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Thursday, 17 August 2017

MIDEAST STOCKS-Gulf rises, Saudi's Atheeb Telecom jumps after swinging to profit

MIDEAST STOCKS-Gulf rises, Saudi's Atheeb Telecom jumps after swinging to profit:

"Stock markets in the Gulf rose early on Thursday with Saudi Arabia's index gaining strength from positive company-specific news. The Riyadh index was up 0.4 percent in the first hour, as Atheeb Telecommunications surged 8.5 percent after it swing to a quarterly net profit of 55.4 million riyals ($14.8 million) from a loss of 58.1 million a year ago. The result was mainly due to the sale of 500 communications towers, but also reflected an increase in data, internet and voice revenue, the company said."



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From leader to loser: Australia risks missing next LNG wave: Russell

From leader to loser: Australia risks missing next LNG wave: Russell:

"Should the arrival of the last major piece of kit in Australia's $180 billion liquefied natural gas (LNG) spree be a cause for celebration or for a wake? It may seem that the arrival of the Ichthys Venturer floating production, storage and offloading facility would be worthy of breaking out the champagne. The vessel, which will be moored some 220 kilometers (132 miles) off the northwestern coast as part of Inpex's Ichthys project, is the final piece of the jigsaw that completes eight massive new LNG ventures."



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Qatar’s big economic conundrum - The National

Qatar’s big economic conundrum - The National:

"The third month into the diplomatic crisis, the most serious since the founding of the Gulf Cooperation Council in 1981, Qatar’s intransigence towards the quartet of Saudi Arabia, the UAE, Bahrain and Egypt continues. Doha’s defiant stance towards its Arab neighbours has come at a high price. The country, which supplies about a third of the world’s total liquefied natural gas (LNG), has been forced to tap into its foreign currency reserves and borrow from debt markets to support its economy, which is facing the prospect of posting a fiscal deficit. Yesterday the country’s sovereign wealth fund was compelled to reduce its stake in Credit Suisse to 4.94 per cent Trouble for Qatar began when the Arab bloc led by Saudi Arabia severed diplomatic and transport relations with Doha over accusations of meddling in their internal affairs as well the country’s support for “terrorist groups aiming to destabilise the region”. "



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Etihad, partners' bonds drop again as Air Berlin bankruptcy sparks bailout concerns

Etihad, partners' bonds drop again as Air Berlin bankruptcy sparks bailout concerns:

"Etihad Airways' bonds issued through a special purpose vehicle have dropped more than five points in the secondary market a day after Air Berlin, in which Etihad has a large minority stake, filed for bankruptcy protection.

In April, the "EA Partners" bonds dropped by almost 10 cents on the dollar after workers at the Italian carrier Alitalia [CAITLA.UL] – in which Etihad has a 49 percent stake – rejected the company's latest turnaround plan, blocking it from accessing rescue financing.

An "internal debt assumption" agreement between Etihad and Alitalia – revealed through a Fitch note in the days following Alitalia entering special administration, but had been signed earlier – put a floor under the bonds, and they subsequently bounced back almost to par value."



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Qatar's Growth Prospects Dim as Saudi-Led Boycott Takes Toll - Bloomberg

Qatar's Growth Prospects Dim as Saudi-Led Boycott Takes Toll - Bloomberg:

"Qatar’s economy will expand this year at the slowest pace since 1995, according to economists surveyed by Bloomberg this month, as the impact of a Saudi Arabia-led boycott is felt on trade and investor confidence.

Gross domestic product will grow 2.5 percent in 2017 and 3.2 percent next year, compared with 3.1 percent and 3.2 percent respectively in the previous survey conducted in June. Economists now expect a budget deficit of 5.1 percent of GDP this year, up from 4.6 percent, while the forecast for inflation dropped to 2.2 percent from 2.5 percent."



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Saudi Crude Exports Fall Just as Domestic Stockpiles Dwindle - Bloomberg

Saudi Crude Exports Fall Just as Domestic Stockpiles Dwindle - Bloomberg:

"Saudi Arabia, the world’s biggest crude exporter, shipped the least oil in almost three years in June, just as domestic stockpiles are dwindling. 

Exports fell to 6.9 million barrels a day, the lowest since September 2014, from 6.92 million in May, according to data Thursday on the Joint Organisations Data Initiative website. Domestic stockpiles stood at 256.6 million barrels, the lowest since January 2012, the data show.

“You can assume exports will fall even further going forward because they can’t keep running down stockpiles,” said Amrita Sen, an analyst at Energy Aspects in London. “It is clear that the rebalancing process is in full swing, we are drawing down stockpiles everywhere.”"



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Wednesday, 16 August 2017

Is the Brent crude glut coming to an end? | Markets

Gulf boycott of Qatar spreads to banks — FT News — Overcast

Gulf boycott of Qatar spreads to banks — FT News — Overcast:

"Companies with business ties to Arab Gulf states have found themselves in an uncomfortable position as a result of a trade boycott of Qatar by four regional Arab states, including Saudi Arabia and the UAE. Now it appears that global banks are feeling the impact. Caroline Binham asks the FT’s Gulf correspondent Simeon Kerr what’s going on. Music by Kevin MacLeod."



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MIDEAST STOCKS-Most markets up; Egypt ends losing streak but Qatar down after data

MIDEAST STOCKS-Most markets up; Egypt ends losing streak but Qatar down after data:

"Most Middle Eastern stock markets rose on Wednesday, with Egypt ending a six-day losing streak, but trading volumes were thin in the absence of major new catalysts for investors. The Dubai index rose 0.3 percent as GFH Financial , the most active stock, climbed 2.9 percent. It had plunged 12.9 percent over the previous two days as it acquired a $1.2 billion infrastructure portfolio in Africa and the Middle East, funding it with a $315 million capital increase that took issued and paid-up capital to $975 million - a big dilution for minority shareholders."



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UPDATE 1-Qatar sovereign fund said to plan new foreign investments despite sanctions

UPDATE 1-Qatar sovereign fund said to plan new foreign investments despite sanctions:

"Qatar's sovereign wealth fund, with around $300 billion to its name, is shrugging off the country's diplomatic crisis with its neighbours and planning to expand its holdings.

Its chief executive was quoted on Wednesday as saying there were no plans to liquidate foreign assets -- as some investors had speculated -- and that the fund would soon announce big new international investments.

"We have just completed a tour of several countries around the world and you will hear about significant investments soon," Sheikh Abdullah bin Mohamed bin Saud al-Thani, who runs the Qatar Investment Authority, told the Lusail newspaper."



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UAE, Saudi to be the first countries in GCC to introduce VAT | GulfNews.com

UAE, Saudi to be the first countries in GCC to introduce VAT | GulfNews.com:

"The UAE and Saudi Arabia will be the first countries in the Gulf Cooperation Council (GCC) to introduce Value Added Tax (VAT) from January 1 next year, a senior government official said on Tuesday. “The UAE and Saudi Arabia will be the first countries to roll out VAT in the GCC from early 2018 while other Gulf countries have time till the end of next year to implement the new tax system,” said Khalid Ali Al Bustani, Director General of Federal Tax Authority (FTA), at a press conference in Abu Dhabi on Tuesday. The rate for VAT is set at 5 per cent whereas excise tax will be 100 per cent on tobacco and energy drinks and 50 per cent on soft drinks excluding sparkling water."



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Dubai's Noor Bank cuts dozens of jobs -sources

Dubai's Noor Bank cuts dozens of jobs -sources:

"Dubai-based Noor Bank has laid off several dozen employees, banking sources told Reuters on Tuesday, the latest lender to adjust to more subdued growth levels in the local financial services sector.

Although the number of jobs cut in the past few weeks was in the high double-digits, sources said the final figure for the planned redundancies could be more than 200. The Islamic bank's total workforce before the redundancies was around 1,200 to 1,500, the sources said.

"The Bank has seen significant growth over the past few years - and following a robust evaluation, believes that now is the time to streamline its functions and align to a new operating model," Noor said in a statement to Reuters in response to a request for comment on the redundancies."



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Cox: Qatar kerfuffle could tip Aramco to New York

Cox: Qatar kerfuffle could tip Aramco to New York:

"Economic boycotts are usually designed to force dramatic change. They deprive enemies of income that can be used to finance armies, feed propaganda machines and sustain populations - with the hope of provoking the target's people to overthrow their leaders. Saudi Arabia, the UAE, Egypt and Bahrain have followed much of this playbook since early June in their ostracism of Qatar, which they accuse of financing terrorism. The four Arab neighbors have cut diplomatic ties and trade links with Doha, and suspended air and shipping routes with the gas-rich nation. They issued a 13-point ultimatum insisting, among other things, that it scale back ties with Iran and muzzle the Al-Jazeera cable network. Thus far, Western companies have not been overtly punished for maintaining their ties with Qatar. And U.S. companies will not be, according to a letter the quartet of nations sent to Secretary of State Rex Tillerson in July, Reuters reported over the weekend. One exception may be companies who count entities controlled by the Al Thani monarchy, primarily through Qatar's $300 billion-plus sovereign wealth fund, as important shareholders. If so, these regional grievances may alter the trajectory of one of the biggest deals in the history of global capital markets, the planned initial public offering sometime next year of the $2 trillion Saudi Aramco. "



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Saudi Arabia plans to launch second local currency sukuk issuance next week

Saudi Arabia plans to launch second local currency sukuk issuance next week:

"Saudi Arabia plans to launch the second issue of its local currency sukuk programme during the week beginning on August 20, the ministry of finance said on Wednesday. Saudi Arabia made its first offer of riyal-denominated sukuk, or Islamic bonds, in late July. The government, which is raising debt financing to cover a budget deicit caused by lower oil prices, raised 17 billion riyals ($4.53 billion) with the first issuance."



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Natural Gas Heads for Middle East Doldrums - Bloomberg

Natural Gas Heads for Middle East Doldrums - Bloomberg:

"Conventional wisdom says that Middle East natural gas demand will continue to surge. In the 10 years through 2016, consumption rose by 25 billion cubic feet a day -- much more than in both the U.S., despite its shale boom, and China. BP Plc’s 2017 energy outlook sees demand rising from 47 Bcf a day in 2015 to 73 Bcf by 2035. National oil companies and liquefied natural gas exporters are both relying on the region’s appetite to justify ambitious expansion plans. But this is about to change.

The story of how we got here can be simply told. The region’s economic boom from the early 2000s on, fueled by high oil prices, led to rapid growth, the construction of new cities and demand for air conditioning, winter heating, cooking, desalinated water and all the other accoutrements of a comfortable life.

Governments pursued energy-intensive industrialization, seeking to diversify their economies into sectors where they had a competitive advantage: petrochemicals, aluminium, steel and cement. Mindful of social pressures, they subsidized natural gas, electricity and water, leading to runaway demand and inefficiency."



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Qatari Sovereign Wealth Fund Reduces Stake in Credit Suisse - Bloomberg

Qatari Sovereign Wealth Fund Reduces Stake in Credit Suisse - Bloomberg: "The

Qatar Investment Authority has reduced its shareholding in Credit Suisse Group AG to 4.94 percent.

The country’s sovereign wealth fund, known as QIA, previously held 5.01 percent in voting rights, according to a Swiss stock market filing. The QIA’s overall holding in Credit Suisse -- made up of so-called contingent convertible bonds which convert into equity if the bank’s tier 1 capital falls below a certain threshold -- fell to 15.91 percent from 17.98 percent, after the bank’s recent capital increase.

Credit Suisse, which is halfway through a three-year strategy revamp, raised about 4.1 billion francs ($4.21 billion) in June after tapping shareholders for a second time since Chief Executive Officer Tidjane Thiam took over in mid-2015. The bank has said the fresh funding will increase its common equity Tier 1 capital to 13.4 percent of risk-weighted assets, up from 11.7 percent at the end of the first quarter."



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MIDEAST STOCKS-Gulf moves sideways, GFH and Union Properties recover a bit in Dubai

MIDEAST STOCKS-Gulf moves sideways, GFH and Union Properties recover a bit in Dubai:

"Gulf stock markets mostly moved sideways in quiet trade early on Wednesday although two major stocks in Dubai, GFH Financial and Union Properties, rebounded modestly after sharp losses on the previous day. The Dubai index was flat as GFH, the most active stock, rose 4.0 percent. It had plunged 12.9 percent over the previous two days as it acquired a $1.2 billion infrastructure portfolio in Africa and the Middle East, funding it with a $315 million capital increase that took issued and paid-up capital to $975 million - a big dilution for minority shareholders. Union Properties edged up 0.5 percent after sinking 4.3 percent on Tuesday, when it reported a 2.29 billion dirham ($624 million) net loss for the second quarter because of big provisions to cover past accounting errors. "



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Tuesday, 15 August 2017

Air Berlin turns to Lufthansa and German govt after filing for insolvency

Air Berlin turns to Lufthansa and German govt after filing for insolvency:

"Air Berlin has filed for insolvency and is in discussions with Lufthansa and the German government to rescue parts of its business, after its largest shareholder Etihad said it would not provide any further funding for the struggling airline. Germany’s second-largest carrier has struggled to compete with low-cost rivals and has been kept in the air by repeated cash injections from Abu Dhabi based carrier Etihad, which bought a stake in the airline in 2011. However, on Tuesday Air Berlin filed a provisional insolvency proceeding at the local court of Berlin-Charlottenburg after Etihad refused to provide further guarantees for Air Berlin’s short-and medium-term commitments. Two members of Air Berlin’s board who were nominated by Etihad also resigned from their positions."



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Oil ‘backwardation’ a key test for sentiment

Oil ‘backwardation’ a key test for sentiment:

"Oil trader sentiment hangs in the balance, and while fears of another collapse in the price are contained, the odds of a further move to take it significantly higher than $50 a barrel appear slim. A stream of positive data showing shrinking US oil stockpiles and stronger than expected demand in the summer months have bolstered the market and stoked a rebound in prices since July. Now, as oil market watchers focus on the spot price they are also monitoring contracts for delivery in months to come for signals about how supply and demand is playing out."



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Air Berlin files for insolvency after losses mount - The National

Air Berlin files for insolvency after losses mount - The National:

"Air Berlin, Germany’s second-largest airline, filed for insolvency proceedings after it ran into operational and financial difficulties following years of losses. Air Berlin no longer has “a positive continuation prognosis”, as its main shareholder, Etihad Airways, withdrew financial support, the European carrier said in a statement on Tuesday. Etihad, which bought a 29.2 per cent stake in the German carrier in 2011, said in a statement that the move to seek administration was “disappointing for all parties”, especially, as the Abu Dhabi-based operator provided extensive support to Air Berlin for its previous liquidity challenges and restructuring efforts over the past six years. “In April this year, Etihad provided €250 million of additional funding to Air Berlin as well as supporting the airline to explore strategic options for the business,” an Etihad spokesperson said in statement. The business of the discount airline, however, had deteriorated at an unprecedented pace, which prevented it from overcoming its problems and pursuing alternative rescue plans, the spokesperson said."



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Oil prices fall 2.5 percent on strong dollar, weak China data

Oil prices fall 2.5 percent on strong dollar, weak China data:

"Turkey's Unit International has signed a $7 billion agreement with Russia's state-owned Zarubezhneft and Iran's Ghadir Investment Holding to drill for oil and natural gas in Iran, the company said on Tuesday. In a statement, Unit said the three companies had invested a total of $7 billion for the drilling, which would take place at three oil fields and one large natural gas field in Iran. The total reserves at the three oil fields stand at 10 billion barrels, and the fields will produce 100,000 barrels per day, Unit said. It said the natural gas field had a production capacity of 75 billion cubic metres per year."



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Dana Gas bondholders face “significant liability” in UAE court case

Dana Gas bondholders face “significant liability” in UAE court case:

"Investors in Dana Gas's $700 million Islamic bond are likely to have to repay the company a "significant" amount as a result of legal action in the United Arab Emirates, the company said on Tuesday. In a case which has unsettled the Islamic finance industry, Dana is seeking in UAE and British courts to avoid repaying its $700 million in Islamic bonds when they mature in October, arguing that the bonds have become unlawful in the UAE because of changes to Islamic financial practice. “The final outcome of the ongoing litigation in UAE courts would likely result in a significant liability for the sukuk holders to repay the company excess "on account profit payments" based on a lawful reconciliation of the matter,” Dana said."



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Sanctions boost food prices, hurt real estate in Qatar in July

Sanctions boost food prices, hurt real estate in Qatar in July:

"Sanctions imposed by other Arab states are continuing to push up food prices in Qatar while hurting the real estate market, but not to the point of damaging the economy severely, according to inflation figures released by the government on Tuesday.

The annual inflation rate fell back sharply to 0.2 percent in July. It had spiked to 0.8 percent in June from 0.1 percent in May after Saudi Arabia, the United Arab Emirates, Bahrain and Egypt cut diplomatic and transport ties with Qatar on June 5, accusing it of supporting terrorism, which Doha denies.

By closing Qatar's land border with Saudi Arabia and disrupting maritime shipping routes, the sanctions slashed Qatari imports by more than a third in June, pushed up prices of some basic goods and hurt business sentiment in Doha."



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MIDEAST STOCKS-Region sags as Union Properties loss hits Dubai, Egypt continues slide

MIDEAST STOCKS-Region sags as Union Properties loss hits Dubai, Egypt continues slide:

"Middle Eastern stock markets sagged again on Tuesday because of a mediocre economic outlook, with a shock loss at a real estate developer weighing on Dubai and Egypt dropping for a sixth straight day. Union Properties sank 4.3 percent to 0.82 dirham after it reported a 2.29 billion dirham ($624 million) net loss for the second quarter, although the stock came well off its intra-day low of 0.77 dirham. It accounted for over a third of Dubai's trading volume. The company said it was taking big provisions to cover past accounting errors related to its booking of a 503 million dirham gain on a plot of land at Dubai's Motor City."



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Shares in Bahrain's GFH slide as it acquires $1.2 bln assets via equity issue

Shares in Bahrain's GFH slide as it acquires $1.2 bln assets via equity issue:

"Shares in Bahrain's GFH Financial Group fell sharply on Tuesday as the firm said it had acquired $1.2 billion of infrastructure assets in Africa and the Middle East by increasing its capital, diluting minority shareholders.

The financial firm, which did not give details of the assets, said in a bourse statement that it had made the acquisition through a $315 million capital increase, taking GFH's issued and paid-up capital to $975 million.

GFH's Dubai-listed shares sank 3.3 percent to 1.75 dirhams, bringing their losses over two days to 12.9 percent."



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Dana Gas profits jump 77% as enegry prices rise | GulfNews.com

Dana Gas profits jump 77% as enegry prices rise | GulfNews.com:

"Dana Gas, the Sharjah-based natural gas company, reported on Tuesday a 77 per cent jump in its net profit for the first half of 2017 on the back of lower costs and higher energy prices. In the first half, the company recorded $23 million in net profits, up from the $13 million recorded in the same half of 2016 as operating costs fell 7 per cent. Capital expenditure was also axed by 84 per cent, supporting the increase in profitability, as revenues grew. The figures put net profit in the second quarter of 2017 alone at $12 million, up 71 per cent from the $7 million recorded in the second quarter last year. "



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Dubai Magnate Tied to Trump Brand Seeks New Ventures Abroad - Bloomberg

Dubai Magnate Tied to Trump Brand Seeks New Ventures Abroad - Bloomberg:

"During recent trips to Croatia and Malta, a Dubai-based billionaire and business partner of the Trump Organization looked more like a head of state himself — mingling with government dignitaries, receiving a presidential reception and visiting the glittering Mediterranean Sea.

Hussain Sajwani met with leaders in the two European nations and addressed local journalists, many of whom referred to his ties to President Donald Trump or simply called him "the Donald of Dubai."

Sajwani's trips, as well as a recent deal in Oman, show that Trump's business partner in Dubai wants to expand his development empire beyond the Mideast and a tower under construction in London."



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U.S. Oil Drillers Keep Pressure on OPEC With Record Shale Output - Bloomberg

U.S. Oil Drillers Keep Pressure on OPEC With Record Shale Output - Bloomberg:

"Oil output from major U.S. shale plays is poised to reach a fresh record next month, further complicating OPEC’s efforts to support prices.

The gain is being led by the oil-rich Permian basin of Texas and New Mexico, where production has risen steadily over the past two years. The Energy Information Administration projects Permian output to rise by 64,000 barrels in September, reaching a record of 2.6 million barrels a day."



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OPEC’s Long-Sought Success Spoiled by 2018 Oil Supply Worry - Bloomberg

OPEC’s Long-Sought Success Spoiled by 2018 Oil Supply Worry - Bloomberg:

"Oil investors are already worrying over the potential fallout when OPEC’s deal to cut output expires, marring emerging signs that the accord to shrink a glut is finally succeeding. Uncertainty about how supplies curbed by the Organization of Petroleum Exporting Countries and its allies will be returned to the market in 2018 is clouding the outlook for crude, according to BMI Research. Prices remain vulnerable even though demand is strong, production gains are largely exhausted in Libya and Nigeria, and U.S. shale output is slowing, the unit of Fitch Group said in a report."



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MIDEAST STOCKS-Gulf sluggish early on, Union Properties plunges on Q2 loss

MIDEAST STOCKS-Gulf sluggish early on, Union Properties plunges on Q2 loss:

"Gulf stock markets were mostly slugggish in early trade on Tuesday with Union Properties plunging after it reported a 2.29 billion dirham ($624 million) net loss for the second quarter. Union Properties said it was taking big provisions to cover past accounting errors related to its booking of a 503 million dirham gain on a plot of land at Dubai's Motor City. The errors were discovered as a new board and senior management, appointed in May, conducted an investigation of accounting practices dating back to 2013, the company said; its stock sank 7.9 percent to 0.789 dirham. Trading volume in Union Properties was about half half the market's entire volume."



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Monday, 14 August 2017

Despite looting allegations, 1MDB makes payment to Abu Dhabi after delay | Coconuts KL

Despite looting allegations, 1MDB makes payment to Abu Dhabi after delay | Coconuts KL:

"Malaysia’s crisis-hit state investment fund 1MDB said Friday it has paid Abu Dhabi the equivalent of $350 million, the first installment under a deal to settle its debts after it missed previous deadlines. 1MDB and its founder Prime Minister Najib Razak are battling allegations that billions were looted from the fund in complex overseas deals that are being investigated by authorities in several countries. Both the fund, 1Malaysia Development Berhad, and Najib have vehemently denied wrongdoing."



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Dubai's Emaar Properties posts 14 pct rise in second-quarter profit

Dubai's Emaar Properties posts 14 pct rise in second-quarter profit:

"Dubai's Emaar Properties , which is planning a partial listing of its UAE development operation, reported a 14.4 percent increase in second-quarter profit on Monday. Emaar, in which Dubai's government owns a minority stake, made 1.45 billion dirham ($394.8 million) of profit attributable to the owners of the company for the three months to June 30, it said in a bourse filing, on revenue that rose 1.9 percent to 3.79 billion dirhams. The profit, up from 1.27 billion dirhams a year earlier, beat a SICO Bahrain forecast of 1.3 billion dirhams but was short of a 1.52 billion dirham forecast from EFG Hermes."



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Oil Stuck in Loop Leaves Bored Hedge Funds Awaiting Clarity - Bloomberg

Oil Stuck in Loop Leaves Bored Hedge Funds Awaiting Clarity - Bloomberg:

"Oil hasn’t been so tedious in a long time, and hedge funds just don’t know what to do with it.

Their weekly stance on West Texas Intermediate crude prices barely changed as futures are on track to trade in the tightest monthly range since July 2002. It’s been tough to reconcile the mixed signals from a steady decline in U.S. stockpiles with rising production from shale fields and elsewhere in the world.

Funds “are waiting to see if something is going to happen, if something will break where you’ll get some real movement,” Bill O’Grady, chief market strategist at Confluence Investment Management in St. Louis, said by telephone. “The other problem is, the fundamentals are kind of mixed, too. You’re just not getting a real clear picture.”"



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Shuaa Capital plans to sell non-core assets - The National

Shuaa Capital plans to sell non-core assets - The National:

"Shuaa Capital plans to sell non-core assets in the second half as the biggest shareholder of the Dubai-based bank implements a turnaround plan. The company is seeking to raise more than Dh100 million by selling investments in a private equity fund and water infrastructure services company, said the general manager Fawad Tariq Khan in Dubai. Shuaa also aims to expand its capital markets business and cut costs after Abu Dhabi Financial Group bought a 48.36 per cent stake last November. “We are exiting a part of Shuaa’s proprietary investments, a lot of which is a legacy from even before the financial crisis,” Mr Khan said. Money raised from the sales will be reinvested into the business and it also wants to increase investments in real-estate projects in the United Arab Emirates, he said."



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Saudi Aramco’s ‘to do’ list before it can make IPO history | Arab News

Saudi Aramco’s ‘to do’ list before it can make IPO history | Arab News:

"Matters are slowly, and cautiously, being clarified in the run-up to the record-breaking initial public offering (IPO) of Saudi Aramco, which will be the world’s biggest stock market flotation when it eventually debuts on global exchanges. The plan is still to get the shares — up to $100 billion worth of them — away by the end of next year, but there is a lot to do between now and then. There has not been much said publicly by the company since the publication of its annual review a month ago, but behind the scenes the army of policymakers, advisers and consultants involved in the IPO preparation are working hard to get through the “to do” list. The issue that has hogged the headlines for the past few weeks has been: New York or London? The two biggest markets in the Western world have made no secret of their desire to get Aramco on their trading boards, and London in particular has shown a willingness to be “flexible,” to the extent that some in the investment community have shouted “special treatment.”"



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MIDEAST STOCKS-Qatar's IHG falls on listing, Dubai dragged down by weak Q2 earnings

MIDEAST STOCKS-Qatar's IHG falls on listing, Dubai dragged down by weak Q2 earnings:

"Shares of the first family business to list in Qatar fell in early trade on Monday, while weak earnings at several companies in Dubai weighed on the stock index there. In its first hour of trade, Qatari conglomerate Investment Holding Group declined 8.8 percent to 9.12 riyals from its initial public offer (IPO) price. Trading volume was about 1.7 million shares. IHG had offered 49.8 million shares, or 60 percent of its share capital, at 10.0 riyals per share, plus a 0.1 riyal fee in its IPO during January, making the value of the listing about $138 million."



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U.A.E.'s Al Nuaimi on Qatar, Infrastructure - Bloomberg

U.A.E.'s Al Nuaimi on Qatar, Infrastructure - Bloomberg:

"United Arab Emirates Minister of Infrastructure Development Abdullah Al Nuaimi discusses the blockade of Qatar, the plans for infrastructure, Dubai's plans for a shipping investment fund, plans to improve ports and the Gulf rail project. He speaks on "Bloomberg Markets: Middle East." (Source: Bloomberg)"



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Sunday, 13 August 2017

Saudi Aramco’s value at risk from climate change policies

Saudi Aramco’s value at risk from climate change policies:

"The valuation of Saudi Aramco, which is planning its initial public offering for next year, could be greatly cut by policies to address the threat of global warming, an environmental campaign group has warned.

Oil Change International has calculated that policies to meet the Paris climate agreement’s commitment to limit global warming to “well below” 2C could reduce the value of Saudi Arabia’s state energy group by about 40 per cent.

“New York and London have been competing hard to get the Aramco listing, but I don’t think they have been paying enough attention to how much it would increase oil price risk and climate risk for investors,” said Greg Muttitt of Oil Change."



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Exclusive: Arab bloc won't discriminate against U.S. firms in Qatar rift - sources

Exclusive: Arab bloc won't discriminate against U.S. firms in Qatar rift - sources:

"Four Arab countries that imposed sanctions on Qatar have told the United States that U.S. companies doing business with them would not be punished for also working with Doha, four sources with knowledge of the matter said.

Foreign firms have become increasingly cautious on their cross border dealings over concerns they could fall foul of the region's biggest diplomatic crisis in years.

Saudi Arabia, the United Arab Emirates (UAE), Egypt and Bahrain sent a letter to U.S. Secretary of State Rex Tillerson in July reassuring him that U.S. companies would not be discriminated against as part of the boycott, according to sources with knowledge of the letter.

"



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Saudi Arabia's Budget Deficit Narrows as Crude Revenue Rises - Bloomberg

Saudi Arabia's Budget Deficit Narrows as Crude Revenue Rises - Bloomberg:

"Saudi Arabia’s second-quarter budget gap narrowed to 46.5 billion riyals ($12.4 billion) from the same period last year after income from oil advanced, while non-oil revenue fell.

Total revenue climbed 6 percent in the second quarter to 163.9 billion riyals after income from crude jumped 28 percent, the finance ministry said in a statement. That helped narrow the deficit from 58.4 billion riyals in the same period last year, even though revenue from non-oil sources fell by 17 percent. Spending dropped 1.3 percent, to 210.4 billion riyals.

“It’s really a story of stronger oil revenue and ongoing fiscal restraint,” said Monica Malik, chief economist at Abu Dhabi Commercial Bank. “Much of the narrowing in the deficit seen in the first half of 2017 is due to higher oil revenue, versus in 2016,”"



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MIDEAST STOCKS-Bourses most exposed to foreign funds lag as global mood cautious

MIDEAST STOCKS-Bourses most exposed to foreign funds lag as global mood cautious:

"Stock markets in the Middle East that are most exposed to foreign funds were the chief losers on Sunday, taking their cue from international bourses, where the mood was soured last week by growing tensions between the United States and North Korea.

The worst performer in the region was Egypt's blue-chip index, which dropped 1.4 percent as all but two of the 30 most valuable shares declined. The broader EGX100 fell 0.7 percent.

Shares often traded by foreign funds were particularly weak, with Investment firm EFG Hermes dropping 5.8 percent and Commercial International Bank shedding 1.4 percent."



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MIDEAST STOCKS-UAE, Qatar underperform, Saudi flat in early trade

MIDEAST STOCKS-UAE, Qatar underperform, Saudi flat in early trade:

"Stock markets in the Gulf that are most exposed to foreign funds were the chief losers in early trade on Sunday, taking their cue from global bourses, where the mood was soured last week by growing tensions between the United States and North Korea.

The Dubai index was down 0.5 percent as most shares fell, including commodities shipper Gulf Navigation, which was down 3.0 percent despite reporting a rise in second-quarter profit.

Shuaa Capital rose 0.8 percent, however, after it swung to a second-quarter net profit of 12.1 million dirhams ($3.3 million) from a loss of 50.8 million dirhams a year ago."



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Saturday, 12 August 2017

UAE markets take a rest | GulfNews.com

UAE markets take a rest | GulfNews.com:

"Last week the Dubai Financial Market General Index (DFMGI) fell by 27.79 or 0.76 per cent to end at 3,647.33, its first decline in six weeks. There were only nine advancing issues while 26 declined, and volume dropped to a six-week low.

The DFMGI attempted to go higher just briefly last Sunday as it rallied above the prior week’s high of 3,68044 before quickly finding resistance at 3,681.11 and turning down. Subsequently, the index dropped into Wednesday before showing a little strength on Thursday. The low of the week, Thursday’s low, was at 3,623.08.
So far we’re seeing just a mild pullback and this is healthy for the uptrend, especially since it follows a four-week 8.0 per cent plus advance. The key price levels to watch next are last week’s high and low. A drop through the bottom will likely lead to a deeper pullback, and a daily close above last week’s high signals a continuation of the uptrend."



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Exclusive: Saudi Arabia favours New York for Aramco listing despite risks - sources

Exclusive: Saudi Arabia favours New York for Aramco listing despite risks - sources:

"Saudi Arabia favours New York for the main foreign listing of state oil giant Aramco, even though some financial and legal advisers have recommended London as a less problematic and risky option, people familiar with the matter told Reuters. A final decision on where to stage what could be the world's largest initial public offering will be taken by Crown Prince Mohammad bin Salman - or MbS as he is known - who oversees the kingdom's economic and energy policies, the sources said. Their comments point to internal disagreements between what some advisers are recommending and what the crown prince wants."



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Oil Caps Weekly Drop Amid Shaky OPEC Compliance, Weaker Demand - Bloomberg

Oil Caps Weekly Drop Amid Shaky OPEC Compliance, Weaker Demand - Bloomberg:

"Oil had its worst week in a month as compliance with OPEC’s deal falters and the outlook for demand worsens.

While a weaker dollar helped push prices in New York 0.5 percent higher on Friday, erasing earlier losses, futures closed 1.5 percent down for the week. The International Energy Agency reduced demand estimates for OPEC crude this year and 2018, and said there are doubts about the group’s commitment to cutting production. Even a pledge by Saudi Arabia and Iraq to strengthen their commitment to the curbs isn’t helping.

“With the latest rhetoric from the IEA, it looks like the balancing cycle is further protracted, which is not great for the market,” Michael Loewen, a strategist at Scotiabank in Toronto, said by telephone. Investors need to see either OPEC production really decline or compliance to the output-reduction deal improve to believe rebalancing is happening, he said."



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Friday, 11 August 2017

IEA issues warning despite pre-2016 oil stockpiles

IEA issues warning despite pre-2016 oil stockpiles:

"Oil stockpiles in industrialised nations have fallen below 2016 levels but the rebalancing of supply and demand remains a “stubborn process” despite robust consumption, the International Energy Agency said on Friday.

At the end of the second quarter, commercial inventories — the component of the global total for which there is the most visibility — fell 500,000 barrels a day to just over 3bn barrels as supply cuts from big producer countries took effect.

But the Paris-based body said in its monthly oil market report that even if the same level of drawdowns continued into the first three months of 2018, stockpiles would remain above their five-year average levels."



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Jawboning oil prices

Jawboning oil prices:

"In Monty Python’s Life of Brian, when the People’s Front of Judea learns that Brian has been arrested, John Cleese exclaims: “Right! This calls for immediate discussion!” The effort by leading oil-producing countries to boost crude prices seems to work on similar principles.

Facing concerns that some countries, particularly the UAE and Iraq, were not living up to their commitments to curb output, the joint technical committee of Opec members and their allied non-members convened meetings in Abu Dhabi this week “to identify ways and means of raising levels of conformity”.

The statement after those meetings, co-chaired by Kuwait and Russia, said representatives from the UAE, Iraq, Kazakhstan and Malaysia had met the committee, and “all expressed their full support for the existing monitoring mechanism and their willingness to fully co-operate . . . in the months ahead in order to achieve the goal of reaching full conformity.”"



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Petrofac hires top lawyer as fraud probe continues - The National

Petrofac hires top lawyer as fraud probe continues - The National:

"Petrofac has hired a top litigator to oversee the Serious Fraud Office’s (SFO) investigation into the Unaoil corruption scandal. Edward Sparrow, a partner at law firm Ashurst with 20 years of running major litigation cases, will be responsible for the company’s management of and response to the investigation. The SFO announced in May that it would investigate allegations that the company used Unaoil to secure consultancy contracts worth $2bn in Kazakhstan between 2002 and 2009."



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Oil Slides Toward $48 as Skepticism Over OPEC-led Cuts Returns - Bloomberg

Oil Slides Toward $48 as Skepticism Over OPEC-led Cuts Returns - Bloomberg:

"Oil investors are back to being skeptical over whether OPEC-led production cuts are draining a global glut fast enough, keeping prices below $49 a barrel and driving crude toward a second weekly loss.

Futures declined as much as 1.1 percent in New York. Neither a pledge by the two biggest producers of the Organization of Petroleum Exporting Countries to strengthen their commitment to curbs, or shrinking U.S. crude stockpiles is managing to lift prices. The International Energy Agency cut estimates for the amount of crude needed from OPEC this year and next after lowering its historical assessments of consumption in nations including China and India."



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Oil stockpiles falling as supply cuts take hold, says IEA

Oil stockpiles falling as supply cuts take hold, says IEA:

"Commercial oil stockpiles in industrialised nations have fallen below 2016 levels, but the rebalancing of supply and demand still remains a “stubborn process” despite robust consumption, the International Energy Agency said on Friday. In the second quarter global inventories fell by 500,000 barrels a day to just over 3bn barrels, the Paris-based body said in its monthly oil market report, as supply cuts from big producer countries took effect. But the IEA said that if the same level of drawdowns continues into the first three months of 2018, stockpiles will remain above their five year average, implying the goal of the cuts agreement will not have been met."



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Thursday, 10 August 2017

MIDEAST STOCKS-Kuwait's Zain surges on Omantel move, Egypt falls on high inflation

MIDEAST STOCKS-Kuwait's Zain surges on Omantel move, Egypt falls on high inflation:

"Gulf stock indexes moved sideways on Thursday, continuing a two-week-old trend, but Kuwaiti telecommunications firm Zain surged in response to an investment by Omantel. Egypt's bourse dropped after data showed a fresh rise in inflation to above 30 percent. Kuwait's index rose 0.3 percent as Zain gained 4.4 percent to 0.471 dinar in its heaviest trade since March after agreeing to sell 425.7 million treasury shares, equivalent to 9.84 percent of the firm, to Omantel for $846 million or 0.60 dinar per share. The stock came well off the day's high of 0.505 dinar. The purchase, subject to regulatory approval, was announced days before Oman is to shortlist qualified applicants for a third mobile licence, for which Zain has bid. Omantel, which is making the investment to diversify beyond its small home market and has been trading near multi-year lows, fell 1.3 percent in its heaviest trade since November."



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OPEC sees higher 2018 oil demand, but raises output again

OPEC sees higher 2018 oil demand, but raises output again:

"OPEC forecast higher demand for its oil in 2018 due to rising global consumption and slower supply growth from rivals, although another jump in the group's output suggested the market will remain in surplus despite efforts to rein in production. In a monthly report on Thursday, the Organization of the Petroleum Exporting Countries said the world would need 32.42 million barrels per day (bpd) of its crude next year, up 220,000 bpd from the previous forecast. The Organization of the Petroleum Exporting Countries was also upbeat about 2018 economic growth and said oil stocks in developed economies declined in June and would fall further in the United States, a sign the OPEC-led supply cut is working."



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Oil industry has plenty of time before its own ‘iPhone moment’ | Arab News

Oil industry has plenty of time before its own ‘iPhone moment’ | Arab News:

"The traditional motor industry, especially in Germany, has had a bad press of late. Just in the past week or so, we have read about allegations of cartels, the threat from the next generation of electric vehicles made by the likes of Tesla, the ongoing investigations into cheating on emissions by diesel manufacturers, and even a claim that the industry faces its very own “iPhone moment,” when newfangled technology will drive the old motor dinosaurs to extinction. To cap it all, the governments of Britain and France announced that they would ban petrol and diesel cars completely by 2040, mainly on environmental grounds. Although the Arabian Gulf might regard this as somebody else’s problem — there is little in the way of a motor manufacturing industry in the region — it nonetheless has a direct impact on economies and culture here."



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Abu Dhabi’s Union National Bank updating bond programme - sources

Abu Dhabi’s Union National Bank updating bond programme - sources:

"Abu Dhabi’s Union National Bank (UNB) is updating its bond programme and could issue a U.S. dollar-denominated bond after that, banking sources said on Thursday.

The lender, majority-owned by the government, is updating a Euro Medium Term Note (EMTN) programme, a set of documentation allowing repeat bond issuance over time, said the sources, who spoke on condition of anonymity as the information is private.

It has not yet appointed banks for the exercise and the timing of the potential bond issue is still uncertain."



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Almost Half of Qatar's Traditional Investor Base Has Cut Ties With the Country - Bloomberg

Almost Half of Qatar's Traditional Investor Base Has Cut Ties With the Country - Bloomberg:

Banks in the world’s wealthiest nation per capita will need to offer more yield if they tap the market as almost half of their traditional investor base has cut ties with the country.

Qatar National Bank QPSC, Commercial Bank QSC and Doha Bank QSC are considering funding options that include loans, private placements or dollar bonds, people familiar with the plans said. But investors and analysts say the lenders will have to pay more to compensate for the region’s political risk to drum up interest.

 Saudi Arabia and other Arab nations severed relations with Qatar two months ago accusing it of supporting extremist groups, a charge it denies. That led to a drop in foreign deposits in June, the steepest in almost two years, and a record jump in the three-month Qatar Interbank Offer Rate."



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HKEX Chief Says Primary Connect a Key to Winning Saudi Aramco - Bloomberg

HKEX Chief Says Primary Connect a Key to Winning Saudi Aramco - Bloomberg:

"Hong Kong Exchanges & Clearing Ltd.’s bid to win Saudi Arabian Oil Co.’s listing would get a boost from having a primary connect trading system with mainland China, according to its chief executive officer.

HKEX has so far created three links with domestic Chinese markets, and CEO Charles Li has plans for several others. The primary connect, which would see shares in Hong Kong-based initial public offerings made available to mainland investors, would act as a lure to major companies, he said in an interview on Bloomberg Television on Thursday.

“For Saudi Aramco to consider listing in Hong Kong, just a pure Hong Kong listing would probably not be compelling,” Li said. To be able to list in the city and sell shares into major Chinese institutions would be the “perfect catalyst” for primary connect, he said."



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MIDEAST STOCKS-Zain surges on Omantel move, TAQA down after earnings

MIDEAST STOCKS-Zain surges on Omantel move, TAQA down after earnings:

"Gulf stock indexes moved little in early trade on Thursday, continuing a two-week-old trend, with Kuwaiti telecommunications firm Zain a standout gainer in response to an investment by Omantel.

The Kuwaiti index edged down 0.2 percent but Zain climbed 6.7 percent in heavy trade after signing a deal to sell 425.7 million treasury shares, equivalent to 9.84 percent of the company, to Omantel for $846 million.

The purchase, subject to regulatory approval, was announced days before Oman is to shortlist qualified applicants for a third mobile licence, for which Zain has bid. Omantel, which is making the investment to diversify beyond its small home market, was flat."



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Wednesday, 9 August 2017

Qatar Air Targets Other U.S. Investments After American Spat - Bloomberg

Qatar Air Targets Other U.S. Investments After American Spat - Bloomberg:

"Qatar Airways hasn’t given up on investing in the U.S. after scrapping plans to buy a stake in American Airlines Group Inc. amid opposition from the Fort Worth, Texas-based company.

“We have other opportunities, both in America and North America, which we will consider,” Akbar Al Baker, the Persian Gulf carrier’s chief executive officer, said Wednesday in Doha, the Qatari capital. “I have some things in mind. The U.S. is an important market for us.”

Qatar Airways ended its interest in American on Aug. 2 after the U.S. company’s chief, Doug Parker, said he wasn’t keen on having the Gulf carrier as a shareholder. While the airlines are partners in the Oneworld alliance, the approach came as a surprise since American had publicly opposed the growth of Mideast airlines in the U.S., claiming they’ve benefited from $50 billion in illegal aid."



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Fitch: UAE Islamic Banks Affected by Higher Financing Costs and Impairment Charges

Fitch: UAE Islamic Banks Affected by Higher Financing Costs and Impairment Charges:

"Fitch Ratings says in a new report that UAE Islamic banks' performance in 2016 was hit by higher funding costs and financing impairment charges (FICs). Stronger financing growth than conventional banks continued. While the average Islamic bank's impaired financing ratio improved further to 5% in 2016, aided by rapid financing growth (above conventional banks), this ratio is skewed by the two largest UAE Islamic banks, which account for almost two-thirds of Islamic banking assets, and whose ratios have fallen sharply to around 4%. The other four Islamic banks have young, fast-growing franchises, and their impaired financing ratios are between 5% and 9%. FICs increased to 1.4% of financing in 2016 (2015: 1.1%) due to deterioration in the SME segment. Islamic financing grew, albeit at a slower rate of 10% (2015: 19%), due to wider adoption and more innovative structuring of sharia-compliant products. Higher funding costs in 2016 put pressure on most Islamic banks' net financing margins and operating profitability metrics, despite many banks successfully repricing their financing books. "



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Abu Dhabi informally boycotts western banks with big Qatari investors

Abu Dhabi informally boycotts western banks with big Qatari investors:

"Abu Dhabi has launched an informal boycott of western banks with significant Qatari shareholders, broadening the impact of the Arab quartet’s two-month embargo against the gas-rich state.

Officials have told bankers that lenders such as Credit Suisse, Deutsche Bank and Barclays are unlikely to win significant mandates in the capital of the UAE in the coming months because of large shareholdings held by Qatar’s sovereign wealth fund and members of the ruling family.

Saudi Arabia, the UAE, Egypt and Bahrain launched an economic embargo on June 5, accusing the gas-rich state of supporting terrorism, claims denied by Doha."



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State oil producers eye bigger slice of trading pie

State oil producers eye bigger slice of trading pie:

"National oil companies have spent years watching independent traders make huge profits from shipping their crude around the world: now these state-backed producers want a larger slice of the action.

As rivalries between traditional exporter countries intensify and Opec producers battle newer competitors such as US shale companies, big Middle East producers such as Iraq, the UAE and Kuwait are exploring ways to get more involved in oil trading. This reflects efforts to generate greater cash for their crude as the market downturn enters its third year.

“These national oil companies are at the very early stages of this process,” says Roland Rechtsteiner, head of global risk and trading at consultancy Oliver Wyman. “But one thing that is consistent across the board, particularly in the Middle East, is the recognition they must find additional revenue streams.”"



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Qatar dispute puts UK-Gulf trade talks on hold | Politics | The Guardian

Qatar dispute puts UK-Gulf trade talks on hold | Politics | The Guardian:

"Plans for a prestigious UK-Gulf Co-operation Council meeting in London this year have been put on hold, threatening UK plans for a quick free-trade deal with some of the richest economies in the world after Brexit.

Theresa May promised last year to host the first meeting of the GCC nations outside the Gulf in December as part of a symbolic show of the UK’s strengthening trade and security ties with the regional bloc.

But Gulf nation sources said the two-month dispute between Qatar and three other Gulf states has put planning for the summit on hold. There have been suggestions that if the dispute worsens Qatar will be suspended from the GCC, or that the organisation itself will fold."



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MIDEAST STOCKS-Region moves sideways, outperforms EM index; DXBE slides on losses

MIDEAST STOCKS-Region moves sideways, outperforms EM index; DXBE slides on losses:

"Middle Eastern stock markets generally moved sideways in quiet trade on Wednesday, outperforming other emerging markets, though Dubai theme park operator DXB Entertainments sank because of poor first-half earnings.

The Gulf has underperformed global emerging markets this year, hit by low oil prices and government austerity policies.

But this may have left the Gulf less vulnerable to a pull-back as MSCI's emerging market index dropped 0.9 percent on Wednesday, partly because of tensions between the United States and North Korea."



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Qatar standoff an opportunity to rethink GCC’s basic economic model | Arab News

Qatar standoff an opportunity to rethink GCC’s basic economic model | Arab News:

"The ongoing standoff between the members of the Anti-Terror Quartet (ATQ) and Qatar over Doha’s alleged financing of terror groups has already called into question the future of the Gulf Cooperation Council (GCC) as it is currently constituted — but that debate looks set to intensify as the economic, financial and commercial repercussions of the dispute sink in.

Whatever the ultimate outcome of the current confrontation, regional policymakers should take a long, hard look at the GCC in any case, because it is clear that the organization has fallen short of the ambitious targets it set itself in 1981 when it was first set up, and which have been restated by various measures in the period since. 

Most notably, these included the establishment of a free-trade agreement between the member states in 1983, a customs union in 2003, and a declaration of commitment to freedom of movement for people and goods in 2008."



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MIDEAST STOCKS-Dubai's DXBE, Industries Qatar drop on weak Q2 in early trade

MIDEAST STOCKS-Dubai's DXBE, Industries Qatar drop on weak Q2 in early trade:

"Shares of Dubai theme park operator DXB Entertainments sank in early trade on Wednesday because of weak interim earnings, while Doha's Industries Qatar was also down after its quarterly net income missed analysts' estimates. Dubai's stock index fell 0.4 percent as DXBE fell 3.0 percent after reporting a first-half net loss of 578 million dirhams ($157 million). The company has not made a profit since it opened its first theme parks and hotels in October 2016. The company said it was reorganising its business into three units: theme parks, family entertainment centres, and retail and hospitality. It announced an agreement with local developer Meraas to manage its portfolio of leisure and entertainment offerings including Hub Zero, Splash Pad and Roxy Cinemas."



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OPEC Says Iraq, U.A.E, Kazakhstan Affirm Commitment to Cuts - Bloomberg

OPEC Says Iraq, U.A.E, Kazakhstan Affirm Commitment to Cuts - Bloomberg:

"OPEC said Iraq, the United Arab Emirates and Kazakhstan -- who have lagged in their implementation of a deal to cut production -- affirmed their commitment to the accord at a meeting in Abu Dhabi.

“All expressed their full support” for the system to monitor the cutbacks “in order to achieve the goal of reaching full conformity,” OPEC said in a statement on its website. Malaysia also attended and made the same pledge.

The meeting, co-chaired by Kuwait and Russia, was scheduled after several nations faltered in their pledges to reduce output. Twenty-four producers, from among the Organization of Petroleum Exporting Countries and beyond, agreed to cut production late last year to try to end a global glut."



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Dubai builder Arabtec swings to Q2 profit, Depa investment helps

Dubai builder Arabtec swings to Q2 profit, Depa investment helps:

"Dubai builder Arabtec said on Wednesday that it had swung to a net profit in the second quarter, boosted by profits from its investment in interior designer Depa as well as by cost-cutting. Arabtec made a net profit attributable to equity holders in the parent of 39.8 million dirhams ($10.8 million) in the three months to June 30, compared to a loss of 186.4 million dirhams a year ago. It was Arabtec's second straight profitable quarter; in 2015 and 2016, it consistently posted loses as the company coped with a slumping regional construction market, which has been hit by government austerity measures due to low oil prices, as well as internal management changes."



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Tuesday, 8 August 2017

Kingdom Holdings reports 68 per cent rise in quarterly profits - The National

Kingdom Holdings reports 68 per cent rise in quarterly profits - The National:

"Saudi Arabia’s Kingdom Holdings reported a 68 per cent rise in second quarter profits compared with the first three months of the year, amid plans for an $800 mn investment in three Egyptian hotels.

The investment firm, owned by Prince Alwaleed bin Talal, reported a net profit of 216.3 million Saudi riyals for the second quarter of the year, compared with a loss of 80 million riyals in the same period last year, and a first quarter profit of 129m riyals, according to a statement posted on the Saudi stock exchange.

Kingdom said that the increase in profitability came from an “increase in income from and gain on investments in addition to increase in dividends income, increase in other gains and increase in share of results from equity-accounted investees,” which came in spite of a rise in financial charges and general administrative expenses."



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OPEC Veteran Zanganeh Tapped to Return as Iran Oil Minister - Bloomberg

OPEC Veteran Zanganeh Tapped to Return as Iran Oil Minister - Bloomberg:

"Iran’s President Hassan Rouhani proposed the reappointment of its longest-serving oil minister, Bijan Namdar Zanganeh, who fought to restore crude production and closed a landmark deal with Total SA to develop the Persian Gulf country’s share of the world’s biggest natural gas field.

Rouhani submitted names of his cabinet nominees, including Zanganeh, for parliamentary approval, Tasnim news agency reported Tuesday. Zanganeh, a 65-year-old engineer who served two presidents as oil minister, succeeded in shielding Iran from joining global cuts in crude production by OPEC and other major suppliers. Parliament is set to vote on his reappointment starting next week, according to state media.

During the first of his two terms as oil minister, from 1997 until 2005, Zanganeh enticed foreign companies including Total and Royal Dutch Shell Plc to help revive Iran’s oil and gas fields after years of under-investment. He returned to the post in 2013 and boosted the nation’s oil exports as production rose by about 1 million barrels a day after the easing of economic sanctions in January 2016."



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SolarWorld founder Asbeck, Qatar to buy some of its factories -sources

SolarWorld founder Asbeck, Qatar to buy some of its factories -sources:

"Frank Asbeck, founder and former CEO of SolarWorld, has teamed up with Qatar to buy two of the insolvent panel maker's factories, sources familiar with the matter said.

Qatar was a shareholder in SolarWorld with a stake of 29 percent before its collapse, while Asbeck held 21 percent.

The plants, located in the German states of Saxony and Thuringia, will be taken over by a new investment vehicle called SolarWorld Industries GmbH, which counts Asbeck and the Qatar Foundation as its owners, the sources told Reuters on Tuesday."



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Abu Dhabi gives Malaysia 1MDB new extension for missed $600 million payment

Abu Dhabi gives Malaysia 1MDB new extension for missed $600 million payment:

"Abu Dhabi has once again extended a deadline for troubled state fund 1Malaysia Development Bhd (1MDB) - the subject of allegations of fraud and money-laundering - to make a debt payment of over $600 million that was originally due at the end of July. 1MDB is now required to pay at least $310 million by Aug. 12 and the rest of the money plus interest by Aug. 31, Abu Dhabi's government-owned International Petroleum Investment Co (IPIC) said in a statement to the London Stock Exchange on Tuesday. Under a deal struck in April, 1MDB originally agreed to pay $1.2 billion in two installments to IPIC, with the first of about $600 million to be paid by July 31. The Malaysian fund did not honor that commitment and IPIC then gave it a grace period which ended on Tuesday; 1MDB also missed that deadline."



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OPEC expects laggards to comply more fully with oil cut pact

OPEC expects laggards to comply more fully with oil cut pact:

"OPEC expects greater adherence to its pact with non-OPEC producers to cut oil output after two days of meetings in Abu Dhabi aimed at boosting compliance with the accord. The Organization of the Petroleum Exporting Countries, Russia and other producers are cutting output by about 1.8 million barrels per day (bpd) until March 2018 to get rid of a glut and support prices. OPEC producers Iraq and the UAE have shown relatively low compliance with the deal based on figures from secondary sources OPEC uses to monitor its supply. Meanwhile, non-OPEC Kazakhstan and Malaysia have been boosting output in the last few months, according to the International Energy Agency."



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HSBC plans Saudi growth thanks to kingdom's 'unprecedented' transformation

HSBC plans Saudi growth thanks to kingdom's 'unprecedented' transformation:

"HSBC is planning to add staff to its Saudi Arabian operations as the kingdom embarks on one of the biggest economic transformations attempted by any country, the bank's regional chief Georges Elhedery told Reuters.

Opportunities for investment banks have increased tremendously due to Vision 2030, the reform program launched by Crown Prince Mohammed bin Salman to diversify the economy and end its reliance on oil exports, Elhedery said in an interview.

Riyadh has ambitious privatization plans, including to raise $100 billion through the listing of five percent of state oil firm Saudi Aramco at home and on one or more overseas markets.

"



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Rise of electric cars challenges the world’s thirst for oil

Rise of electric cars challenges the world’s thirst for oil:

"In the early years of US oil production in the late 19th century, gasoline was considered a useless byproduct of kerosene that would be burnt off or dumped in rivers.

That changed when the first mass-produced automobiles hit the road. But just over a century later, the symbiotic relationship between oil and cars which transformed society is beginning to fray.

Recent announcements by the UK and France of plans to ban sales of new petrol and diesel vehicles by 2040 have amplified two critical questions for the petroleum industry: will electric vehicles (EVs) cause oil demand to decline and, if so, when?

"



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Kazakhstan: US sanctions will not affect oil projects

Kazakhstan: US sanctions will not affect oil projects:

"New US sanctions against Russia will not affect multi-billion dollar oil projects in Kazakhstan backed by Chevron, ExxonMobil and other western energy majors, the country’s economy minister has said. Fresh sanctions against Moscow signed into law by President Donald Trump this week directly target Russian energy export pipelines, raising fears that oil from Kazakhstan, which is exported along the Caspian Pipeline Consortium (CPC) pipeline that runs through Russia to the Black Sea, could be affected. “The pipeline, which links our oil to the seas, in particular, to Novorossiysk, is not covered by the sanctions. American companies, such as Chevron, who are also shareholders of the CPC, have themselves obtained from their parliament that such transit pipelines be excluded from sanctions,” minister of national economy Timur Suleimenov told reporters. “Therefore, in this case, the delivery of our oil to foreign markets will not be affected.”"



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MIDEAST STOCKS-Savola helps Saudi rise, Dubai's Air Arabia jumps on earnings

MIDEAST STOCKS-Savola helps Saudi rise, Dubai's Air Arabia jumps on earnings:

"A surge by major food maker Savola helped Saudi Arabia's stock market outperform a generally sluggish region on Tuesday, while Air Arabia jumped in Dubai on its second-quarter earnings.

The Saudi stock index rose 0.5 percent as Savola, which had been in an uptrend for the last few days, gained 4.0 percent in its heaviest trade for over a month.

Savola climbed despite reporting that quarterly profit dropped to 229.3 million riyals ($61.1 million) from 253.5 million riyals a year ago, as sales declined. The profit slide appeared to be partly due to contracting retail margins, analysts at NCB Capital said."



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MIDEAST STOCKS-Gulf markets narrowly mixed but Dubai's Air Arabia surges

MIDEAST STOCKS-Gulf markets narrowly mixed but Dubai's Air Arabia surges:

"Stock markets in the Gulf were narrowly mixed in sluggish, early trade on Tuesday although Dubai's Air Arabia rose sharply on better-than-expected second-quarter earnings. Air Arabia surged 6.5 percent, accounting for over a third of the market's trading volume, after it reported a 19.2 percent rise in second-quarter net profit to 150.7 million dirhams ($41.03 million). EFG Hermes and SICO Bahrain had forecast 95.9 million dirhams and 96.3 million dirhams. Dubai's index edged up only 0.1 percent, however, as falling stocks outnumbered gainers 14 to eight. Amlak Finance dropped 1.8 percent despite reporting that it had swung to a small second-quarter profit from a year-earlier loss."



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Renault Sets Up New Iran Partnership Amid U.S. Trade Tensions - Bloomberg

Renault Sets Up New Iran Partnership Amid U.S. Trade Tensions - Bloomberg:

"Renault SA plans to increase its car manufacturing in Iran by 75 percent, defying efforts by U.S. President Donald Trump’s administration to isolate the country with additional sanctions. The French automaker is setting up a joint venture with Iran’s Industrial Development & Renovation Organization and local dealer Parto Negin Naseh Co. to build 150,000 vehicles a year, Renault said Monday in a statement. The company reached an initial deal with IDRO in September, when it said the partnership will begin producing cars next year. Investment in the project’s first phase will total 660 million euros ($779 million), Iran’s official IRNA news agency reported, without specifying how much each partner will spend. Renault declined to comment on any amount. The French company will hold 60 percent of the business and local partners the rest, IRNA cited Mansour Moazami, head of IDRO, as saying."



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Best-Performing Arab Economy Balks at Float on Egypt Devaluation - Bloomberg

Best-Performing Arab Economy Balks at Float on Egypt Devaluation - Bloomberg:

"In five decades of importing steel wires, Zahar Benmoussa’s company never worried about currency risks -- until Morocco announced plans to float the dirham. “For the first time in our history, we started to hedge” in the currency market, said Benmoussa, managing director at Casablanca-based Grillages Marocains. Across Morocco, fears of a weaker dirham triggered a rush for dollars and euros, causing a $3 billion drop in its reserves in just three months this year. Then in June, the government put its plans on hold again. It was at least the second time it stalled on a move supported by the International Monetary Fund and a centerpiece of Morocco’s ambitions to become North Africa’s dominant financial hub. By delaying, it risks wasting a “perfect time” in terms of its economic health to loosen controls, according to Charles Robertson, global chief economist at London-based Renaissance Capital."



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Monday, 7 August 2017

US malls hunt for shoppers | World

Saudi Arabia Builds Cities in the Sand to Move Beyond Oil - Bloomberg

Saudi Arabia Builds Cities in the Sand to Move Beyond Oil - Bloomberg:

"After relying on oil to fuel its economy for more than half a century, Saudi Arabia is turning to its other abundant natural resource to take it beyond the oil age -- desert. The kingdom is converting thousands of square kilometers of sand into new cities as it seeks to diversify away from crude, create jobs and boost investment. In the past month alone, the world’s biggest oil exporter has announced two major developments -- one covering an area bigger than Belgium and another almost the size of Moscow. That’s on top of plans to build a series of so-called economic cities -- special zones in logistics, tourism, industry and finance, an entertainment city and a $10 billion financial district."



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EFG-Hermes says good chance that Saudi Arabia and Kuwait will be upgraded to emerging market status by FTSE  - The National

EFG-Hermes says good chance that Saudi Arabia and Kuwait will be upgraded to emerging market status by FTSE  - The National:

"There is a good chance that both Saudi Arabia and Kuwait will both be upgraded to emerging market status by the index provider FTSE as early as September because of reforms undertaken in both countries by market regulators, according to the Egyptian investment bank EFG-Hermes.  "We see a strong chance of an upgrade for Kuwait and Saudi Arabia," said Mohamad Al Hajj and Simon Kitchen, analysts at the bank. "We believe Kuwait returns could be stronger as it is the least anticipated of the two, and we are overweight on Kuwait and underweight on Saudi Arabia."  An upgrade by FTSE of Kuwait and Saudi Arabia to emerging market status would attract about $4.5 billion (Dh16.5bn) into both markets, according to EFG. Of that, Saudi Arabia, which is expected to account for 2.5 per cent of FTSE's EM Index, would account for $3.75bn. and Kuwait, which may make up 0.5 per cent of the index, would attract $740m. "



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Air Arabia first-half profit climbs 7% to Dh261m | GulfNews.com

Air Arabia first-half profit climbs 7% to Dh261m | GulfNews.com:

"New routes and increases in capacity helped Air Arabia grow its net profit to Dh261 million in the first half of this year, a 7 per cent rise compared to the same period last year. The Sharjah-based low cost carrier said on Monday it served over 4.1 million passengers in the first six months of 2017, while the average seat load factor – or passengers carried as a percentage of available seats – for the same period stood at 79 per cent. Turnover for the Middle East and North Africa’s largest low-cost carrier reached Dh1.716 billion, it said in a statement."



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Ras al-Khaimah fund says does not own stake in JBF RAK

Ras al-Khaimah fund says does not own stake in JBF RAK:

"The Ras al-Khaimah Investment Authority (RAKIA), a state body in the emirate of Ras al-Khaimah, said on Monday it does not own a stake in JBF RAK, a manufacturer which is in talks with banks on renegotiating around 2 billion dirhams ($545 million) of debt. JBF RAK's website says the company was established as a joint venture by India's JBF Group and RAKIA in 2007. United Arab Emirates central bank records, seen by Reuters, show RAKIA owned 60 percent of JBF RAK. However, RAKIA said in a statement to Reuters on Monday that it "has no share ownership" in JBF RAK."



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Qatar shipper Milaha plans base in Oman after trade hit by diplomatic rift

Qatar shipper Milaha plans base in Oman after trade hit by diplomatic rift:

"Qatar Navigation (Milaha), a top Doha-based shipping and logistics group, said it was shifting its regional trans-shipment hub from Dubai to the Omani port of Sohar after a diplomatic crisis in the region disrupted Qatar's trade. Milaha is setting up a warehousing and logistics operation at Sohar, on Oman's northern coast, and is exploring other opportunities to expand in that country, the company said on Monday. The plan suggests Qatar is making long-term preparations to cope with sanctions imposed by Saudi Arabia, the United Arab Emirates, Bahrain and Egypt, which cut diplomatic and transport ties on June 5, accusing Doha of backing terrorism."



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StanChart CEO says Gulf rift puts Dubai finance hub at risk

StanChart CEO says Gulf rift puts Dubai finance hub at risk:

"The boss of Standard Chartered (STAN.L) has warned that Dubai risks damaging its status as a financial center as a result of the trade boycott of Qatar by a Saudi-led bloc, which includes the United Arab Emirates. Standard Chartered is a major lender across the Middle East and CEO Bill Winters said it could become increasingly difficult for Dubai to act as a comprehensive regional hub for international companies' Gulf operations if the tension in the region continued. "There is a lot of benefit we get from having a Dubai hub, we are looking to see what the effect of this will be," he told Reuters."



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Hedge Funds Lend Oil a Hand in the Choppy Road to the $50s - Bloomberg

Hedge Funds Lend Oil a Hand in the Choppy Road to the $50s - Bloomberg:

"Oil seems to have hedge funds in its corner as futures stagger toward $50 a barrel.

Money managers haven’t been so optimistic about West Texas Intermediate crude since April, piling on bets that prices will rise while short-sellers step back. It helps that supplies in the U.S., the biggest oil consumer, have shrunk to the lowest this year. 

“We’ve seen 21 million barrels of U.S. inventory declines this quarter; that’s pretty substantial,” Rob Thummel, a managing director at Tortoise Capital Advisors LLC, said by telephone. “That has kind of sent some of the bears back into hibernation.”"



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MIDEAST STOCKS-Most Saudi, Egyptian banks bask in global glow but Samba sold on weak Q2

MIDEAST STOCKS-Most Saudi, Egyptian banks bask in global glow but Samba sold on weak Q2:

"The banking sector helped support stock indexes in Saudi Arabia and Egypt on Monday as investors were influenced by the positive mood in global bourses, while other markets in the region moved little. "With quarterly earnings now largely behind us, investors are looking for fresh triggers, and the optimism buzzing around global markets is just that," said a Riyadh-based broker. Sixty banks in the six-nation Gulf Cooperation Council have now reported second-quarter earnings and according to analysts at Oman's U-Capital, the sector's total net profit for the period was $7.85 billion, up 4.7 percent from a year ago."



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Oil slides from nine-week highs as market looks to OPEC

Oil slides from nine-week highs as market looks to OPEC:

"Oil prices edged lower on Monday, sliding away from nine-week highs, as worries lingered over high production from OPEC and the United States. Global benchmark Brent crude futures LCOc1 were down 60 cents, or 1.14 percent, at $51.82 a barrel at 1113 GMT. They traded as low as $51.56 a barrel earlier in the day. U.S. crude futures CLc1 were down 55 cents, or 1.11 percent, at $49.03 per barrel, but up from the day's low of $48.78 a barrel."



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Oil Trades Near $49 as Prices Still Capped by Sufficient Supply - Bloomberg

Oil Trades Near $49 as Prices Still Capped by Sufficient Supply - Bloomberg:

"Oil traded near $49 a barrel in New York amid speculation that plentiful supplies will continue to thwart any further rallies.

Futures fell 1.3 percent. While growth in U.S. drilling has stalled and Libya’s production revival was dealt a setback by protests, rebounding output is still capping prices, according to Saxo Bank A/S. A committee co-chaired by Kuwait and Russia will examine why some participants in the deal between OPEC and other producers to reduce global supply aren’t fully implementing their cuts.

"



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UAE's ADNOC to split huge oil concession, in talks with potential partners

UAE's ADNOC to split huge oil concession, in talks with potential partners:

"State-owned energy giant Abu Dhabi National Oil Co (Adnoc) said on Monday that it would split its ADMA-OPCO offshore oil concession into two or more areas with new terms to unlock greater value and increase opportunities for partnerships.

Adnoc is in advanced talks with more than a dozen potential partners, the company said. The current operating license for the concession will expire next March.

The potential partners are a mix of existing concession holders in Adnoc's offshore oilfields and new participants, Adnoc said without identifying them.

"



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Saudi Aramco Book, Above the Oil Fields - Bloomberg

Saudi Aramco Book, Above the Oil Fields - Bloomberg:

"Ayesha Malik was born half a mile from Dammam well No. 7—the well that started the Saudi oil industry in 1938. She was raised among some of the world's largest oil fields and refineries. Yet her home was an oasis within the kingdom: the 22.5 square-mile gated community created to house employees of the state-owned company that's known today as Saudi Aramco.  She documented the buzz of the compound and nearby area in a series of striking photographs she is publishing in her book "Aramco: Above the Oil Fields." (Daylight Books, $50) The compound forms a world largely unknown outside the closely knit community of Aramco staffers. The city, which was built by the American oil companies that owned Aramco before its nationalization in 1980, could be any small town in America. Children travel in iconic yellow American school buses. Baseball fields abound. The Boy Scouts have their own pack, number 253. Set aside the desert heat and this could be suburban Los Angeles. Inside the gates is a life available nowhere else in Saudi Arabia. Women drive. Concerts are allowed. Men and women shop together. (Alcohol is banned as in the rest of the kingdom) "



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MIDEAST STOCKS-Saudi market gains, but Samba drops on Q2 results

MIDEAST STOCKS-Saudi market gains, but Samba drops on Q2 results:

"Saudi stocks edged up in early trade, with gains kept in check by sharp declines in the local market's third largest bank after it reported a slight dip in second quarter profit. Samba Financial Group dropped 2.7 percent after it reported net profit of 1.27 billion riyals ($339 million), broadly in line with analysts' forecasts and down 3.3 percent year on year. Its shares had jumped 3.4 percent on Sunday after its board recommended a cash dividend of 0.75 riyals for the first half of the year, two-thirds more than the 2016 interim payout."



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Sunday, 6 August 2017

Slowdown in GCC takaful sector expected to linger | GulfNews.com

Slowdown in GCC takaful sector expected to linger | GulfNews.com:

"Following significant premium growth in the GCC’s Islamic insurance (takaful) sector in 2014 and 2015, the industry has battled a slowdown that started last year and which is expected to linger, according to ratings agency Standard & Poor’s. The sector reported high premium growth rates in the GCC, mainly driven by the introduction of new mandatory insurance covers, as well as strong increases in premium rates in Saudi Arabia, as new covers and actuarial pricing guidelines were adopted. After reporting of annual growth in gross premiums of up to 20 per cent in the GCC takaful sector, growth slowed significantly to less than 1 per cent in 2016. This was largely due to a slowdown in Saudi Arabia, which has the largest Islamic insurance market in the GCC."



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UAE firm JBF RAK seeks to renegotiate 2 bln dirhams of debt-sources

UAE firm JBF RAK seeks to renegotiate 2 bln dirhams of debt-sources:

"Manufacturer JBF RAK, which is 60 percent owned by the United Arab Emirates' Ras al-Khaimah Investment Authority (RAKIA), is in talks with banks about renegotiating around 2 billion dirhams ($544.6 million) of debt, banking sources told Reuters.

The polyester producer, which according to its website is an affiliate of India's JBF Group, has contacted lenders about reviewing its debt obligations, said the sources, who spoke on condition of anonymity as the matter is not public.

JBF RAK and RAKIA did not respond to a Reuters request for comment."



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