Oil minister says Iran needs foreign investment, but can survive without it - The Peninsula Qatar:
"Iran's oil minister told state television on Thursday that foreign investment was needed to develop its oil industry, but that it could survive if foreigners decided to stay away after the U.S. decision to pull out of a multinational nuclear deal. "If foreigners invest in Iran, it will accelerate the development of our oil sector but, if not, we will not die," said Bijan Zanganeh. "I personally prefer a stable crude price of $65 per barrel.""
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Thursday, 10 May 2018
Oil sales, bank woes: Can Iran’s economy survive Trump exit?
Oil sales, bank woes: Can Iran’s economy survive Trump exit?:
"Whatever steps Iranian leaders take after Donald Trump’s decision to withdraw from the nuclear accord, none will be more critical to domestic stability than their efforts to minimise the economic damage.
The currency is plunging, banks are struggling with bad loans and the looming return of broad US sanctions mean European companies, many already on the fence, will likely decide it’s too risky to invest in the Islamic Republic. A significant loss of oil revenues would hit state coffers hard and present a challenge for President Hassan Rouhani, who won two elections promising to end Iran’s isolation and revive its economy.
“The next few months will be very, very hard for the Iranian economy,” said Henry Smith, lead analyst at Control Risks in Dubai. “It’s hard to see it any other way. The saving grace would be if there’s some type of mechanism put together to manage some of the secondary sanctions.”"
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"Whatever steps Iranian leaders take after Donald Trump’s decision to withdraw from the nuclear accord, none will be more critical to domestic stability than their efforts to minimise the economic damage.
The currency is plunging, banks are struggling with bad loans and the looming return of broad US sanctions mean European companies, many already on the fence, will likely decide it’s too risky to invest in the Islamic Republic. A significant loss of oil revenues would hit state coffers hard and present a challenge for President Hassan Rouhani, who won two elections promising to end Iran’s isolation and revive its economy.
“The next few months will be very, very hard for the Iranian economy,” said Henry Smith, lead analyst at Control Risks in Dubai. “It’s hard to see it any other way. The saving grace would be if there’s some type of mechanism put together to manage some of the secondary sanctions.”"
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Iran oil sanctions could advance China's 'petro-yuan' | Reuters
Iran oil sanctions could advance China's 'petro-yuan' | Reuters:
"China is positioned to be a chief beneficiary of the U.S. decision to withdraw from the Iran nuclear deal as it would give China leverage to demand oil imports be priced in yuan, several currency experts said on Thursday.
President Donald Trump is preparing to impose new sanctions on Iran, the White House said on Wednesday, following the U.S. withdrawal from the multinational 2015 agreement that stalled Iran’s nuclear program.
The sanctions would aim to limit global trade of the oil producer’s crude. The effects may be muted as major Asian importers, China chief among them, are likely to continue buying Iranian oil. "
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"China is positioned to be a chief beneficiary of the U.S. decision to withdraw from the Iran nuclear deal as it would give China leverage to demand oil imports be priced in yuan, several currency experts said on Thursday.
President Donald Trump is preparing to impose new sanctions on Iran, the White House said on Wednesday, following the U.S. withdrawal from the multinational 2015 agreement that stalled Iran’s nuclear program.
The sanctions would aim to limit global trade of the oil producer’s crude. The effects may be muted as major Asian importers, China chief among them, are likely to continue buying Iranian oil. "
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Rosneft's tilt towards investors prompted Qatar stake increase | Reuters
Rosneft's tilt towards investors prompted Qatar stake increase | Reuters:
"When Qatar negotiated a deal to increase its holding in Rosneft it told the Russian oil company it wanted higher returns on its existing stake before it bought more, three sources familiar with the deal said.
Qatar’s request was one of the triggers which prompted Igor Sechin, Rosneft’s boss and a close ally of President Vladimir Putin, to propose last week a $2 billion share buyback and an $8 billion debt reduction, marking a significant shift in the oil company’s strategy.
Days later, Qatar’s sovereign wealth fund Qatar Investment Authority, one of the world’s largest, raised its stake in state-controlled Rosneft to just under 19 percent from 4.8 percent bringing the value of its total investment to 10 billion euros.
"
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"When Qatar negotiated a deal to increase its holding in Rosneft it told the Russian oil company it wanted higher returns on its existing stake before it bought more, three sources familiar with the deal said.
Qatar’s request was one of the triggers which prompted Igor Sechin, Rosneft’s boss and a close ally of President Vladimir Putin, to propose last week a $2 billion share buyback and an $8 billion debt reduction, marking a significant shift in the oil company’s strategy.
Days later, Qatar’s sovereign wealth fund Qatar Investment Authority, one of the world’s largest, raised its stake in state-controlled Rosneft to just under 19 percent from 4.8 percent bringing the value of its total investment to 10 billion euros.
"
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UAE's Dana Gas close to sukuk restructuring agreement with creditors - sources | Reuters
UAE's Dana Gas close to sukuk restructuring agreement with creditors - sources | Reuters:
"United Arab Emirates energy producer Dana Gas is close to reaching agreement on restructuring $700 million in Islamic bonds, potentially ending a complex and protracted legal battle with its creditors, sources familiar with the matter said.
Dana Gas last year halted payments on its sukuk, saying the bonds had become unlawful because of changes in Islamic finance. Holders of the sukuk contest its position and are demanding to be paid back.
While legal proceedings are continuing in British and United Arab Emirates courts, talks to find an out-of-court settlement have so far failed to find a resolution."
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"United Arab Emirates energy producer Dana Gas is close to reaching agreement on restructuring $700 million in Islamic bonds, potentially ending a complex and protracted legal battle with its creditors, sources familiar with the matter said.
Dana Gas last year halted payments on its sukuk, saying the bonds had become unlawful because of changes in Islamic finance. Holders of the sukuk contest its position and are demanding to be paid back.
While legal proceedings are continuing in British and United Arab Emirates courts, talks to find an out-of-court settlement have so far failed to find a resolution."
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UAE's VAT move has gone well, inflation to moderate: IMF official | Reuters
UAE's VAT move has gone well, inflation to moderate: IMF official | Reuters:
"The United Arab Emirates’ introduction of value-added tax has gone smoothly and inflation, having jumped in response, will moderate, the head of the International Monetary Fund’s mission to the country said on Thursday.
Natalia Tamirisa said the 5 percent VAT rate imposed at the start of this year was a big cultural and administrative shift in a country that has traditionally had minimal taxation.
“Given the challenges, VAT introduction has been well managed and relatively smooth,” she told Reuters after a visit to the UAE for talks with authorities."
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"The United Arab Emirates’ introduction of value-added tax has gone smoothly and inflation, having jumped in response, will moderate, the head of the International Monetary Fund’s mission to the country said on Thursday.
Natalia Tamirisa said the 5 percent VAT rate imposed at the start of this year was a big cultural and administrative shift in a country that has traditionally had minimal taxation.
“Given the challenges, VAT introduction has been well managed and relatively smooth,” she told Reuters after a visit to the UAE for talks with authorities."
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Some U.S. fund managers finally convinced oil rally is for real | Reuters
Some U.S. fund managers finally convinced oil rally is for real | Reuters:
"U.S. fund managers are barreling into the energy sector by making broad bets on anything connected with oil, finally convinced that gains in crude prices - on track for their fourth consecutive quarterly gain, the longest such stretch for more than 10 years - are more than a mirage.
Ever since oil prices slid in late 2014 after rallying above $115 a barrel, U.S. mutual fund managers have largely stayed underweight the sector, convinced that advances in fracking technology would allow U.S. production to ramp up at any moment and keep a lid on prices.
Yet with oil futures hitting 3-1/2-year highs on Thursday, up approximately 75 percent from this time last year after top exporter Saudi Arabia and No.1 producer Russia led efforts since 2017 to cap output, some U.S. fund managers are convinced that high oil prices are finally here to stay. "
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"U.S. fund managers are barreling into the energy sector by making broad bets on anything connected with oil, finally convinced that gains in crude prices - on track for their fourth consecutive quarterly gain, the longest such stretch for more than 10 years - are more than a mirage.
Ever since oil prices slid in late 2014 after rallying above $115 a barrel, U.S. mutual fund managers have largely stayed underweight the sector, convinced that advances in fracking technology would allow U.S. production to ramp up at any moment and keep a lid on prices.
Yet with oil futures hitting 3-1/2-year highs on Thursday, up approximately 75 percent from this time last year after top exporter Saudi Arabia and No.1 producer Russia led efforts since 2017 to cap output, some U.S. fund managers are convinced that high oil prices are finally here to stay. "
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UPDATE 1-TMX CEO says it is still in the running for Saudi Aramco listing | Reuters
UPDATE 1-TMX CEO says it is still in the running for Saudi Aramco listing | Reuters:
"Canada’s TMX Group Ltd is still in discussions with Saudi Aramco to get the oil company to list on the Toronto Stock Exchange (TSX) as part of its highly anticipated initial public offering, expected to be the biggest IPO in history, TMX CEO Lou Eccleston said on Thursday.
Any slice of the Saudi Aramco IPO could raise TMX’s global profile and generate significant revenue. TMX has campaigned hard get Aramco to list on the TSX.
“I don’t think the door is ever closed,” Eccleston told Reuters in an interview on the sidelines of TMX’s annual general meeting in Toronto.
"
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"Canada’s TMX Group Ltd is still in discussions with Saudi Aramco to get the oil company to list on the Toronto Stock Exchange (TSX) as part of its highly anticipated initial public offering, expected to be the biggest IPO in history, TMX CEO Lou Eccleston said on Thursday.
Any slice of the Saudi Aramco IPO could raise TMX’s global profile and generate significant revenue. TMX has campaigned hard get Aramco to list on the TSX.
“I don’t think the door is ever closed,” Eccleston told Reuters in an interview on the sidelines of TMX’s annual general meeting in Toronto.
"
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MIDEAST STOCKS-Saudi petrochemicals surge as politics pulls down most markets | Reuters
MIDEAST STOCKS-Saudi petrochemicals surge as politics pulls down most markets | Reuters:
"Saudi Arabian petrochemical shares surged on Thursday as Brent oil hit $78 a barrel, while most of the region’s stock markets fell because of geopolitical tensions after Israeli forces traded fire with Iranian forces in Syria.
The Saudi index rose 0.5 percent as the biggest petrochemical producer, Saudi Basic Industries, added one percent.
Nama Chemicals soared 9.6 percent in its heaviest trade since May 2014 after saying it had swung to a 28.2 million riyal ($7.5 million) profit in the first quarter from a year-earlier loss."
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"Saudi Arabian petrochemical shares surged on Thursday as Brent oil hit $78 a barrel, while most of the region’s stock markets fell because of geopolitical tensions after Israeli forces traded fire with Iranian forces in Syria.
The Saudi index rose 0.5 percent as the biggest petrochemical producer, Saudi Basic Industries, added one percent.
Nama Chemicals soared 9.6 percent in its heaviest trade since May 2014 after saying it had swung to a 28.2 million riyal ($7.5 million) profit in the first quarter from a year-earlier loss."
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Emirates Global Aluminium likely to delay float after market turmoil
Emirates Global Aluminium likely to delay float after market turmoil:
"Emirates Global Aluminium’s (EGA) stock market listing is likely to slip to 2019 because of turmoil in global aluminum markets after the US imposed sanctions on Russian aluminum group Rusal, three sources familiar with the deal said. “The IPO (initial public offering) is delayed to 2019 due to market conditions,” one of the sources said. EGA, which produces 2.6 million tons of cast metal a year and is the third-largest producer of primary aluminum outside China, announced plans to float last year."
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"Emirates Global Aluminium’s (EGA) stock market listing is likely to slip to 2019 because of turmoil in global aluminum markets after the US imposed sanctions on Russian aluminum group Rusal, three sources familiar with the deal said. “The IPO (initial public offering) is delayed to 2019 due to market conditions,” one of the sources said. EGA, which produces 2.6 million tons of cast metal a year and is the third-largest producer of primary aluminum outside China, announced plans to float last year."
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As Saudis Pursue Aramco IPO, Abu Dhabi Hedges to Stay Relevant - Bloomberg
As Saudis Pursue Aramco IPO, Abu Dhabi Hedges to Stay Relevant - Bloomberg:
"Behind the 65-story glass tower that houses the shiny new headquarters of Abu Dhabi National Oil Co. sits a remnant of the Middle Eastern emirate’s not-so-distant past: the squat, sand-colored building that the government-owned energy giant once called home. The stark contrast between the old and new buildings provides a hint of the changes afoot in energy-rich Abu Dhabi. The tiny, but stratospherically wealthy, emirate is trying to forge an economy for a post-oil world and needs to wring more profits from its petroleum industry to finance the makeover. A similar shift is taking place in neighboring Saudi Arabia, where Adnoc’s larger rival, Saudi Aramco, plans to sell shares for the first time. With a projected $2 trillion valuation, Aramco is set to have the world’s biggest initial public offering. Adnoc also wants to secure an economic future for its government owner after the hydrocarbons run out, but it’s treading a different path. “Adnoc has always been seen as a stodgy, slow-moving company,” says Robin Mills, chief executive officer of consultant Qamar Energy. “Now they’re striving to set up a strategy and actually implement it. It’s still a work in progress.”"
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"Behind the 65-story glass tower that houses the shiny new headquarters of Abu Dhabi National Oil Co. sits a remnant of the Middle Eastern emirate’s not-so-distant past: the squat, sand-colored building that the government-owned energy giant once called home. The stark contrast between the old and new buildings provides a hint of the changes afoot in energy-rich Abu Dhabi. The tiny, but stratospherically wealthy, emirate is trying to forge an economy for a post-oil world and needs to wring more profits from its petroleum industry to finance the makeover. A similar shift is taking place in neighboring Saudi Arabia, where Adnoc’s larger rival, Saudi Aramco, plans to sell shares for the first time. With a projected $2 trillion valuation, Aramco is set to have the world’s biggest initial public offering. Adnoc also wants to secure an economic future for its government owner after the hydrocarbons run out, but it’s treading a different path. “Adnoc has always been seen as a stodgy, slow-moving company,” says Robin Mills, chief executive officer of consultant Qamar Energy. “Now they’re striving to set up a strategy and actually implement it. It’s still a work in progress.”"
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OPEC in no hurry to decide if extra oil needed to offset Iran - sources | Reuters
OPEC in no hurry to decide if extra oil needed to offset Iran - sources | Reuters:
"OPEC is in no hurry to decide whether to pump more oil to make up for an expected drop in exports from Iran after the imposition of new U.S. sanctions, three sources familiar with the issue said, saying any loss in supply would take time. The Organization of the Petroleum Exporting Countries has a deal with Russia and non-OPEC producers to cut supplies that has helped erase a global glut and boosted oil prices to their highest since 2014. Officials are considering whether a drop in Iranian exports and a decline in supply from another OPEC member, Venezuela, demands adjusting the deal that runs to the end of 2018. Ministers meet in June to review the policy."
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"OPEC is in no hurry to decide whether to pump more oil to make up for an expected drop in exports from Iran after the imposition of new U.S. sanctions, three sources familiar with the issue said, saying any loss in supply would take time. The Organization of the Petroleum Exporting Countries has a deal with Russia and non-OPEC producers to cut supplies that has helped erase a global glut and boosted oil prices to their highest since 2014. Officials are considering whether a drop in Iranian exports and a decline in supply from another OPEC member, Venezuela, demands adjusting the deal that runs to the end of 2018. Ministers meet in June to review the policy."
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Saudi banks plan U.S. dollar bonds despite ample liquidity: sources | Reuters
Saudi banks plan U.S. dollar bonds despite ample liquidity: sources | Reuters:
"At least three commercial banks in Saudi Arabia are preparing U.S. dollar debt issues, banking sources said, in what would be the first hard-currency debt sales by Saudi banks in several years.
The banks want to diversify their sources of finance and boost capital levels, but are in no rush for the cash as they are still flush with liquidity due to sluggish credit growth and looser public spending.
The kingdom’s increasing reliance on international bond issues has also freed up liquidity for local banks."
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"At least three commercial banks in Saudi Arabia are preparing U.S. dollar debt issues, banking sources said, in what would be the first hard-currency debt sales by Saudi banks in several years.
The banks want to diversify their sources of finance and boost capital levels, but are in no rush for the cash as they are still flush with liquidity due to sluggish credit growth and looser public spending.
The kingdom’s increasing reliance on international bond issues has also freed up liquidity for local banks."
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MIDEAST STOCKS-Geopolitics weigh on Gulf markets, Arabtec jumps in Dubai | Reuters
MIDEAST STOCKS-Geopolitics weigh on Gulf markets, Arabtec jumps in Dubai | Reuters:
"Gulf markets were mostly weak in early trade on Thursday amid investor concerns over an escalation of tensions in the Middle East, where Israel responded to what it said was a rocket attack from Iranian forces in Syria.
The attack on the Israeli-occupied Golan Heights, just after midnight, marked the first time Iranian forces have attacked Israel from Syria, where they have deployed along with Iran-backed Shi’ite militias and Russian troops to support President Bashar al-Assad in Syria’s civil war.
The Saudi index was down 0.4 pct, despite strong oil prices that usually boost Gulf markets and shares in the energy sector."
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"Gulf markets were mostly weak in early trade on Thursday amid investor concerns over an escalation of tensions in the Middle East, where Israel responded to what it said was a rocket attack from Iranian forces in Syria.
The attack on the Israeli-occupied Golan Heights, just after midnight, marked the first time Iranian forces have attacked Israel from Syria, where they have deployed along with Iran-backed Shi’ite militias and Russian troops to support President Bashar al-Assad in Syria’s civil war.
The Saudi index was down 0.4 pct, despite strong oil prices that usually boost Gulf markets and shares in the energy sector."
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Non-oil growth in Dubai slows in April | ZAWYA MENA Edition
Non-oil growth in Dubai slows in April | ZAWYA MENA Edition:
"Dubai's non-oil economic growth slowed in April as employment generation, output and new work improved at a slower pace.
The Dubai Economy Tracker Index (DET), released by Emirates NBD, declined to 53.9 in April from 55.3 in March and from a 2018 high of 56.0 in January.
Both output (57.1) and new work (58.0) increased sharply last month but at a slower rate than in previous months.
"
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"Dubai's non-oil economic growth slowed in April as employment generation, output and new work improved at a slower pace.
The Dubai Economy Tracker Index (DET), released by Emirates NBD, declined to 53.9 in April from 55.3 in March and from a 2018 high of 56.0 in January.
Both output (57.1) and new work (58.0) increased sharply last month but at a slower rate than in previous months.
"
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BUZZ-Dubai's Arabtec jumps from 9-year low on Q1 profit rise | ZAWYA MENA Edition
BUZZ-Dubai's Arabtec jumps from 9-year low on Q1 profit rise | ZAWYA MENA Edition:
"** Shares in Dubai-listed construction firm Arabtec ARTC.DU jump 6.9 percent to 1.71 dirhams in early, unusually heavy trade; on Wednesday, stock had hit nine-year low ** Arabtec reported on Thursday Q1 net profit attributable to shareholders of 63.6 mln dirhams ($17.3 million), up from 17.6 million dirhams a year ago; highest profit since Q3 2014. Q1 revenues also rose ** Company seeking to recover from construction industry downturn in region and difficulties in obtaining receivables, especially in Saudi Arabia "
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"** Shares in Dubai-listed construction firm Arabtec ARTC.DU jump 6.9 percent to 1.71 dirhams in early, unusually heavy trade; on Wednesday, stock had hit nine-year low ** Arabtec reported on Thursday Q1 net profit attributable to shareholders of 63.6 mln dirhams ($17.3 million), up from 17.6 million dirhams a year ago; highest profit since Q3 2014. Q1 revenues also rose ** Company seeking to recover from construction industry downturn in region and difficulties in obtaining receivables, especially in Saudi Arabia "
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UAE's TAQA Q1 profit up on higher oil prices | Reuters
UAE's TAQA Q1 profit up on higher oil prices | Reuters:
"Abu Dhabi National Energy Company (TAQA) on Thursday reported a 43 percent rise in first-quarter profit, boosted by higher crude oil prices. The state-owned oil explorer and power supplier made a profit attributable to shareholders of 110 million dirhams ($30 million) in the three months ending March 31, it said in a bourse statement. That compared with 77 million dirhams profit earned in the first quarter of 2017. Revenues in the quarter totalled 4.3 billion dirhams versus 4.1 billion dirhams in the year-ago period. Production volumes of 123,800 barrels of oil equivalent per day in the first quarter 2018 were down 6 percent from the year earlier period, impacted by natural decline and North Sea platform maintenance. But operating margins per barrel increased, mainly driven by higher realised prices, the statement said. “TAQA is concentrating on optimizing its assets in the oil and gas business, while studying growth opportunities in the power and water sector,” Saeed Mubarak al Hajeri, chairman of Taqa said in the statement. TAQA’S liquidity stood at 12.6 billion dirhams, including 3.6 billion dirhams in cash and cash equivalents and 8.9 billion dirhams of undrawn credit facilities. Total debt was reduced by 790 million dirhams during the period, bringing it down to 69.4 billion dirhams ending March 31. Last month, TAQA issued $1.75 billion in bonds for repaying outstanding debt."
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"Abu Dhabi National Energy Company (TAQA) on Thursday reported a 43 percent rise in first-quarter profit, boosted by higher crude oil prices. The state-owned oil explorer and power supplier made a profit attributable to shareholders of 110 million dirhams ($30 million) in the three months ending March 31, it said in a bourse statement. That compared with 77 million dirhams profit earned in the first quarter of 2017. Revenues in the quarter totalled 4.3 billion dirhams versus 4.1 billion dirhams in the year-ago period. Production volumes of 123,800 barrels of oil equivalent per day in the first quarter 2018 were down 6 percent from the year earlier period, impacted by natural decline and North Sea platform maintenance. But operating margins per barrel increased, mainly driven by higher realised prices, the statement said. “TAQA is concentrating on optimizing its assets in the oil and gas business, while studying growth opportunities in the power and water sector,” Saeed Mubarak al Hajeri, chairman of Taqa said in the statement. TAQA’S liquidity stood at 12.6 billion dirhams, including 3.6 billion dirhams in cash and cash equivalents and 8.9 billion dirhams of undrawn credit facilities. Total debt was reduced by 790 million dirhams during the period, bringing it down to 69.4 billion dirhams ending March 31. Last month, TAQA issued $1.75 billion in bonds for repaying outstanding debt."
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Oil prices hit highest in years as markets adjust to looming sanctions on Iran | Reuters
Oil prices hit highest in years as markets adjust to looming sanctions on Iran | Reuters:
"Oil prices clocked up more multi-year highs on Thursday as traders adjusted to the prospects of renewed U.S. sanctions against major crude exporter Iran amid an already tightening market.
The United States plans to impose new sanctions against Iran, which produces around 4 percent of global oil supplies, after abandoning an agreement reached in late 2015 which limited Tehran’s nuclear ambitions in exchange for removing U.S.-Europe sanctions.
Oil prices rose sharply in response to the announced measures.
"
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"Oil prices clocked up more multi-year highs on Thursday as traders adjusted to the prospects of renewed U.S. sanctions against major crude exporter Iran amid an already tightening market.
The United States plans to impose new sanctions against Iran, which produces around 4 percent of global oil supplies, after abandoning an agreement reached in late 2015 which limited Tehran’s nuclear ambitions in exchange for removing U.S.-Europe sanctions.
Oil prices rose sharply in response to the announced measures.
"
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