Saudi central bank raises key interest rates by 50 bps | Reuters
The Saudi Central Bank said on Wednesday it increased its key interest rates by 50 basis points after the U.S. Federal Reserve made its biggest rate hike since 1994, at three-quarters of a percentage point.
The Saudi Central Bank, also known as SAMA, lifted its repo and reverse repo rates by 50 bps to 2.25% and 1.75%, respectively. The Saudi riyal is pegged to the dollar.
Wednesday 15 June 2022
Oil prices fall over 2% as Fed hikes interest rates | Reuters
Oil prices fall over 2% as Fed hikes interest rates | Reuters
Oil prices fell more than $3 on Wednesday as markets worried about a fall in demand after the Federal Reserve hiked interest rate by three-quarters of a percentage point.
Brent crude futures for August settled down $2.7, or 2.2%, at $118.51 a barrel, having fallen as low as $117.75. U.S. West Texas Intermediate crude for July fell $3.62, or 3.04%, to $115.31 a barrel, after dropping to a low of $114.60.
The biggest hike by the U.S. central bank since 1994 also sent dollar higher with the dollar index rising to its highest since 2002. A stronger greenback makes U.S. dollar-priced oil more expensive for holders of other currencies, curtailing demand.
Meanwhile, U.S. crude production, which has been largely stagnant over the last few months, edged up 100,000 barrels per day last week to 12 million bpd, its highest level since April 2020, data from the Energy Information Administration showed.
Oil prices fell more than $3 on Wednesday as markets worried about a fall in demand after the Federal Reserve hiked interest rate by three-quarters of a percentage point.
Brent crude futures for August settled down $2.7, or 2.2%, at $118.51 a barrel, having fallen as low as $117.75. U.S. West Texas Intermediate crude for July fell $3.62, or 3.04%, to $115.31 a barrel, after dropping to a low of $114.60.
The biggest hike by the U.S. central bank since 1994 also sent dollar higher with the dollar index rising to its highest since 2002. A stronger greenback makes U.S. dollar-priced oil more expensive for holders of other currencies, curtailing demand.
Meanwhile, U.S. crude production, which has been largely stagnant over the last few months, edged up 100,000 barrels per day last week to 12 million bpd, its highest level since April 2020, data from the Energy Information Administration showed.
EXCLUSIVE Aramco Trading plans to absorb Motiva Trading ahead of possible IPO | Reuters
EXCLUSIVE Aramco Trading plans to absorb Motiva Trading ahead of possible IPO | Reuters
Saudi Aramco is planning to merge two energy trading units, people familiar with the matter said, with Aramco Trading Co (ATC) due to absorb Motiva Trading ahead of a potential initial public offering of the business.
The move to combine the businesses is expected to give potential investors a better sense of the scale of Aramco's trading and would also allow the state oil producer to simplify financial reporting and cut duplication.
The restructuring is likely to be announced before the end of the year, one of the two people familiar with the matter said. The merger would come four years after Shell Plc exited Motiva Enterprises, leaving Aramco in control of Motiva Trading and Motiva's refinery, the largest in the United States.
Saudi Aramco and other Middle East producers accelerated their trading efforts as a way to boost incomes after the 2014 collapse in oil prices. They have slowly gained market share from oil majors and Swiss commodity merchants, using access to their own feedstocks and strength in refining to compete aggressively.
Saudi Aramco is planning to merge two energy trading units, people familiar with the matter said, with Aramco Trading Co (ATC) due to absorb Motiva Trading ahead of a potential initial public offering of the business.
The move to combine the businesses is expected to give potential investors a better sense of the scale of Aramco's trading and would also allow the state oil producer to simplify financial reporting and cut duplication.
The restructuring is likely to be announced before the end of the year, one of the two people familiar with the matter said. The merger would come four years after Shell Plc exited Motiva Enterprises, leaving Aramco in control of Motiva Trading and Motiva's refinery, the largest in the United States.
Saudi Aramco and other Middle East producers accelerated their trading efforts as a way to boost incomes after the 2014 collapse in oil prices. They have slowly gained market share from oil majors and Swiss commodity merchants, using access to their own feedstocks and strength in refining to compete aggressively.
Oil prices fall over 1% as Fed hikes interest rates | Reuters
Oil prices fall over 1% as Fed hikes interest rates | Reuters
Oil prices fell more than 1% on Wednesday as the Federal Reserve raised its target interest rate by three-quarters of a percentage point amid demand woes and as U.S. oil production reached pre-pandemic levels.
Brent crude futures for August were down $1.7, or 1.5%, at $119.46 a barrel by 2:07 p.m. ET (1705 GMT), having fallen as low as $119.26 earlier in the session. It briefly turned positive, rising 2 cents, after the rate hike announcement.
U.S. West Texas Intermediate crude for July fell $2.21, or 1.8%, to $116.72 a barrel, after dropping to a low of $116.15.
The rate hike was the biggest by the U.S. central bank since 1994, and markets worry it could slam fuel demand. read more
Oil prices fell more than 1% on Wednesday as the Federal Reserve raised its target interest rate by three-quarters of a percentage point amid demand woes and as U.S. oil production reached pre-pandemic levels.
Brent crude futures for August were down $1.7, or 1.5%, at $119.46 a barrel by 2:07 p.m. ET (1705 GMT), having fallen as low as $119.26 earlier in the session. It briefly turned positive, rising 2 cents, after the rate hike announcement.
U.S. West Texas Intermediate crude for July fell $2.21, or 1.8%, to $116.72 a barrel, after dropping to a low of $116.15.
The rate hike was the biggest by the U.S. central bank since 1994, and markets worry it could slam fuel demand. read more
Gulf bourses end mixed ahead of Fed meeting | Reuters
Gulf bourses end mixed ahead of Fed meeting | Reuters
Stock markets in the Gulf ended mixed on Wednesday, ahead of a potentially large interest rate hike by the U.S. Federal Reserve to curb soaring inflation.
Investors have dramatically raised their bets that the Fed will raise interest rates by 75 basis points (bps) rather than 50 bps on Wednesday, a swing in expectations that has fuelled a violent selloff across world markets. read more
Saudi Arabia's benchmark index (.TASI) dropped 0.4%, with oil behemoth Saudi Aramco (2222.SE) losing 1.5% and Riyad Bank (1010.SE) declining 2.6%.
Oil prices, a key catalyst for the Gulf's financial markets, fell on concerns about fuel demand and global economic growth.
The Qatari index (.QSI) dropped 0.8%, weighed down by a 3.2% fall in Commercial Bank (COMB.QA).
The Qatari stock market retreated after the large decline in natural gas prices recorded yesterday following an explosion at an LNG export facility in the U.S., creating an oversupply in the region, said Fadi Reyad, market analyst at CAPEX.com.
In Abu Dhabi, the index (.FTFADGI) added 0.4%, helped by a 0.6% rise in telecoms firm e& (ETISALAT.AD).
Dubai's main share index (.DFMGI) advanced 1.2%, boosted by sharia-compliant lender Dubai Islamic Bank (DISB.DU) 2.3% rise.
The United Arab Emirates' federal government aims to increase spending by 1.23 billion dirhams ($334.9 million) in the 2022 budget, the Federal National Council said on Twitter on Tuesday. read more
Outside the Gulf, Egypt's blue-chip index (.EGX30) dipped 0.1%.
According to Fadi, the Egyptian market could see an impact from today's Federal Reserve decision as international investors could react strongly.
Stock markets in the Gulf ended mixed on Wednesday, ahead of a potentially large interest rate hike by the U.S. Federal Reserve to curb soaring inflation.
Investors have dramatically raised their bets that the Fed will raise interest rates by 75 basis points (bps) rather than 50 bps on Wednesday, a swing in expectations that has fuelled a violent selloff across world markets. read more
Saudi Arabia's benchmark index (.TASI) dropped 0.4%, with oil behemoth Saudi Aramco (2222.SE) losing 1.5% and Riyad Bank (1010.SE) declining 2.6%.
Oil prices, a key catalyst for the Gulf's financial markets, fell on concerns about fuel demand and global economic growth.
The Qatari index (.QSI) dropped 0.8%, weighed down by a 3.2% fall in Commercial Bank (COMB.QA).
The Qatari stock market retreated after the large decline in natural gas prices recorded yesterday following an explosion at an LNG export facility in the U.S., creating an oversupply in the region, said Fadi Reyad, market analyst at CAPEX.com.
In Abu Dhabi, the index (.FTFADGI) added 0.4%, helped by a 0.6% rise in telecoms firm e& (ETISALAT.AD).
Dubai's main share index (.DFMGI) advanced 1.2%, boosted by sharia-compliant lender Dubai Islamic Bank (DISB.DU) 2.3% rise.
The United Arab Emirates' federal government aims to increase spending by 1.23 billion dirhams ($334.9 million) in the 2022 budget, the Federal National Council said on Twitter on Tuesday. read more
Outside the Gulf, Egypt's blue-chip index (.EGX30) dipped 0.1%.
According to Fadi, the Egyptian market could see an impact from today's Federal Reserve decision as international investors could react strongly.
#Oman Wealth Fund Considers IPOs of State Energy Firm OQ’s Units - Bloomberg
Oman Wealth Fund Considers IPOs of State Energy Firm OQ’s Units - Bloomberg
Oman is considering an initial public offering of two units of state energy company OQ SAOC and a manufacturing firm as the sultanate seeks to catch up with an IPO boom in neighboring Saudi Arabia and the United Arab Emirates.
The share sales are part of Oman Investment Authority’s plan to exit state assets in a bid to bolster the country’s coffers and expand its stock exchange, according to its statement on twitter. It plans a full and partial exit of a number of Omran hotels and resorts, and two Asyad projects.
The potential Omani IPOs come at a time when the Middle East is enjoying an unprecedented listings boom fueled by high oil prices, equity inflows and a drive by regional governments to list state-owned assets. IPOs in the region have raised $13.4 billion in the first five months of the year, already eclipsing the amount raised in any other first half, data compiled by Bloomberg show.
Oman hasn’t had a major IPO since 2010 when telecom operator Nawras, now known as Ooredoo Oman, raised $475 million. In March, Muscat Stock Exchange’s Chief Executive Officer Haitham Al-Salmi said that Oman is planning to list 35 state-owned enterprises over the next five years, with one or two oil companies to potentially list this year.
Oman is considering an initial public offering of two units of state energy company OQ SAOC and a manufacturing firm as the sultanate seeks to catch up with an IPO boom in neighboring Saudi Arabia and the United Arab Emirates.
The share sales are part of Oman Investment Authority’s plan to exit state assets in a bid to bolster the country’s coffers and expand its stock exchange, according to its statement on twitter. It plans a full and partial exit of a number of Omran hotels and resorts, and two Asyad projects.
The potential Omani IPOs come at a time when the Middle East is enjoying an unprecedented listings boom fueled by high oil prices, equity inflows and a drive by regional governments to list state-owned assets. IPOs in the region have raised $13.4 billion in the first five months of the year, already eclipsing the amount raised in any other first half, data compiled by Bloomberg show.
Oman hasn’t had a major IPO since 2010 when telecom operator Nawras, now known as Ooredoo Oman, raised $475 million. In March, Muscat Stock Exchange’s Chief Executive Officer Haitham Al-Salmi said that Oman is planning to list 35 state-owned enterprises over the next five years, with one or two oil companies to potentially list this year.
Turkey's Kalyon in talks with #AbuDhabi's IHC on energy assets -sources | Reuters
Turkey's Kalyon in talks with Abu Dhabi's IHC on energy assets -sources | Reuters
Turkey's Kalyon Holding is in advanced stages of talks with Abu Dhabi's International Holding Company (IHC.AD) on setting up a strategic partnership for energy assets, according to people familiar with the issue.
A total of four sources said Kalyon, which has big solar and wind concessions in Turkey, was in energy partnership talks with Abu Dhabi, with two of them naming IHC and two saying the talks were advanced, but that a final deal was not yet certain.
Turkey obtains the vast majority of its energy from imports and in order to boost its renewable energy production it began large-scale solar and wind power station tenders in 2017.
Last November, Turkey and the United Arab Emirates signed investment deals worth billions of dollars, including in energy, after talks between President Tayyip Erdogan and Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed al-Nahyan. read more
Turkey's Kalyon Holding is in advanced stages of talks with Abu Dhabi's International Holding Company (IHC.AD) on setting up a strategic partnership for energy assets, according to people familiar with the issue.
A total of four sources said Kalyon, which has big solar and wind concessions in Turkey, was in energy partnership talks with Abu Dhabi, with two of them naming IHC and two saying the talks were advanced, but that a final deal was not yet certain.
Turkey obtains the vast majority of its energy from imports and in order to boost its renewable energy production it began large-scale solar and wind power station tenders in 2017.
Last November, Turkey and the United Arab Emirates signed investment deals worth billions of dollars, including in energy, after talks between President Tayyip Erdogan and Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed al-Nahyan. read more
Oil prices fall as expected U.S. interest rate hike looms | Reuters
Oil prices fall as expected U.S. interest rate hike looms | Reuters
Oil prices fell on Wednesday on concerns about fuel demand and global economic growth before an expected big hike in interest rates by the U.S. Federal Reserve.
Brent crude futures for August were down $1.27, or 1%, at $119.90 a barrel as of 1001 GMT, in volatile trading.
U.S. West Texas Intermediate crude for July fell $1.44, or 1.2%, to $117.49 a barrel.
"Oil markets are seeing uncertainty over what central banks do next and how that impacts oil demand," said UBS analyst Giovanni Staunovo.
Surging inflation has led investors and oil traders to brace for a big move by the Fed this week - a 75-basis-point increase, which would be the largest U.S. interest rate hike in 28 years. read more
Oil prices fell on Wednesday on concerns about fuel demand and global economic growth before an expected big hike in interest rates by the U.S. Federal Reserve.
Brent crude futures for August were down $1.27, or 1%, at $119.90 a barrel as of 1001 GMT, in volatile trading.
U.S. West Texas Intermediate crude for July fell $1.44, or 1.2%, to $117.49 a barrel.
"Oil markets are seeing uncertainty over what central banks do next and how that impacts oil demand," said UBS analyst Giovanni Staunovo.
Surging inflation has led investors and oil traders to brace for a big move by the Fed this week - a 75-basis-point increase, which would be the largest U.S. interest rate hike in 28 years. read more
#AbuDhabi’s Aldar Mulls Buying Stake in Egypt’s Medinet Nasr - Bloomberg
Abu Dhabi’s Aldar Mulls Buying Stake in Egypt’s Medinet Nasr - Bloomberg
Aldar Properties PJSC is considering the acquisition of a majority stake in Egyptian developer Medinet Nasr Housing, according to people familiar with the matter, a deal that would strengthen the Abu Dhabi firm’s presence in the Arab world’s most populous country. The Egyptian company’s shares climbed.
The discussions are in early stages and an offer may not be imminent, said the people, who asked not to be identified because the matter is private.
The Egyptian government owns a 15% stake in Medinet Nasr. Hisham Tawfik, Egypt’s public enterprise minister, said Aldar has shown interest in the Cairo-based developer, but an offer has yet to materialize.
Aldar declined to comment. Medinet Nasr said in a Tuesday statement to Cairo’s stock exchange that it hasn’t received any tender offers. Board member Salah Katamish declined to give additional comment when contacted by Bloomberg.
Aldar Properties PJSC is considering the acquisition of a majority stake in Egyptian developer Medinet Nasr Housing, according to people familiar with the matter, a deal that would strengthen the Abu Dhabi firm’s presence in the Arab world’s most populous country. The Egyptian company’s shares climbed.
The discussions are in early stages and an offer may not be imminent, said the people, who asked not to be identified because the matter is private.
The Egyptian government owns a 15% stake in Medinet Nasr. Hisham Tawfik, Egypt’s public enterprise minister, said Aldar has shown interest in the Cairo-based developer, but an offer has yet to materialize.
Aldar declined to comment. Medinet Nasr said in a Tuesday statement to Cairo’s stock exchange that it hasn’t received any tender offers. Board member Salah Katamish declined to give additional comment when contacted by Bloomberg.
The #Saudi investment king who no longer rules alone | Reuters
The Saudi investment king who no longer rules alone | Reuters
The prince who's the international face of Saudi business may no longer be able to call all the shots.
For years, Prince Alwaleed bin Talal, Saudi Arabia's self-styled Warren Buffett, has made hundreds of millions of dollars by investing in companies from Citigroup (C.N) to Uber (UBER.N) to Twitter (TWTR.N) with almost complete autonomy.
Now, his Kingdom Holding (4280.SE) investment firm counts Saudi Arabia's Public Investment Fund (PIF) as a minority shareholder and the powerful sovereign wealth fund is unlikely to sit on the sidelines, sources familiar with the matter said.
The wealth fund, which is at the heart of Crown Prince Mohammed bin Salman's ambitious plan to diversify the Saudi economy, will want Kingdom Holding's investment committee to have more power over decision making than in the past, two sources with knowledge of Kingdom's business told Reuters.
"(PIF) will want to be an active investor," said a sovereign wealth fund investor in the Gulf. "The investment committee of Kingdom Holding is essentially Alwaleed, and I can't imagine the PIF being at the whims of the prince."
The prince who's the international face of Saudi business may no longer be able to call all the shots.
For years, Prince Alwaleed bin Talal, Saudi Arabia's self-styled Warren Buffett, has made hundreds of millions of dollars by investing in companies from Citigroup (C.N) to Uber (UBER.N) to Twitter (TWTR.N) with almost complete autonomy.
Now, his Kingdom Holding (4280.SE) investment firm counts Saudi Arabia's Public Investment Fund (PIF) as a minority shareholder and the powerful sovereign wealth fund is unlikely to sit on the sidelines, sources familiar with the matter said.
The wealth fund, which is at the heart of Crown Prince Mohammed bin Salman's ambitious plan to diversify the Saudi economy, will want Kingdom Holding's investment committee to have more power over decision making than in the past, two sources with knowledge of Kingdom's business told Reuters.
"(PIF) will want to be an active investor," said a sovereign wealth fund investor in the Gulf. "The investment committee of Kingdom Holding is essentially Alwaleed, and I can't imagine the PIF being at the whims of the prince."
Rosneft Examines Idea of #Dubai-Based Oil Trading Unit - Bloomberg
Rosneft Examines Idea of Dubai-Based Oil Trading Unit - Bloomberg
Russia’s state oil producer has explored the idea of creating a trading venture in Dubai, the latest sign of how sanctions against Moscow are disrupting the nation’s export system.
Officials from Rosneft PJSC visited the emirate in the past month and met with advisers who could assist in setting up a new entity, according to people with knowledge of the matter, who asked not to be identified as the details are private.
Rosneft didn’t immediately respond to a request for comment.
It’s not clear what conclusions the Rosneft officials drew from their visit, what the scope of any new entity might be, or where it would leave Energopole SA, the producer’s Geneva-based trading arm.
The meetings took place long before last week’s announcement by Swiss authorities that the country would follow European Union sanctions targeting Russia. But those measures highlight the urgent need that some companies have to find Moscow-friendly jurisdictions.
Russia’s state oil producer has explored the idea of creating a trading venture in Dubai, the latest sign of how sanctions against Moscow are disrupting the nation’s export system.
Officials from Rosneft PJSC visited the emirate in the past month and met with advisers who could assist in setting up a new entity, according to people with knowledge of the matter, who asked not to be identified as the details are private.
Rosneft didn’t immediately respond to a request for comment.
It’s not clear what conclusions the Rosneft officials drew from their visit, what the scope of any new entity might be, or where it would leave Energopole SA, the producer’s Geneva-based trading arm.
The meetings took place long before last week’s announcement by Swiss authorities that the country would follow European Union sanctions targeting Russia. But those measures highlight the urgent need that some companies have to find Moscow-friendly jurisdictions.
Major Gulf bourses slide ahead of Fed meeting | Reuters
Major Gulf bourses slide ahead of Fed meeting | Reuters
Most major Gulf equities were subdued in early trade on Wednesday, ahead of the U.S. Federal Reserve's policy meeting, with many fearing a drastic action would risk tipping the world into recession.
Investors have dramatically raised their bets that the Fed will raise interest rates by 75 basis points (bps) rather than 50 bps on Wednesday, a swing in expectations that has fuelled a violent selloff across world markets. read more
In Abu Dhabi, the index (.FTFADGI) lost 0.3%, hit by a 1.2% fall in telecoms firm Emirates Telecommunications Group (ETISALAT.AD) and a 0.1% decrease in the country's biggest lender First Abu Dhabi Bank (FAB.AD).
Dubai's benchmark index (.DFMGI) eased 0.2%, with blue-chip developer Emaar Properties (EMAR.DU) losing 1.8%.
The Qatari index (.QSI) retreated 0.5%, weighed down by a 3% fall in Commercial Bank (COMB.QA).
Saudi Arabia's benchmark index (.TASI), however, bucked the trend to trade 0.6% higher, with Al Rajhi Bank (1120.SE) rising 0.7% and Banque Saudi Fransi (1050.SE) advancing 2.4%.
Oil prices, a key catalyst for the Gulf's financial markets, edged up after the Organization of the Petroleum Exporting Countries (OPEC) stuck to its forecast that world oil demand will exceed pre-pandemic levels in 2022.
Saudi Arabia's consumer price index rose 2.2% in May from a year earlier, government data showed on Wednesday, slowing from a 2.3% pace in April. read more
Most major Gulf equities were subdued in early trade on Wednesday, ahead of the U.S. Federal Reserve's policy meeting, with many fearing a drastic action would risk tipping the world into recession.
Investors have dramatically raised their bets that the Fed will raise interest rates by 75 basis points (bps) rather than 50 bps on Wednesday, a swing in expectations that has fuelled a violent selloff across world markets. read more
In Abu Dhabi, the index (.FTFADGI) lost 0.3%, hit by a 1.2% fall in telecoms firm Emirates Telecommunications Group (ETISALAT.AD) and a 0.1% decrease in the country's biggest lender First Abu Dhabi Bank (FAB.AD).
Dubai's benchmark index (.DFMGI) eased 0.2%, with blue-chip developer Emaar Properties (EMAR.DU) losing 1.8%.
The Qatari index (.QSI) retreated 0.5%, weighed down by a 3% fall in Commercial Bank (COMB.QA).
Saudi Arabia's benchmark index (.TASI), however, bucked the trend to trade 0.6% higher, with Al Rajhi Bank (1120.SE) rising 0.7% and Banque Saudi Fransi (1050.SE) advancing 2.4%.
Oil prices, a key catalyst for the Gulf's financial markets, edged up after the Organization of the Petroleum Exporting Countries (OPEC) stuck to its forecast that world oil demand will exceed pre-pandemic levels in 2022.
Saudi Arabia's consumer price index rose 2.2% in May from a year earlier, government data showed on Wednesday, slowing from a 2.3% pace in April. read more
Oil prices climb, but expected U.S. interest rate hike looms | Reuters
Oil prices climb, but expected U.S. interest rate hike looms | Reuters
Oil prices rose on Wednesday, rebounding from losses earlier in the session amid concerns over fuel demand and the broader economy ahead of an expected big hike in interest rates by the U.S. Federal Reserve.
In a volatile session, Brent crude futures for August were up 46 cents, or 0.4%, at $121.63 a barrel as of 0642 GMT after falling to as low as $120.65 earlier in the session on the back of a 0.9% decline on Tuesday.
U.S. West Texas Intermediate crude for July rose 41 cents, or 0.3%, to $119.34 a barrel, after hitting a low of $118.22 earlier in the day, having dropped 1.7% a day earlier.
Surging inflation has led investors and oil traders to brace for a big move by the Fed this week - a 75-basis-point increase, which would be the largest U.S. interest rate hike in 28 years. read more
Oil prices rose on Wednesday, rebounding from losses earlier in the session amid concerns over fuel demand and the broader economy ahead of an expected big hike in interest rates by the U.S. Federal Reserve.
In a volatile session, Brent crude futures for August were up 46 cents, or 0.4%, at $121.63 a barrel as of 0642 GMT after falling to as low as $120.65 earlier in the session on the back of a 0.9% decline on Tuesday.
U.S. West Texas Intermediate crude for July rose 41 cents, or 0.3%, to $119.34 a barrel, after hitting a low of $118.22 earlier in the day, having dropped 1.7% a day earlier.
Surging inflation has led investors and oil traders to brace for a big move by the Fed this week - a 75-basis-point increase, which would be the largest U.S. interest rate hike in 28 years. read more