Oil Updates – prices rise after US interest rate cut
Updated 19 September 2024
Reuters
BEIJING: Oil prices rose on Thursday after a large interest rate cut from the US Federal Reserve, but concerns over global demand lingered and capped gains.
Brent crude futures for November were up 36 cents, or 0.5 percent, to $74.01 a barrel at 9:18 a.m. Saudi time, while WTI crude futures for October were up 34 cents, or 0.3 percent, to $71.15 a barrel. The benchmarks recovered after falling in early Asian trade.
The US central bank cut interest rates by half a percentage point on Wednesday. Interest rate cuts typically boost economic activity and energy demand, but the market also saw it as a sign of a weaker US labor market that could slow the economy.
“While the 50 basis point cut hints at harsh economic headwinds ahead, bearish investors were left unsatisfied after the Fed raised the medium-term outlook for rates,” ANZ analysts said in a note.
Weak demand from China’s slowing economy also continued to weigh.
Refinery output in China slowed for a fifth month in August, statistics bureau data showed over the weekend. China’s industrial output growth also slowed to a five-month low last month, and retail sales and new home prices weakened further.
Markets were also keeping an eye on events in the Middle East after walkie-talkies used by Lebanese armed group Hezbollah exploded on Wednesday following similar explosions of pagers the previous day.
Security sources said Israeli spy agency Mossad was responsible, but Israeli officials did not comment on the attacks.
Citi analysts say they expect a counter-seasonal oil market deficit of around 0.4 million barrels per day to support Brent crude prices in the $70 to $75 a barrel range during the next quarter, but that would be temporary.
“As 2025 global oil balances deteriorate in most scenarios, we still anticipate renewed price weakness in 2025 with Brent on a path to $60/barrel,” Citi said in a note on Thursday.
Saudi Arabia unveils listing rules for sports clubs
New legal framework seeks to enhance governance
Updated 6 sec ago
Dayan Abou Tine
RIYADH: Saudi Arabia’s private sports clubs are now required to notify the Financial Market Authority before negotiating the sale of 5 percent or more of their capital to investors.
A new regulation from the Ministry of Sports mandates compliance with the Kingdom’s Companies Law, the Financial Market System, and guidelines from the Financial Market Authority for public listing.
The ministry states that this framework aims to strengthen governance for private athletic clubs, improve competitiveness in local and international arenas, and foster an appealing investment environment.
The draft regulation is open for public feedback via the National Competitiveness Center until Nov. 20, allowing stakeholders to weigh in on the proposed rules.
This initiative aligns with Saudi Arabia’s Vision 2030, which seeks to diversify the economy and elevate the sports sector as a vital area for private investment and job creation.
Vision 2030 prioritizes sports as crucial for social and economic development, driving significant government initiatives to improve infrastructure and attract international events.
The Ministry of Sports has made notable strides through programs like the Quality of Life initiative, which builds sports facilities and promotes public fitness. Government investments have attracted global partnerships, featuring events like the Saudi Arabian Grand Prix and major golf tournaments, enhancing the Kingdom’s status as a global sports hub.
A private athletic club is defined as a sports company with independent legal status, established under the Companies Law and licensed by the ministry. These clubs are members of one or more sports federations and operate under the ministry’s oversight.
Their funding comes from service fees, match revenues, investment income, sponsorships, and broadcasting rights, regulated by the ministry.
Clubs can also engage in player transfers, loans, and accept donations. They can enter loan agreements, sell or mortgage assets, and manage debt under the Companies Law.
The regulations apply to all private sports clubs, including newly formed associations and existing organizations transitioning to companies. This new regulation replaces the previous licensing framework and will take effect immediately upon ministerial approval.
FACTOID
- A private athletic club is defined as a sports company with independent legal status, established under the Companies Law and licensed by the ministry.
- These clubs are members of one or more sports federations and operate under the ministry’s oversight.
- The draft regulation is open for public feedback via the National Competitiveness Center until Nov. 20, allowing stakeholders to weigh in on the proposed rules.
Jordan expands to 144 markets as exports to Arab nations rise 13%
Updated 4 min 6 sec ago
Mohammed Al-Kinani
JEDDAH: Jordan’s exports to Arab nations surged 13 percent year on year to 2.29 billion Jordanian dinars ($3.23 billion) in the first eight months of 2024, according to a top executive.
Fathi Jaghbir, president of the Jordan and Amman Chambers of Industry, noted that despite various challenges, the country has successfully entered over 144 international markets, demonstrating the resilience and competitiveness of its industrial sector, the Jordan News Agency reported.
Jaghbir noted that while overall exports dipped 2.2 percent compared to the same period last year, Jordanian industries have identified new opportunities in less conventional markets, including Belgium, South Korea, and Ukraine, as well as Norway, Myanmar, Latvia, and Luxembourg.
This comes as a recent World Bank report indicated that Jordan’s economy has shown resilience in early 2024, following real gross domestic product growth of 2.7 percent last year.
This growth is attributed to a broad economic base, with significant contributions from manufacturing, agriculture, and services sectors, particularly in restaurants and hotels.
Jaghbir highlighted that growth in Arab markets was especially prominent in Iraq, Saudi Arabia, and Egypt, with respective increases of 51 percent, 11 percent, and 38 percent.
Exports to North America also rose by over 12 percent, reaching 1.56 billion dinars, fueled by a 14 percent increase in demand from the US market.
The executive noted that the transition to non-traditional markets has yielded promising results, particularly in Ukraine, which saw an increase of 17 million dinars; Belgium, with 19 million dinars; and Norway, with 9 million dinars. Italy and Finland recorded increases of 8 million dinars and 6 million dinars, respectively.
He emphasized that the transition to non-traditional markets has also shown promising results, with European markets experiencing significant growth, particularly in Ukraine, which saw an increase of 17 million dinars; Belgium, with 19 million dinars; and Norway, with 9 million dinars.
Additionally, Italy and Finland recorded increases of 8 million dinars and 6 million dinars, respectively.
Exports to South Korea and Japan rose by 82 percent and 18 percent, respectively, with Jordanian products making inroads into markets such as Myanmar, Latvia, and Luxembourg.
Despite regional challenges and political tensions that could impact trade, the president highlighted the resilience of Jordan’s industrial sector, which has proven capable of adapting to complex global conditions.
Jaghbir highlighted that significant growth was noted across various industrial sectors, with the leather and garments sector leading the way with an increase of over 196 million dinars, marking a 20 percent growth rate. The food and supply sector expanded by more than 125 million dinars, reflecting a 31 percent growth.
The medical supplies and therapeutic products sector maintained strong performance, growing by 52 million dinars, or 16 percent.
Additionally, exports from the plastics and rubber sector rose by over 17 million dinars, translating to a 17 percent growth rate.
Conversely, some sectors, including construction, mining, and engineering, faced export declines due to global price fluctuations and shifting regional demand.
The president concluded with optimism for further expansion into new markets, contingent on overcoming current obstacles and enhancing promotional efforts.
Meanwhile, in a separate meeting, Minister of Industry, Trade, and Supply Yarub Qudah emphasized the government’s commitment to enhancing the competitiveness of Jordanian products and expanding their global reach.
Speaking with members of the Jordan Exporters Association, he reiterated the government’s dedication to supporting national exports and promoting growth across various sectors.
The minister highlighted efforts to capitalize on Jordan’s free trade agreements with numerous countries, aiming to boost exports and overcome sectoral challenges. He noted that these initiatives seek to enhance international market penetration, drive economic growth, and generate additional job opportunities.
He discussed recent Cabinet-approved policies designed to support the industrial and export sectors, including a decision to exempt profits from service exports from income tax, aimed at stimulating growth in service-oriented exports.
Qudah outlined various government support programs for the industrial sector, including an industry support fund and initiatives from the Jordan Enterprise Development Corp. and Jordan Exports Co.
He underscored the government’s dedication to fostering a productive partnership with the private sector, recognizing its critical role in economic activity and its ability to offer innovative solutions to address economic challenges.
Members of the Jordan Exporters Association expressed appreciation for the government’s continued collaboration with the private sector and welcomed the tax exemption on service exports, noting that this decision would positively impact exports and strengthen the national economy.
Technological revolution unlocks extraordinary opportunities for humanity, says top executive
Acceleration, particularly in AI, biotechnology, and space exploration, is creating unique opportunities
Discussions about the direction of these advancements and their implications for humanity are lacking
Updated 11 min 6 sec ago
NADIN HASSAN
RIYADH: The world is experiencing an unprecedented rate of technological and societal change, which a senior executive has described as “the most extraordinary time ever to be alive.”
In an exclusive interview with Arab News at the 8th Future Investment Initiative summit in Riyadh, Peter Diamandis, executive chairman of the XPRIZE Foundation and board member of the FII, highlighted that this acceleration, particularly in areas like artificial intelligence, biotechnology, and space exploration, is creating unique opportunities.
Diamandis said: “The speed of change is accelerating, and there’s not enough conversation taking place on where things are going, how fast they’re getting there, and how do we shape it, and how do we steer it.”
He expressed his belief that we have the potential to uplift every individual on the planet and to foster a hopeful, abundant future for humanity. “That’s my mission,” he added.
However, he cautioned that discussions about the direction of these advancements and their implications for humanity are lacking.
Peter Diamandis, executive chairman of the XPRIZE Foundation and board member of the FII. Supplied
All about the mindset
Diamandis said that mindset is crucial for any leader’s success. He argued that a positive mindset enables leaders to navigate challenges and recover even when everything else seems lost.
“I would posit that mindset was the single most important attribute of any leader in their success, and if they lost everything but retained their mindset, they’d be able to regain their success,” he added.
He continued: “If that’s true, then a lot of the mission I’m focused on is helping people realize that the mindset you have is your single greatest asset as a leader, as an entrepreneur, whatever you’re doing.”
Diamandis said that the scarcity mindset, inherited through generations, is outdated today. He advocates for an abundance mindset, which centers on believing that technology can convert scarcity into abundance.
Technology as a catalyst
Diamandis’ work embodies the belief that technology is a powerful force that transforms scarcity into abundance.
“Technology is a force that turns whatever was scarce into greater and greater abundance,” he said, adding that advancements like artificial intelligence have the potential to democratize access to resources and opportunities for everyone on the planet.
He expressed optimism that these innovations will pave the way for a future where everyone has access to essential resources such as food, water, energy, health care, and education.
Reflecting on the value of health, Diamandis said that it is humanity’s greatest wealth. He noted that when asked to prioritize between health and any other asset, most people would choose the health of their loved ones.
“I think health is our greatest wealth. I think if you ask yourself what matters, if you had to choose between the health of your husband or wife, the health of your children, and anything else you have, I hope most people would choose their health,” he said.
Diamandis advocates for extending the health span — the number of years people live in good health — through technologies like AI and biotechnology to combat aging. He sees this pursuit as a significant and lucrative frontier for the coming decades.
“I believe that this is the decade that principally because of AI and biotechnology, that we’re beginning to understand why we age how to slow it, stop it, and eventually reverse it,” Diamandis said.
He added: “When I ask people, would you like to live 220 or 150, most people’s image of that is drooling in a wheelchair. But what we’re speaking about is, can you have the energy, the aesthetics, the cognition at 100 that you had when you’re in your 40s and 50s.”
A sneak peek at the future
Despite ongoing conflicts and global challenges, Diamandis remains optimistic about the future. He believes humanity has the potential to create a world of abundance where everyone has access to life’s necessities.
“I think despite the challenges we have in conflicts, we have extraordinary opportunities to create a world of massive abundance, a world where every man, woman, and child has access to all the food, water, energy, health care, and education they desire. This is without question,” he said.
As Saudi Arabia continues its transformation under Vision 2030, Diamandis’ insights resonate with the Kingdom’s commitment to innovation and sustainable industry development. His focus on mindset, health, and technology highlights the importance of forward-thinking leadership in crafting a prosperous and inclusive future.
As FII’s board member, he explained that his role involves helping the initiative act as a platform for uniting leaders in finance and technology to engage in crucial discussions about humanity’s future.
“I’m actively involved as a host on stage and within the conclaves, ensuring that we’re addressing the most important conversations needed to shape the world’s future,” he said.
Ambassador, industry experts gather in Tokyo for Aramco forum
The forum aimed to build partnerships for the development and production of oil, gas and chemical products in Saudi Arabia
Updated 29 October 2024
Arab News Japan
A forum was organized by Aramco in Tokyo on Tuesday, with Saudi Ambassador to Japan Ghazi Binzagr and Senior Vice President of Project Management at Aramco Asia Japan Co. Yahya Abu Shal in attendance.
The forum aimed to build partnerships for the development and production of oil, gas and chemical products in Saudi Arabia.
Experts from Aramco and several other Saudi and Japanese organizations delivered speeches. The Saudi side hosted a presentation on the support programs that enable Japanese companies to benefit from business opportunities in the Kingdom.
According to the Saudi Embassy in Japan, the forum attracted substantial interest from participants and people interested in energy and industrial development.
FII CEO Richard Attias announces departure at opening of 8th Future Investment Initiative
Updated 29 October 2024
Miguel Hadchity
RIYADH: Future Investment Initiative Institute CEO Richard Attias is stepping down from the role, he announced on the opening day of the eighth FII forum.
Addressing an audience of global leaders and investors, Attias expressed gratitude for his journey with FII and said he would leave the position by the end of 2024.
In his remarks the executive, who joined FII as CEO in January 2020, emphasized the importance of passing the baton to the next generation.
“Thank you for allowing me to be part of this incredible journey. It has been the honor of a lifetime,” he said.
Attias opened the event with a message highlighting the potential and ambition driving the summit’s agenda: “When we speak of infinite horizons, we are not merely picturing vast landscapes.”
He added: “We are invoking the limitless possibilities that define our human spirit.”
Describing the theme of “Infinite Horizons” as an invitation to imagine new futures, Attias said: “The horizon is not an end; it’s an invitation, an invitation to push the boundaries of what we believe is possible and to shape the future that reflects our highest ambitions.”
He urged attendees to lead with vision and drive: “Today, we call on each of you to be the leaders who do not see the world as it is, but as it could be.”
Reflecting on the FII’s transformative impact since its start in 2017, Attias celebrated the event’s role as more than a forum for dialogue. “Since its inception, FII has transcended beyond just discussions, becoming a transformative force for action, progress, and solutions,” he said.
Governor of the Public Investment Fund, Chairman of Saudi Aramco, and Chairman of the FII Institute, Yasir Al-Rumayyan, built on Attias’s remarks, emphasizing the need for interconnected solutions in an increasingly complex world.
Chairman of the FII Institute Yasir Al-Rumayyan. Screenshot
“Today, we face challenges that are no longer isolated but interconnected,” Al-Rumayyan said.
He explained that these challenges open new pathways for progress and encapsulated the ambition of this year’s theme, and highlighted the responsibility of investing with purpose, saying: “We have the responsibilities and the opportunities to shape a future that invests not only in our economies but in humanity itself.”
Stressing the role of emerging markets, the FII Institute chairman said: “By 2030, it’s projected that the growth of emerging markets’ economies will outpace developed markets.” This shift, he explained, “underscores the need for strategic investments in places that will drive tomorrow’s global economy.”
Artificial intelligence emerged as a focal point in the speech, with Al-Rumayyan highlighting its transformative economic potential. “AI alone could add nearly $20 trillion to the global economy by 2030,” he projected, adding that by 2027 “AI’s role as an economic driver will become a benchmark of national power.”
He also emphasized the energy sector as a prime example of purposeful investment, saying: “Our goal is not just to fuel economies, but to empower a future where energy sustains progress and well-being for generations to come.”
Al-Rumayyan underscored the importance of aligning government policies with fiscal strategies to achieve sustainable impact, calling this alignment the “new frontier where purposeful investments meet sustainable impact.”
Highlighting global investment trends, Al-Rumayyan pointed to data from the FII Priority Compass, underlining that while rising living costs remain a top global concern, “climate change is now the fourth highest priority globally.”
At the FII Institute, he pledged a continued commitment to inclusivity, stating: “Investing with purpose means creating a new standard where financial returns and human progress go hand in hand together.”
He urged investors and directors alike to view challenges as opportunities for transformative impact: “As leaders and global investors, we can transform today’s challenges into tomorrow’s opportunities.”
Later, in a roundtable discussion, Al-Rumayyan reflected on the evolution of Saudi Arabia’s investment strategy. “A lot of people would come looking for our money to be invested abroad. But that has shifted over the years; now we’re more focused on the domestic economy.”
Over the past eight to nine years, PIF has increasingly concentrated on local initiatives, transforming Saudi Arabia’s economic landscape and altering global perceptions. “Most of our projects are getting operational and commercial, and people are seeing the difference between their perception of Saudi Arabia back in 2015 and now,” he said.
The Kingdom’s economy, Al-Rumayyan underlined, is among the fastest-growing globally. “In 2022, we were the fastest-growing economy in the G20, growing by more than 7 percent,” he said, adding that projections place the nation among the top performers in the G20 in the years to come.
To balance global and domestic investments, he explained that PIF aims to adjust its international investment share from 30 percent to a target range of 18-20 percent.
Al-Rumayyan highlighted the Kingdom’s strategic positioning as an international economic nexus, describing the country’s unique advantages.
“Saudi Arabia is very well-positioned to be a global hub, not only a regional hub,” he said, listing factors such as efficient energy use, low energy costs, and extensive resources, including advanced technologies and renewable energy potential.
He emphasized the scale of backing required for infrastructure growth globally, pointing to a massive $9 trillion in money markets awaiting investment.
Laurence Fink, CEO of BlackRock. Screenshot
Laurence Fink, CEO of BlackRock, echoed this sentiment, calling the current period an “investment blossoming.” Fink highlighted robust earnings growth and the alignment of profits with price elasticity, signaling that global markets are witnessing sustained growth.
AI’s transformative potential was a recurring theme, explored further by other tech leaders. Ruth Porat, president and chief investment officer of Alphabet and Google, described AI as a “transformational, generational technology,” urging leaders to rethink what is possible in an era of advanced systems.
Former Google CEO Eric Schmidt commented on AI’s future in defense, suggesting a redefinition of warfare, where automation could transform traditional combat roles.
“War is today defined stereotypically as man shooting another man. If you’re a computer scientist, this makes no sense. The guns should be automated, and people should be drinking coffee somewhere else,” Schmidt said.
The FII event continues until Oct. 31, with leaders and investors engaging in discussions underscoring the commitment to purposeful investment as a driver for sustainable impact, human progress, and future-focused economic growth.
