Saudi Arabia's Output Cuts Will Tighten Oil Market Sharply, OPEC Data Signals - Bloomberg
Saudi Arabia’s latest oil production cuts are set to tighten global markets sharply next month, data from OPEC show.
Even before the kingdom announced its surprise new measures just over a week ago, the Organization of Petroleum Exporting Countries expected that world inventories would deplete rapidly in the second half amid a post-pandemic recovery in fuel demand.
With the 1 million barrel-a-day cutback to be implemented by Riyadh in July — and possibly longer — the shortfall will intensify. World consumption will exceed supplies by roughly 2.7 million barrels a day next month, a report from OPEC indicated on Tuesday.
If the kingdom opted to extend the reduction for the whole third quarter, it would be the biggest deficit since 2021.
Tuesday 13 June 2023
After Blinken Visit, #SaudiArabia Looks to China for Business as US Sway Wanes - Bloomberg
After Blinken Visit, Saudi Arabia Looks to China for Business as US Sway Wanes - Bloomberg
Days after welcoming Secretary of State Antony Blinken as part of efforts to reset relations with the US, Saudi Arabia turned its attention to boosting ties with one of Washington’s main competitors: China.
For the past two days, the Saudi capital has played host to the largest ever Chinese-Arab business gathering. Under the chandeliers and vaulted ceilings of Riyadh’s grandest conference hall, Saudi officials spoke of integrating China into the Arab region and Chinese executives said they stood ready to “de-Americanize” the world’s top oil exporter. At lunch they mingled over a fusion of dim sum and local mutton.
“The time has come, in my view, for China to be a principal investment partner in the Arab world’s development drive,” Saudi Investment Minister Khalid Al-Falih said in a keynote address on Sunday, suggesting the Arab economic powerhouse act as a “bridge” to the rest of the region.
As the Middle East has become less of a strategic priority for the US, it has left a political and economic vacuum in the region that its rival is rushing to fill.
Days after welcoming Secretary of State Antony Blinken as part of efforts to reset relations with the US, Saudi Arabia turned its attention to boosting ties with one of Washington’s main competitors: China.
For the past two days, the Saudi capital has played host to the largest ever Chinese-Arab business gathering. Under the chandeliers and vaulted ceilings of Riyadh’s grandest conference hall, Saudi officials spoke of integrating China into the Arab region and Chinese executives said they stood ready to “de-Americanize” the world’s top oil exporter. At lunch they mingled over a fusion of dim sum and local mutton.
“The time has come, in my view, for China to be a principal investment partner in the Arab world’s development drive,” Saudi Investment Minister Khalid Al-Falih said in a keynote address on Sunday, suggesting the Arab economic powerhouse act as a “bridge” to the rest of the region.
As the Middle East has become less of a strategic priority for the US, it has left a political and economic vacuum in the region that its rival is rushing to fill.
#Qatar, #Dubai bourses rise on Fed rate pause optimism; #Saudi retreats | Reuters
Qatar, Dubai bourses rise on Fed rate pause optimism; Saudi retreats | Reuters
Stock markets in Dubai and Qatar ended higher on Tuesday ahead of a widely expected interest rate pause by the U.S. Federal Reserve although other major markets were subdued amid volatile oil prices.
Most market participants expect the U.S. central bank to leave interest rates unchanged at its policy meeting concluding on Wednesday.
Currencies in most Gulf Cooperation Council countries are pegged to the dollar and any monetary policy change in the United States is usually mimicked by Saudi Arabia, the United Arab Emirates and Qatar.
In Qatar, the benchmark index (.QSI) rose 0.6%, recouping its losses across three previous sessions straight, with all sectors trading in the green.
The region's largest lender Qatar National Bank (QNBK.QA) and index heavyweight Qatar Islamic Bank (QISB.QA) gained 1.4% and 1.1%, respectively, while the world's largest LNG shipping fleet owner, Qatar Gas Transport (QGTS.QA) (Nakilat) added 1.9%.
Dubai's benchmark index (.DFMGI) continued its 13-session winning streak and ended 0.3% higher. The index was supported by gains in industry and financial sectors, with tolls operator Salik Company (SALIK.DU) adding 1.3% and low cost flyer Air Arabia (AIRA.DU) rising 2.5%.
The emirate's largest lender Emirates NBD (ENBD.DU) rose 0.7%.
In Abu Dhabi, the index (.FTFADGI) declined 0.3%, snapping two previous sessions gains, weighed down by a 1.7% drop in Abu Dhabi National Oil Company for Distribution (ADNOCDIST.AD) and a 1.8% loss in Abu Dhabi Islamic Bank(ADIB.AD).
The United Arab Emirates' biggest lender, First Abu Dhabi Bank (FAB.AD) slipped 1.1%.
Saudi Arabia's benchmark index (.TASI) fell 0.1%, dragged down by losses in materials, energy and financial sectors with world's largest Islamic bank by assets Al Rajhi Banking & Investment Corporation (1120.SE) dropping 0.4% and oil major Saudi Aramco (2222.SE) shedding 0.7%.
Oil prices - a key catalyst for the Gulf's financial markets - inched up on Tuesday with Brent crude up 2.5% at $73.65 a barrel by 1230 GMT.
But gains were limited as investors remained cautious ahead of key policy decisions by central banks and on weak economic data from China.
Outside th.e Gulf, Egypt's blue-chip index (.EGX30) slipped 0.9%, ending its previous session losses, with most sectors trading in the green.
Misr Fertilizers Production (MFPC.CA) and Abu Qir Fertilizers and Chemical Industries (ABUK.CA) shot up 20% and 4.3%, respectively. Telecom Egypt (ETEL.CA) surged 4.7%
Stock markets in Dubai and Qatar ended higher on Tuesday ahead of a widely expected interest rate pause by the U.S. Federal Reserve although other major markets were subdued amid volatile oil prices.
Most market participants expect the U.S. central bank to leave interest rates unchanged at its policy meeting concluding on Wednesday.
Currencies in most Gulf Cooperation Council countries are pegged to the dollar and any monetary policy change in the United States is usually mimicked by Saudi Arabia, the United Arab Emirates and Qatar.
In Qatar, the benchmark index (.QSI) rose 0.6%, recouping its losses across three previous sessions straight, with all sectors trading in the green.
The region's largest lender Qatar National Bank (QNBK.QA) and index heavyweight Qatar Islamic Bank (QISB.QA) gained 1.4% and 1.1%, respectively, while the world's largest LNG shipping fleet owner, Qatar Gas Transport (QGTS.QA) (Nakilat) added 1.9%.
Dubai's benchmark index (.DFMGI) continued its 13-session winning streak and ended 0.3% higher. The index was supported by gains in industry and financial sectors, with tolls operator Salik Company (SALIK.DU) adding 1.3% and low cost flyer Air Arabia (AIRA.DU) rising 2.5%.
The emirate's largest lender Emirates NBD (ENBD.DU) rose 0.7%.
In Abu Dhabi, the index (.FTFADGI) declined 0.3%, snapping two previous sessions gains, weighed down by a 1.7% drop in Abu Dhabi National Oil Company for Distribution (ADNOCDIST.AD) and a 1.8% loss in Abu Dhabi Islamic Bank(ADIB.AD).
The United Arab Emirates' biggest lender, First Abu Dhabi Bank (FAB.AD) slipped 1.1%.
Saudi Arabia's benchmark index (.TASI) fell 0.1%, dragged down by losses in materials, energy and financial sectors with world's largest Islamic bank by assets Al Rajhi Banking & Investment Corporation (1120.SE) dropping 0.4% and oil major Saudi Aramco (2222.SE) shedding 0.7%.
Oil prices - a key catalyst for the Gulf's financial markets - inched up on Tuesday with Brent crude up 2.5% at $73.65 a barrel by 1230 GMT.
But gains were limited as investors remained cautious ahead of key policy decisions by central banks and on weak economic data from China.
Outside th.e Gulf, Egypt's blue-chip index (.EGX30) slipped 0.9%, ending its previous session losses, with most sectors trading in the green.
Misr Fertilizers Production (MFPC.CA) and Abu Qir Fertilizers and Chemical Industries (ABUK.CA) shot up 20% and 4.3%, respectively. Telecom Egypt (ETEL.CA) surged 4.7%
#UAE banks to be modestly profitable this year, says Moody's
UAE banks to be modestly profitable this year, says Moody's
Moody's Investor Service has maintained a stable outlook for the UAE's banking system reflecting the view that operating conditions in the country will continue to recover from pandemic lows, buoyed by high oil prices.
The ratings agency has forecast the UAE's real GDP to jog along at 4% this year, following a 7.6% expansion in 2022. The country is OPEC's third-largest producer.
The higher oil price will boost private consumption and investment in the non-hydrocarbon sectors of the economy, where the banks do most of their business, including the real-estate sector, the report said.
Last week, the S&P Global UAE Purchasing Managers' Index (PMI) report noted that despite a slight softening, the UAE's non-oil private sector grew at a robust pace, posting 55.5 on the index, well in expansion territory.
Brent crude futures was trading slightly higher at $72.34 a barrel this morning, after falling around $3 on Monday, Eikon data showed.
According to Moody's, rising business confidence, particularly among large corporate players, will drive overall economic growth, supporting loan performance.
"Consequently, we expect problem loans to decline, although large loan restructurings will keep loan-loss provisioning charges broadly flat," said the lead analyst Azhar Bouzidi and others.
Strengthening loan portfolios, combined with growth in operating income, will deliver modest growth in profitability, likely restoring it to pre-pandemic levels.
The stable outlook also captures the UAE banks' strong capital buffers. Robust oil prices will boost domestic deposits and "we expect funding and liquidity conditions to remain strong".
The likelihood of government support for banks in financial difficulty is very high, the ratings agency noted.
Moody's Investor Service has maintained a stable outlook for the UAE's banking system reflecting the view that operating conditions in the country will continue to recover from pandemic lows, buoyed by high oil prices.
The ratings agency has forecast the UAE's real GDP to jog along at 4% this year, following a 7.6% expansion in 2022. The country is OPEC's third-largest producer.
The higher oil price will boost private consumption and investment in the non-hydrocarbon sectors of the economy, where the banks do most of their business, including the real-estate sector, the report said.
Last week, the S&P Global UAE Purchasing Managers' Index (PMI) report noted that despite a slight softening, the UAE's non-oil private sector grew at a robust pace, posting 55.5 on the index, well in expansion territory.
Brent crude futures was trading slightly higher at $72.34 a barrel this morning, after falling around $3 on Monday, Eikon data showed.
According to Moody's, rising business confidence, particularly among large corporate players, will drive overall economic growth, supporting loan performance.
"Consequently, we expect problem loans to decline, although large loan restructurings will keep loan-loss provisioning charges broadly flat," said the lead analyst Azhar Bouzidi and others.
Strengthening loan portfolios, combined with growth in operating income, will deliver modest growth in profitability, likely restoring it to pre-pandemic levels.
The stable outlook also captures the UAE banks' strong capital buffers. Robust oil prices will boost domestic deposits and "we expect funding and liquidity conditions to remain strong".
The likelihood of government support for banks in financial difficulty is very high, the ratings agency noted.
Moody's changes outlook on #Saudi banks to positive on reforms, oil price
Moody's changes outlook on Saudi banks to positive on reforms, oil price
Moody's Investor Service has changed its outlook for Saudi Arabia's banking system to positive from stable as high oil prices and the country's reform agenda boost economic growth, business confidence and government spending.
The ratings agency said this is nurturing sustained growth in the non-hydrocarbon sectors of the economy where the banks do most of their business. Increased spending will deliver non-oil GDP growth of around 4.7% in 2023.
Demand for credit is high and loan performance is improving, and this is likely to translate into robust profits for banks.
Capital will remain strong thanks to good internal capital generation and flexible dividend payouts, said the lead analyst Ashraf Madani and others.
However, banks face challenges from higher rates which are encouraging depositors to switch to more costly term deposits, squeezing interest margins. They also face risk from their over dependence on large single depositors such as the government and public entities.
Large government projects are boosting corporate credit demand. Growth in residential mortgages will continue, supported by a government initiative to increase home ownership, and an improved jobs outlook.
Lending to the private sector will expand by 9%-10%, Moody's said.
Last week, the S&P Global UAE Purchasing Managers' Index (PMI) said non-oil private sector slowed during May growth in new orders and output eased. Nevertheless, the index was a at healthy 58.5, well above the 50.0 growth threshold.
Meanwhile, brent crude futures were trading slightly higher at $72.34 a barrel this morning, after falling around $3 on Monday, Eikon data showed. Earlier this week, Goldman Sachs Group revised its year-end price estimate for Brent to below $90, following two previous downward revisions in the last six months.
Moody's Investor Service has changed its outlook for Saudi Arabia's banking system to positive from stable as high oil prices and the country's reform agenda boost economic growth, business confidence and government spending.
The ratings agency said this is nurturing sustained growth in the non-hydrocarbon sectors of the economy where the banks do most of their business. Increased spending will deliver non-oil GDP growth of around 4.7% in 2023.
Demand for credit is high and loan performance is improving, and this is likely to translate into robust profits for banks.
Capital will remain strong thanks to good internal capital generation and flexible dividend payouts, said the lead analyst Ashraf Madani and others.
However, banks face challenges from higher rates which are encouraging depositors to switch to more costly term deposits, squeezing interest margins. They also face risk from their over dependence on large single depositors such as the government and public entities.
Large government projects are boosting corporate credit demand. Growth in residential mortgages will continue, supported by a government initiative to increase home ownership, and an improved jobs outlook.
Lending to the private sector will expand by 9%-10%, Moody's said.
Last week, the S&P Global UAE Purchasing Managers' Index (PMI) said non-oil private sector slowed during May growth in new orders and output eased. Nevertheless, the index was a at healthy 58.5, well above the 50.0 growth threshold.
Meanwhile, brent crude futures were trading slightly higher at $72.34 a barrel this morning, after falling around $3 on Monday, Eikon data showed. Earlier this week, Goldman Sachs Group revised its year-end price estimate for Brent to below $90, following two previous downward revisions in the last six months.
Mideast stocks: Gulf bourses gain on rising oil prices, Fed rate pause optimism
Mideast stocks: Gulf bourses gain on rising oil prices, Fed rate pause optimism
Most stock markets in the Gulf rose in early trade on Tuesday, tracking oil prices higher, while investors remained cautious ahead of key policy decisions by the U.S. Federal Reserve and other central banks.
Crude prices - a key catalyst for the region's financial markets - climbed 1.1% on Tuesday, with Brent crude up to $72.61 a barrel, as of 0640 GMT.
In Qatar, the benchmark index rose 0.7%, recouping its losses across three consecutive sessions, with all sectors trading in the green.
Index heavyweights Qatar Islamic Bank QPSC and Ooredoo QPSC gained 1.1% and 2.4%, respectively.
Dubai's benchmark stock index added 0.2% in early trade, supported by gains in most sectors, with Emaar Properties PJSC gaining 0.7% and tolls operator Salik Company PJSC rising 1%.
The Emirate's largest lender Emirates NBD Bank PJSC rose 0.4%.
In Abu Dhabi, the benchmark stock index was up 0.1%, helped by a 1.6% gains in Multiply Group PJSC and 1.2% rise in blue-chip developer Aldar Properties PJSC .
Saudi Arabia's benchmark stock index inched up 0.1%, lifted by gains in finance, health care and industry sectors, with Dr. Sulaiman Al-Habib Medical Services Group adding 0.8% and Banque Saudi Fransi SJSC rising 1.1%.
Most market participants expect the U.S. central bank to leave interest rates unchanged at its policy meeting concluding on Wednesday.
Currencies in most Gulf Cooperation Council countries are pegged to the dollar and any monetary policy change in the United States is usually mimicked by Saudi Arabia, the United Arab Emirates and Qatar.
Most stock markets in the Gulf rose in early trade on Tuesday, tracking oil prices higher, while investors remained cautious ahead of key policy decisions by the U.S. Federal Reserve and other central banks.
Crude prices - a key catalyst for the region's financial markets - climbed 1.1% on Tuesday, with Brent crude up to $72.61 a barrel, as of 0640 GMT.
In Qatar, the benchmark index rose 0.7%, recouping its losses across three consecutive sessions, with all sectors trading in the green.
Index heavyweights Qatar Islamic Bank QPSC and Ooredoo QPSC gained 1.1% and 2.4%, respectively.
Dubai's benchmark stock index added 0.2% in early trade, supported by gains in most sectors, with Emaar Properties PJSC gaining 0.7% and tolls operator Salik Company PJSC rising 1%.
The Emirate's largest lender Emirates NBD Bank PJSC rose 0.4%.
In Abu Dhabi, the benchmark stock index was up 0.1%, helped by a 1.6% gains in Multiply Group PJSC and 1.2% rise in blue-chip developer Aldar Properties PJSC .
Saudi Arabia's benchmark stock index inched up 0.1%, lifted by gains in finance, health care and industry sectors, with Dr. Sulaiman Al-Habib Medical Services Group adding 0.8% and Banque Saudi Fransi SJSC rising 1.1%.
Most market participants expect the U.S. central bank to leave interest rates unchanged at its policy meeting concluding on Wednesday.
Currencies in most Gulf Cooperation Council countries are pegged to the dollar and any monetary policy change in the United States is usually mimicked by Saudi Arabia, the United Arab Emirates and Qatar.