JEDDAH: The Organization of the Petroleum Exporting Countries’ (OPEC) job to restore the balance of the oil market just got harder as more output is expected to come from shale oil producers in North America with oil prices settling now at around $50.
OPEC is not sure that the market will rebalance this year if more production from shale oil producers can offset the group’s efforts to bring down global inventories, an OPEC source told Arab News.
The source said that there are risks to the deal from supply from other OPEC members such as Libya and Nigeria that are exempted from the production cut targets, due to their security issues and unstable production situation.
OPEC is now trying to conduct more studies on the impact of shale oil in the market and the findings of these studies will be presented to the ministers of the committee that monitors the agreement to cut production in their next meeting, the source, who asked not to be named because he is not authorized to speak to media, added.
The committee known as the Joint Ministerial Monitoring Committee, or JMMC, will probably convene in Vienna next month to review market developments since the last meeting in Russia in July, the source said. Shale crude oil production from seven major US oil plays is expected to reach a record in September. The US Energy Information Administration (EIA) said on Aug. 14 in its monthly drilling productivity report that it expects shale oil production to climb by 117,000 barrels per day (bpd) in September.
The EIA said last week that US production in the week ending Aug. 11 hit 9.5 million bpd, a level not seen since 2015, according to Bloomberg’s estimates. “$50 a barrel is still a pretty critical number and that number is going to be even more critical as we move into next year,” Tortoise Capital Advisors’ Rob Thummel told Bloomberg on Aug. 2.
Some analysts, however, expect shale oil production not to grow by as much as many in the industry believe that the cost of production for shale is also increasing. Standard Chartered’s analyst Steve Brice told Bloomberg TV on Aug. 22 that shale oil will stabilize this year at current levels unless oil prices increased from current levels.
Balancing the oil market could be jeopardized by shale
Balancing the oil market could be jeopardized by shale
Arab food and beverage sector draws $22bn in foreign investment over 2 decades: Dhaman
JEDDAH: Foreign investors committed about $22 billion to the Arab region’s food and beverage sector over the past two decades, backing 516 projects that generated roughly 93,000 jobs, according to a new sectoral report.
In its third food and beverage industry study for 2025, the Arab Investment and Export Credit Guarantee Corp., known as Dhaman, said the bulk of investment flowed to a handful of markets. Egypt, Saudi Arabia, the UAE, Morocco and Qatar attracted 421 projects — about 82 percent of the total — with capital expenditure exceeding $17 billion, or nearly four-fifths of overall investment.
Projects in those five countries accounted for around 71,000 jobs, representing 76 percent of total employment created by foreign direct investment in the sector over the 2003–2024 period, the report said, according to figures carried by the Kuwait News Agency.
“The US has been the region's top food and beverage investor over the past 22 years with 74 projects or 14 projects of the total, and Capex of approximately $4 billion or 18 percent of the total, creating more than 14,000 jobs,” KUNA reported.
Investment was also concentrated among a small group of multinational players. The sector’s top 10 foreign investors accounted for roughly 15 percent of projects, 32 percent of capital expenditure and 29 percent of newly created jobs.
Swiss food group Nestlé led in project count with 14 initiatives, while Ukrainian agribusiness firm NIBULON topped capital spending and job creation, investing $2 billion and generating around 6,000 jobs.
At the inter-Arab investment level, the report noted that 12 Arab countries invested in 108 projects, accounting for about 21 percent of total FDI projects in the sector over the past 22 years. These initiatives, carried out by 65 companies, involved $6.5 billion in capital expenditure, representing 30 percent of total FDI, and generated nearly 28,000 jobs.
The UAE led inter-Arab investments, accounting for 45 percent of total projects and 58 percent of total capital expenditure, the report added, according to KUNA.
The report also noted that the UAE, Saudi Arabia, Egypt, and Qatar topped the Arab ranking as the most attractive countries for investment in the sector in 2024, followed by Oman, Bahrain, Algeria, Morocco, and Kuwait.
Looking ahead, Dhaman expects consumer demand to continue rising. Food and non-alcoholic beverage sales across 16 Arab countries are projected to increase 8.6 percent to more than $430 billion by the end of 2025, equivalent to 4.2 percent of global sales, before exceeding $560 billion by 2029.
Sales are expected to remain highly concentrated geographically, with Egypt, Saudi Arabia, Algeria, the UAE and Iraq accounting for about 77 percent of the regional total. By product category, meat and poultry are forecast to lead with sales of about $106 billion, followed by cereals, pasta and baked goods at roughly $63 billion.
Average annual per capita spending on food and non-alcoholic beverages in the region is projected to rise 7.2 percent to more than $1,845 by the end of 2025, approaching the global average, and to reach about $2,255 by 2029. Household spending on these products is expected to represent 25.8 percent of total expenditure in 13 Arab countries, above the global average of 24.2 percent.
Arab external trade in food and beverages grew more than 15 percent in 2024 to $195 billion, with exports rising 18 percent to $56 billion and imports increasing 14 percent to $139 billion. Brazil was the largest foreign supplier to the region, exporting $16.5 billion worth of products, while Saudi Arabia ranked as the top Arab exporter at $6.6 billion.
