Saudis and Russians threaten to step up oil deal battle:
"Saudi Arabia and Russia have threatened to escalate a brewing oil dispute to the highest levels of government, as frustration with countries who have failed to cut production in line with an Opec-led supply deal starts to spill over. Khalid al Falih, Saudi Arabia’s energy minister, said on Monday in St Petersburg there could be no more “free rides” after reviewing the progress of the supply deal, which was hailed as a new period of co-operation between Opec and big oil producers outside the group, but has so far failed to hold prices above $50 a barrel. “We are going to forcefully demand participation of all,” Mr Falih said in a joint press conference, adding they planned to raise the matter to “leadership beyond oil ministers if we do not see a response”."
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Monday, 24 July 2017
MIDEAST STOCKS-Banks push Qatar higher, Mobily's loss dampens Saudi
MIDEAST STOCKS-Banks push Qatar higher, Mobily's loss dampens Saudi:
"Banks pushed Qatar's stock market higher on Monday while Saudi Arabia's market edged down as telecommunications firm Mobily plunged in the wake of a bigger-than-expected quarterly loss.
The Qatari index added 0.8 percent to 9,579 points, outperforming the rest of the region and closing at its highest level since June 5, when a diplomatic crisis with neighbouring Arab states erupted. It is now just 3.5 percent from its pre-crisis level, after dropping more than 10 percent at one stage.
Corporate earnings and macroeconomic data have shown the economy is suffering only minor damage from sanctions imposed by the other Arab states, and a Reuters poll of economists last week found them predicting Qatar will remain one of the Gulf's fastest-growing economies."
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"Banks pushed Qatar's stock market higher on Monday while Saudi Arabia's market edged down as telecommunications firm Mobily plunged in the wake of a bigger-than-expected quarterly loss.
The Qatari index added 0.8 percent to 9,579 points, outperforming the rest of the region and closing at its highest level since June 5, when a diplomatic crisis with neighbouring Arab states erupted. It is now just 3.5 percent from its pre-crisis level, after dropping more than 10 percent at one stage.
Corporate earnings and macroeconomic data have shown the economy is suffering only minor damage from sanctions imposed by the other Arab states, and a Reuters poll of economists last week found them predicting Qatar will remain one of the Gulf's fastest-growing economies."
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Assessing the IMF findings on Saudi Arabia | Arab News
Assessing the IMF findings on Saudi Arabia | Arab News:
"The International Monetary Fund (IMF) has just given the Saudi Arabian economy its annual road test, and it does more than just glance under the bonnet and kick the tires. Its Article IV Consultation report is based on a visit to the country by a team of top IMF experts, experts in Middle East economics, and meetings with top financial and economic policymakers, followed by a written report which is discussed by the full IMF team of 30 or so executive directors in Washington. The result is as accurate and independent a snapshot of the roadworthiness of a country’s economy as it is possible to produce. In essence the 2017 report just produced finds the Saudi engine in good condition, benefiting from the increased level servicing it is getting."
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"The International Monetary Fund (IMF) has just given the Saudi Arabian economy its annual road test, and it does more than just glance under the bonnet and kick the tires. Its Article IV Consultation report is based on a visit to the country by a team of top IMF experts, experts in Middle East economics, and meetings with top financial and economic policymakers, followed by a written report which is discussed by the full IMF team of 30 or so executive directors in Washington. The result is as accurate and independent a snapshot of the roadworthiness of a country’s economy as it is possible to produce. In essence the 2017 report just produced finds the Saudi engine in good condition, benefiting from the increased level servicing it is getting."
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Qatar Crisis to Bring Cheer to World's Worst Emerging Market Airline of 2017 - Bloomberg
Qatar Crisis to Bring Cheer to World's Worst Emerging Market Airline of 2017 - Bloomberg:
"The troubles of a local rival may bring respite to Air Arabia PJSC, the worst-performing stock among major emerging-market airlines this year. While the United Arab Emirates’ only listed carrier has tumbled 20 percent in 2017, things look more favorable in the second half of the year, analysts say. The company could attract more travelers on routes that overlap with Qatar Airways, which has been banned from flying into or over countries including Saudi Arabia and the U.A.E after they severed commercial ties with their neighbor last month. The “Qatar Airways situation will help increase passenger traffic and load factors,” said Amine Wafy, an equities analyst at Renaissance Capital in Dubai. Air Arabia operates at near-full capacity into Saudi Arabia and the company could add more planes than anticipated for those routes, helping offset the lost capacity from flying into Qatari market, he said."
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"The troubles of a local rival may bring respite to Air Arabia PJSC, the worst-performing stock among major emerging-market airlines this year. While the United Arab Emirates’ only listed carrier has tumbled 20 percent in 2017, things look more favorable in the second half of the year, analysts say. The company could attract more travelers on routes that overlap with Qatar Airways, which has been banned from flying into or over countries including Saudi Arabia and the U.A.E after they severed commercial ties with their neighbor last month. The “Qatar Airways situation will help increase passenger traffic and load factors,” said Amine Wafy, an equities analyst at Renaissance Capital in Dubai. Air Arabia operates at near-full capacity into Saudi Arabia and the company could add more planes than anticipated for those routes, helping offset the lost capacity from flying into Qatari market, he said."
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UAE's Adnoc in talks with banks for big syndicated loan, project bond: sources
UAE's Adnoc in talks with banks for big syndicated loan, project bond: sources:
"State-owned energy giant Abu Dhabi National Oil Co (Adnoc) is in talks with regional and international banks to obtain a syndicated loan worth several billion U.S. dollars, banking sources familiar with the discussions said on Monday. The loan will be "huge", two bankers said; a third said it was expected to be in a range of $4 billion to $5 billion. The facility would have various maturities of up to five years. The loan financing is one of a number of fund-raising plans which the company is considering. It is also discussing the possibility of issuing a project bond that could be as large as $3 billion in size, bankers said, declining to be named because of commercial sensitivities."
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"State-owned energy giant Abu Dhabi National Oil Co (Adnoc) is in talks with regional and international banks to obtain a syndicated loan worth several billion U.S. dollars, banking sources familiar with the discussions said on Monday. The loan will be "huge", two bankers said; a third said it was expected to be in a range of $4 billion to $5 billion. The facility would have various maturities of up to five years. The loan financing is one of a number of fund-raising plans which the company is considering. It is also discussing the possibility of issuing a project bond that could be as large as $3 billion in size, bankers said, declining to be named because of commercial sensitivities."
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Saudi Economic Pain Will Test Resolve of Prince’s Reform Push - Bloomberg
Saudi Economic Pain Will Test Resolve of Prince’s Reform Push - Bloomberg:
"Saudi Arabia’s drive to reduce the economy’s reliance on oil has hit a snag: its reliance on oil.
More than a year after the kingdom’s dominant leader, Crown Prince Mohammed bin Salman, unveiled a blueprint for the post-oil era, the drop in crude prices is making economists more skeptical about whether some of the plan’s medium-term targets can be met. The reason: lower oil revenue deprives the government of money needed to balance its books by 2020 while trying to stimulate growth to ease the transition’s burden on the population.
IMF data released Friday underscored the challenge. The fund lowered its forecasts for Saudi economic growth this year to “close to zero.” Analysts at Citigroup, EFG-Hermes and Standard Chartered see a bleaker picture, expecting the economy to shrink for the first time since the global financial crisis in 2009, according to data compiled by Bloomberg.
Deeper economic pain will test the authorities’ resolve to pursue tough reform measures as they seek to go against the run of history, which suggests that successful diversification efforts depended largely on policies put in place before a price shock."
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"Saudi Arabia’s drive to reduce the economy’s reliance on oil has hit a snag: its reliance on oil.
More than a year after the kingdom’s dominant leader, Crown Prince Mohammed bin Salman, unveiled a blueprint for the post-oil era, the drop in crude prices is making economists more skeptical about whether some of the plan’s medium-term targets can be met. The reason: lower oil revenue deprives the government of money needed to balance its books by 2020 while trying to stimulate growth to ease the transition’s burden on the population.
IMF data released Friday underscored the challenge. The fund lowered its forecasts for Saudi economic growth this year to “close to zero.” Analysts at Citigroup, EFG-Hermes and Standard Chartered see a bleaker picture, expecting the economy to shrink for the first time since the global financial crisis in 2009, according to data compiled by Bloomberg.
Deeper economic pain will test the authorities’ resolve to pursue tough reform measures as they seek to go against the run of history, which suggests that successful diversification efforts depended largely on policies put in place before a price shock."
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Saudi Arabia Sells Domestic Debt for First Time in 2017 - Bloomberg
Saudi Arabia Sells Domestic Debt for First Time in 2017 - Bloomberg:
"Saudi Arabia, the Arab world’s biggest economy, started the sale of its first riyal-denominated debt in 10 months, according to people with knowledge of the matter.
The kingdom’s three-part Islamic offering consists of bonds priced between 2.9 to 3 percent for five-year debt, 3.25 to 3.35 percent for seven-year notes and 3.55 to 3.65 percent for a 10-year issue, the people said, declining to be identified because the information isn’t public. Investors have until Monday to submit bids, they said, with one person adding that Saudi Arabia plans to raise as much as 25 billion riyals ($6.67 billion).
The sale comes as lower oil prices and austerity measures weigh on Saudi Arabia’s economy. Gross domestic product contracted in the three months through March for the first time since 2009 -- illustrating the scale of the challenge facing the country’s new heir, Crown Prince Mohammed bin Salman, as he implements his blueprint for a transition away from oil dependency. The government, which said on Sunday it started a local sukuk program of unlimited size, raised $9 billion from its inaugural sale of international Islamic bonds this year."
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"Saudi Arabia, the Arab world’s biggest economy, started the sale of its first riyal-denominated debt in 10 months, according to people with knowledge of the matter.
The kingdom’s three-part Islamic offering consists of bonds priced between 2.9 to 3 percent for five-year debt, 3.25 to 3.35 percent for seven-year notes and 3.55 to 3.65 percent for a 10-year issue, the people said, declining to be identified because the information isn’t public. Investors have until Monday to submit bids, they said, with one person adding that Saudi Arabia plans to raise as much as 25 billion riyals ($6.67 billion).
The sale comes as lower oil prices and austerity measures weigh on Saudi Arabia’s economy. Gross domestic product contracted in the three months through March for the first time since 2009 -- illustrating the scale of the challenge facing the country’s new heir, Crown Prince Mohammed bin Salman, as he implements his blueprint for a transition away from oil dependency. The government, which said on Sunday it started a local sukuk program of unlimited size, raised $9 billion from its inaugural sale of international Islamic bonds this year."
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Saudis Plan to Tackle Lagging Compliance With Oil Cuts `Head On' - Bloomberg
Saudis Plan to Tackle Lagging Compliance With Oil Cuts `Head On' - Bloomberg:
"Saudi Arabia, OPEC’s biggest oil producer, plans to step up pressure on nations that aren’t complying with their commitment to cut output, including a proposal to start monitoring exports.
“Some countries continue to lag” in their compliance, Saudi Oil Minister Khalid Al-Falih said Monday in St. Petersburg, Russia, where he’s attending a meeting of OPEC and non-OPEC producers. It’s “a concern we must address head on.”
OPEC’s supply in July will be the highest this year, data from tanker-tracker Petro-Logistics SA show. The group’s compliance with its November deal to curtail output dropped to 92 percent in June from 110 percent in May, according to a person familiar with the data."
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"Saudi Arabia, OPEC’s biggest oil producer, plans to step up pressure on nations that aren’t complying with their commitment to cut output, including a proposal to start monitoring exports.
“Some countries continue to lag” in their compliance, Saudi Oil Minister Khalid Al-Falih said Monday in St. Petersburg, Russia, where he’s attending a meeting of OPEC and non-OPEC producers. It’s “a concern we must address head on.”
OPEC’s supply in July will be the highest this year, data from tanker-tracker Petro-Logistics SA show. The group’s compliance with its November deal to curtail output dropped to 92 percent in June from 110 percent in May, according to a person familiar with the data."
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MIDEAST STOCKS-Banks pull Qatar higher, big Mobily loss weighs on Saudi
MIDEAST STOCKS-Banks pull Qatar higher, big Mobily loss weighs on Saudi:
"Banks pulled Qatar's stock market higher in early trade on Monday while Saudi Arabia's market edged down after a string of second-quarter earnings, with telecommunications firm Mobily plunging on a bigger-than-expected loss.
The Qatari index added 0.4 percent as Qatar National Bank climbed 1.0 percent and Masraf Al Rayan rose 0.8 percent. Qatar International Islamic Bank gained 1.4 percent after reporting a modest year-on-year rise in first-half net profit.
Islamic insurer AlKhaleej Group surged 2.8 percent in unusually heavy trade."
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"Banks pulled Qatar's stock market higher in early trade on Monday while Saudi Arabia's market edged down after a string of second-quarter earnings, with telecommunications firm Mobily plunging on a bigger-than-expected loss.
The Qatari index added 0.4 percent as Qatar National Bank climbed 1.0 percent and Masraf Al Rayan rose 0.8 percent. Qatar International Islamic Bank gained 1.4 percent after reporting a modest year-on-year rise in first-half net profit.
Islamic insurer AlKhaleej Group surged 2.8 percent in unusually heavy trade."
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The blockade against #Qatar damages all sides
The blockade against Qatar damages all sides:
"With help from President Donald Trump, Riyadh and its Arab allies have painted themselves into a corner at a precarious moment for the Gulf. It is seven weeks since Saudi Arabia, the United Arab Emirates, Egypt and Bahrain clubbed together to impose a blockade on Qatar in an attempt to bend the gas-rich emirate’s rulers to their will. There are few signs that US and regional mediation is making progress towards breaking the impasse, even though it is clear that the dispute is damaging all concerned. In effect, Saudi Arabia and its allies have asked Qatar to volunteer for vassal status as the price for ending a trade and diplomatic embargo. Their initial demands included closing Al Jazeera, the Doha-based broadcaster; scaling back co-operation with Iran, with which Qatar shares its gas; evicting a Turkish military base; and cutting ties to the Muslim Brotherhood. They also required the emirate to submit to regular compliance checks."
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"With help from President Donald Trump, Riyadh and its Arab allies have painted themselves into a corner at a precarious moment for the Gulf. It is seven weeks since Saudi Arabia, the United Arab Emirates, Egypt and Bahrain clubbed together to impose a blockade on Qatar in an attempt to bend the gas-rich emirate’s rulers to their will. There are few signs that US and regional mediation is making progress towards breaking the impasse, even though it is clear that the dispute is damaging all concerned. In effect, Saudi Arabia and its allies have asked Qatar to volunteer for vassal status as the price for ending a trade and diplomatic embargo. Their initial demands included closing Al Jazeera, the Doha-based broadcaster; scaling back co-operation with Iran, with which Qatar shares its gas; evicting a Turkish military base; and cutting ties to the Muslim Brotherhood. They also required the emirate to submit to regular compliance checks."
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