Middle East News: #Oman Weighs Financial Aid Request From Gulf - Bloomberg

Middle East News: Oman Weighs Financial Aid Request From Gulf - Bloomberg:

Oman has discussed the possibility of financial aid with other Gulf states to help it cope with the economic impact of the coronavirus pandemic and low oil prices, according to two officials in the region and a U.S. government official familiar with the contacts.

The topic was one of several discussed at recent high-level political meetings between Gulf officials, two of the people said. The discussions are preliminary and nothing has been decided, including the scope or type of support that could be on the table, they said, declining to be named because of the sensitive nature of the conversations.

The talks took place at the leadership and foreign ministry level, the people said.

An Omani foreign ministry official said the country is engaged with Gulf neighbors to discuss ways to back up its national program to mitigate the impacts of the drop in oil prices and the coronavirus outbreak, asking not to be named because the discussions haven’t been made public.

Mideast Stocks: Most of Gulf in red as oil prices fall; banks aid #Qatar | ZAWYA MENA Edition

Mideast Stocks: Most of Gulf in red as oil prices fall; banks aid Qatar | ZAWYA MENA Edition:

Most Middle Eastern stock markets ended lower on Thursday, amid falling oil prices, though the Qatari index bucked the trend on the back of gains for its banking shares.

Brent crude futures erased Wednesday's gains, falling 6.1%, or $2.53, to $39.20 a barrel by 1246 GMT, hit by a record build-up in U.S. crude inventories and the U.S. Federal Reserve's projections that the world's biggest economy would shrink 6.5% this year. 

Saudi Arabia's benchmark index slipped 0.3%, with National Commercial Bank losing 1.5% and Samba Financial Group shedding 2.2%.

But oil giant Saudi Aramco, which raised gasoline prices for June, edged up 0.2%.

In Dubai, the index dropped 1%, pressured by a 1.6% fall in Emirates NBD Bank, and a 4.6% slide in Dubai Investments as the stock traded ex-dividend.

The Abu Dhabi index eased 0.8%, with the United Arab Emirates' largest lender, First Abu Dhabi Bank, falling 2.4%.

The UAE economy is likely to contract by 3.6% this year after economic activity slowed because of the coronavirus outbreak, the central bank said on Wednesday. 

In Qatar, the index gained 0.5%, helped by a 3.5% rise in Qatar Islamic Bank and a 0.6% increase in Qatar National Bank.

Emirates NBD Bank clarifies: No acquisition of shares by US-based bank | ZAWYA MENA Edition

Emirates NBD Bank clarifies: No acquisition of shares by US-based bank | ZAWYA MENA Edition:

Emirates NBD Bank has said that 101,731,408 shares were purchased by 254 unique investors on 28th May 2020, following a press clipping indicating that the US-based Bank of America, BofA, had acquired a 1.5 percent stake in Emirates NBD.

In a statement published on the Dubai Financial Market website, the Dubai-based bank explained, "The largest purchase by one single investor was 10,116,892 shares on this date (28th May 2020)." It went on to note that, "This increase in purchase volume coincides with Emirates NBD’s inclusion in the ‘MSCI Emerging Markets Standard Index’ and Emirates NBD Bank confirms that a large number of these purchases were made by Emerging Markets Index Tracking Funds.

Emirates NBD issued the statement in response to a recent news report speculating that BofA had bought 100 million shares - 1.5 percent stake of Emirates NBD Bank PJSC - worth about AED900 million.

Qatari government entities must cut foreign staff costs by 30%: document - Reuters

Qatari government entities must cut foreign staff costs by 30%: document - Reuters:

Qatar has directed ministries and all other government and public entities to reduce costs for non-Qatari employees by 30% as of June 1, either via pay cuts or lay-offs, a finance ministry document seen by Reuters showed. 


The document also outlined other cuts affecting Qatari employees, including to benefits, which come as the world’s top liquefied natural gas exporter feels the bite of a global coronavirus downturn that has sapped energy demand.

Expatriates make up the majority of many Gulf states’ populations, including in tiny Qatar, where the workforce of everything from its banks to airlines are filled out by foreign nationals.

Like other Gulf states, Qatar has been pushing to nationalise much of its labour force, a task complicated by a national population of just roughly 300,000.

Oil prices slump 8% as virus-related demand concerns resurface - Reuters

Oil prices slump 8% as virus-related demand concerns resurface - Reuters:

Oil prices tumbled about 8% a barrel on Thursday, fuelled by renewed concerns about demand destruction as new cases of coronavirus tick up globally, while crude inventories hit a record in the United States.

U.S. coronavirus cases surpassed 2 million on Wednesday, according to a Reuters tally, and new infections are rising slightly after five weeks of declines. While most states have loosened restrictions on movement that shackled demand, fuel consumption remains 20% below typical levels, as consumers remain cautious.

The U.S. Federal Reserve has expressed concern that this will continue, limiting demand.

“A series of local spikes could have the effect of undermining people’s confidence in travelling, in restaurants, entertainment,” Fed Chair Jerome Powell said on Wednesday.

Brent crude LCOc1 futures fell $3.18, or 7.6%, to settle at $38.55 a barrel. U.S. West Texas Intermediate (WTI) crude CLc1 fell $3.26, or 8.2%, to settle at $36.34 a barrel. Brent and WTI posted their worst daily drops since April 21 and 27, respectively.

European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar close

European, Middle Eastern & African Stocks - Bloomberg:

Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.

A $230 Billion Wealth Fund Readies Dry Powder for U.S. Deals - Bloomberg

A $230 Billion Wealth Fund Readies Dry Powder for U.S. Deals - Bloomberg:

One of the world’s biggest sovereign wealth funds said it’s ready to use its growing cash pile to buy more stocks and make other overseas equity investments, possibly in the U.S.

Mubadala Investment Co., which has $232 billion of assets, is looking at deals across the globe, according to Saeed Al Mazrouei, deputy chief financial officer and head of mergers and acquisitions at the Abu Dhabi-based firm.

The company would join other sovereign funds from Norway to Saudi Arabia in bulking up on stocks that got hammered during the meltdown in global markets earlier this year as the coronavirus spread and energy prices crashed.

“We have built dry powder over the last two years,” he said in an interview with Bloomberg Television. “We are looking to deploy that across different sectors and asset classes. I believe the U.S. market is very resilient. We don’t see any systemic risk. We see strong capitalization in the banking system.”

#UAE's flydubai extends salary cuts, puts pilots on unpaid leave: sources - Reuters

UAE's flydubai extends salary cuts, puts pilots on unpaid leave: sources - Reuters:

United Arab Emirates carrier flydubai has indefinitely extended the period of reduced pay for employees and placed dozens of pilots on unpaid leave for a year, company sources said.

The airline had temporarily cut salaries for three months from April, which an employee had said reduced wages of pilots and engineers by half and cabin crew pay by a quarter.

It extended the pay cut and placed some pilots on unpaid leave in effort to preserve cash, two sources said.

Pilots could be recalled to paid work early if needed, they said.

Flydubai in talks with staff as Covid-19 impact intensifies - Arabianbusiness

Flydubai in talks with staff as Covid-19 impact intensifies - Arabianbusiness:

Dubai-based low-cost carrier Flydubai has revealed talks are taking place with staff regarding their future employment with the company, as the airline battles against the economic impact of the coronavirus pandemic.

Employees had already agreed to take a three-month salary cut from April, ranging from 50 percent and 25 percent for certain pay grades, although junior members of staff were not impacted – this has been extended for an indefinite period.

While earlier this week it was announced that a number of staff had been asked to take unpaid leave.

A statement sent to Arabian Business on Thursday said: “We have constantly reviewed the evolving situation and the implications for our medium-term operations. The outcome has resulted in discussions with a number of our pilots and cabin crew regarding their future employment with the airline.”

Middle East News: #UAE's Covid-19 Recovery Seen U and V Shaped - Bloomberg

Middle East News: UAE's Covid-19 Recovery Seen U and V Shaped - Bloomberg:

The United Arab Emirates economy will likely witness a combination of a U- or V-shaped recovery following the coronavirus pandemic, the oil-rich nation’s minister of infrastructure development said.

The country has a pipeline of 20 billion dirhams ($5.4 billion) of federal infrastructure projects, including 7 billion dirhams for state-sponsored housing programs, Abdullah Al Nuaimi, said in an interview with Bloomberg TV. The plans will continue albeit with some delays, he said.

The economic slowdown in the UAE may deplete the population of 10 million, mostly made up of foreign workers. Oxford Economics estimates the country could lose 900,000 jobs and see 10% of its residents leave. -- the central bank expected non-oil economy to contract 4.1% this year

#Qatar Cuts Pay for Foreign Employees Working for Government - Bloomberg

Qatar Cuts Pay for Foreign Employees Working for Government - Bloomberg:

Qatar told government-funded entities to cut spending on non-Qatari staffers’ wages as it tries to shore up its finances to cope with the impact of the coronavirus pandemic. 

The Ministry of Finance instructed government ministries, institutions and entities funded by the state to reduce monthly costs for non-Qatari employees by 30% from June 1, either by cutting salaries or laying off workers with a two-month notice, according to a letter seen by Bloomberg.

Declines in energy prices have dented Gulf states’ coffers just as local economies struggle under pandemic-driven lockdowns. Most are bridging the gap with a combination of spending cuts and debt issuance. Qatar, which is due to host the 2022 soccer World Cup, raised $10 billion in debt in April.

In introducing cuts targeting foreign workers or support programs that exclude them, Qatar is joining its neighbors from Oman to the United Arab Emirates. Meanwhile, Kuwait’s prime minister said the country’s expatriate population should be more than halved to 30% of the total.

Mubadala well placed to face 'double whammy' of Covid-19 and oil crash - Arabianbusiness

Mubadala well placed to face 'double whammy' of Covid-19 and oil crash - Arabianbusiness:

Abu Dhabi-based Mubadala Investment Company is in a strong position to see out the “double whammy” of the coronavirus pandemic and the crash in oil prices, according to its CEO and managing director, Khaldoon Khalifa Al Mubarak.

The emirate’s sovereign investor announced its financial results on Thursday, which included total income for 2019 of AED53 billion ($14.4bn), compared to AED12.5bn ($3.4bn) the previous year (324% increase), driven by Mubadala’s public equities portfolio and funds, as well as the company’s assets across various sectors.

Mubarak described last year as a “milestone benchmark year” for the group and said Mubadala is well placed going forward, despite the current global economic turmoil.

European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar mid-session

European, Middle Eastern & African Stocks - Bloomberg:

Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.

Oil prices drop on concerns about patchy demand recovery, record U.S. stocks - Reuters

Oil prices drop on concerns about patchy demand recovery, record U.S. stocks - Reuters:

Oil prices fell by about 4% on Thursday on worries about slow demand growth as coronavirus cases rise, with U.S. crude stockpiles hitting an all-time high and the U.S. Federal Reserve saying recovery from the pandemic could take years. 

Brent crude LCOc1 futures fell 3.4%, or $1.42, to $40.31 a barrel by 0600 GMT, erasing Wednesday’s gains. Earlier in the session, Brent was down as much as $1.53, or 3.7%.

U.S. West Texas Intermediate (WTI) crude CLc1 dropped 4%, or $1.60, to $38 a barrel, after being down earlier as much as $1.69, or 4.3%.

U.S. crude inventories rose unexpectedly by 5.7 million barrels in the week to June 5 to 538.1 million barrels - a record - as imports were boosted by the arrival of supplies bought by refiners when Saudi Arabia flooded the market in March and April, data from the Energy Information Administration (EIA) showed.

MIDEAST STOCKS-Major Gulf indexes retreat amid falling oil prices - Agricultural Commodities - Reuters

MIDEAST STOCKS-Major Gulf indexes retreat amid falling oil prices - Agricultural Commodities - Reuters:

Stock markets in the Gulf traded lower on Thursday after oil prices fell on worries about slow demand growth as coronavirus cases rise, with U.S. crude stockpiles hitting an all-time high.

Brent crude futures fell 3.4%, or $1.42, to $40.31 a barrel by 0740 GMT, erasing Wednesday’s gains.

The benchmark index in Saudi Arabia, which has reported the highest number of new coronavirus infections in the six countries of the Gulf Cooperation Council, traded 0.9% down. Al Rajhi Bank dropped 1.2% and National Commercial Bank, the kingdom’s largest lender, declined 1.8%.

Elsewhere, petrochemical maker Saudi Basic Industries retreated 0.5%.