Oil rises on economic optimism, tightening supplies | Reuters
Oil rose on strong U.S. economic data, falling inventories and a decision by the Organization of the Petroleum Exporting Countries and producer allies to stick to its output cuts. But a stronger dollar limited price gains.
Brent crude futures settled up 38 cents at $58.84 a barrel. U.S. crude futures added 54 cents to settle at $56.23 a barrel.
Thursday 4 February 2021
#Kuwait should accelerate reforms to be less tied to oil price fluctuations - IMF | Reuters
Kuwait should accelerate reforms to be less tied to oil price fluctuations - IMF | Reuters
Kuwait needs to accelerate reforms to reduce the dependence of government policies on the rise and fall of oil prices, an International Monetary Fund (IMF) official said.
The oil-rich Gulf state faces near-term liquidity risks largely due to the absence of parliamentary authorisation for the government to borrow.
“Kuwait has high levels of buffers but they need to accelerate reforms,” said Jihad Azour, director of the Middle East and Central Asia Department at the IMF.
Kuwait has been hit hard by lower oil prices and the COVID-19 pandemic, but economic reforms have stalled due to repeated rows and deadlocks between cabinets and assemblies.
Ratings agency Fitch this week downgraded Kuwait’s outlook to “negative” from “stable”.
Kuwait needs to accelerate reforms to reduce the dependence of government policies on the rise and fall of oil prices, an International Monetary Fund (IMF) official said.
The oil-rich Gulf state faces near-term liquidity risks largely due to the absence of parliamentary authorisation for the government to borrow.
“Kuwait has high levels of buffers but they need to accelerate reforms,” said Jihad Azour, director of the Middle East and Central Asia Department at the IMF.
Kuwait has been hit hard by lower oil prices and the COVID-19 pandemic, but economic reforms have stalled due to repeated rows and deadlocks between cabinets and assemblies.
Ratings agency Fitch this week downgraded Kuwait’s outlook to “negative” from “stable”.
CEO at UAE's construction giant Arabtec makes an exit | Property – Gulf News
CEO at UAE's construction giant Arabtec makes an exit | Property – Gulf News
The UAE's biggest construction company, Arabtec, has let go of its CEO - Wail Farsakh. The company is currently in the liquidation process and changes at the top was something that the marketplace was talking about.
Farsakh had been in the saddle for the last year and had come in at a time when the company was still trying to arrest its slide into bankruptcy. There was a phase when it was felt that Arabtec would find strategic investors - and the money - to survive.
The liquidation when complete would represent the biggest such in UAE's corporate history. It will also be the biggest since the amended Bankruptcy Law came into effect.
The UAE's biggest construction company, Arabtec, has let go of its CEO - Wail Farsakh. The company is currently in the liquidation process and changes at the top was something that the marketplace was talking about.
Farsakh had been in the saddle for the last year and had come in at a time when the company was still trying to arrest its slide into bankruptcy. There was a phase when it was felt that Arabtec would find strategic investors - and the money - to survive.
The liquidation when complete would represent the biggest such in UAE's corporate history. It will also be the biggest since the amended Bankruptcy Law came into effect.
Trafigura, Mubadala Said to Weigh Sale of Spanish Copper Miner - Bloomberg
Trafigura, Mubadala Said to Weigh Sale of Spanish Copper Miner - Bloomberg
Commodities trader Trafigura Group and Abu Dhabi wealth fund Mubadala Investment Co. are considering the sale of a Spanish copper miner amid rising demand for the base metal, people familiar with the matter said.
The joint owners have been discussing a potential disposal of Minas de Aguas Tenidas, known as Matsa, according to the people. The operations could be valued at about $2 billion or more in a sale, the people said, asking not to be identified because the information is private.
Matsa could be one of the largest copper assets to come to the market in Europe this year. The company owns the Agua Tenidas, Sotiel and Magdalena mines in southern Spain, which produce copper, zinc and lead concentrates.
The venture could attract interest from large miners seeking to expand their copper portfolios, according to the people. The price of the metal has jumped about 40% over the past year amid renewed demand from China. Trafigura and Mubadala are likely to appoint an adviser to assist with the sale in the coming days, the people said.
Commodities trader Trafigura Group and Abu Dhabi wealth fund Mubadala Investment Co. are considering the sale of a Spanish copper miner amid rising demand for the base metal, people familiar with the matter said.
The joint owners have been discussing a potential disposal of Minas de Aguas Tenidas, known as Matsa, according to the people. The operations could be valued at about $2 billion or more in a sale, the people said, asking not to be identified because the information is private.
Matsa could be one of the largest copper assets to come to the market in Europe this year. The company owns the Agua Tenidas, Sotiel and Magdalena mines in southern Spain, which produce copper, zinc and lead concentrates.
The venture could attract interest from large miners seeking to expand their copper portfolios, according to the people. The price of the metal has jumped about 40% over the past year amid renewed demand from China. Trafigura and Mubadala are likely to appoint an adviser to assist with the sale in the coming days, the people said.
Oil Climbs Ever Closer Toward $60 With Inventories in Retreat - Bloomberg
Oil Climbs Ever Closer Toward $60 With Inventories in Retreat - Bloomberg
Oil prices continued their surge in the world’s major trading centers, fortified by shrinking stockpiles and continued investor optimism that the market will strengthen in the coming months.
Brent crude, which was about $35 a barrel as recently as three months ago, rose as high as $59.04 on Thursday. Multiple trading gauges suggest a market that’s getting tighter, a move with global ramifications including boosting the revenues of oil-rich economies and bolstering gasoline prices at the pump.
Crude inventories at a key storage hub in the U.S. are now below their five-year average, and nationwide stockpiles continue to slump, an early indication that Saudi Arabia and its allies are succeeding in their efforts to drain a glut. Inventories are also dropping in China, where oil major Royal Dutch Shell Plc said its sales in January were up significantly on a year earlier, meaning the world’s two most-important demand centers are seeing a notable tightening.
Oil prices continued their surge in the world’s major trading centers, fortified by shrinking stockpiles and continued investor optimism that the market will strengthen in the coming months.
Brent crude, which was about $35 a barrel as recently as three months ago, rose as high as $59.04 on Thursday. Multiple trading gauges suggest a market that’s getting tighter, a move with global ramifications including boosting the revenues of oil-rich economies and bolstering gasoline prices at the pump.
Crude inventories at a key storage hub in the U.S. are now below their five-year average, and nationwide stockpiles continue to slump, an early indication that Saudi Arabia and its allies are succeeding in their efforts to drain a glut. Inventories are also dropping in China, where oil major Royal Dutch Shell Plc said its sales in January were up significantly on a year earlier, meaning the world’s two most-important demand centers are seeing a notable tightening.
#Kuwait Finance House fourth quarter net profit falls 22% as COVID-19 hurts economy | Reuters
Kuwait Finance House fourth quarter net profit falls 22% as COVID-19 hurts economy | Reuters
Kuwait Finance House on Thursday reported a 22% drop in fourth-quarter net profit and a 40.9% drop in 2020 net profit, blaming the annual fall on a sharp slide in investment income and a rise in impairment charges.
Kuwaiti banks’ earnings have been hit by the effects of the coronavirus pandemic and relative weakness in oil prices, which caused the economy to contract last year.
Fitch Ratings, which cut its ratings outlook on Kuwait to negative on Wednesday, has forecast that the oil producer’s economy will stage a modest recovery this year, and estimated last year’s contraction at 7%.
KFH said its net profit was 47.2 million dinars ($156 million) in the quarter that ended on Dec. 31, down from 60.5 million dinars in the same period a year earlier.
Kuwait Finance House on Thursday reported a 22% drop in fourth-quarter net profit and a 40.9% drop in 2020 net profit, blaming the annual fall on a sharp slide in investment income and a rise in impairment charges.
Kuwaiti banks’ earnings have been hit by the effects of the coronavirus pandemic and relative weakness in oil prices, which caused the economy to contract last year.
Fitch Ratings, which cut its ratings outlook on Kuwait to negative on Wednesday, has forecast that the oil producer’s economy will stage a modest recovery this year, and estimated last year’s contraction at 7%.
KFH said its net profit was 47.2 million dinars ($156 million) in the quarter that ended on Dec. 31, down from 60.5 million dinars in the same period a year earlier.
#Dubai leads major Gulf markets lower; Saudi index gains | Reuters
Dubai leads major Gulf markets lower; Saudi index gains | Reuters
Most stock markets in the Middle East ended lower on Thursday, with Dubai leading the losses, as a surge in COVID-19 cases rattled investor confidence, although Saudi Arabia bucked the trend to close higher.
The main share index in Dubai, the Middle East’s trade and tourism hub, dropped 1.5%. The index also posted its second weekly loss in five, losing 1% over the five sessions to Thursday.
Blue-chip developer Emaar Properties slid 2.5%, while Dubai Investments retreated 4.9%, to become the top loser on the index, a day after it reported a sharp decline in full-year profit.
A second wave of coronavirus infections threatens to upend a tourism boom in Dubai which provided a salve to its battered economy.
Dubai, one of the few destinations open to international travellers since July, has yet to impose the toughest restrictions after record daily infections in the UAE, in the hopes that vaccinations will spare a repeat of last year’s lockdown.
Following the correction of major exchanges including the U.S. at the end of January, easing of the local market is almost inevitable, said Daniella Stoeva, business market analyst with ICM.com.
The benchmark index in Saudi Arabia rose 0.9%, with Al Rajhi Bank advancing 3.5% and National Commercial Bank, the kingdom’s biggest lender, rising 1.7%.
The kingdom’s non-oil private sector grew strongly in January, its fifth straight month of expansion, as output soared and firms were hopeful of a substantial economic recovery, a survey showed on Wednesday.
In Abu Dhabi, the index slipped 0.2%, with the country’s largest lender First Abu Dhabi Bank losing 0.3%.
The Qatari index fell 0.4%, hit by a 1.5% fall in petrochemical maker Industries Qatar.
Most stock markets in the Middle East ended lower on Thursday, with Dubai leading the losses, as a surge in COVID-19 cases rattled investor confidence, although Saudi Arabia bucked the trend to close higher.
The main share index in Dubai, the Middle East’s trade and tourism hub, dropped 1.5%. The index also posted its second weekly loss in five, losing 1% over the five sessions to Thursday.
Blue-chip developer Emaar Properties slid 2.5%, while Dubai Investments retreated 4.9%, to become the top loser on the index, a day after it reported a sharp decline in full-year profit.
A second wave of coronavirus infections threatens to upend a tourism boom in Dubai which provided a salve to its battered economy.
Dubai, one of the few destinations open to international travellers since July, has yet to impose the toughest restrictions after record daily infections in the UAE, in the hopes that vaccinations will spare a repeat of last year’s lockdown.
Following the correction of major exchanges including the U.S. at the end of January, easing of the local market is almost inevitable, said Daniella Stoeva, business market analyst with ICM.com.
The benchmark index in Saudi Arabia rose 0.9%, with Al Rajhi Bank advancing 3.5% and National Commercial Bank, the kingdom’s biggest lender, rising 1.7%.
The kingdom’s non-oil private sector grew strongly in January, its fifth straight month of expansion, as output soared and firms were hopeful of a substantial economic recovery, a survey showed on Wednesday.
In Abu Dhabi, the index slipped 0.2%, with the country’s largest lender First Abu Dhabi Bank losing 0.3%.
The Qatari index fell 0.4%, hit by a 1.5% fall in petrochemical maker Industries Qatar.
IMF calls on Arab leaders to take action or risk new ‘lost decade’ | Financial Times
IMF calls on Arab leaders to take action or risk new ‘lost decade’ | Financial Times
The IMF has warned that the Arab world risks another “lost decade” if governments fail to invest in technology and implement reforms to accelerate the recovery of economies that have been battered by the pandemic.
The IMF has warned that the Arab world risks another “lost decade” if governments fail to invest in technology and implement reforms to accelerate the recovery of economies that have been battered by the pandemic.
Jihad Azour, the fund’s director for the Middle East, told the Financial Times that governments in the region, which are grappling with diminishing resources, rising debts and rampant youth unemployment, had to “learn from the past”.
“After the global financial crisis, it took the countries of the region much longer than the average emerging economy to regain their previous level of growth,” said Mr Azour, a former finance minister of Lebanon. “The risk now is that there are countries that will not be able to regain their 2019 level [of output] until 2022, and some who won’t reach it for five years.”
Even before the coronavirus outbreak, poorer oil-importing countries in the region had failed to tackle high poverty rates and joblessness in the decade since social and economic grievances fuelled the Arab uprisings. The pandemic has exacerbated the problem by shuttering the tourism industry vital for employment and foreign currency earnings, and damaging other sectors.
Swiss bank NPB forms joint venture to set up wealth advisory business in #AbuDhabi | The National
Swiss bank NPB forms joint venture to set up wealth advisory business in Abu Dhabi | The National
Neue Privat Bank, a Zurich-based private bank, is tying up with investment company Almha to set up a private wealth advisory business in Abu Dhabi’s financial free zone.
NPB and Almha – a company founded by London-based entrepreneur Amjed Al Jaffery and Hareb Al Darmaki, a former chairman of the Central Bank of the UAE – are seeking a Category 4 licence to operate from Abu Dhabi Global Market, NPB chief executive Markus Ruffner told The National in an interview.
The joint venture entity is expected to be operational by the middle of 2021, subject to regulatory approvals, he said.
NPB, a small Swiss private bank, operates through a network of global managers who invest across asset classes including equities, debt, convertible instruments, private equity and real estate investments.
“Even the very large [private] banks, they are not very good in all markets and all asset classes,” Mr Ruffner said. “We have a lot of asset management companies … we choose [partners based] on what our clients need … [and pick] really the best for different investment segments.
Neue Privat Bank, a Zurich-based private bank, is tying up with investment company Almha to set up a private wealth advisory business in Abu Dhabi’s financial free zone.
NPB and Almha – a company founded by London-based entrepreneur Amjed Al Jaffery and Hareb Al Darmaki, a former chairman of the Central Bank of the UAE – are seeking a Category 4 licence to operate from Abu Dhabi Global Market, NPB chief executive Markus Ruffner told The National in an interview.
The joint venture entity is expected to be operational by the middle of 2021, subject to regulatory approvals, he said.
NPB, a small Swiss private bank, operates through a network of global managers who invest across asset classes including equities, debt, convertible instruments, private equity and real estate investments.
“Even the very large [private] banks, they are not very good in all markets and all asset classes,” Mr Ruffner said. “We have a lot of asset management companies … we choose [partners based] on what our clients need … [and pick] really the best for different investment segments.
Gulf States Reach Out to Erdogan in Wary Move to Ease Tensions - Bloomberg
Gulf States Reach Out to Erdogan in Wary Move to Ease Tensions - Bloomberg
The United Arab Emirates and Saudi Arabia are holding out the possibility of better ties with Turkey that could benefit trade and security in a volatile region, according to people familiar with the strategy.
The moves are tentative given the backdrop of longstanding tensions and jostling for influence. They are also likely to fall afoul of the Gulf duo’s insistence that Turkey rein in support for the Muslim Brotherhood, the pan-Islamist group they label as terrorist but which Ankara views as a popular movement. But even limited progress could ease frictions over wider regional issues.
The outreach -- taking place both publicly and privately -- coincides with foreign policy reboots both in the Gulf and Washington. Saudi Arabia and the UAE recently ended a rift with Turkey’s ally Qatar over topics with similarities to their dispute with Ankara.
Turkish President Recep Tayyip Erdogan is also seeking to improve relations with the European Union. And Turkey, the UAE and Saudi all face a U.S. administration under President Joe Biden that is likely to be tougher on all of them.
The United Arab Emirates and Saudi Arabia are holding out the possibility of better ties with Turkey that could benefit trade and security in a volatile region, according to people familiar with the strategy.
The moves are tentative given the backdrop of longstanding tensions and jostling for influence. They are also likely to fall afoul of the Gulf duo’s insistence that Turkey rein in support for the Muslim Brotherhood, the pan-Islamist group they label as terrorist but which Ankara views as a popular movement. But even limited progress could ease frictions over wider regional issues.
The outreach -- taking place both publicly and privately -- coincides with foreign policy reboots both in the Gulf and Washington. Saudi Arabia and the UAE recently ended a rift with Turkey’s ally Qatar over topics with similarities to their dispute with Ankara.
Turkish President Recep Tayyip Erdogan is also seeking to improve relations with the European Union. And Turkey, the UAE and Saudi all face a U.S. administration under President Joe Biden that is likely to be tougher on all of them.
Major Gulf markets mixed in early trade | Reuters
Major Gulf markets mixed in early trade | Reuters
Major Gulf stocks were mixed early on Thursday, with Dubai on track to extend losses from the previous session weighed by rising COVID-19 cases.
Dubai’s main share index fell 1.2%, with blue-chip developer Emaar Properties dropping 2% and Dubai Investments retreating 4.9%.
A second wave of coronavirus infections threatens to upend a tourism boom in Dubai which provided a salve to its battered economy.
Dubai, one of the few destinations open to international travellers since July, has yet to impose the toughest restrictions after record daily infections in the UAE, in the hopes that vaccinations will spare a repeat of last year’s lockdown.
In Abu Dhabi, the index slipped 0.1% hit by Abu Dhabi Commercial Bank falling 1.2%.
Saudi Arabia’s benchmark index edged up 0.2%, helped by Al Rajhi Bank gaining 1.3% and Saudi Arabian Mining Company (Ma’aden) jumping 4.4%.
On Wednesday, Ma’aden reported a full-year net loss of 208.9 million riyals ($55.69 million), compared with a loss of 739.5 million riyals a year earlier.
The kingdom’s non-oil private sector grew strongly in January, its fifth straight month of expansion, as output soared and firms were hopeful of a substantial economic recovery, a survey showed on Wednesday.
The Qatari index added 0.3%, boosted by the Gulf’s largest lender Qatar National Bank gaining 0.6%.
Major Gulf stocks were mixed early on Thursday, with Dubai on track to extend losses from the previous session weighed by rising COVID-19 cases.
Dubai’s main share index fell 1.2%, with blue-chip developer Emaar Properties dropping 2% and Dubai Investments retreating 4.9%.
A second wave of coronavirus infections threatens to upend a tourism boom in Dubai which provided a salve to its battered economy.
Dubai, one of the few destinations open to international travellers since July, has yet to impose the toughest restrictions after record daily infections in the UAE, in the hopes that vaccinations will spare a repeat of last year’s lockdown.
In Abu Dhabi, the index slipped 0.1% hit by Abu Dhabi Commercial Bank falling 1.2%.
Saudi Arabia’s benchmark index edged up 0.2%, helped by Al Rajhi Bank gaining 1.3% and Saudi Arabian Mining Company (Ma’aden) jumping 4.4%.
On Wednesday, Ma’aden reported a full-year net loss of 208.9 million riyals ($55.69 million), compared with a loss of 739.5 million riyals a year earlier.
The kingdom’s non-oil private sector grew strongly in January, its fifth straight month of expansion, as output soared and firms were hopeful of a substantial economic recovery, a survey showed on Wednesday.
The Qatari index added 0.3%, boosted by the Gulf’s largest lender Qatar National Bank gaining 0.6%.
Oil climbs after OPEC+ maintains oil output cuts, U.S. stock draw | Reuters
Oil climbs after OPEC+ maintains oil output cuts, U.S. stock draw | Reuters
Oil prices extended gains on Thursday after the OPEC+ alliance of major producers stuck to a reduced output policy, and as crude stockpiles in the United States fell to their lowest levels since March last year.
Brent crude futures gained 51 cents, or 0.9%, to $58.97 a barrel, by 0741 GMT, having earlier hit their highest since Feb. 21, 2020 in the wake of the OPEC+ decision.
U.S. West Texas Intermediate (WTI) crude futures climbed 53 cents, or 1%, to $56.22 a barrel after reaching its highest settlement level in a year on Wednesday.
“Crude prices have been rising higher now that OPEC+ has convinced the energy market that they are determined in accelerating market re-balancing without delay,” said Edward Moya, senior market analyst at OANDA.
Oil prices extended gains on Thursday after the OPEC+ alliance of major producers stuck to a reduced output policy, and as crude stockpiles in the United States fell to their lowest levels since March last year.
Brent crude futures gained 51 cents, or 0.9%, to $58.97 a barrel, by 0741 GMT, having earlier hit their highest since Feb. 21, 2020 in the wake of the OPEC+ decision.
U.S. West Texas Intermediate (WTI) crude futures climbed 53 cents, or 1%, to $56.22 a barrel after reaching its highest settlement level in a year on Wednesday.
“Crude prices have been rising higher now that OPEC+ has convinced the energy market that they are determined in accelerating market re-balancing without delay,” said Edward Moya, senior market analyst at OANDA.
Race between vaccines and virus to shape uneven Middle East recovery - IMF | Reuters
Race between vaccines and virus to shape uneven Middle East recovery - IMF | Reuters
The Middle East will see an uneven economic recovery from the COVID-19 pandemic, an International Monetary Fund official said, as countries move at different speeds to secure vaccines and fiscal policy responses differ across the region.
Oil-rich Gulf Cooperation Council countries have secured bilateral agreements with several vaccine providers, but fragile and conflict-afflicted states with limited healthcare capacities rely on the limited coverage of the World Health Organization’s (WHO) COVAX initiative, which could delay broad vaccine availability to the second half of 2022.
“What we are seeing today is still a race between the vaccine and the virus, and this will shape the recovery in 2021,” said Jihad Azour, director of the Middle East and Central Asia Department at the International Monetary Fund.
“We will have recovery across the board, but it will be divergent, uneven and uncertain,” he said, adding that accelerating vaccinations could improve growth outlooks by 0.3%-0.4%.
The Middle East will see an uneven economic recovery from the COVID-19 pandemic, an International Monetary Fund official said, as countries move at different speeds to secure vaccines and fiscal policy responses differ across the region.
Oil-rich Gulf Cooperation Council countries have secured bilateral agreements with several vaccine providers, but fragile and conflict-afflicted states with limited healthcare capacities rely on the limited coverage of the World Health Organization’s (WHO) COVAX initiative, which could delay broad vaccine availability to the second half of 2022.
“What we are seeing today is still a race between the vaccine and the virus, and this will shape the recovery in 2021,” said Jihad Azour, director of the Middle East and Central Asia Department at the International Monetary Fund.
“We will have recovery across the board, but it will be divergent, uneven and uncertain,” he said, adding that accelerating vaccinations could improve growth outlooks by 0.3%-0.4%.