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Friday, 31 March 2017

Mercuria on oil and blockchain | Commodities

India to cut Iranian oil purchases in row over gas field | Reuters

India to cut Iranian oil purchases in row over gas field | Reuters:

"Indian state refiners will cut oil imports from Iran in 2017/18 by a fifth, as New Delhi takes a more assertive stance over an impasse on a giant gas field that it wants awarded to an Indian consortium, sources familiar with the matter said. India, Iran's biggest oil buyer after China, was among a handful of countries that continued to deal with the Persian Gulf nation despite Western sanctions over Tehran's nuclear programme. However, previously close ties have been strained since the lifting of some sanctions last year as Iran adopts a bolder approach in trying to get the best deal for its oil and gas."



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Qatari-Owned Insurer to Double London Presence With New Offices - Bloomberg

Qatari-Owned Insurer to Double London Presence With New Offices - Bloomberg:

"A Qatar Insurance Co. SAQ unit has signed a lease for a new headquarters close to the Lloyd’s of London insurance market that is more than twice the size of the company’s existing premises.



Antares Underwriting Services Ltd., acquired by QIC in 2014, agreed with Aldgate Developments and the City of London Corporation to lease 21 Lime Street, an office development that will be completed next month, according to a joint statement issued by the building’s broker CBRE Group Inc. The company will occupy the entire 32,000 square feet (3,000 square meters) of offices in the building on a 15-year lease.



Acquiring a new headquarters underlines the company’s commitment to the Lloyd’s of London insurance market and reflects the company’s growth under QIC, Antares managing director Stephen Redmond said in the statement. QIC is the largest insurance company in the Middle East and North Africa by market value.

"



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Indian Billionaires Are Interested Managing Delayed Iran Port: Sources - Bloomberg

Indian Billionaires Are Interested Managing Delayed Iran Port: Sources - Bloomberg:

"India is inching closer to establishing its presence near the Persian Gulf with billionaires Gautam Adani and the Essar group’s Ruia brothers flagging interest in managing terminals at Iran’s Chabahar port, which India first agreed to develop 14 years ago, according to people with knowledge of the matter. Adani Ports & Special Economic Zone Ltd., operator of India’s largest port, and Essar Ports Ltd. are among companies that have expressed an interest in managing and operating two terminals at Chabahar, said the people, asking not to be identified discussing confidential matters. India Ports Global Ltd., the company mandated to drive India’s investments in overseas ports, on March 17 invited firms to express interest if they want to be considered for a strategic partnership."



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Oil price seen struggling as U.S. output weighs against OPEC cuts: Reuters poll | Reuters

Oil price seen struggling as U.S. output weighs against OPEC cuts: Reuters poll | Reuters:

"Oil analysts have grown more unsure that OPEC's supply cut will be enough to offset the increase in U.S. production and do not believe prices will reach $60 a barrel until early next year, according to a Reuters poll on Friday.

Brent crude is expected to average $57.25 per barrel in 2017, slightly lower than last month's forecast of $57.52, the poll of 32 economists and analysts showed.

Forecasts for Brent in 2017 range from a high of $73 by Raymond James to a low of $51 by Commerzbank."



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Banks secure key adviser roles on Saudi Aramco IPO

Banks secure key adviser roles on Saudi Aramco IPO:

"Saudi Arabia has appointed banks to conduct preparatory work on the initial public offering of Saudi Aramco, the world’s largest oil producer, which is aiming to become the most valuable listed company. The state-controlled company has hired JPMorgan, Morgan Stanley and HSBC as financial advisers for the listing, said four people briefed on the matter. This initial role suggests these banks will ultimately be the lead underwriters for the IPO, working as global coordinators, added two of these people. Saudi Aramco did not respond to a request for comment."



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What's shaping commodities in 2017 | World

Thursday, 30 March 2017

Auditor warns on Drake & Scull’s future as contractor breaches terms of bank loans | The National

Auditor warns on Drake & Scull’s future as contractor breaches terms of bank loans | The National:

"Drake & Scull International’s chairman Majed Al Ghurair has said the company will focus on "strengthening our capital structure and reducing our leverage level" after the contractor reported a loss of Dh732.9 million and confirmed it was in breach of banking covenants. It finished the year with a negative cash balance of Dh329m, according to newly filed accounts. The company’s auditor, PwC, warned that a "material uncertainty exists that may cast significant doubt on the group’s ability to continue as a going concern"."



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Impairments drag Taqa’s losses down to Dh19b in 2016 | GulfNews.com

Impairments drag Taqa’s losses down to Dh19b in 2016 | GulfNews.com:

"Abu Dhabi National Energy Company (Taqa) reported on Thursday a net loss of Dh19 billion for 2016, primarily on the back of Dh16.9 billion in post-tax impairment charges related to the company’s oil and gas assets.
In a statement to the Abu Dhabi bourse, Taqa said the impairment to assets was in response to the lower commodity price environment. It added that the impairment “is a one-time non-cash charge, and has no impact on Taqa’s ability to meet its obligations.”
The loss in 2016 compares to Dh1.8 billion in losses in 2015."



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Dubai holding CEO and vice chairman departed -sources | Reuters

Dubai holding CEO and vice chairman departed -sources | Reuters:

"The chief executive and vice chairman of Dubai Holding, the investment vehicle of the emirate's ruler, have left the company, sources familiar with the matter told Reuters on Thursday.

The departures come a few days after Abdulla al-Habbai was chosen as chairman of the investment conglomerate by Dubai ruler Sheikh Mohammed bin Rashid al-Maktoum. Dubai Holding chief executive Fadel al-Ali and vice chairman Ahmad Bin Byat had both left, the sources said.

The company was not immediately available to comment."



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CORRECTED-UPDATE 1-UAE state fund Mubadala nearly triples net profit in 2016 | Reuters

CORRECTED-UPDATE 1-UAE state fund Mubadala nearly triples net profit in 2016 | Reuters:

"Abu Dhabi's state-owned Mubadala Development Co, which is merging with fellow Abu Dhabi-owned International Petroleum Investment Company (IPIC), said on Thursday its net profit nearly tripled in 2016.

Mubadala, which is focused on developing Abu Dhabi's economy through local companies such as clean energy firm Masdar and stakes in international players such as General Electric, is among the few state-controlled firms to publish results.

The company reported a net profit of 3.3 billion dirhams ($899 million) for 2016, compared to a net profit of 1.2 billion dirhams in 2015. Its total comprehensive income, which comprises all forms of income, was 4.1 billion dirhams in 2016, recovering from a negative 1.3 billion dirhams in 2015 when the market value of some assets fell."



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UAE's Mubadala plans overseas investments, may also divest stakes | Reuters

UAE's Mubadala plans overseas investments, may also divest stakes | Reuters:

"Abu Dhabi state-owned fund Mubadala Investment Company is lining up new overseas investments in 2017 and may also sell or reduce some of its existing stakes in companies, its chief executive said on Thursday. Mubadala, which is merging with Abu Dhabi-owned International Petroleum Investment Company (IPIC), will not see any change it its strategy after the merger, which will be completed in May, Khaldoon al-Mubarak told Reuters in an interview. The company said in January the merged entity would have assets of about $125 billion."



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Oil hits three-week highs as OPEC deal extension seen likely | Reuters

Oil hits three-week highs as OPEC deal extension seen likely | Reuters:

"Oil prices jumped for a third day on Thursday to their highest in three weeks after Kuwait gave its backing for an extension of OPEC production cuts in an attempt to reduce global oversupply.

Kuwait oil minister Essam al-Marzouq said his country was among several nations supporting the extension into the second half of the year of a deal between the Organization of the Petroleum Exporting Countries and other exporters to limit production, state news agency KUNA reported.

OPEC agreed to reduce its oil production by 1.2 million barrels per day during the first six months and so far, output has fallen for a third straight month and members have now complied with 95 percent of their commitments."



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MIDEAST STOCKS-Kuwait rebounds in volatile session, Dubai, Saudi firm | Reuters

MIDEAST STOCKS-Kuwait rebounds in volatile session, Dubai, Saudi firm | Reuters:

"Most stock markets in the Gulf ended the week on a slightly positive footing on Thursday with Kuwait's index managing to rebound from heavy losses earlier in the session. The Kuwaiti index swung 0.3 percent in a volatile session, after dropping as much as 2.0 percent earlier in the day as some shares which had pulled back in the first hour of trade triggered buy orders at those price dips. Telecommunications operator Zain added 1.1 percent to 0.455 dinars, rebounding from a session low of .445 dinars."



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Merged U.A.E. Banking Giant Seen Earning Bigger MSCI Weighting - Bloomberg

Merged U.A.E. Banking Giant Seen Earning Bigger MSCI Weighting - Bloomberg:

"A mega-merger of the two biggest banks in the United Arab Emirates should leave the combined company with a larger representation on the benchmark emerging-market index, triggering hundreds of millions of dollars of inflows to the stock, according to calculations by EFG-Hermes strategists. Thursday marks the last day of trading in First Gulf Bank PJSC before its combination with National Bank of Abu Dhabi PJSC in a deal that creates the biggest financial institution in the country. The combined entity starts trading on April 2, with FGB stock holders receiving 1.254 shares for each one they own before the merger. While FGB’s last trading day is likely to see foreign investors selling out of the stock, this should more than reverse over time for the combined company as it reaches liquidity benchmarks in 2018, said Mohamad Al Hajj, a Dubai-based equity strategist at EFG Hermes. The enlarged bank, trading as National Bank of Abu Dhabi, could gain an MSCI Emerging Markets Index weighting of 0.18 percent, once a liquidity factor adjustment is removed, compared with the banks’ combined 0.1 percent right after the merger, he said."



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Saudi Aramco formally appoints banks to advise on share sale | Reuters

Saudi Aramco formally appoints banks to advise on share sale | Reuters:

"Saudi Aramco has formally appointed JPMorgan Chase & Co, Morgan Stanley and HSBC as international financial advisers for its initial public offering, sources familiar with the matter told Reuters. The trio join Moelis & Co and Evercore, which have been appointed independent financial advisers, one source said of what is expected to be the world's biggest share sale. The Saudi authorities aim to sell up to 5 percent of Aramco, listing the shares in Riyadh and at least one foreign exchange to raise cash for investment in new industries in a bid to diversify away from oil exports in an era of cheap crude."



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MIDEAST STOCKS-Kuwait weighed down by ex-dividend shares, region quiet | Reuters

MIDEAST STOCKS-Kuwait weighed down by ex-dividend shares, region quiet | Reuters:

"Kuwait's stock market underperformed in an otherwise quiet region during early trade on Thursday as three Kuwaiti large-cap shares went ex-dividend. The Kuwaiti index dropped 1.9 percent because of a 4.4 percent drop in Ahli United Bank, a 3.3 percent decline in Kuwait Telecom and a 1.5 percent fall in Burgan Bank. Most other stocks also fell with Boubyan Bank down 2.4 percent. Meanwhile Riyadh's index was up 0.3 percent in the first half-hour as most petrochemical shares rose. National Industrialization (Tasnee) added 1.8 percent."



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Wednesday, 29 March 2017

FGB shares to be delisted on Thursday ahead of merger with NBAD | The National

FGB shares to be delisted on Thursday ahead of merger with NBAD | The National:

"The Abu Dhabi lender FGB will have its shares delisted from the stock exchange today ahead of its merger with National Bank of Abu Dhabi (NBAD).

Shares in the new entity, which retains the NBAD name, will begin trading on Sunday after the formal declaration of the new merged entity at the close of trade today, the banks said in a brief statement on the website of the Abu Dhabi stock exchange. Those shares include 5,643,000,000 new NBAD ordinary shares issued to FGB shareholders, the lenders said.


The merger, which was approved by both banks’ shareholders on December 7, was done in part to cut down on costs by removing duplicate posts and sharing resources."



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Abu Dhabi fund loses crisis-related arbitration against Citigroup | Reuters

Abu Dhabi fund loses crisis-related arbitration against Citigroup | Reuters:

"Citigroup Inc (C.N) has prevailed in the latest arbitration pursued by Abu Dhabi Investment Authority over the sovereign wealth fund's $7.5 billion investment in 2007 to shore up the then-struggling bank during the subprime mortgage meltdown.

Abu Dhabi Investment Authority said on Wednesday it was disappointed by the outcome of the arbitration.

Documents in the case were unsealed on March 20 in Manhattan federal court, where Citigroup filed a petition earlier in the month to have a federal judge confirm a decision an arbitration panel issued in December."



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UPDATE 1-Russia plans to produce more than 70 mln tonnes of LNG a year in Arctic | Reuters

UPDATE 1-Russia plans to produce more than 70 mln tonnes of LNG a year in Arctic | Reuters:

"Russia may produce more than 70 million tonnes of liquefied natural gas (LNG) per year in its remote Arctic regions, the head of gas producer Novatek said on Wednesday. "The Gydan and Yamal peninsulas have a vast resource base that allows the production of over 70 million tonnes (of LNG); it is comparable to LNG production in Qatar", Leonid Mikhelson, the head and co-owner of Novatek told a conference. Novatek, which was put on the list of Russian companies sanctioned by the West over Moscow's role in the Ukraine crisis, plans to ship its first liquefied gas cargo from the Yamal LNG plant in December, mainly targeting Asian markets."



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Barclays Qatar SFO Charging Deadline Delayed to May - Bloomberg

Barclays Qatar SFO Charging Deadline Delayed to May - Bloomberg:

"Charging decisions over Barclays Plc’s 2008 emergency fundraising from Qatar may not come before May after the U.K. Serious Fraud Office wrote to targets extending the deadline, according to two people with knowledge of the situation. The SFO sent letters to a number of former Barclays executives in the last week informing them it will make a decision on whether to file charges by the end of May, according to the people, who didn’t want to be identified because the letters are private. The SFO previously told a London court it would make a decision by the end of March."



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Saudi Arabia considering changes to debut dollar sukuk structure –sources | Reuters

Saudi Arabia considering changes to debut dollar sukuk structure –sources | Reuters:

"Saudi Arabia is considering whether to change the structure of its planned U.S. dollar sukuk issue, which would be the kingdom's first international issue of Islamic bonds, banking sources told Reuters on Wednesday. Riyadh is expected to sell up to $10 billion of sukuk with an issue that could take place in the next few weeks, bankers say. It has been planning a hybrid structure for the sukuk. The structure would comprise a mudaraba agreement, a form of Islamic investment management partnership, plus a murabaha facility that would trade commodities with a special purpose vehicle."



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Turkey State-Run Bank Sinks After U.S. Sanctions Case Arrest - Bloomberg

Turkey State-Run Bank Sinks After U.S. Sanctions Case Arrest - Bloomberg:

"The biggest state-owned bank on Turkey’s stock market plunged the most on record on Wednesday after its deputy chief executive was arrested in the U.S., accused of using his position at the bank to help facilitate evasion of U.S. sanctions on Iran. The shares of Turkiye Halk Bankasi AS, as the lender is formally known, fell as much as 19 percent in Istanbul, knocking 2.1 billion liras ($576 million) off its market value. Traders exchanged almost 153 million shares by 4:56 p.m., the most since the shares were listed, according to data compiled by Bloomberg. Mehmet Hakan Atilla, the deputy chief executive officer now detained in the U.S., faces charges including conspiring to evade trade sanctions on Iran and banking fraud. Investors have been on tenterhooks since Reza Zarrab, an Iranian-Turkish gold trader accused of running a scheme to help the Iranian government launder hundreds of millions of dollars, was arrested in the U.S. last March. Tapes released in a previous corruption investigation in Turkey showed Zarrab coordinating with Halkbank officials including Atilla."



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OPEC compliance with oil curbs rises in March as UAE joins cut: survey | Reuters

OPEC compliance with oil curbs rises in March as UAE joins cut: survey | Reuters:

"OPEC oil output is likely to fall for a third straight month in March, a Reuters survey found on Wednesday, as the United Arab Emirates made progress in trimming supplies while maintenance and unrest cut production in exempt nations Nigeria and Libya. The reduction by the UAE has helped boost OPEC compliance this month with its production-cutting deal to 95 percent, up from an initial February estimate of 94 percent and a record high, according to Reuters surveys. The Organization of the Petroleum Exporting Countries pledged to reduce output by about 1.2 million barrels per day (bpd) from Jan. 1 - the first accord on supply curbs since 2008. Non-OPEC countries pledged to cut about half as much."



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Trafigura on oil outlook | Companies

MIDEAST STOCKS-Saudi Arabia outperforms in otherwise quiet region | Reuters

MIDEAST STOCKS-Saudi Arabia outperforms in otherwise quiet region | Reuters:

"A small rebound in crude oil prices towards $52 barrel helped lift Saudi Arabia's stock index in early trade on Wednesday, in an otherwise quiet region. The Saudi index added 0.4 percent in the first 40 minutes as almost four-fifths of listed petrochemical producers advanced; Saudi Kayan Petrochemical was up 1.3 percent Builder Al Khodari climbed 2.0 percent after saying it had renewed its credit line of 373 million riyals ($99.5 million) with Alawwal Bank to help it finance working capital. Alwwal was up 0.5 percent."



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Merged U.A.E. Banking Giant Seen Earning Bigger MSCI Weighting - Bloomberg

Merged U.A.E. Banking Giant Seen Earning Bigger MSCI Weighting - Bloomberg:

"A mega-merger of the two biggest banks in the United Arab Emirates should leave the combined company with a larger representation on the benchmark emerging-market index, triggering hundreds of millions of dollars of inflows to the stock, according to calculations by EFG-Hermes strategists. Thursday marks the last day of trading in First Gulf Bank PJSC before its combination with National Bank of Abu Dhabi PJSC in a deal that creates the biggest financial institution in the country. The combined entity starts trading on April 2, with FGB stock holders receiving 1.254 shares for each one they own before the merger. While FGB’s last trading day is likely to see foreign investors selling out of the stock, this should more than reverse over time for the combined company as it reaches liquidity benchmarks in 2018, said Mohamad Al Hajj, a Dubai-based equity strategist at EFG Hermes. The enlarged bank, trading as National Bank of Abu Dhabi, could gain an MSCI Emerging Markets Index weighting of 0.18 percent, once a liquidity factor adjustment is removed, compared with the banks’ combined 0.1 percent right after the merger, he said."



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After six decades, U.S. set to turn natgas exporter amid LNG boom | Reuters

After six decades, U.S. set to turn natgas exporter amid LNG boom | Reuters:

"The last time the United States was a net exporter of natural gas was in 1957, when Dwight Eisenhower was president. That should change in 2018 when the country is expected to become the world's third-largest exporter of liquefied natural gas (LNG). By the end of next year, U.S. LNG export capacity in the lower 48 states will top 6 billion cubic feet per day (bcfd), or 8 percent of the country's domestic consumption, up from zero at the beginning of 2016. Six bcfd of gas can fuel about 30 million U.S. homes, or almost every house in California, Texas and Florida combined. That growth in U.S. LNG exports is set to transform world energy markets. Just a decade ago, before the shale revolution, the United States was expected to become a growing LNG importer, not an exporter, likely dependent on Russian, Middle East and North African gas, much as it has for decades depended on foreign crude."



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Turkey's Halkbank Plunges After U.S. Probe Extends to Lender - Bloomberg

Turkey's Halkbank Plunges After U.S. Probe Extends to Lender - Bloomberg:

"The biggest state-owned bank on Turkey’s stock market plunged on Wednesday after its deputy chief executive was arrested in the U.S., accused of using his position at the bank to help facilitate evasion of U.S. sanctions on Iran.

The shares of Turkiye Halk Bankasi AS, as the lender is officially known, fell as much as 19 percent in Istanbul, the most on record. Mehmet Hakan Atilla, the deputy chief executive officer now detained in the U.S., faces charges including conspiring to evade trade sanctions on Iran and banking fraud.

Investors have been on tenterhooks since Reza Zarrab, an Iranian-Turkish gold trader accused of running a scheme to help the Iranian government to launder hundreds of millions of dollars, was arrested in the U.S. last March. Tapes released in a previous corruption investigation in Turkey showed Zarrab coordinating with Halkbank officials including Atilla."



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Saudi Aramco's $2 Trillion Valuation Has Too Many Assumptions - Bloomberg View

Saudi Aramco's $2 Trillion Valuation Has Too Many Assumptions - Bloomberg View:

"Changing a tax system that has endured since the 1970s is no small matter, especially when it concerns what could be the world’s most valuable company. Saudi Arabia’s announcement on Monday that it was cutting the tax rate on large oil companies to 50 percent from 85 percent is crucial for the fate of the initial public offering of state oil giant Aramco. But is it enough to bridge the gap between a $2 trillion aspiration and independent estimates of $400 billion? When the IPO was first publicly suggested in January 2016, a notional value of $2 trillion was given, and it has become important to justify a figure around this level. The problem is that this number, based on a simplistic multiple of the company’s reserves, overlooked two factors: Aramco’s high tax rate, and the long period over which reserves are expected to be produced. The original tax rate of 85 percent was set back in the 1970s, when Aramco was still a consortium of U.S. majors: Exxon, Mobil, Chevron and Texaco. Nationalisation was completed in 1982. The company also pays a royalty on gross revenues of 20 percent, which has apparently not been affected by the latest reform."



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Saudi Aramco to Price Islamic Bond in $10 Billion Debt Push - Bloomberg

Saudi Aramco to Price Islamic Bond in $10 Billion Debt Push - Bloomberg:

"Saudi Arabian Oil Co. set final pricing for its debut Islamic bond as the company presses ahead with plans to raise $10 billion in debt, according to a person with knowledge of the matter. Aramco, as the world’s largest oil producer is known, is selling debt with a seven year tenure in a private placement at 25 basis points over the country’s interbank offered rate, the person said, asking not to be identified as the information is private. The company is seeking to raise about $2 billion in its debut sale of Islamic bonds under a 37.5 billion-riyal ($10 billion) sukuk program, people with knowledge of the matter said this month. The oil giant is selling debt ahead of an initial public offering in 2018 as the country’s finance ministry plans to cut taxation on the company, potentially raising its valuation to more than $1 trillion, according to estimates by Sanford C. Bernstein & Co. The cut will boost Aramco’s net income by 300 percent, putting per-barrel income in a range similar to that of international oil companies including Exxon Mobil Corp., Bernstein analysts said. "



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Tuesday, 28 March 2017

Hapag Lloyd-UASC merger hits snags over future share ownership: sources | Reuters

Hapag Lloyd-UASC merger hits snags over future share ownership: sources | Reuters:

"A merger of Hapag-Lloyd (HLAG.DE) and United Arab Shipping Company (UASC) has hit a snag, with the German shipping line and some banks seeking assurances that UASC's top shareholder Qatar remain committed to the deal for the long term, sources say. Hapag Lloyd Chief Executive Rolf Habben Jansen told a news conference this week he had underestimated the complexity of the 7 billion to 8 billion euro ($7.6-$8.7 bln) deal, which will create one of the world's largest shipping lines. Two finance sources, who declined to be identified citing deal sensitivity, said one of the main concerns of Hapag Lloyd and some of the Gulf-based syndicate banks is that Qatar could in future lower its stake in the combined group. "



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UPDATE 3-Santander Brasil slumps as Qatar fund seeks partial exit | Reuters

UPDATE 3-Santander Brasil slumps as Qatar fund seeks partial exit | Reuters:

"Shares in Banco Santander Brasil SA fell the most in intraday trading in almost four months on Tuesday after Qatar's sovereign wealth fund filed to sell a 2.25 percent in Brazil's fourth-largest listed lender. The bank informed regulators that Qatar Investment Authority had put as many as 80 million units up for sale in a so-called restricted-efforts offering. Units are a blend of common and preferred shares and are the bank's most widely traded class of stock in Brazil. With the transaction, the sovereign wealth fund, known as QIA, would liquidate 40 percent of the 5.5 percent stake it holds. Fund managers and analysts said QIA's move comes after a rally that nearly doubled the price of Santander Brasil's units . "



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Amazon Buys Souq.com as Middle East Online Market Takes Off - Bloomberg

Amazon Buys Souq.com as Middle East Online Market Takes Off - Bloomberg:

"Amazon.com Inc. has agreed to buy Dubai-based online retailer Souq.com, betting that e-commerce in the Middle East is poised to take off.

The U.S. e-commerce giant beat out Emaar Malls PJSC, which runs the world’s biggest shopping center and had bid $800 million for Souq.com. Amazon and Souq.com didn’t disclose deal terms and declined to comment.

Amazon has been stepping up its overseas expansion. Having largely ceded China to Alibaba Group Holding Ltd., the Seattle company is waging a war of attrition with Flipkart Online Services Pvt in India, where it has pledged to spend $5 billion in the next few years. The Middle East has lagged behind the rest of the world in e-commerce, but online shopping is picking up in such countries as Bahrain, Qatar and the United Arab Emirates, where most people own mobile phones."



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Saudi bank lending growth slows to a crawl in February | Reuters

Saudi bank lending growth slows to a crawl in February | Reuters:

"Growth in Saudi Arabian bank lending almost halted in February, central bank data showed on Tuesday, with companies holding back from investment in the face of stubbornly low oil prices and concern over government austerity policies. Bank lending to the private sector showed year-on-year growth of only 0.3 percent in February, slowing from 1.8 percent in January and down sharply from the 10 percent registered a year earlier. Bankers say part of the reason for the lending slowdown is that state money is flowing more freely through the economy than it was for most of last year, when the government stopped paying many of its bills as low oil prices took a heavy toll on public coffers."



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Commercial property sales subject to VAT from next year – but residential is exempt | The National

Commercial property sales subject to VAT from next year – but residential is exempt | The National:

"Property experts have welcomed news from the Ministry of Finance that sales and leases of commercial property will be subject to VAT from January, but residential property will not. In a briefing session for advisers last week at Festival City, civil servants said that offices, shops and other commercial property will be subject to the new 5 per cent VAT levy. However, sales and leases of residential property will be exempt from the tax, along with undeveloped land."



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Amazon announces agreement to buy Souq.com | The National

Amazon announces agreement to buy Souq.com | The National:

"Amazon said today it had reached an agreement to acquire Souq.com, ending months of speculation about the leading regional e-commerce group. The purchase price was not disclosed but the deal comes just a day after Emaar Malls said it had submitted an $800 million bid for the company. "Amazon’s entry into the region reflects the visionary foresight of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai, who launched Dubai Internet City in 1999 and adopted the e-commerce and online business legislation of 2002," said Sheikh Hamdan bin Mohammed, Crown Prince of Dubai. "Furthermore, it reiterates Dubai’s position as a regional and global hub for the world’s biggest and leading organizations," Sheikh Hamdan said."



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MIDEAST STOCKS-Most markets edge up, Emaar Malls jumps as Amazon seals Souq.com deal | Reuters

MIDEAST STOCKS-Most markets edge up, Emaar Malls jumps as Amazon seals Souq.com deal | Reuters:

"Most Gulf stock markets edged up on Tuesday although trading volumes were generally low, while Emaar Malls jumped in Dubai after the company appeared to lose a contest with Amazon.com to acquire Middle Eastern online retailer Souq.com.

Emaar Malls added 3.6 percent, outperforming Dubai's stock index, which dropped 0.2 percent.

The company's shares had dropped 2.8 percent in the previous two days on news it was making an $800 million bid to acquire e-commerce operator Souq.com, which could have put it in a bidding war with Amazon.com. The U.S. company had agreed in principle to buy Souq.com."



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World’s top oil traders see Opec rollover if Russia commits

World’s top oil traders see Opec rollover if Russia commits:

"The world’s top oil traders believe Opec will commit to maintaining their production cuts as long as Russia increases its compliance to keep the cartel’s most powerful members on board. Speaking at the FT Commodities Global Summit in Lausanne, Switzerland, executives from some of the world’s largest independent trading houses said a push to draw down oil inventories would likely need to last at least for the rest of the year. “There’s a feeling stocks aren’t drawing in the way they were meant to,” said Russell Hardy, chief executive of Vitol’s European, Middle East and African business. “At $50 there’s a lot of incentive for people to continue with the current policy,” though he cautioned a sharper recovery in prices could weaken Opec’s resolve."



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Market share or higher prices? The Saudi, Russia oil dilemma: Russell | Reuters

Market share or higher prices? The Saudi, Russia oil dilemma: Russell | Reuters:

"Saudi Arabia and Russia are likely to discover that when pursuing two incompatible goals, the one deemed less important will ultimately be sacrificed. The world's top two oil exporters appear to be chasing both higher crude prices through their curbs to production and market share by increasing exports, at least in Asia, the world's biggest crude importing region and the fastest growing. The question is which of these two goals will ultimately be abandoned in favor of the other, and how long will it take for Saudi Arabia and Russia to realize the incompatibility of their dual ambitions?"



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Saudi Aramco’s Valuation Could Top $1 Trillion After Tax Cut - Bloomberg

Saudi Aramco’s Valuation Could Top $1 Trillion After Tax Cut - Bloomberg:

"Saudi Aramco could have a market value of more than $1 trillion, Sanford C. Bernstein & Co. estimates, after the government slashed the oil producer’s tax burden to attract investors ahead of what may be the world’s biggest initial public offering.

The tax cut will increase Aramco’s net income by 300 percent, putting its per-barrel income in a range similar to that of international oil companies including Exxon Mobil Corp., Bernstein analysts said in a report. A production-weighted valuation on a par with such companies could give Aramco, known officially as Saudi Arabian Oil Co., a market value of $1 trillion to $1.5 trillion, the analysts said. "



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Saudi sovereign fund expands footprint with Jordan investment firm | Reuters

Saudi sovereign fund expands footprint with Jordan investment firm | Reuters:

"Saudi Arabia's top sovereign wealth fund said on Tuesday it was expanding its international presence by creating an investment firm that would pursue real estate, energy, tourism and infrastructure projects in Jordan. The Public Investment Fund, founded in 1971 to finance development projects within Saudi Arabia, has traditionally served largely as a holding company for the government's stakes in Saudi companies. But under Saudi economic reforms launched last year, the PIF is expanding abroad, investing in U.S. ride-hailing firm Uber and a global technology fund, and considering other investments ranging from a Kuwaiti food maker to German financial firms."



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Amazon Agrees to Buy Souq.com - Bloomberg

Amazon Agrees to Buy Souq.com - Bloomberg:

"The acquisition of the mideast e-commerce firm is expected to close in 2017. Amazon recently restarted talks to acquire Souq.com in a deal valued at as much as $650 million after walking away earlier this year. The bid was challenged by Emaar Malls, which offered $800 million."



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Qatar Air Chief Accelerates India Push, Plans New Routes to U.K. - Bloomberg

Qatar Air Chief Accelerates India Push, Plans New Routes to U.K. - Bloomberg:

"Qatar Airways Ltd. may order 100 new jetliners before the end of this year to power its push into India and also plans to announce two new routes to the U.K. even as the country prepares to exit the European Union, Chief Executive Officer Akbar Al Baker said. The Persian Gulf carrier is confident that a new aviation policy mapped out by “futuristic” Indian Prime Minister Narendra Modi will permit 100 percent foreign ownership of a domestic airline, Al Baker said Monday in London. Qatar Airways is briefing lawyers in India and will seek formally to establish the new airline soon, with a tender for aircraft to follow. “It could be this year,” the CEO told journalists after addressing the Qatar-U.K. Business and Investment Forum. “It depends how fast we can arrange our application.”"



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Qatar Wealth Fund Expansion Plan Is Undeterred by Brexit, Trump - Bloomberg

Qatar Wealth Fund Expansion Plan Is Undeterred by Brexit, Trump - Bloomberg:

"Qatar’s sovereign wealth fund plans to expand in the U.K. and the U.S., as top officials said long-term commercial opportunities would outweigh political uncertainty roiling the two countries. The gas-rich Gulf emirate will add 5 billion pounds ($6.3 billion) to its U.K. portfolio in the next three to five years, and will set up an office soon in San Francisco -- its second in the U.S. after New York. The focus will be on infrastructure, technology, healthcare and real estate, they said. The plans were announced on Monday in London, two days before U.K. Prime Minister Theresa May is set to begin the two-year clock on negotiations to leave the European Union. The investments could help signal that the U.K. remains an attractive destination for foreign capital even after it leaves the EU."



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Trump Ally Giuliani to Aid Turkish Dealer in Sanctions Case - Bloomberg

Trump Ally Giuliani to Aid Turkish Dealer in Sanctions Case - Bloomberg:

"An Iranian-Turkish gold dealer hired two confidants of President Donald Trump to help defend him against U.S. charges of using his network of companies to circumvent federal sanctions on Iran and possibly bring an end to the case.

Former New York City mayor Rudolph Giuliani and former U.S. Attorney General Michael Mukasey were retained by a team representing Reza Zarrab. The lawyers won’t be taking part in the trial, Zarrab’s attorney, Benjamin Brafman, said in a court filing. Zarrab had pleaded not guilty and is scheduled to go on trial in New York in October.

Giuliani was an outspoken Trump supporter during the election campaign, while Mukasey helped advise the president and was part of a team Giuliani said was drafted to legally implement a Muslim ban that Trump had promised. That led to an executive order restricting travel to the U.S. from seven mostly Muslim countries."



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COLUMN-Market share or higher prices? The Saudi, Russia oil dilemma: Russell | Reuters

COLUMN-Market share or higher prices? The Saudi, Russia oil dilemma: Russell | Reuters:

"Saudi Arabia and Russia are likely to discover that when pursuing two incompatible goals, the one deemed less important will ultimately be sacrificed. The world's top two oil exporters appear to be chasing both higher crude prices through their curbs to production and market share by increasing exports, at least in Asia, the world's biggest crude importing region and the fastest growing. The question is which of these two goals will ultimately be abandoned in favour of the other, and how long will it take for Saudi Arabia and Russia to realise the incompatibility of their dual ambitions?"



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MIDEAST STOCKS- Emaar Malls rebounds, Gulf markets trade steady or higher | Reuters

MIDEAST STOCKS- Emaar Malls rebounds, Gulf markets trade steady or higher | Reuters:

"Most Gulf stock markets were steady or in positive territory in early trade on Tuesday after Asian bourses rebounded, but trading volumes were generally thin.

Emaar Malls added 1.2 percent, outperforming a flat Dubai index. The company had dropped 2.8 percent in the previous two days on news it was making an $800 million bid to acquire e-commerce operator Souq.com, which could put it in a bidding war with Amazon.com. The U.S. company had agreed in principle to buy Souq.com.

On Tuesday, sources told Reuters that Souq.com would make an announcement later in the day about Amazon.com's bid. One of the sources, declining to be identified ahead of the announcement, said the statement would say Souq.com's shareholders had accepted the Amazon bid."



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Monday, 27 March 2017

Hurricane makes 'largest undeveloped' oil find in UK waters - BBC News

Hurricane makes 'largest undeveloped' oil find in UK waters - BBC News:

"An oil exploration firm has made what it has described as the "largest undeveloped discovery" of oil in UK waters.
Hurricane Energy said one billion barrels of recoverable oil could be contained within the Greater Lancaster Area, 60 miles (97km) west of Shetland.
The company hopes to begin production in 2019.
"



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Iran's Rouhani signals expansion in energy cooperation with Russia | Reuters

Iran's Rouhani signals expansion in energy cooperation with Russia | Reuters:

"Iranian President Hassan Rouhani said on Monday that Tehran welcomed Russian investment in its gas and oil fields, signaling major developments in energy cooperation between the two countries. "There is a huge potential for Russian investment in Iran's energy sector," Rouhani told reporters at Mehrabad airport in Tehran before departing for Moscow. "Some oil and gas fields have been suggested to Russian companies... We will see a big development in energy cooperations," he said in a news conference broadcast live on state television."



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Emirates Global Said to Pick BofA, Goldman and JPMorgan for IPO - Bloomberg

Emirates Global Said to Pick BofA, Goldman and JPMorgan for IPO - Bloomberg:

"Emirates Global Aluminium, the largest aluminum producer in the Middle East, has selected advisers for an initial public offering that could raise about $3 billion, according to people familiar with the matter. The United Arab Emirates-based company is working with Bank of America Corp., Goldman Sachs Group Inc. and JPMorgan Chase & Co. on the share sale, said the people, who asked not to be named as the details aren’t public. Aside from a local listing, EGA could also seek a presence on an overseas stock exchange like London, though no final decisions have been made, the people said."



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Saudi Aramco Tax Slashed Ahead of What May Be Biggest IPO - Bloomberg

Saudi Aramco Tax Slashed Ahead of What May Be Biggest IPO - Bloomberg:

"Saudi Arabia slashed taxes by more than a third for state oil producer Saudi Aramco ahead of what could be the world’s biggest initial public offering.

New rates reduce Aramco’s income tax rate to 50 percent from 85 percent, Chief Executive Officer Amin Nasser said in an emailed statement. The Saudi Arabian Oil Co., known as Saudi Aramco, plans to sell as much as 5 percent of the company in an IPO next year that the kingdom estimates could value the business at more than $2 trillion.

“The new tax rate will bring Saudi Aramco in line with international benchmarks,” Nasser said. The new rates on hydrocarbon companies announced by royal order on Monday are effective retroactively from Jan. 1, according to the official Saudi Press Agency."



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MIDEAST STOCKS-Region follows global downtrend; Emaar Malls drops on Souq.com bid | Reuters

MIDEAST STOCKS-Region follows global downtrend; Emaar Malls drops on Souq.com bid | Reuters:

"Most Middle Eastern stock markets fell in thin trade on Monday, in line with global losses, with Egypt hit particularly hard. The Saudi stock index edged down 0.3 percent in the lowest volume since September; declining shares outnumbered advancing ones by 115 to 31. Most petrochemical producers fell, with Saudi Kayan Petrochemical losing 0.7 percent. The largest dairy producer, Almarai, fell 0.7 percent and United Wire Factories dropped 2.0 percent as they both went ex-dividend."



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Saudi projects ‘frozen in time’ | GulfNews.com

Saudi projects ‘frozen in time’ | GulfNews.com:

"Saudi Arabia has undergone a massive transformation over the past several decades, but considering the money and resources allocated by the government to upgrade the infrastructure and quality of life, the country always seems to be falling short of the finish line. Sandwiched between some genuine accomplishments, examples of failures are present everywhere. The major cities in the kingdom are still devoid of an effective potable water network that leaves many homes at the mercy of the arrival of a water tanker for their household needs. Similarly, the lack of a sewage disposal network has given rise to an army of sewage disposal tankers that run about the cities, carrying their foul-smelling load. The road networks, while connecting many of the country’s towns and cities, are criticised by users for lack of public service facilities along the routes. The absence of adequate gas stations, convenience stores and rest rooms along highways makes longer journeys often a challenging test of endurance."



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Iranian poor struggle to make ends meet

Iranian poor struggle to make ends meet:

"Ibrahim cannot remember the last time he could afford to feed his family chicken — the cheapest meat available in Iran.

The 38-year-old builder, who relies on casual work, says that finances have been so tough that he could not afford to buy his children clothes for the Persian new year. The festival, which began last week, is normally a time for feasting and celebration.

“My income this year has been just enough to stop me begging in the streets,” says Ibrahim, who lives in a poor neighbourhood in the east of the capital Tehran. “My bank account has had zero money for most of this year, unlike before when I could save small amounts.”"



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Qataris to Unveil Major Investments in ‘Global Britain’ - Bloomberg

Qataris to Unveil Major Investments in ‘Global Britain’ - Bloomberg:

"Qatar said it will announce major new investments in the U.K. this week, deepening the countries’ trade ties as London prepares to quit the European Union.

The emirate’s prime minister, Sheikh Abdullah bin Nasser bin Khalifa Al-Thani, is leading a delegation of more than 400 officials and business executives to London and Birmingham to a two-day meeting with U.K. counterparts, according to government statements. The visit concludes on Tuesday, a day before U.K. Prime Minister Theresa May plans to start the two-year clock on Brexit negotiations by invoking Article 50 of the Lisbon Treaty."



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Kuwait to Adopt New Equities Benchmark After Reorganizing Market - Bloomberg

Kuwait to Adopt New Equities Benchmark After Reorganizing Market - Bloomberg:

"Kuwait’s stock exchange will introduce a new equities benchmark next year after completing a reorganization of its listed companies into new market categories, the bourse’s chief executive officer said. Boursa Kuwait, as the exchange is known, will group companies in segments according to criteria including market capitalization and average daily traded volume as part of a program to boost liquidity and draw new investors and issuers, CEO Khaled Al Khaled said in an interview in Kuwait City on Sunday."



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Saudis Thinking Beyond Oil in Asia Courtship - Bloomberg View

Saudis Thinking Beyond Oil in Asia Courtship - Bloomberg View:

"King Salman bin Abdulaziz's trip to Asia has been characterized as either a routine visit to bolster the already strong trading ties between Saudi Arabia and Asia, an effort to diversify ties away from the U.S. or as a way to attract investments into Saudi Arabia and promote its own. The reality is that it's a combination of all the above. Yes, oil is an important part of the story, but not the only part. About two-thirds of Saudi Arabia's oil exports end up in Asia. The perception in the Middle East is that the U.S. in recent years has de-emphasized the region while initiating a type of rapprochement with Iran. By initiating investment deals with Malaysia, Indonesia, Japan and China, Saudi Arabia is hoping to spark reciprocity and presence in Asia. The partnership between Saudi Arabia and Asia has been gaining in importance over the last decade, and strengthened in 2016 when Asia overtook the European Union to become the largest trading partner with the Gulf Cooperation Council. Japan imports 83 percent of its oil from the Gulf, with more than a third sourced from Saudi Arabia. Both countries enjoy excellent diplomatic ties that date back to 1938 when Saudi envoys visited the country for the opening of a mosque in Tokyo. The Toyota Land Cruiser is the best-selling and most celebrated SUV in Saudi Arabia, and Toyota Motor was asked again to launch a feasibility study to produce certain vehicles in the nation."



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MIDEAST STOCKS-Gulf edges lower; Emaar Malls down on $800 mln Souq.com bid | Reuters

MIDEAST STOCKS-Gulf edges lower; Emaar Malls down on $800 mln Souq.com bid | Reuters:

"Stock markets in the Gulf edged slightly lower in early lethargic trade on Monday as crude oil prices remained near $50 a barrel and international markets were sluggish.

The Saudi stock index was down 0.3 percent in the first 25 minutes of trade. The number of declining shares outnumbered advancing ones by 99 to 23.

The largest dairy producer, Almarai, fell 0.7 percent and United Wire Factories fell 2.2 percent as they both went ex-dividend."



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Sunday, 26 March 2017

UAE federal budget shows surplus in first nine months of 2016 | The National

UAE federal budget shows surplus in first nine months of 2016 | The National:

"The rally in crude prices and a cut in government spending meant that the Federal budget surplus was Dh4.5 billion higher in the first nine months of last year compared to the same period in 2015. The surplus rose 130 per cent year-on-year during the period to almost Dh8bn compared to Dh3.48bn a year earlier, the Emirates News Agency (Wam) reported, according to its own analysis. Benchmark Brent crude rose 31 per cent to US$49 a barrel from $37.22 between January and the end of September 2016. "



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Nasdaq Dubai set to reinforce equity futures after robust progress | GulfNews.com

Nasdaq Dubai set to reinforce equity futures after robust progress | GulfNews.com:

"Nasdaq Dubai wants to reinforce equity futures after it witnessed strong growth, its chief executive officer said on Sunday.
Nasdaq Dubai plans to introduce futures in two names by the beginning of April, taking the total number of shares to 11 from the current nine.
“We are looking at Dubai Investment Company, and Dubai Financial Market contracts to go live in the first week of April,” Hamed Ali, chief executive officer of the bourse told Gulf News in an interview."



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Gulf Arab states push for UK free trade deal after Brexit: officials | Reuters

Gulf Arab states push for UK free trade deal after Brexit: officials | Reuters:

"Gulf Arab states are pressing for an early deal on free trade with Britain to secure preferential arrangements after Brexit, and could have a draft agreement ready within months, Gulf officials say.

Britain cannot formally sign trade agreements while it remains a member of the European Union, but the British government has said it is keen to start preparatory work so deals can be reached quickly after it leaves.

One of the first agreements could be with the six-nation Gulf Cooperation Council, which includes Qatar and the two biggest Arab economies, Saudi Arabia and the United Arab Emirates, as well as Kuwait, Bahrain and Oman, according to the officials. Trade between Britain and the GCC totals about 30 billion pounds ($37.5 billion) annually."



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Oil producers' compliance with deal at 94 percent: Russia | Reuters

Oil producers' compliance with deal at 94 percent: Russia | Reuters:

"Compliance with a deal to cut oil output is at 94 percent among OPEC and non-OPEC oil producers combined, Russian Energy Minister Alexander Novak told reporters on Sunday. Russia is committed to cuts of 300,000 barrels per day by the end of April, he added. Novak said he expects global oil stockpiles to decrease in the second quarter of this year."



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Goldman Sachs in Talks for Saudi Arabian Equities License - Bloomberg

Goldman Sachs in Talks for Saudi Arabian Equities License - Bloomberg:

"Goldman Sachs Group Inc. is in preliminary talks for an equities license in Saudi Arabia as the U.S. lender seeks to take advantage of the country’s economic reforms, according to people familiar with the matter.

The bank has yet to file a formal application, the people said, asking not to be identified as the information is private. While talks are ongoing, no final decisions have been made, the people said. The bank may also decide against going ahead with the submission, they said.

A Goldman Sachs representative declined to comment. Saudi Arabia’s Capital Markets Authority, which would approve the license, didn’t immediately respond to requests for comment."



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MIDEAST STOCKS-Markets mixed as Saudi fails to keep reform-related gains | Reuters

MIDEAST STOCKS-Markets mixed as Saudi fails to keep reform-related gains | Reuters:

"Middle East stock markets were mixed in mostly thin trade on Sunday, with Saudi Arabia giving up early gains triggered by progress in reforms that could help it to join MSCI's emerging market index. The Saudi index rose as much as 0.5 percent in early trade but closed 0.1 percent down in its thinnest volume since last September. The exchange said late on Thursday that it would extend the period for settling trades and introduce short-selling on April 23 in reforms demanded by MSCI. The reforms had been expected in the second quarter, but the date is positive because it gives MSCI time to evaluate their impact before deciding in June whether to put Riyadh on its review list."



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Frontier too far? Oil producers adjust to reduced hopes for Kurdistan

Frontier too far? Oil producers adjust to reduced hopes for Kurdistan:

"It was described by former BP chief executive Tony Hayward as the “one of the last great frontiers in the oil and gas industry”.

Back in 2011, when Mr Hayward made those remarks, the semi-autonomous Kurdistan region of Iraq was hailed as the energy sector’s new darling.

Excited tales about how Kurdistan was one of the cheapest places on earth to pump crude grabbed the attention of big energy groups such as ExxonMobil as well as small oil explorers including London-listed Genel Energy, which Mr Hayward chairs."



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De-risking takes toll on GCC institutions’ access to global banking system | GulfNews.com

De-risking takes toll on GCC institutions’ access to global banking system | GulfNews.com:

"Restrictions imposed by global financial institutions on smaller regional and local counterparts as part of reducing risks associated with anti-money laundering (AML) and combating financing of terrorism (CFT) are causing significant business losses to regional banks and money transfer companies. Global financial institutions are increasingly terminating or restricting correspondent banking relationships with remittance companies and smaller local banks in many regions of the world — a practice that is called “de-risking.” De-risking has been rampant in regions that are generally perceived to be high risk. Bankers say GCC region is perceived as ‘high risk’ because of the volatile political situation prevailing in the neighbouring countries and regions."



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Emaar Malls Bids for Dubai's Souq.com to Challenge Amazon - Bloomberg

Emaar Malls Bids for Dubai's Souq.com to Challenge Amazon - Bloomberg:

"Emaar Malls PJSC, the shopping-center unit of Dubai’s largest publicly-traded property developer, bid for online retailer Souq.com in a challenge to an offer made by Amazon.com Inc., according to people familiar with the matter.

The retail division of Emaar Properties PJSC, run by Mohamed Alabbar, offered about $800 million for Souq.com last week, which includes a convertible deposit of $500 million, one of the people said, asking not to be identified as the talks are private. Amazon has an exclusivity clause in its buyout talks for the online retailer, the person said.

A final agreement hasn’t been reached with any bidder, the people said. An Emaar spokesman declined to comment. A representative for Souq.com couldn’t immediately be reached for comment. Emaar’s bid was previously reported by Arabian Business."



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More Oil Producers Call to Roll Over Output Cuts Beyond June - Bloomberg

More Oil Producers Call to Roll Over Output Cuts Beyond June - Bloomberg:

"Venezuela, Iraq and Oman added their support for a possible extension of global oil-production cuts beyond June as momentum builds among OPEC members and other crude producers to prolong the strategy to re-balance the market and prop up prices. Oil minsters for the three countries commented on Sunday, a day after Algeria’s Energy Minister Noureddine Boutarfa called for an extension because he said the strategy is succeeding in paring global inventories. The ministers are meeting in Kuwait City to discuss compliance with the pledged reductions. So far, five OPEC members, including Kuwait and Angola, have backed an extension of the cuts. “We are ready to support” prolonging the six-month deal, which took effect in January, Venezuela’s Oil Minister Nelson Martinez told reporters on Sunday before the meeting. “It does make sense to extend the agreement for another six months -- maybe at least,” said his Omani counterpart, Mohammed Al Rumhy. Oman, unlike Venezuela, isn’t a member of the Organization of Petroleum Exporting Countries."



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MIDEAST STOCKS-Gulf stocks mixed, reforms support Saudi shares | Reuters

MIDEAST STOCKS-Gulf stocks mixed, reforms support Saudi shares | Reuters:

"Stock markets in the Gulf were mixed in early trade on Sunday with Saudi Arabia outperforming after its exchange announced progress on reforms that could help it join MSCI's emerging market index.

The Saudi index rose 0.4 percent in the first hour with much activity focusing on smaller stocks such as Filing and Packing Materials Manufacturing Co, up 7.1 percent. Arab Bank dropped 2.5 percent as it went ex-dividend.

The exchange said late on Thursday that it would extend the period for settling trades and introduce short-selling on April 23, reforms demanded by MSCI. The reforms had already been expected sometime in the second quarter but the date is positive as it will give MSCI time to evaluate their impact before deciding in June whether to put Riyadh on its review list."



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Friday, 24 March 2017

US drillers add most oil rigs since January

US drillers add most oil rigs since January:

"US drillers added the most oil rigs since January last week, further fuelling concerns that rising US production will frustrate Opec’s efforts to rebalance the oil market. US drillers brought 21 oil rigs back online last week, oilfield services company Baker Hughes said on Friday. Drillers have now added oil rigs every week this year barring one to bring the total operational rigs to 652, compared with 372 a year ago. It is also the highest level since September 2015. The rally in crude prices after Saudia Arabia-led Opec and non-members like Russia struck a deal late last year to curb crude output by 1.8m barrels per day in the first half of 2017 have prompted US drillers to move mothballed rigs back online."



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Qatari connection casts long shadow over Barclays

Qatari connection casts long shadow over Barclays:

"On a balmy evening in 2007, the Tunisian wife of an Italian industrialist introduced a high-flying Scottish banker at Barclays to the Anglophile prime minister of Qatar — the sort of nexus of celebrity, power and money that takes places every summer on Sardinia’s Costa Smeralda. This encounter proved more important than most. Just over a year later, as the worst financial crisis in a generation created havoc across the industry, Barclays was suddenly under threat and in desperate need of outside funding. Roger Jenkins, then head of Barclays’ principal investing group, would be the one to secure it. Over the course of 2008 he masterminded two deals with a man he met in Sardinia the previous summer: Sheikh Hamad bin Jassim bin Jabr al-Thani, at the time Qatar’s prime minister and chair of the country’s sovereign wealth fund. Known as HBJ, he would help pump a total of £6.1bn into the bank. The goal was to save it from government ownership, even as its rivals Royal Bank of Scotland and Lloyds Banking Group were bailed out."



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Thursday, 23 March 2017

MIDEAST STOCKS-Most Gulf bourses recover, Egypt rebounds as foreign funds buy | Reuters

MIDEAST STOCKS-Most Gulf bourses recover, Egypt rebounds as foreign funds buy | Reuters:

"Most stock markets in the Gulf made small gains on Thursday, recovering some of the week's losses, but trading volumes remained very low. Egypt rebounded as foreign funds bought shares there. The Saudi stock index climbed 0.7 percent as the petrochemical sector regained some of the previous session's heavy losses, after Brent oil bounced from a four-month low hit on Wednesday. Saudi Kayan Petrochemical rose 1.3 percent. The insurance sector, which has been very volatile in recent days, also firmed with all but four of the 35 listed insurers advancing. Buruj Cooperative Insurance jumped 9.3 percent and was the top performer on the exchange."



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Islamic finance aims for easier sukuk investment with proposed new standards | Reuters

Islamic finance aims for easier sukuk investment with proposed new standards | Reuters:

"Two top standard-setting bodies are proposing new guidelines for Islamic bonds that could increase investment in the instruments by making them more transparent and easier to structure. Last week the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) published draft accounting standards for sukuk that aim to clarify how they should be treated on balance sheets and the information which issuers should disclose. Bahrain-based AAOIFI, whose standards are followed in whole or in part by Islamic financial institutions around the world, said it had also formed a working group to overhaul its sharia standards for sukuk. Sharia standards cover the instruments' compliance with Islamic principles."



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Saudi pledges stable oil supply as market confused by data | Reuters

Saudi pledges stable oil supply as market confused by data | Reuters:

"Output or exports? OPEC members have argued for decades over which of the two they should monitor to gauge compliance with oil-output cuts.

This month, Saudi Arabia has thrown a third metric – supply - into the debate.

The move saw oil prices declining, with confused traders fearing Riyadh would pump more crude, thus complicating OPEC’s efforts to reduce a global glut and prop up the market."



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City watchdog relaunches probe into Barclays’ cash call

City watchdog relaunches probe into Barclays’ cash call:

"The City watchdog has reignited its investigation into Barclays’ emergency cash call during the height of the financial crisis, opening up yet another line of inquiry that the UK bank must face as a consequence of the controversial deal. The Financial Conduct Authority has launched a series of interviews in recent weeks, according to people familiar with the situation. It is re-examining the fundraising of October 2008, when Barclays turned to Qatari and Abu Dhabi senior royals and sovereign wealth funds for a £7.3bn boost as a last-chance effort to stay out of UK government control. The interviews come despite the fact that the FCA already came to an early determination in 2013 that the bank had failed to disclose arrangements and fees it paid to Qatari investors at the time. The watchdog ‎said it would fine Barclays £50m, which the bank disclosed that year, adding that it would contest the findings."



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UAE bankruptcy no longer leads straight to prison

UAE bankruptcy no longer leads straight to prison:

"Pervez, a British businessman, set up a building materials supplier just before Dubai’s financial crisis began in 2008. The small-scale operation started as the emirate’s real estate boom turned to bust, with state-owned developers repaying only a fraction of the invoices outstanding for goods and services owed. Scraping through this difficult period, his business flourished as a new building boom gripped Dubai — seen as a safe haven — in the aftermath of the Arab Spring of 2011. But the return of another crunch since 2014, sparked by the regional oil price slide, led to a chain of late payments throughout the construction industry. “Customers just chose not to pay,” says Pervez. (He would only use his first name.) That meant owners were running away, because if they bounced a cheque they would face jail. “Half my market ran away,” he says. “People take as much credit as they can and run.” As the situation worsened, his bank froze hundreds of thousands of dirhams in his personal account, further limiting his ability to service debts. Last year, as due dates approached on cheques he had guaranteed, Pervez also chose to flee, to his native Britain. His staff dismembered his business once news of his departure spread."



'via Blog this'

Saudi Arabia Rating Cut by Fitch on Worsening Public Finances - Bloomberg

Saudi Arabia Rating Cut by Fitch on Worsening Public Finances - Bloomberg:

"Saudi Arabia’s credit worthiness was cut one level by Fitch Ratings, which said low oil prices were worsening public and external finances.

 Fitch reduced Saudi Arabia’s rating to A+, the fifth-highest investment grade, and changed the outlook to stable from negative, the agency said in a statement on Wednesday. The downgrade “reflects the continued deterioration of public and external balance sheets, the significantly wider than expected fiscal deficit in 2016 and continued doubts about the extent to which the government’s ambitious reform program can be implemented," Fitch said.

 The downgrade by Fitch “was anticipated,” the Finance Ministry said in an emailed statement. Saudi Arabia’s economic fundamentals are strong, it said. Fitch’s cut puts its Saudi rating on par with Moody’s Investors Service. Both classify the kingdom two levels above S&P Global Ratings.

"



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MIDEAST STOCKS-Saudi outperforms in mostly flat region; Dubai's DSI up on asset sale | Reuters

MIDEAST STOCKS-Saudi outperforms in mostly flat region; Dubai's DSI up on asset sale | Reuters:

"Saudi Arabia's stock market outperformed the region in early trade on Thursday, recovering some of the previous session's losses, while in Dubai builder Drake & Scull climbed after it agreed to sell a major asset. The Saudi stock index was up 0.5 percent after 15 minutes of trade as the petrochemical sector recovered some of the previous session's heavy losses, after Brent oil bounced from a four-month low hit on Wednesday. Saudi Kayan Petrochemical rose 1.3 percent. The insurance sector, which has been very volatile in recent days, also firmed with all but three of the 35 listed insurers advancing. Solidarity Saudi Takaful rose 1.4 percent."



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Wednesday, 22 March 2017

Dubai has highest number of self-made Gulf billionaires – report

Dubai has highest number of self-made Gulf billionaires – report:

"Dubai is the preferred location for the Gulf’s super-rich with 12 billionaires located in the UAE emirate, according to the first ever list of self-made high net worth individuals from the China-based Hurun Report. Saudi city Jeddah is ranked second, with four billionaires, while Abu Dhabi, Riyadh and Muscat tie for third with three apiece. Majid Al Futtaim is the richest self-made person in the Gulf with an estimated $13bn, according to the report."



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What to expect after Article 50 | Opinion

Amazon deal for Souq.com is back on | The National

Amazon deal for Souq.com is back on | The National:

"Amazon’s interest in making an investment in regional online retailer Souq.com is back on. Speculation about a potential sale of Souq to the US ecommerce firm had circulated for months but the deal was thought to have floundered in January over the valuation. Souq.com had been valued at US$1 billion in a $275 million funding round in February last year. It is understood that a full acquisition of Souq.com by Amazon has now been agreed."



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Saudi Aramco Weighs Rolling Bank Mandates for Record IPO - Bloomberg

Saudi Aramco Weighs Rolling Bank Mandates for Record IPO - Bloomberg:

"Saudi Arabian Oil Co. is weighing a plan to hire investment banks for different stages of its initial public offering, four people with knowledge of the matter said.

The company -- known as Saudi Aramco -- is talking to banks for a role as financial adviser to review potential listing destinations and prepare the company for the float, the people said, asking not to be identified as the talks are private. Banks that do well in that role will then be considered for subsequent stages including underwriting, the people said. Aramco may re-tender the work if they’re unhappy with a bank’s performance, they said.

No final decisions have been made on the advisory roles, though Aramco is expected to mandate banks in coming days, the people said."



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MIDEAST STOCKS-Oil near $50 dents sentiment in Gulf | Reuters

MIDEAST STOCKS-Oil near $50 dents sentiment in Gulf | Reuters:

"Stock markets in the Gulf followed international bourses lower in early trade on Wednesday as crude oil prices trading down near $50 a barrel dented sentiment towards oil-sensitive shares.

All but two of the 12 listed Saudi Arabian petrochemical makers fell, dragging the main Saudi index 0.7 percent lower after 35 minutes. Heavyweight Saudi Basic Industries lost 1.0 percent.

Supermarket operator Al Othaim declined 1.0 percent after its board recommended a cash dividend of 2.0 riyals per share for 2016; although the payout was above the prior year's outlay, it fell below expectations. Analysts at NCB Capital had forecast the retailer would pay 2.3 riyals."



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Tuesday, 21 March 2017

New developer pumps Dh2b plus into Sharjah projects | GulfNews.com

New developer pumps Dh2b plus into Sharjah projects | GulfNews.com:

"Sharjah’s property market is seeing the big investment plays coming through. A three-way alliance involving the Sharjah Government entity Shurooq, Dubai’s Emaar Properties and Eagle Hills is to oversee three projects with a combined value of Dh2.47 billion.
The largest of these will be a Dh2.26 billion “Maryam Island”, a mixed-use development located between Al Khan Lagoon and Al Mamzar peninsula.
The other projects from Omran Properties — the name of the new venture — are the Al Khan Village Resort, a five-star hotel costing Dh120.6 million, and Kalba Waterfront Mall in the Eastern region of the emirate and a development cost of Dh106 million. The land area is around 364,000 square meters and with a leasable retail area of 18,581 square meters."



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U.S. oil hits November low as fresh glut fears overshadow OPEC cut talk | Reuters

U.S. oil hits November low as fresh glut fears overshadow OPEC cut talk | Reuters:

"Oil prices fell on Tuesday, with U.S. crude dropping to its lowest since November, as concerns about new supplies overshadowed the latest talk by OPEC that it was looking to extend output cuts beyond June.

The decline also came ahead of the release of U.S. crude inventory data later Tuesday and on Wednesday that is expected to show a crude stock build of 2.8 million barrels for last week, according to a Reuters poll. [EIA/S]

If correct, that would be the tenth weekly crude stock build in the last 11 following a surprise dip in the prior week and could boost inventories back to a record high."



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MIDEAST STOCKS-Gulf rises in quiet trade, Egypt declines | Reuters

MIDEAST STOCKS-Gulf rises in quiet trade, Egypt declines | Reuters:

"Gulf stock markets were mostly higher on Tuesday, buoyed by firm global equities, although trading volumes were generally thin and the Egyptian bourse fell on profit taking. Abu Dhabi was the top performer, climbing 1.2 percent on strong banking shares, with National Bank of Abu Dhabi up 1.9 percent. Aldar Properties rose 1.3 percent after its chairman Abubaker al-Khoori told shareholders late on Monday of plans to increase its operating income to 2.2 billion dirhams ($599 million) in 2020 from the current 1.6 billion dirhams."



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Saudi Aramco Plans $2 Billion Debut Bond Ahead of IPO - Bloomberg

Saudi Aramco Plans $2 Billion Debut Bond Ahead of IPO - Bloomberg:

"Saudi Arabian Oil Co. is seeking to raise about $2 billion in its debut bond sale, the first step of a plan by the energy giant to tap markets for $10 billion, according to people familiar with the matter. Saudi Aramco, as the company is known, will sell riyal-denominated Islamic bonds, or sukuk, as early as the second quarter, the people said, asking not to be identified as the discussions are private. The sukuk may be privately placed with investors, they said. Saudi Aramco is preparing to sell bonds ahead of an IPO in 2018, the latest in a string of debt sales that raised almost $80 billion for countries in the Middle East and North Africa, the most since Bloomberg started compiling data in 1999. The Saudi government’s debut offering in October raised $17.5 billion in the biggest-ever emerging-market sale."



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Big Oil’s Plan to Buy Into the Shale Boom - Bloomberg

Big Oil’s Plan to Buy Into the Shale Boom - Bloomberg:

"Exxon Mobil Corp., Royal Dutch Shell Plc and Chevron Corp., are jumping into American shale with gusto, planning to spend a combined $10 billion this year, up from next to nothing only a few years ago.

 The giants are gaining a foothold in West Texas with such projects as Bongo 76-43, a well which is being drilled 10,000 feet beneath the table-flat, sage-scented desert, and which then extends horizontally for a mile, blasting through rock to capture light crude from the sprawling Permian Basin.

 While the first chapter of the U.S. shale revolution belonged to wildcatters such as Harold Hamm and the late Aubrey McClendon, who parlayed borrowed money into billions, Bongo 76-43 is financed by Shell."



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MIDEAST STOCKS-Gulf edges up in early trade, Aldar climbs in Abu Dhabi | Reuters

MIDEAST STOCKS-Gulf edges up in early trade, Aldar climbs in Abu Dhabi | Reuters:

"Major Gulf stock markets were marginally higher in quiet, early trade on Tuesday, while Abu Dhabi's Aldar Properties climbed after its annual general meeting discussed expansion plans. The Abu Dhabi stock index gained 0.5 percent as Aldar, the most heavily traded stock, added 0.8 percent. It plans to increase its operating income to 2.2 billion dirhams ($599 million) in 2020 from the current 1.6 billion dirhams, chairman Abubaker al-Khoori told shareholders late on Monday. Dubai edged up 0.1 percent as GFH Financial , the most active stock, climbed 1.1 percent."



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Monday, 20 March 2017

Hedge funds bet on renewed oil decline below $50 a barrel

Hedge funds bet on renewed oil decline below $50 a barrel:

"Hedge funds are unwinding a near billion-barrel speculative oil position at a record pace, slashing bets on rising prices and adding to wagers that the market could suffer a renewed slump below $50 a barrel. In the latest week funds reduced their net-long position — the difference between bets on rising and falling prices — by a combined 153m barrels across the two benchmark oil contracts, the biggest one week cut on record and the equivalent of selling almost two days of global crude demand. Oil slumped to a three-month low last week, with doubts rising about Opec’s ability to reduce a supply glut that has roiled the market since mid-2014."



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UAE hospital operator NMC Health to pursue Gulf expansion, debut bond | Reuters

UAE hospital operator NMC Health to pursue Gulf expansion, debut bond | Reuters:

"United Arab Emirates-based hospital operator NMC Health plans to expand in Gulf markets with a debut bond issue to fund acquisitions, its new chief executive said on Monday.

NMC is among the beneficiaries from substantial growth in the Gulf's healthcare sector as an increasingly wealthy population becomes more susceptible to lifestyle diseases such as diabetes and obesity.

The company's main focus since its London listing in 2012 has been its UAE home market, where it has both built and acquired hospitals, including last month's completion of the purchase of Al Zahra Hospital in Sharjah for $560 million."



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OPEC leans toward oil cut extension, but non-members need to be in: sources | Reuters

OPEC leans toward oil cut extension, but non-members need to be in: sources | Reuters:

"OPEC oil producers increasingly favor extending beyond June a pact on reducing crude supply to balance the market, sources within the group said, although Russia and other non-members need to remain part of the initiative. The Organization of the Petroleum Exporting Countries is curbing its output by about 1.2 million barrels per day (bpd) from Jan. 1 for six months, the first reduction in eight years. Russia and other non-OPEC producers agreed to cut half as much. The deal has lifted oil prices LCOc1, but inventories in industrial nations are rising and higher returns have encouraged U.S. companies to pump more. A growing number of OPEC officials believe it may take longer than six months to reduce stocks."



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MIDEAST STOCKS-Insurance, petchems dampen Saudi, Qatar rises as it completes FTSE upgrade | Reuters

MIDEAST STOCKS-Insurance, petchems dampen Saudi, Qatar rises as it completes FTSE upgrade | Reuters:

"Stock markets in the Middle East were mixed on Monday with petrochemicals and the insurance sector weighing on Saudi Arabia while Qatar rose as it completed its upgrade by index compiler FTSE Russell to secondary emerging market status. The Saudi index fell 0.5 percent with the main drag coming from the petrochemical sector as Brent oil futures fell further towards $51 a barrel. Saudi Kayan Petrochemical lost 1.9 percent. Most insurance shares, which had risen strongly on Sunday, retreated. Solidarity Saudi Takaful slumped 5.6 percent after the company said the regulator had suspended its right to issue health insurance policies because of regulatory violations; the firm did not describe those violations. "



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Saudi king's Asia tour trumpets Aramco's moves downstream | Reuters

Saudi king's Asia tour trumpets Aramco's moves downstream | Reuters:

"Saudi King Salman's lavish tour of Asia, arriving in each country on a golden escalator with 400 tonnes of luggage, had a hardnosed marketing mission - to cement the kingdom's place as leading oil supplier to the world's biggest consumer region. The string of deals inked on his three-week tour to Malaysia, Indonesia, Japan and China also point to a fresh strategy, one to increase Saudi leverage over refined product and petrochemical markets, known as the downstream sector. "Our strategy is about growth in the downstream," said Amin Nasser, chief executive officer of state oil company Aramco, told Reuters on Sunday. "The growth in that sector is very important, and anything integrated between refining, petrochemical, with marketing and distribution, is of interest to us.""



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Sovereign wealth funds move beyond trophy assets

Sovereign wealth funds move beyond trophy assets:

"Sovereign wealth funds are shifting away from luxury businesses, buying more hotels and increasing their allocations to private deals as they look to offset falling state revenue from lower oil prices, a report on their investment strategies has revealed.

Investment by national funds in trophy assets aimed at wealthy customers, including Tiffany, Porsche and LVMH, has fallen from $13bn in 2009 to just $1.4bn in 2015, according to the latest figures available for analysis by Madrid-based IE Business School.

By contrast, sovereign wealth funds increased their spending in the hotel sector from $500m in 2012 to $7bn in 2015. The number of direct investments — rather than through a fund — has also increased from 105 in 2012 to 178 in 2015."



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DP World profits benefit from purchases in UAE and abroad | The National

DP World profits benefit from purchases in UAE and abroad | The National:

"The ports operator DP World’s profit for 2016 on a reported basis jumped almost 30 per cent as acquisitions in the UAE and Canada boosted earnings. The Nasdaq Dubai-listed firm said profit attributable to owners of the company rose 27.6 per cent to US$1.12 billion thanks to a full-year contribution from Jebel Ali Free Zone and the firm’s terminal in Prince Rupert, Canada. On a like-for-like basis, profit attributable to owners of the company, was up a more modest 6.2 per cent, DP World said in a statement. However, consolidated throughput at its ports fell 1.6 per cent on a like-for-like basis to 29.24 million twenty-foot equivalent units (TEUs)."



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Oil Prices Seen Stuck Below $60 This Year as High Stocks Persist - Bloomberg

Oil Prices Seen Stuck Below $60 This Year as High Stocks Persist - Bloomberg:

"An historic agreement between OPEC countries and other oil producers to reduce their output won’t be enough to nudge crude prices above $60 a barrel this year, according to energy lender Arab Petroleum Investment Corp. Consumer countries have built up large stockpiles of crude during nearly three years of low prices, and U.S. shale production is rebounding as prices have recovered since OPEC reached the production deal November. That means the process of balancing the market will take at least until the second half of this year, the company known as Apicorp said Monday in a report. The inability to balance the market in the first half of the year will mean the Organization of Petroleum Exporting Countries should extend the six-month deal, which took effect on Jan. 1, for the rest of the year, it said. OPEC meets in Vienna on May 25."



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