Global energy sector employment increased by 3.8% in 2023: IEA

Global energy sector employment increased by 3.8% in 2023: IEA
The solar PV industry added over half a million new jobs, spurred by record new installation. Shutterstock
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Updated 13 November 2024
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Global energy sector employment increased by 3.8% in 2023: IEA

Global energy sector employment increased by 3.8% in 2023: IEA
  • IEA said the sector added 2.5 million jobs worldwide in 2023
  • It released its study at a time when international leaders have rallied in Baku, Azerbaijan, for COP29

RIYADH: The number of jobs in the global energy sector reached 68 million in 2023, representing a 3.8 percent rise compared to the previous year, according to an analysis. 

In its latest report, the International Energy Agency said that the sector added 2.5 million jobs worldwide in 2023, driven by a wave of investment in manufacturing eco-conscious technologies. 

The IEA released its study at a time when international leaders have rallied in Baku, Azerbaijan, for COP29, where discussions are going on to elevate renewable energy growth globally to tackle climate challenges. 

During the opening ceremony of COP29 on Nov. 11, Simon Stiell, executive secretary of the UN Framework Convention on Climate Change, affirmed the growth of the renewable sector and said that clean energy infrastructure investments are expected to reach $2 trillion in 2024, nearly double that of fossil fuels.

“The global energy sector has been a powerful engine of job growth around the world in recent years, and as the energy system continues to transform and grow, rising demand for skilled energy workers is a given,” said the IEA’s Director of Sustainability, Technology and Outlooks, Laura Cozzi. 

Clean energy sector leading growth

According to the IEA, employment in the clean energy sector increased by 1.5 million last year and contributed as much as 10 percent of economy-wide job growth in the leading markets for clean technologies. 

The report said that the solar PV industry added over half a million new jobs, spurred by record new installations, while employment in electric vehicle manufacturing and batteries grew by 410,000 as sales reached nearly 20 percent of the global car market. 

Even though several wind manufacturers implemented layoffs as rising costs contributed to a slower-than-anticipated offshore project pipeline, total employment in the sector still climbed as a record number of new projects entered construction. 

The IEA said that jobs in the oil and gas supply sector increased by around 3 percent, or 600,000, in 2023 after a period of cautious post-pandemic rehiring, while global coal employment fell for the third year in a row, declining by around 1 percent year on year. 

“Global coal employment fell in both supply and power, largely due to continued mining productivity gains and a slowdown in the pipeline of new coal-fired power plants compared with the highs of the last decade,” said the report. 

Employment in manufacturing vehicles with internal combustion engines rose by 440,000 positions, just outstripping job additions in EVs. 

In China, clean energy made up over 90 percent of energy job growth, while fossil fuels accounted for 80 percent of the gains in the Middle East.

The analysis also said that the growth in energy jobs was led by manufacturing — diverging from previous years when it was generally led by construction and installation. 

“This largely reflects the 70 percent rise in clean energy manufacturing investment in 2023 to $200 billion as firms responded to increasing demand for clean energy technologies and new policies,” added IEA. 

Skill shortage continues in energy sector 

According to the report, shortages of skilled workers remain a major concern for employers looking to hire in the global energy industry.

The IEA said that the lack of skilled workers in many parts of the industry — particularly those requiring high degrees of specialization, such as grids and nuclear power — remains a substantial bottleneck for the sector. 

A survey conducted by the agency found that over 190 energy employers across 27 countries reported plans to hire but had difficulties finding qualified applicants for nearly all occupation categories. 

“Governments, the private sector, and educational and training institutions must work together to improve the hiring pipeline, which will play an important role in shaping our energy future,” said Cozzi. 

The report added that intense competition for talent in clean energy sectors is prompting firms to hire aggressively in anticipation of future growth — a tactic that could prove effective but may also leave some companies exposed to uncertainties related to project flows and changing policies. 

The analysis said many firms facing shortages of qualified applicants are also increasing on-the-job training to deliver these skills. 

According to the IEA, countries transitioning to clean energy are experiencing substantial employment growth in the sector. In 2023, job creation in clean energy accounted for over 10 percent of overall job growth in China and 4 to 6 percent in economies such as the US, EU, and Japan.

The analysis added that clean energy’s share of new jobs is below 2 percent in many emerging and developing economies. 

In September, another report released by the US Department of Energy revealed that the clean energy sector in the country added 142,000 jobs in 2023, representing a rise of 4.2 percent compared to the previous year. 

In October, the Indian government said that the total number of jobs in the country’s renewable energy sector reached over 1 million by the end of 2023, led by hydropower which provides 453,000 employment opportunities in the Asian nation. 

The IEA added that wages in the energy sector are rising, reflecting increasing competition for skilled workers. 

“After real wages fell in many regions in 2022, growth resumed in much of the world in 2023, though absolute wages generally remain below pre-pandemic levels. Wages for energy-specific roles have broadly fared better than those for more generic occupations relevant to the energy sector, notably for technicians,” said the report. 

The analysis revealed that the rising wages in the energy sector are partially a response to skills gaps, as firms aim to attract new workers from within and outside the industry. 

The IEA added that clean energy wage increases were, on average, greater than those in fossil fuels, even in major oil, gas, and coal-producing countries. 

Future outlook

According to the IEA, employment in the energy sector is set to grow by 3 percent in 2024, a slowdown compared with last year due to the impacts of tight labor markets, elevated interest rates, and changes in the expected pipeline of new energy projects.

“While clean energy firms seem set to take more bullish positions on hiring in anticipation of growth, less diversified fossil fuel firms have been remaining cautious for now. As a result, fossil fuel job growth is expected to stall in 2024,” said the agency. 


Saudi PIF on track to reach $2tn in AuM, 2nd-largest globally by 2030

Saudi PIF on track to reach $2tn in AuM, 2nd-largest globally by 2030
Updated 10 January 2025
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Saudi PIF on track to reach $2tn in AuM, 2nd-largest globally by 2030

Saudi PIF on track to reach $2tn in AuM, 2nd-largest globally by 2030

RIYADH: Saudi Arabia’s Public Investment Fund is set to be ranked second among the world’s sovereign wealth bodies by 2030 with $2 trillion in assets under management, according to monitoring organization Global SWF.

A report from the firm forecasts PIF will more than double its current AuM value of $925 billion by the end of the decade, and rise from its 2024 ranking of sixth among global state-owned investor funds.

According to projections from the institute, PIF’s AuM in 2030 will represent 10.5 percent of the global sovereign wealth funds’ total assets, which are set to reach $19 trillion, as it rises from sixth place

Diego Lopez, founder and managing director at Global SWF, said: “Capital attracts capital — so international financial institutions are attracted in partnering with a player with such a huge balance sheet and role in the economic development.”

According to the report, to achieve its ambitious goal of reaching $2 trillion by 2030, the PIF will depend on a combination of strategies. These include oil revenue allocations, which refer to the portion of the Kingdom’s oil earnings transferred to the PIF, debt issuance, and returns generated from its investments.

“Saudi Arabia needs to make its capital base sustainable, diversified and resilient to lower levels of oil prices,” Lopez told Arab News.

“That means raising debt, as PIF has been doing, and eventually raising equity through subsidiaries that can act as asset managers — we see this working very well in Abu Dhabi with Mubadala Capital, Lunate, etc,” he added.

According to the report, the PIF’s 10-year annualized return from 2013 to 2022 stood at 6.9 percent, outperforming the sovereign wealth fund average of 5.7 percent annually.

In 2024, the global economy showed resilience despite geopolitical risks and market uncertainties, with global GDP growth projected at 3.2 percent, slightly improving to 3.3 percent in 2025, according to the OECD.

The International Monetary Fund forecasts a subdued five-year outlook of 3.1 percent, reflecting weaker growth in China, Latin America, and the EU. Developed markets are facing slower growth due to tightening monetary policies, while developing economies maintain greater stability.

Central banks, led by the US Federal Reserve, began easing rates in 2024, responding to reduced inflationary pressures. According to the report, as the global economy adapts, sovereign wealth funds are increasingly focused on capital preservation and stimulating foreign direct investment, with those in the Middle East and North Africa region entering a new phase of growth.

Saudi Arabia offers robust economic expansion fueled by diversification initiatives and ambitious mega-projects like NEOM, the Red Sea Project, and Qiddiya.  

PIF’s investments are strategically positioned to capitalize on these high-growth areas, making it a gateway for investors seeking exposure to dynamic emerging market opportunities.

GCC sees greater international attention

According to the report, global sovereign wealth funds have, for the first time, surpassed $13 trillion in assets under management, with capital heavily concentrated in two key regions — the Gulf Cooperation Council, holding 38 percent of the total, and Southeast Asia at 10 percent.

Interest in these powerful global investors remains strong, the report said, drawing heightened international attention to the GCC, a region with fewer than 60 million residents.

Previously named the “Region of the Year” by Global SWF, the GCC has seen a wave of global asset managers and bankers establishing local offices to capitalize on burgeoning opportunities. According to the report, the GCC-Southeast Asia axis is expected to continue driving growth across the sovereign wealth landscape.

PIF represented 7.11 percent of MENA’s sovereign wealth funds’ AuM, with assets totaling $925 billion. 

Leading the rankings is Abu Dhabi Investment Authority at $1.11 trillion, followed by Kuwait Investment Authority with $969 billion.

Global sovereign wealth fund investments totaled $136.1 billion across 358 transactions in 2024. The “Oil Five” — ADIA, ADQ, PIF, QIA, and Mubadala — maintained their dominance, together accounting for 60 percent of the total investment value, amounting to $82 billion. As a result, they secured positions among the top 19 dealmakers of the year.

This marks a significant rise from $74 billion in both 2023 and 2022, $41 billion in 2021, $39 billion in 2020, and $28 billion in 2019, reflecting the accelerating investment momentum of these sovereign wealth giants.

While some Gulf sovereign wealth funds leaned toward emerging markets, including their domestic economies, developed markets remained the dominant choice for most global sovereign investors.

Saudi Arabia’s PIF, Abu Dhabi’s ADQ, and Qatar’s QIA exhibited a preference for emerging markets, reflecting their strategic focus on regional and high-growth economies.

PIF investments

According to the report, a significant factor driving the PIF’s growth is its projected boost in domestic spending to $70 billion annually by 2025.

The fund’s investment strategy is focused on high-growth sectors, including infrastructure, digitalization, AI, and renewable energy.

Among the top 15 largest global investments by sovereign wealth funds in 2024 was PIF’s $3 billion acquisition of a 51 percent stake in Saudi Arabia’s TAWAL and $2.16 billion of a 40 percent stake in Selfridges in the UK.

Other significant investments for the PIF include a 15 percent stake in Heathrow Airport for $1.8 billion.

According to the institute, the largest deals are consistently pursued by a select group of funds known for their substantial firepower and risk appetite. This group includes the top 10 spenders, with the GCC’s “Big 5” leading the way.

Mubadala emerged as the leading sovereign investor in 2024, deploying $29.2 billion across 52 deals, a 67 percent increase from the previous year. It was followed by GIC at $26.6 billion, CPP with $21.1 billion, PIF at $19.9 billion, and ADIA at $17.1 billion.

PIF has also ventured into artificial intelligence and space, co-investing in Databricks and launching Neo Space Group to advance Saudi Arabia’s satellite industry.

These initiatives reflect the fund’s commitment to positioning Saudi Arabia as a leader in global digital and technological innovation.

PIF saw a 24 percent decline in its US equity portfolio, the report said. At the beginning of 2024, the fund sold shares in 18 companies worth nearly $13 billion, including pandemic-era investments like gaming giant Activision Blizzard, cruise leader Carnival, and entertainment company Live Nation, which yielded strong returns.

According to Lopez: “The sale of the listed equities was about monetizing a huge upside from their purchase during covid, rather than about decreasing the overseas portfolio.”

The expert noted the importance to recognize that while PIF’s domestic portfolio may be growing relative to its international holdings, the overall assets under management continue to expand, with significant investments being made outside the Kingdom.

PIF has also made significant investments in the electric vehicle sector, despite facing challenges with earlier ventures.

In 2019, PIF divested from Tesla but doubled down on Lucid Motors, placing a major bet on the EV manufacturer.

This strategic move has required substantial funding, including $2.8 billion in 2024 alone. Despite the financial commitment, PIF remains focused on its long-term vision for Saudi Arabia, supporting Lucid’s growth with a manufacturing facility in King Abdullah Economic City.

In January, Lucid Motors became the first global automotive company to join the Kingdom’s “Made in Saudi” program, reinforcing the country’s push to strengthen its industrial capabilities.

The program also supports Vision 2030’s goals of attracting investments, boosting non-oil exports, and creating sustainable jobs, while positioning Saudi Arabia as a hub for innovation and manufacturing in the EV sector.

PIF’s debt financing

On Jan. 6, PIF announced the completion of its inaugural $7 billion murabaha credit facility, supported by a syndicate of 20 international and regional financial institutions.

This Shariah-compliant financing structure is part of the fund’s medium-term capital raising strategy, aimed at diversifying its funding sources to support transformative investments both globally and within Saudi Arabia.

According to another report published by Global SWF in January, PIF’s use of debt financing mirrors a growing trend among sovereign wealth funds and public pension funds, which have raised around $700 billion over the past two decades.

Despite strong credit ratings from Moody’s and Fitch, PIF faces pressure from surging domestic investment in giga-projects like NEOM and Qiddiya, with annual funding needs expected to rise from $40 billion in 2023 to $70 billion by 2025.

Sustaining investor confidence will depend on its ability to manage financial obligations and execute Vision 2030 goals.

While markets currently support PIF’s sovereign-backed debt, delays or disruptions could strain resources and affect its ambitious agenda, making its financing strategy critical for both national economic transformation and global sovereign investment trends.

However, PIF’s diversified funding strategy, coupled with its ability to attract global partnerships, positions it as a transformative force capable of reshaping Saudi Arabia’s economic future and reinforcing its role as a leading driver of global investment innovation.


Oil Updates — crude jumps on concerns about more sanctions on Russia and Iran

Oil Updates — crude jumps on concerns about more sanctions on Russia and Iran
Updated 10 January 2025
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Oil Updates — crude jumps on concerns about more sanctions on Russia and Iran

Oil Updates — crude jumps on concerns about more sanctions on Russia and Iran

LONDON: Oil prices surged on Friday and were on track for a third straight week of gains as traders focused on potential supply disruptions from more sanctions on Russia and Iran.

Brent crude futures gained $2.50, or 3.3 percent, to $79.42 a barrel by 3:48 p.m. Saudi time, reaching their highest in more than three months. US West Texas Intermediate crude futures advanced $2.39, or 3.2 percent, to $76.31.

“There are several drivers today. Longer term, the market is focused on the prospect for additional sanctions,” said Ole Hansen, head of commodity strategy at Saxo Bank. “Short term, the weather is very cold across the US, driving up demand for fuels.”

Ahead of US President-elect Donald Trump’s inauguration on Jan. 20, expectations are mounting over potential supply disruptions from tighter sanctions against Iran and Russia while oil stockpiles remain low.

This could materialize even earlier, with US President Joe Biden expected to announce new sanctions targeting Russia’s economy before Trump takes office. A key target of sanctions so far has been Russia’s oil industry.

The US weather bureau expects central and eastern parts of the country to experience below-average temperatures. Many regions in Europe have also been hit by extreme cold and are likely to continue to experience a colder than usual start to the year, which JPMorgan analysts expect to boost demand.

“We anticipate a significant year-over-year increase in global oil demand of 1.6 million barrels a day in the first quarter of 2025, primarily boosted by ... demand for heating oil, kerosene and LPG,” they said in a note on Friday.

Meanwhile, the premium on the front-month Brent contract over the six-month contract reached its widest since August this week, potentially indicating supply tightness at a time of rising demand.

Inflation worries are also delivering a boost to crude oil prices, said Saxo Bank’s Hansen. Investors are growing concerned about Trump’s planned tariffs, which could drive inflation higher. A popular trade to hedge against rising consumer prices is through buying oil futures.

Oil prices have rallied despite the US dollar strengthening for six straight weeks, making crude oil more expensive outside the US.


SABIC, Almarai, SEC able to absorb fuel price hike: S&P Global

SABIC, Almarai, SEC able to absorb fuel price hike: S&P Global
Updated 09 January 2025
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SABIC, Almarai, SEC able to absorb fuel price hike: S&P Global

SABIC, Almarai, SEC able to absorb fuel price hike: S&P Global

RIYADH: Major Saudi companies, including chemical company SABIC, dairy firm Almarai, and Saudi Electric Co., are well-positioned to handle the impact of higher fuel and feedstock prices introduced on Jan. 1, according to a new report.

Released by capital market economy firm S&P Global, the analysis reveals that those corporates will be able to absorb the marginal increase in production costs by further improving operational efficiencies as well as potentially via pass-through mechanisms.

This came after Saudi Aramco increased diesel prices in the Kingdom to SR1.66 ($0.44) per liter, effective Jan. 1, marking a 44.3 percent rise compared to the start of 2024. The company has kept gasoline prices unchanged, with Gasoline 91 priced at SR2.18 per liter and Gasoline 93 at SR2.33 per liter.

Despite the hike, diesel prices in Saudi Arabia remain lower than those in many neighboring Arab countries. In the UAE and Qatar, a liter of diesel is priced at $0.73 and $0.56, respectively, while in Bahrain and Kuwait, it costs $0.42 and $0.39 per liter.

“For SABIC and Almarai, the increase in feedstock prices will not affect profitability significantly. In the case of utility company, SEC, additional support will likely come from the government if needed,” the report said.

The capital market economy firm projects that SABIC will continue to outperform global peers on profitability.

“We don’t expect the rise in feedstock and fuel prices to materially affect profitability, since the company estimates it will increase its cost of sales by only 0.2 percent,” the report said.

It further highlighted that SABIC is considered a government-related entity with a high possibility of receiving support when needed.

The report also underlines that Almarai anticipates an additional SR200 million in costs for 2025, driven by higher fuel prices and the indirect effects of increased expenses across other areas of its supply chain.

“We believe Almarai will continue focusing on business efficiency, cost optimization, and other initiatives to mitigate these impacts,” the release stressed.

With regards to SEC, S&P said that an unrestricted and uncapped balancing account provides a mechanism for government support, including related to the higher fuel costs.

“We believe any increased fuel cost will be covered by this balancing account,” the report said.

The study further highlights that the marginal increase “could significantly affect wider Saudi corporations’ profit margins and competitiveness.”

The S&P data also suggests that additional costs will be reflected in companies’ financials from the first quarter of 2025.

“Saudi Arabia is continuing its significant and rapid transformation under the country’s Vision 2030 program. We expect an acceleration of investments to diversify the Saudi economy away from its reliance on the upstream hydrocarbon sector,” the report said.

“The sheer scale of projects — estimated at more than $1 trillion in total — suggests large funding requirements. Higher feedstock and fuel prices would help reduce subsidy costs for the government, with those savings potentially redeployed to Vision 2030 projects,” it added.


Lenovo to produce ‘Saudi Made’ PCs by 2026 following $2bn Alat deal closure

Lenovo to produce ‘Saudi Made’ PCs by 2026 following $2bn Alat deal closure
Updated 09 January 2025
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Lenovo to produce ‘Saudi Made’ PCs by 2026 following $2bn Alat deal closure

Lenovo to produce ‘Saudi Made’ PCs by 2026 following $2bn Alat deal closure

RIYADH: Chinese tech giant Lenovo is set to manufacture millions of computer devices in Saudi Arabia by 2026, following the completion of a $2 billion investment deal with Alat, a subsidiary of the Public Investment Fund. 

First announced in May, the partnership has now received shareholder and regulatory approvals, paving the way for Lenovo to establish a regional headquarters and a manufacturing facility in the Kingdom. 

The deal marks a significant step in aligning Lenovo’s growth ambitions with Saudi Arabia’s Vision 2030 goals of economic diversification, innovation, and job creation, the company said in a press release. 

The factory will manufacture millions of PCs and servers every year using local research and development teams for fully end-to-end “Saudi Made” products and is expected to begin production by 2026, it added. 

“Through this powerful strategic collaboration and investment, Lenovo will have significant resources and financial flexibility to further accelerate our transformation and grow our business by capitalizing on the incredible growth momentum in KSA and the wider MEA region,” Yang said. 

He added: “We are excited to have Alat as our long-term strategic partner and are confident that our world-class supply chain, technology, and manufacturing capabilities will benefit KSA as it drives its Vision 2030 goals of economic diversification, industrial development, innovation, and job creation.” 

Amit Midha, CEO of Alat, underscored the significance of the partnership for both Lenovo and the Kingdom. 

“We are incredibly proud to become a strategic investor in Lenovo and partner with them on their continued journey as a leading global technology company,” said Midha. 

“With the establishment of a regional headquarters in Riyadh and a world-class manufacturing hub, powered by clean energy, in the Kingdom of Saudi Arabia, we expect the Lenovo team to further their potential across the MEA region,” he added. 

The partnership is expected to generate thousands of jobs, strengthen the region’s technological infrastructure, and attract further investment into the Middle East and Africa, according to the press release. 

In May, Lenovo raised $1.15 billion through the issuance of warrants to support its future growth plans. The initiative, which was fully subscribed by investors, signals confidence in Lenovo’s strategic approach and its plans for global expansion. 

The investment deal was advised by Citi and Cleary Gottlieb Steen & Hamilton for Lenovo, while Morgan Stanley and Latham & Watkins represented Alat. 


Lebanon’s bonds climb as parliament elects first president since 2022

Lebanon’s bonds climb as parliament elects first president since 2022
Updated 09 January 2025
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Lebanon’s bonds climb as parliament elects first president since 2022

Lebanon’s bonds climb as parliament elects first president since 2022

LONDON: Lebanon’s government bonds extended a three-month long rally on Thursday as its parliament voted in a new head of state for the crisis-ravaged country for the first time since 2022.

Lebanese lawmakers elected army chief Joseph Aoun as president. It came after the failure of 12 previous attempts to pick a president and the move boosts hopes that Lebanon might finally be able to start addressing its dire economic woes.

Lebanon’s battered bonds have almost trebled in value since September when the regional conflict with Israel weakened Lebanese armed group Hezbollah, long viewed as an obstacle to overcoming the country’s political paralysis.

Most of Lebanon’s international bonds, which have been in default since 2020, rallied after Aoun’s victory was announced to stand between 0.8 and 0.9 cents higher on the day and at nearly 16 cents on the dollar.

They have also risen almost every day since late December, although they remain some of the lowest priced government bonds in the world, reflecting the scale of Lebanon’s difficulties.

With its economy still reeling from a devastating financial collapse in 2019, Lebanon is in dire need of international support to rebuild from the war, which the World Bank estimates to have cost the country $8.5 billion.