Borrowing Is Outside the Law for Gulf Laggard Draining Reserves - Bloomberg

Borrowing Is Outside the Law for Gulf Laggard Draining Reserves - Bloomberg:

From an unpredictable monetary policy to its noisy domestic politics, Kuwait is often the odd one out in the Gulf.

It boasts the region’s first female finance minister and, uniquely for a Gulf monarchy, has an elected legislature. But acrimony between lawmakers and the appointed government has resulted in eight administrations in as many years, and the fallout on fiscal policy is becoming harder to contain.

Unlike most of its neighbors, OPEC’s fourth-largest producer has failed to introduce taxes after taking a hit from lower oil prices since 2014, earning the moniker of the “slowest reformer” among Gulf Arab economies from Fitch Ratings. For the year starting April 1, AA-rated Kuwait expects to run its biggest-ever budget deficit on anticipation of a decline in oil income and output.

The government’s financing needs “are projected to grow rapidly,” the International Monetary Fund warned last week.

#Saudi lender Samba posts 30% rise in 2019 net profit - Reuters

Saudi lender Samba posts 30% rise in 2019 net profit - Reuters:

Saudi lender Samba Financial Group on Sunday posted a 30% rise in annual net profit, helped by a lower charge for an Islamic tax and a double-digit rise in revenue from special commissions, financing and investments.

Samba said in a bourse filing its 2019 net profit was 3.99 billion riyals, up from 3.06 billion riyals a year earlier.

Analysts had forecast the bank would make a net profit averaging 4.3 billion riyals, according to Refinitiv data. 

Samba’s fourth-quarter net profit was 764 million riyals, compared to a net loss of 586 million riyals a year earlier, according to Reuters calculations in the absence of a quarterly breakdown.

Growth in Gulf countries set to recover in 2020: Emirates NBD | ZAWYA MENA Edition

Growth in Gulf countries set to recover in 2020: Emirates NBD | ZAWYA MENA Edition:

Growth in the Gulf Cooperation Council (GCC) region is set to recover in 2020, following a subdued performance in the previous year.

According to Emirates NBD’s Global Outlook 2020, growth in the Gulf states’ real gross domestic product (GDP), an indicator of the health of an economy, is forecast to rise by 1.47 percent in 2020, up from an estimated 0.5 percent for 2019.

In the UAE, the real GDP growth is expected to hit 1.6 percent this year, driven by non-oil sectors, according to the report. A United Nations (UN) report estimates that the UAE’s real GDP grew at 1.1 percent in 2019, while official data show that real growth accelerated by 2.1 percent in the first half of 2019.

For Saudi Arabia, the real GDP growth is likely to reach 1.3 percent in 2020, up from the official estimate of 0.4 percent in 2019, while non-oil sector growth is likely to slow somewhat.

#Dubai Islamic Bank to cut 500-plus Noor Bank jobs -sources - Reuters

Dubai Islamic Bank to cut 500-plus Noor Bank jobs -sources - Reuters:

Dubai Islamic Bank (DIB) could axe more than half the workforce with a planned 500-plus job cuts at newly acquired Noor Bank as part of cost cuts across both lenders, said three sources close to the matter.

Final numbers on the job losses will emerge after completion of interviews between DIB managers and Noor Bank staff, two of the sources said.

DIB has more than 9,000 employees, the bank says, while sources said that Noor Bank has between 1,200 and 1,400 full-time staff.

DIB did not immediately respond to a request for comment.

#Kuwait and #SaudiArabia start work to resume oil output from Khafji: sources - Reuters

Kuwait and Saudi Arabia start work to resume oil output from Khafji: sources - Reuters:

Kuwait and Saudi Arabia have started preparation work to resume crude oil production from the al-Khafji oilfield jointly operated by the two countries, with initial output expected around the end of February, two industry sources said.

Kuwait and Saudi Arabia, both members of the Organization of the Petroleum Exporting Countries (OPEC), agreed last year to end a five-year dispute over the area known as the Neutral Zone, allowing production to resume at two jointly run fields that can pump up to 0.5% of the world’s oil supply.

Trial production of about 10,000 barrels per day (bpd) from Khafji will start around Feb. 25, a Kuwaiti oil official told Reuters on condition of anonymity, adding that this would be “sufficient to test all installations and their operational efficiency”. 


The field should be pumping about 60,000 bpd by August, the official said.

MIDEAST STOCKS-Gulf tracks global declines on economic fears over China virus - Agricultural Commodities - Reuters

MIDEAST STOCKS-Gulf tracks global declines on economic fears over China virus - Agricultural Commodities - Reuters:

Most Middle Eastern bourses were pressured
on Sunday, mirroring Friday's slide in global shares and oil
prices due to growing concern about the economic impact of a new
coronavirus outbreak, while Saudi Arabia was hit by slew of poor
corporate earnings.

China ramped up measures to contain the epidemic and shore
up an economy hit by travel curbs and business shut-downs on
Sunday as the first death from the illness was reported outside
the country.

Some 304 people have died in China, the country's National
Health Commission said on Sunday, with the number of infections
jumping to 14,380 as of Saturday. 

Saudi Arabia's index declined 1.3%, dragged lower by
banking share losses. Al Rajhi Bank fell 1.1%, while
Alinma Bank retreated 3.7% following an 11.3% decline
in its annual net profit.

OPEC Only Faces One Choice in China's Coronavirus Crisis - Bloomberg

OPEC Only Faces One Choice in China's Coronavirus Crisis - Bloomberg:

Oil producers are starting to feel the impact of  the new coronavirus as it continues to spread, and they need to take drastic action to head off a potentially devastating impact on prices. The world’s biggest producers face two key questions, how long will it last and how severe will the consequences will be? The answers are of course still elusive, but the OPEC+ group of nations will need to weigh some educated guesses soon.

The initial reaction resembles that of an agitated anthill, with frantic scurrying in all directions amid an apparent lack of coordination. The final days of last week saw calls for their next meeting, scheduled for the first week of March, to be brought forward, perhaps by as much as a month. That move appeared to be driven by Saudi Arabia, OPEC’s biggest producer, but initially found little support from the largest of the non-OPEC members of the wider group — Russia.

One of the key challenges facing the Organization of the Petroleum Exporting Countries and its big oil-producing counterparts is that they have no idea how big a problem they face. At this point, estimates of the epidemic’s impact on oil demand vary widely. S&P Global Platts sees global oil demand falling by an “almost catastrophic” 2.6 million barrels a day in February and 2 million barrels in March in its worst-case scenario. No wonder producers are in a panic.

#Dubai property prices set to rebound in 2020 | ZAWYA MENA Edition

Dubai property prices set to rebound in 2020 | ZAWYA MENA Edition:

The property market in Dubai may not see huge price falls this year despite the tens of thousands of new homes joining the market.

Property experts suggest that home sale prices will either ease or rebound over the next several months due to positive market sentiment and an expected decline in new project launches.

“Prices could see a rebound for reasons related to a possible end of a correction cycle and an emerging positive sentiment closely related with the expected improving economy going forward,” Haider Tuaima, head or real estate research at ValuStrat, told Zawya.

Property prices in the UAE have been falling since 2014 due to a combination of factors, such as a huge supply glut, negative investor sentiment, low oil prices and a strong US dollar. Since the end of 2015 alone, apartment and villa sales prices in Abu Dhabi declined by 29 percent and 11 percent, respectively.

Key to Aramco’s Calm January Lies in Hands of #Saudi Stock Owners - Bloomberg

Key to Aramco’s Calm January Lies in Hands of Saudi Stock Owners - Bloomberg:

January delivered a hefty slice of volatility for oil and global energy stocks as the spreading coronavirus shocked investors. But in Riyadh, shares in Saudi Aramco followed a different narrative in their first full month of trading.

The stock weathered the month -- marked by the U.S. killing of an Iranian general and then the spread of the coronavirus -- much better than oil-major peers, ending well above the price set at its record initial public offering. Aramco retreated 3.1% in January, in contrast with the 12% slump in Brent crude and a drop of more than 10% for global peers such as Chevron Corp., Total SA and Royal Dutch Shell Plc.

The reason for the outperformance lies within Saudi Arabia itself. Shares in the oil giant are mostly owned by locals, who are less likely than foreign money managers to sell in times of increased geopolitical tension or during swings in the oil price. The government relied heavily on local investors and funds based in neighboring Gulf monarchies to sell about 1.7% of Aramco in the world’s biggest IPO, with almost five million individuals -- more than one-in-seven Saudi residents -- placing bids. In the end, foreigners subscribed for 23.1% of the stock on offer.

Russian oil output up to 11.28 million bpd in January, highest since August - Reuters

Russian oil output up to 11.28 million bpd in January, highest since August - Reuters:

Russian oil and gas condensate output C-RU-OUT rose to 11.28 million barrels per day (bpd) in January, from 11.26 million bpd in December, Interfax news agency reported on Sunday, citing Energy Ministry’s data.

This is in line with what sources told Reuters last week and the highest since it reached 11.29 million bpd in August.

In tonnes, oil output rose to 47.72 million versus 47.63 million in December. Reuters uses a 7.33 conversion ratio in its calculations when converting tonnes to barrels.

Gas condensate, a light oil, has been excluded from Russia’s production quota in a global pact aimed at curbing oil production and balancing out the energy markets.

MIDEAST STOCKS- #Saudi leads Gulf stock declines amid coronavirus jitters - Agricultural Commodities - Reuters

MIDEAST STOCKS-Saudi leads Gulf stock declines amid coronavirus jitters - Agricultural Commodities - Reuters:

Major Gulf stock markets fell in early trade on Sunday following a decline in oil prices amid mounting economic worries from the spreading coronavirus, with Saudi Arabia leading the losers after a string of poor corporate earnings.

On Friday, Brent crude fell 13 cents to settle at $58.16 a barrel as authorities worldwide imposed travel restrictions to China, where the total number of coronavirus deaths reached 304 as of late Saturday.

Saudi Arabia’s benchmark share price index fell 1.3% on Sunday led by a 1.1% loss at Al Rjahi Bank.

Alinma Bank shed 3.5% after it said its annual net profit declined by 11.3%, while Saudi Arabian Mining lost 2.7%. On Thursday the Saudi miner reported an annual net loss of 739.5 million riyals ($197.14 million) compared with a profit of 1.85 billion riyals a year earlier.