RIYADH: A Saudi energy think tank said that greater private sector involvement in funding and delivering projects would spur the non-oil economy in the Kingdom.
It is one of five key recommendations in a paper published by the King Abdullah Petroleum Studies and Research Center that could maximize the impact of government spending on the economy beyond oil.
It also highlighted the need to improve the Kingdom’s business environment, involving the private sector in investment and job creation projects, and working on reprioritizing government spending, increasing local content and reducing imported goods and services.
The study concluded that government expenditure would have a greater positive impact if it was underpinned by investment in education, vocational training and capacity building.
Regional governments are accelerating their economic diversification agendas as they respond to a six-year period of weaker oil prices that deteriorated further in the last four months as the coronavirus pandemic smothered demand for gasoline and aviation fuel.
Moody’s expects the Saudi economy to grow at an average rate of around 3 percent during 2021-24, which is nearly double the average during 2015-19 (1.6 percent) but lower than the 4.1 percent growth rate recorded during 2005-14.
Saudi energy think tank urges greater private sector funding
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Saudi energy think tank urges greater private sector funding
- One of five key recommendations that could maximize the impact of government spending on the economy beyond oil
European gas prices soar almost 50% as Iran conflict halts Qatar LNG output
- Analysts warn prolonged disruption could push prices higher
- Some shipments of oil, LNG through Strait of Hormuz suspended
- Benchmark Asian LNG price up almost 39 percent
LONDON: Benchmark Dutch and British wholesale gas prices soared by almost 50 percent on Monday, after major liquefied natural gas exporter Qatar Energy said it had halted production due to attacks in the Middle East.
Qatar, soon to cement its role as the world’s second largest LNG exporter after the US, plays a major role in balancing both Asian and European markets’ demand of LNG.
Most tanker owners, oil majors and trading houses have suspended crude oil, fuel and liquefied natural gas shipments via the Strait of Hormuz, trade sources said, after Tehran warned ships against moving through the waterway.
Europe has increased imports of LNG over the past few years as it seeks to phase out Russian gas following Russia’s invasion of Ukraine.
Around 20 percent of the world’s LNG transits through the Strait of Hormuz and a prolonged suspension or full closure would increase global competition for other sources of the gas, driving up prices internationally.
“Disruptions to LNG flows would reignite competition between Asia and Europe for available cargoes,” said Massimo Di Odoardo, vice president, gas and LNG research at Wood Mackenzie.
The Dutch front-month contract at the TTF hub, seen as a benchmark price for Europe, was up €14.56 at €46.52 per megawatt hour, or around $15.92/mmBtu, by 12:55 p.m. GMT, ICE data showed.
Prices were already some 25 percent higher earlier in the day but extended gains after QatarEnergy’s production halt.
Benchmark Asian LNG prices jumped almost 39 percent on Monday morning with the S&P Global Energy Japan-Korea-Marker, widely used as an Asian LNG benchmark, at $15.068 per million British thermal units, Platts data showed.
“If LNG/gas markets start to price in an extended period of losses to Qatari LNG supply, TTF could potentially spike to 80-100 euros/MWh ($28-35/mmBtu),” Warren Patterson, head of commodities strategy at ING, said. The British April contract was up 40.83 pence at 119.40 pence per therm, ICE data showed.
Europe is also relying on LNG imports to help fill its gas storage sites which have been depleted over the winter and are currently around 30 percent full, the latest data from Gas Infrastructure Europe showed. In the European carbon market, the benchmark contract was down €1.10 at €69.17 a tonne
