose main drag on Gulf as global markets skid | Reuters

MIDEAST STOCKS-MSCI shares pose main drag on Gulf as global markets skid | Reuters:

"Stock markets in the Middle East most exposed to foreign fund flows followed global shares lower on Thursday, while the Saudi Arabian index, dominated by local investors, outperformed the region for the day and the week. Dubai's index lost 0.5 percent as most shares that are constituents of the MSCI emerging market index dropped. DXB Entertainments slumped 4.3 percent and Emaar Properties fell 0.8 percent. Members of the MSCI emerging market index were also weak in Abu Dhabi, with First Abu Dhabi Bank losing 0.4 percent and telecommunications operator Etisalat down 0.3 percent. The index closed 0.3 percent lower."



'via Blog this'

Algeria Says Most Nations in OPEC Deal Back Nine-Month Extension - Bloomberg

Algeria Says Most Nations in OPEC Deal Back Nine-Month Extension - Bloomberg:

"Algeria, the African oil producer that was instrumental in crafting OPEC’s historic output deal last year, said most participating nations back a nine-month extension of the cuts. “Most of the countries support the proposition of Russia and Saudi Arabia to extend,” Algerian Energy Minister Noureddine Boutarfa said Thursday in Moscow after talks with his Russian counterpart, Alexander Novak. Algeria also favors that course of action, and is “optimistic for an agreement,” he said. Signatories to a deal struck between the Organization of Petroleum Exporting Countries and its allies, including Russia, late last year will meet May 25 in Vienna to discuss prolonging the supply curbs. Saudi Arabia and Russia said Monday they favor extending the agreement through the first quarter of 2018 to reduce bloated global inventories to the five-year average."



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MIDEAST STOCKS-MSCI EM constituents weigh on Gulf, Saudi flat ahead of Trump visit | Reuters

MIDEAST STOCKS-MSCI EM constituents weigh on Gulf, Saudi flat ahead of Trump visit | Reuters:

"Stock markets in the Gulf most exposed to foreign fund flows followed global shares lower in early trade on Thursday, while the Saudi Arabian index, dominated by local investors, barely moved.

Dubai's index was down 0.5 percent as most shares that are constituents of the MSCI emerging market index dropped. DXB Entertainments lost 2.6 percent and Emaar Properties was down 0.9 percent.

Members of the MSCI emerging market index were also weak in Abu Dhabi, with First Abu Dhabi Bank and Aldar Properties each dropping 0.9 percent. The index was down 0.5 percent."



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Donald Trump Jr., Dubai Business Partner Discuss 'New Ideas' - Bloomberg

Donald Trump Jr., Dubai Business Partner Discuss 'New Ideas' - Bloomberg:

"Donald Trump Jr. traveled to Dubai and met a billionaire business partner in the city-state, discussing "new ideas" as the Emirati's real estate firm still lists possible plans for future joint projects while Trump's father is in the White House. The Trump Organization has said it won't make new foreign deals while Donald Trump serves as America's 45th president. That didn't affect the Trump International Golf Club in Dubai's opening in February , while a previously planned Trump-branded golf course designed by Tiger Woods is still being built nearby. Both projects are being built by Dubai's DAMAC Properties, owned by Emirati billionaire Hussain Sajwani. His company has paid the Trump Organization's subsidiaries between $1 million to $5 million for the projects, according to a U.S. Federal Election Committee report submitted in May."



'via Blog this'

Kuwait Finance House Said to Weigh Buying Ahli United Local Unit - Bloomberg

Kuwait Finance House Said to Weigh Buying Ahli United Local Unit - Bloomberg:

"Kuwait Finance House KSCP is considering buying Ahli United Bank BSC’s Kuwaiti operations as it seeks to expand in the Persian Gulf state, according to people familiar with the matter.

KFH, as the lender is known, is working with a financial adviser on the talks, the people said, asking not to be identified because the information is private. Discussions between the two banks are informal and Bahrain’s Ahli United isn’t running a formal sale process, the people said. There is no guarantee that a deal will take place and final agreements haven’t been reached with any of the parties, they said."



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Saudis Have a Red Carpet Ready for Trump, and a Steep Wish-List - Bloomberg

Saudis Have a Red Carpet Ready for Trump, and a Steep Wish-List - Bloomberg:

"Saudi Arabia is putting on a show for Donald Trump on his first overseas trip as U.S. president. Muslim leaders will assemble in Riyadh, and there’ll be an exhibition of classic American cars as well as sports matches and concerts. An online clock counts down the seconds until the big day.

Behind the pageantry are high expectations that won’t be easy to meet.

Among Gulf leaders, enthusiasm for Trump -- who looks increasingly embattled at home -- is driven by the desire for a like-minded partner in the oil-rich kingdom’s struggle against Iran, its main Middle Eastern rival. That, to Saudi eyes, overrides his record of anti-Islamic rhetoric on the campaign trail, and his attempt to bar some Muslims from entering the U.S. once he took office."



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Saudis Expect Big Economic Boost From Trump Visit - Bloomberg

Saudis Expect Big Economic Boost From Trump Visit - Bloomberg:

"Saudi-U.S. ties have never been better. Saudi Arabia will be President Donald Trump's first stop in his first overseas tour. The Saudis have laid out a massive red carpet for Trump and his business delegation with multiple events. It’s emblematic of the importance the Saudis have bestowed on Trump and the rebirth of its relationship with the U.S. It’s not unusual for a U.S. president to visit Saudi Arabia -- President Barack Obama, who was viewed cautiously by Riyadh, came  more times than any of his predecessors. It is, however, a first for a U.S. president to be visiting the kingdom on his maiden trip. Business comes first. Bilateral trade between the two nations is strong, amounting to almost $40 billion in 2016, according to the U.S. Census Bureau. In fact, last year was the first time in 21 years the U.S. sustained a trade surplus with Saudi Arabia, mainly due to lower oil prices. Oil plays just one part in the relationship. Saudi Arabia was supplanted by Canada in 2006 as the largest supplier of crude to the U.S., and provided 1.1 million barrels per day in 2016, according to the Energy Information Administration. For Trump, Saudi Arabia is a long-term business partner offering enormous potential for U.S. companies as the Middle East nation prepares for its post-oil future. Attracting U.S. investment is vital for its foreign-direct investment programs and successful implementation of Saudi Vision 2030. Taking a leading position in Saudi Arabia’s business opportunities is on the table with officials planning to privatize four sectors this year, including Saline Water Conversion Corp., a power generation company under Saudi Electricity Co., grain silos and sports clubs."



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Saudi Aramco's Only IPO Foray Provides a Cautionary Tale - Bloomberg

Saudi Aramco's Only IPO Foray Provides a Cautionary Tale - Bloomberg:

"The refinery two hours by car north of Mecca is easily overlooked in the Saudi Aramco colossus. But it offers a bonus: a window into one of the world’s most secretive businesses. Since the Saudi state-owned oil giant sold shares in Rabigh Refining and Petrochemical Co. in 2008, the facility has provided a peek into a small corner of its operations. With few other clues available as Saudi Arabia prepares a massive initial public offering of as much as 5 percent of Aramco for next year, investors are scrutinizing the refinery for insights into the parent company itself. The picture at PetroRabigh isn’t promising: a falling share price, mounting losses and troubled operations. Perhaps more importantly, the plant’s struggles pierce a key narrative that Aramco has built about itself: best-in-class installations, engineering prowess and superior employees. Yet for all the challenges at PetroRabigh, investors are likely to take them in stride."



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Wednesday, 17 May 2017

Expansion of Al Maktoum airport delayed to 2018 | GulfNews.com

Expansion of Al Maktoum airport delayed to 2018 | GulfNews.com:

"An expansion of Dubai’s Al Maktoum International Airport has been delayed by a year until 2018, the airport’s operator said on Wednesday.
Currently Dubai’s second-largest airport, it will have the capacity to handle 26 million passengers a year when the expansion is complete.

Al Maktoum airport opened in 2013 and can currently handle about seven million passengers a year. Its expansion has been delayed due to the completion of construction and to allow time for trials and testing, a spokesman for Dubai Airports said."



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UAE's Dana Gas creditors appoint Moelis and Weil for sukuk restructuring –sources | Reuters

UAE's Dana Gas creditors appoint Moelis and Weil for sukuk restructuring –sources | Reuters:

"A committee of the holders of some $700 million in Islamic bonds issued by Dana Gas has appointed New York-based boutique investment bank Moelis and U.S. legal firm Weil, Gotshal & Manges to negotiate restructuring of the notes, sources familiar with the matter said on Wednesday. With a cash balance of around $300 million at end-March and the sukuk due to mature in October this year, the Abu Dhabi-listed energy producer said earlier this month that it intended to hold discussions with its creditors. Dana and Moelis declined to comment on Wednesday. Dana has not yet appointed an adviser for the restructuring, said a source close to the company."



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Saudi oil wealth is again a magnet for western leaders: Kemp | Reuters

Saudi oil wealth is again a magnet for western leaders: Kemp | Reuters:

"Saudi Arabia has again become the favorite destination for western political leaders seeking to promote arms sales and encourage other exports to boost their economies at home. UK Prime Minister Theresa May visited last month to promote trade as the country seeks to diversify its export markets after Brexit. U.S. President Donald Trump is scheduled to make his own pilgrimage to Riyadh later this week with reports suggesting the two countries have been negotiating arms deals worth more than $100 billion."



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Don't tighten fiscal policy too fast, IMF warns Saudis | Reuters

Don't tighten fiscal policy too fast, IMF warns Saudis | Reuters:

"The International Monetary Fund warned Saudi Arabia on Wednesday not to tighten fiscal policy too fast, saying rapid cuts to the government's budget deficit could damage the economy.

Tim Callen, head of an IMF team which held annual consultations with Saudi officials last week, said Riyadh's goal of balancing its budget was appropriate. Low oil prices in the past couple of years have pushed it deep into the red.

But Callen added, "The target of balancing the budget, however, does not need to be met in 2019 as set out in the Fiscal Balance Program given Saudi Arabia’s strong financial asset position and its low debt."



'via Blog this'

MSCI Bounce for Saudi Shares May Happen Sooner Than You Think - Bloomberg

MSCI Bounce for Saudi Shares May Happen Sooner Than You Think - Bloomberg:

"If history is any guide, Saudi Arabian stocks will benefit from being included in MSCI Inc.’s emerging-market index in the months before the promotion, not after.

Saudi equity investors can expect returns of about 20 percent in each of the years leading up to the upgrade and in the year of the event, and then a decline of 12 percent in the following 12 months, according to data collected by EFG-Hermes Holding. The investment bank studied the fortunes of markets that gained emerging status at MSCI from 1993 to 2014, including the United Arab Emirates and Qatar. While foreign investor inflows will increase, that may not translate to higher liquidity."



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Oman to Sell $2 Billion of Islamic Bonds, Finance Chief Says - Bloomberg

Oman to Sell $2 Billion of Islamic Bonds, Finance Chief Says - Bloomberg:

"Oman plans to sell $2 billion of Islamic bonds this month as it seeks to trim a large budget deficit caused by lower oil revenue, Finance Minister Darwish Al Balushi said.

The crude exporter’s budget deficit will reach 12 percent of economic output this year and it will continue to narrow in the coming years, Al Balushi said in an interview Wednesday in Jeddah, Saudi Arabia, on the sidelines of the Islamic Development Bank’s annual meeting.

“We are confident that our economy is heading in the right direction because the government has taken several measures for economic and fiscal reform,” he said. “These measures led to improvement in the fiscal situation and the government will continue to take more measures.”"



'via Blog this'

MIDEAST STOCKS-Real estate sector lifts Egypt, Saudi volumes rise before Ramadan | Reuters

MIDEAST STOCKS-Real estate sector lifts Egypt, Saudi volumes rise before Ramadan | Reuters:

"Egypt's stock market outperformed its Gulf peers on Wednesday on the back of strong first-quarter earnings and positive news from a real estate developer, while Saudi Arabia saw increased activity as traders took positions ahead of Ramadan.

Egypt's index rose 1.0 percent as real estate firm Sixth of October Development (SODIC) jumped 4.2 percent to a four-month high in its heaviest trade since May 2014.

The company's chief executive told Reuters on Wednesday it planned to buy new land to the north and west of Cairo as part of an expansion plan. In total, SODIC would acquire land worth 600 million Egyptian pounds ($33.2 million)."



'via Blog this'

Saudi Aramco Tightens Grip in Top Oil Market With China Refinery - Bloomberg

Saudi Aramco Tightens Grip in Top Oil Market With China Refinery - Bloomberg:

"Saudi Arabian Oil Co. agreed to build a refinery and petrochemical plant in China, deepening ties between world’s biggest oil seller and its largest importer. Saudi Aramco, as the company is known, and state-owned China North Industries Group Corp. signed an agreement Tuesday for an integrated refining and chemical facility in Liaoning’s Panjin, according to a statement from China North. The project includes a 15 million tons-a-year (about 300,000 barrels a day) oil refinery, 1 million tons-a-year ethylene cracker, and other chemical projects. The deal is part of Saudi Aramco’s strategy of investing in refining to help lock in demand for its crude and follows agreements earlier this year for stakes worth $13 billion in refining projects in Malaysia and Indonesia. The project makes Norinco, as China North is known, a player in the country’s energy industry from primarily being a defense manufacturer. It also allows it to invest in Saudi Arabian industries, including railways, power, mining, telecommunications and oil exploration."



'via Blog this'

Saudi Minister Expects Expansionary 2018 Budget Based on Savings - Bloomberg

Saudi Minister Expects Expansionary 2018 Budget Based on Savings - Bloomberg:

"Saudi Arabia’s budget next year will be “expansionary but not significantly” and in line with plans to balance state finances by 2020, Finance Minister Mohammed Al-Jadaan said. “Where the expansion will come is from the efficiency,” Al-Jadaan said in an interview in Jeddah on Tuesday. “So we are working on that -- reducing a lot of the fat that is not necessary and then utilizing that in more productive investments.” The target for a balanced budget is central to the kingdom’s long-term plan to wean the economy off oil, which includes creating the world’s biggest sovereign wealth fund and privatizing some state assets. The Finance Ministry reported this month that the first-quarter deficit narrowed on higher oil revenue, boosting efforts to repair public finances."



'via Blog this'

MIDEAST STOCKS-Large caps weigh on Saudi, Qatar; UAE indexes edge up | Reuters

MIDEAST STOCKS-Large caps weigh on Saudi, Qatar; UAE indexes edge up | Reuters:

"Declines in large caps weighed on Saudi stocks in early trade on Wednesday while the Dubai market rose as property developer DAMAC extended gains.

The Riyadh index was down 0.1 percent after 45 minutes of trade as a little under two-thirds of the 14 listed petrochemical producers fell. Heavyweight Saudi Basic Industries was down 0.8 percent.

Much activity focused on second and third-tier stocks. Saudi Paper Manufacturing was up 4.4 percent as about 2 million shares traded hands, more than double the usual daily volume."



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Tuesday, 16 May 2017

Provision for money owed weighs on Drake & Scull International first quarter | The National

Provision for money owed weighs on Drake & Scull International first quarter | The National:

"Contractor Drake & Scull International (DSI) posted a loss of Dh722.5 million in the first quarter as it made provisions against contract sums owed from customers.

The company wrote down Dh572m in amounts due from customers on contract balances. It also declared a 23 per cent decline in year-on-year revenue during the period to Dh796m.

The loss declared for the quarter "looks like a back-calculation" said Nishit Lakhotia, the head of research at Bahrain-based Securities & Investment Company, allowing it to meet its latest capital restructuring plan."



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Fetchr closes region’s largest ever Series B funding | GulfNews.com

Fetchr closes region’s largest ever Series B funding | GulfNews.com:

"Fetchr, the Dubai-based technology start-up, has secured $41 million (Dh150.5 million) in what is the region’s largest ever Series B round, according to the company’s co-founder and chief executive. Speaking on the phone with Gulf News, Idriss Al Rifai confirmed that the company had closed the record amount from a group of well known investors, including Majid Al Futtaim and New Enterprise Associates (NEA). A funding round refers to the money a start-up raises from venture capitalists to finance its growth and the class of shares sold to investors. The progression of rounds is often viewed as an indication of a company’s progress."



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Singapore's GIC faces US$4bn loss on UBS bet | Reuters

Singapore's GIC faces US$4bn loss on UBS bet | Reuters:

"Singapore sovereign wealth fund GIC Private Limited is facing a loss in excess of US$4bn on its emergency investment in Swiss bank UBS Group nine years ago, according to IFR calculations. GIC cut its stake in UBS on Monday evening, selling 93m shares at SFr16.10 each to bring in SFr1.5bn. The sale was conducted by UBS as sole bookrunner and wrapped up in two and a half hours. The bank accidentally announced the sale ahead of the market close when it had been due to launch. UBS's ECM bankers were already talking to investors through a wall-crossing exercise so the deal was not too disrupted."



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Aramco Plans at Least 10 Energy Deals During Trump Visit - Bloomberg

Aramco Plans at Least 10 Energy Deals During Trump Visit - Bloomberg:

"Saudi Aramco plans to sign agreements with at least 10 companies including General Electric Co. and oil field-service businesses Schlumberger Ltd. and Halliburton Co. when President Donald Trump visits Saudi Arabia, according to two people familiar with the matter. The world’s biggest crude oil exporter plans to sign accords also with Baker Hughes Inc., KBR Inc., Jacobs Engineering Group Inc., Nabors Industries Ltd., Weatherford International Plc, McDermott International Inc. and Rowan Companies Plc, said the people, who asked not to be identified because they are not authorized to speak to media. The deals will be signed on May 20 during Trump’s first foreign trip as president.  Media officials at Aramco, Baker Hughes, McDermott, Halliburton and Jacobs declined to comment. GE, Schlumberger, Weatherford, Nabors, Rowan and KBR didn’t immediately return phone and email messages seeking comment."



'via Blog this'

MIDEAST STOCKS-Egypt's EFG, TMGH diverge on MSCI changes; Gulf firm with oil at $52 | Reuters

MIDEAST STOCKS-Egypt's EFG, TMGH diverge on MSCI changes; Gulf firm with oil at $52 | Reuters:

"Shares of Egypt's EFG Hermes and Talaat Mostafa diverged sharply on Tuesday on news that MSCI will swap the shares in its main Egyptian index, while Gulf equity markets were firm with the Brent oil price at $52 a barrel. Overnight, MSCI said it would include investment bank EFG Hermes in its MSCI Egypt Index but remove real estate developer Talaat Mostafa Group, downgrading it to the small-cap index. The changes will take effect on June 1. EFG, which on Monday reported a near-tripling of first quarter net income and a more than doubling of operating revenue, surged 8.8 percent while TMGH slumped 9.8 percent."



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Another high-profile candidate pulls out of Iran’s presidential race

Another high-profile candidate pulls out of Iran’s presidential race:

"Es’haq Jahangiri, Iran’s reform-minded candidate for president, has stepped aside from Friday’s poll, calling on his supporters to “decisively” vote to re-elect president Hassan Rouhani.

The announcement comes one day after hardline candidate Mohammad Baqer Qalibaf withdrew from the race and threw his weight behind Ebrahim Raisi, a senior cleric and former prosecutor-general. Mr Qalibaf’s withdrawal further polarised the election, leaving two leading candidates from different camps.

Mr Jahangiri – currently first vice-president – was a champion of televised debates thanks to his verbal blows to hard-line candidates. Analysts did not expect him to remain in the race and compete against his boss and speculated that his main intention was to help defend the records of Mr Rouhani."



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Oil market rebalancing needs ‘much work’, says IEA

Oil market rebalancing needs ‘much work’, says IEA:

"Drastic Opec-led production cuts have helped accelerate the oil market recovery but “much work remains” to drain excess inventories, the International Energy Agency said on Tuesday. The deal among some of the world’s biggest producers to curb supply may not dent stubbornly high stockpiles as much as Opec would like in 2017, the energy body said, just as output growth from US shale producers and others exceeds expectations. “It has taken some time for stocks to reflect lower supply when volumes produced before output cuts by Opec and eleven non-Opec countries took effect are still being absorbed by the market,” said the IEA in its monthly oil market report."



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Capital markets growth promises big gains for GCC countries

Capital markets growth promises big gains for GCC countries:

"The plunge in oil prices from mid-2014 has been a serious setback for all oil producing countries but for the members of the Gulf Cooperation Council the effects have been dramatic. From a comfortable position of current account and budget surpluses for more than a decade, GCC governments suddenly found themselves in 2015 with large deficits and sizeable financing needs. While GCC governments financed deficits by drawing on large accumulated reserves and ample bank deposits, there was also renewed borrowing, including from the capital markets. The GCC countries’ current and prospective financing needs may not be large relative to the size of their economies or their financial assets, but their reorientation towards market borrowing provides an opportunity to examine the potential of the local debt capital markets. In the GCC, these have lagged behind emerging-market peers, and remain a relatively under-developed segment of what are otherwise modern and fully globalised economies."



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‘Much work remains’ to drain excess oil inventories – IEA

‘Much work remains’ to drain excess oil inventories – IEA:

"Global oil market supply and demand is moving into balance but “much work remains” to drain excess inventories, the International Energy Agency said on Tuesday. Despite drastic cuts to Opec supply, as part of a global deal to curb output, stockpiles by the end of 2017 might still not fall to levels targeted by the group, the energy body said. The IEA’s forecasts echo those by Opec’s own research arm that show production cuts by global producers may not be enough to severely dent stubbornly high inventories and raise demand significantly for the cartel’s crude."



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ADGM eases capital base rules for VC funds | The National

ADGM eases capital base rules for VC funds | The National:

"The Abu Dhabi Global Market has made it easier for venture capital funds to operate in the financial free zone on Al Maryah Island by removing the need for them to put up cash to start these businesses.

The ADGM’s Financial Services Regulatory Authority, the zone’s regulator, said the move to simplify regulations for venture capital funds by not making them subject to any capital base requirements or expenditure-based capital took effect from May 15.


"In close consultation with industry players, the tailored regulatory framework for VC managers simplifies the applicable regulatory requirements while maintaining the necessary safeguards to ensure that they operate in a safe and sound manner," ADGM said."



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Absent from America, French cars drive into Iran election | Reuters

Absent from America, French cars drive into Iran election | Reuters:

"French carmakers PSA (PEUP.PA) and Renault (RENA.PA) are turning their U.S. absence into an Iranian advantage by piling into a resurgent market still off-limits to foreign rivals fearful of sanctions under Donald Trump's administration. The French investment has been seized upon by Iranian President Hassan Rouhani, who is seeking re-election this week, as evidence that his pursuit of a nuclear detente and attempts to attract foreign money will pay off for the economy. PSA - the maker of Peugeots and Citroens - and Renault have pushed hard into Iran since its 2015 deal with world powers that saw international sanctions lifted in return for curbs on Tehran's nuclear activities. PSA has signed production deals worth 700 million euros ($768 million), while Renault has announced a new plant investment to increase its production capacity to 350,000 vehicles a year."



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Qatar Islamic Bank's dollar sukuk books top $1 billion -lead | Reuters

Qatar Islamic Bank's dollar sukuk books top $1 billion -lead | Reuters:

"Order books for Qatar Islamic Bank's planned dollar five-year sukuk have topped $1 billion, a document from one of the banks leading the deal showed on Tuesday. The Regulation S, senior unsecured deal, part of a $3 billion sukuk programme, will be of benchmark size, which conventionally means upwards of $500 million. Initial price guidance for the Islamic bond was 145-155 basis points over mid-swaps. Citi, Emirates NBD Capital, HSBC, Noor Bank, QInvest and Standard Chartered Bank have been appointed to lead the transaction, which is expected to price on Tuesday. "



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Saudi Aramco Makes Leadership Changes Ahead of IPO Plans - Bloomberg

Saudi Aramco Makes Leadership Changes Ahead of IPO Plans - Bloomberg:

"Saudi Arabian Oil Co. has promoted eight executives to top positions, including a senior vice president for downstream operations, as it seeks to double refining capacity and expand natural gas and chemical businesses ahead of what could be the world biggest share sale.

The world’s largest oil exporter, known as Saudi Aramco, appointed two senior vice presidents, six vice presidents and two associate general counsels, according to an internal memo obtained by Bloomberg that was dated Sunday and signed by Chief Executive Officer Amin Nasser. The appointments are effective May 1. Saudi Aramco declined to comment, and the company website later confirmed the appointments of the two senior vice presidents.

Saudi Arabia plans to sell as much as 5 percent of Aramco in 2018 as part of a plan to set up the world’s biggest sovereign wealth fund and reduce the economy’s reliance on oil. Since King Salman acceded to the throne in 2015, the kingdom changed its oil minister and the top Aramco leadership. The company has formed a supreme board to oversee its affairs, led by the king’s influential son, Deputy Crown Prince Mohammed Bin Salman. The prince has been the driving force behind the Aramco IPO plans."



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MIDEAST DEBT-Bumpy road ahead for Oman loan after downgrade - IFR | Reuters

MIDEAST DEBT-Bumpy road ahead for Oman loan after downgrade - IFR | Reuters:

"Standard & Poor's downgrade of Oman’s credit rating to junk status has complicated the sovereign borrower’s first visit to the Asian syndicated loan market. The agency last Friday lowered the Sultanate of Oman’s rating to BB+ from BBB−, with a negative outlook, saying the country’s external buffers have weakened and are insufficient to mitigate the risk from volatile oil-driven export revenues. The downgrade came days after Thomson Reuters LPC reported that Oman was seeking a $3.6 billion unsecured, five-year bullet loan from Chinese banks. Bank of China, China Development Bank, and Industrial and Commercial Bank of China are the mandated lead arrangers, with the latter two also acting as bookrunners."



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Kuwait Joins Saudis, Russia to Seek Oil-Cuts Extension Into 2018 - Bloomberg

Kuwait Joins Saudis, Russia to Seek Oil-Cuts Extension Into 2018 - Bloomberg:

"Kuwait joined Saudi Arabia and Russia in supporting an extension of oil-output cuts by OPEC and other global producers through the first quarter of 2018 to help trim global stockpiles. Extending the cuts at already agreed-upon volumes is needed to reach the goal of trimming global stockpiles to the five-year average, Kuwait’s Oil Minister Issam Almarzooq said in an emailed statement on Tuesday. “There are positive signals that have started to show, as April and May monthly reports are showing that global stockpiles have fallen significantly,” Almarzooq said."



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MIDEAST STOCKS-Dubai's DSI slumps, DAMAC surges on index entry in generally flat region | Reuters

MIDEAST STOCKS-Dubai's DSI slumps, DAMAC surges on index entry in generally flat region | Reuters:

"Dubai-listed builder Drake & Scull plummeted in response to its first-quarter results, while Dubai real estate firm DAMAC jumped on news that MSCI would add it to an index, in otherwise largely flat Gulf markets early on Tuesday. DSI slumped 7.6 percent to 0.352 dirham, a 15-month low, after it reported a first-quarter net loss attributable to shareholders of 722.5 million dirhams ($196.9 million) versus a profit of 9.8 million dirhams in the year-ago period. The company is in the midst of a capital restructuring plan to wipe out its accumulated losses, and has said it expects to receive a capital injection of 500 million dirhams from a strategic investor by mid-2017."



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Monday, 15 May 2017

Fuel for Thought: The man who gave up a lifetime of oil for renewables | The National

Fuel for Thought: The man who gave up a lifetime of oil for renewables | The National:

"These days Saudi Arabia’s former energy minister, Ali Al Naimi, can’t seem to get enough of renewables. Just last week in Doha, Mr Al Naimi was leading the Forum of Energy Elders, an initiative by the Al Attiyah Foundation. The event aspires to foster a platform for these "energy elders" to provide feedback on how to address important issues facing the industry. According to organisers Gulf Intelligence, Mr Al Naimi said that throughout the earth’s life – which scientists believe to be 4.5 billion years – "the planet has run quite effectively on solar power. Our energy quest today is to utilise solar and other renewable forms of energy.""



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MIDEAST STOCKS-Region mixed; Saudi up with oil, slide in DXBE hurts Dubai | Reuters

MIDEAST STOCKS-Region mixed; Saudi up with oil, slide in DXBE hurts Dubai | Reuters:

"Middle Eastern stock markets were mixed on Monday with Saudi Arabia rising on the back of a rebound in oil prices and a continued slide by amusement park operator DXB Entertainments helping to drag down Dubai.

The Saudi index climbed 0.6 percent. Top petrochemical producer Saudi Basic Industries, whose margins could benefit from higher oil prices, gained 0.5 percent.

But PetroRabigh, which had tumbled its 10 percent daily limit on Sunday after reporting a sharp widening of its quarterly loss, sank a further 5.4 percent."



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