Oil Updates – prices dip as weak demand offsets supply disruptions from Gulf storm

Brent crude futures were down 4 cents, or 0.06 percent, to $72.80 a barrel by 6:34 a.m. Saudi time. Shutterstock
Short Url
Updated 10 September 2024
Follow

Oil Updates – prices dip as weak demand offsets supply disruptions from Gulf storm

HOUSTON/TOKYO: Oil prices edged down on Tuesday as weak Chinese demand offset supply disruptions from Tropical Storm Francine and as global oil oversupply risks continued to weigh on the market.

Brent crude futures were down 4 cents, or 0.06 percent, to $72.80 a barrel by 6:34 a.m. Saudi time. US West Texas Intermediate crude futures lost 10 cents, or 0.15 percent, to trade at $68.60 a barrel.

Both benchmarks gained around 1 percent at Monday’s settlement.

The US Coast Guard ordered the closure of all operations at Brownsville and other small Texas ports on Monday evening, as Tropical Storm Francine barrelled across the Gulf.
The port of Corpus Christi remained open but with restrictions.

The tropical storm is forecast to strengthen significantly over the next couple of days, and was expected to become a hurricane on Monday night or Tuesday morning, according to the National Hurricane Center.

Exxon Mobil said it shut-in output at its Hoover offshore production platform, while Shell paused drilling operations at two platforms. Chevron also began shutting in oil and gas output, at two of its offshore production platforms.

“At least 125,000 barrels per day of oil capacity is at risk of being disrupted,” ANZ analysts said in a note, citing data from the NHC.

However, signs of weakening global demand and expectations of existing oil oversupply continuing weighed on the market.

China data on Monday showed the country’s consumer inflation accelerated in August to the fastest pace in half a year but domestic demand remained fragile, and producer price deflation worsened.

“Signs of weakness in the US and China have spurred a bearish tone across investors, with money managers now the least bullish on crude in more than 13 years,” ANZ said.

Global commodity traders Gunvor and Trafigura anticipate oil prices may range between $60 and $70 per barrel on weakened Chinese demand and persistent global oversupply, executives told Asia Pacific Petroleum Conference attendees on Monday.

China’s shift toward lower-carbon fuels and a sluggish economy are dampening oil demand growth in the world’s largest crude importer, APPEC conference speakers said.

China’s annual demand growth has slowed from around 500,000-600,000 bpd in the five years before the COVID-19 pandemic to 200,000 bpd now, said Daan Struyven, head of oil research at Goldman Sachs.

On Tuesday, markets will be watching for the monthly oil market report from OPEC.

The US Energy Information Administration is also set to publish its short term energy outlook with forecasts about the global market and US crude oil output. 


Closing Bell: Saudi main market closes in green at 12,027

Updated 5 sec ago
Follow

Closing Bell: Saudi main market closes in green at 12,027

RIYADH: The Tadawul All Share Index in Saudi Arabia experienced a positive surge on Tuesday, rising by 113.55 points, or 0.95 percent, to close at 12,027.17.

The benchmark index recorded a total trading turnover of SR8.22 billion ($2.19 billion), with 111 stocks gaining ground while 116 declined.

The MSCI Tadawul Index also saw an increase, gaining 16.72 points to end the day at 1,508.72. In contrast, the parallel market faced a setback, dropping 105.82 points to close at 24,543.25.

A significant factor in the main index’s performance was the impressive 29.97 percent surge in Al Majed Oud Co.’s share price, which reached SR158.80. Other notable performers included Al-Baha Investment and Development Co., whose shares rose by 9.09 percent to SR0.36, and Fawaz Abdulaziz Alhokair Co., with a 7.19 percent increase to SR10.58.

Dar Alarkan Real Estate Development Co. saw its share price hit an all-time high of SR14.58 during the day, the highest since October 2022. It closed at SR14.54, marking a 5.82% increase from the previous session.

On the downside, Saudi Fisheries Co. was the worst performer, with its share price declining by 4.19 percent to SR27.45.

Additionally, Arabian Mills for Food Products Co. began trading on Tadawul on Oct. 8, marking the 10th listing on the Kingdom’s main market this year. The food company started trading at SR66 but closed Tuesday’s session at SR65.80, a decrease of 0.30 percent.

On the announcements front, United Electronics Co., known as eXtra, reported a net profit of SR356.7 million for the first nine months of the year, representing a 34.91 percent increase compared to the same period in 2023.

The company attributed this growth to increased retail segment sales driven by stable demand in the Saudi market. Following the announcement, eXtra’s share price rose by 2.96 percent to SR93.90.


Saudi cement exports reach 8.48m tonnes in 2023 as industry eyes sustainable growth

Updated 53 min 46 sec ago
Follow

Saudi cement exports reach 8.48m tonnes in 2023 as industry eyes sustainable growth

  • In 2023, foreign sales of the resource reached over 8.48 million tonnes
  • Launch of City Cement Co.’s sustainability report marks a significant step toward a more eco-conscious future for the sector

RIYADH: Saudi Arabia’s cement and clinker exports have stayed above 8 million tonnes for four years in a row — double the amount recorded in 2018, according to the latest figures.

New data showed that in 2023, foreign sales of the resource reached over 8.48 million tonnes.

The Minister of Industry and Mineral Resources, Bandar Alkhorayef, emphasized this during the launch of “Madinah Cement Co’s” first sustainability report, reported the Saudi Press Agency.

During the launch, Alkhorayef discussed the Kingdom’s position as the leading cement producer in the Arab world and the 10th largest globally, with an annual production capacity exceeding 80 million tonnes. 

Saudi Arabia’s cement industry is supported by 20 factories across the country. 

The minister said that domestic demand for cement reached approximately 47.3 million tonnes in 2022, driven by ongoing large-scale development projects. With construction sector investments expected to hit SR6 trillion ($1.6 trillion) by 2030, demand is projected to rise further.

Alkhorayef emphasized the efforts of leading companies to adopt the latest manufacturing technologies, which improve production efficiency. Several firms have recently upgraded their production lines to enhance the quality of products.

Saudi Arabia’s cement industry is vital in supporting the Kingdom’s ambitious Vision 2030 initiatives, including NEOM, the Red Sea Project, and Qiddiya. 

These undertakings, aimed at diversifying the economy away from oil dependency, are driving significant demand in the construction and infrastructure sectors, leading to a surge in the consumption of building materials such as cement.

This positions the Kingdom as a key player in the regional and global cement markets, meeting domestic needs and increasing exports to international markets, reflecting the sector’s competitive edge.

Alkhorayef further outlined the ministry’s strategic recommendations to make the cement sector more sustainable. These undertakings, developed in collaboration with relevant authorities, include the Industrial Competitiveness Program and the Liquid Fuel Displacement Program. 

Their implementation is expected to boost energy efficiency, lower production costs, and reduce carbon emissions, particularly within the cement sector. 

The minister also mentioned an initiative involving the Cement Companies National Committee, King Abdullah University of Science and Technology, and other stakeholders to research to minimize industry carbon emissions and produce environmentally friendly cement.

The launch of City Cement Co.’s sustainability report marks a significant step toward a more eco-conscious future for the sector. The study highlights the firm’s efforts to convert waste into alternative fuels for cement production and its recent agreement with a leading company to incorporate green technologies. 

The release of the inaugural sustainability report aligns with the Vision 2030 goals, reinforcing the organization’s role as a responsible leader in the sector. 

It also outlines tangible governance, social responsibility, and environmental protection initiatives, further enhancing its reputation as a company that adheres to global best practices.


NEOM to set up $187m concrete factory to support THE LINE project

Updated 08 October 2024
Follow

NEOM to set up $187m concrete factory to support THE LINE project

RIYADH: Saudi Arabia’s upcoming linear city project THE LINE is set to benefit from a new ready-mix concrete factory valued at SR700 million ($186.7 million). 

NEOM has partnered with Asas Al-Mohileb to develop and operate this facility, which will focus on producing sustainable concrete primarily for the construction of the smart city, which is designed to accommodate 9 million residents within a compact 34 sq. km footprint. 

The multi-plant factory will have the capacity to produce over 20,000 cubic meters of green concrete daily. 

Scheduled to begin operations in November, the facility aims to reach peak production by 2025 and is projected to create over 500 local jobs, contributing to the region’s economic growth. 

THE LINE, extending 170 km from the mountains of NEOM to the Red Sea, features a mirrored structure rising 500 meters above sea level while spanning just 200 meters in width. This innovative design underscores NEOM’s ambition to redefine urban living. 

Nadhmi Al-Nasr, NEOM CEO, said: “The delivery of these concrete plants is another testament to the rapid progress happening at NEOM. It also underscores the strength of the Kingdom’s construction industry, and the critical role local partnerships play in delivering this transformational project efficiently and sustainably.” 

The $500 billion giga-project NEOM, a key component of Saudi Arabia’s Vision 2030, aims to diversify the economy beyond oil by establishing a sustainable, tech-driven region in the country’s northwest.

Key initiatives include developing renewable energy, smart cities like THE LINE, and advanced industries while attracting global investors and fostering innovation in sectors such as biotech, robotics, and mobility. 

“This partnership emphasizes our firm commitment to advancing economic growth in the Kingdom by employing the latest technologies and innovative construction solutions,” said Sulaiman Al-Mohileb, CEO of Al-Mohileb.  

He noted that this initiative aligns with Vision 2030’s goals to strengthen the manufacturing sector and drive national development. 

The advanced concrete facility will integrate carbon capture and utilization technology and other energy-saving measures. 

Most of its output will support the construction of THE LINE, where concrete is essential for both substructure and superstructure elements. 

As construction progresses, the facility is poised to play a crucial role, with nearly 1,000 of the planned 30,000 foundation piles alrady completed.


Saudi Arabia’s fisheries, aquaculture production jumps 55.56% in 2023

Updated 08 October 2024
Follow

Saudi Arabia’s fisheries, aquaculture production jumps 55.56% in 2023

  • Total catch from marine fisheries in the Red Sea and Arabian Gulf reached 74,700 tonnes
  • Kingdom annually exports 59,844 tonnes of fish and shrimp, totaling SR1.1 billion

JEDDAH: Saudi Arabia’s fisheries and aquaculture production rose by 55.56 percent in 2023 to over 140,000 tonnes, underscoring the Kingdom’s commitment to food self-sufficiency and sustainable development.

The Ministry of Environment, Water, and Agriculture said that the country has set new records in saltwater and inland aquaculture projects, achieving unprecedented production levels compared to the 90,000 tonnes recorded in 2021, according to the Saudi Press Agency.

MEWA added that the total catch from marine fisheries in the Red Sea and Arabian Gulf reached 74,700 tonnes, marking a 16.2 percent increase from 64,300 tonnes at the end of 2022, bringing the combined production from aquaculture projects and marine fisheries to 214,000 tonnes last year.

Saudi Arabia’s National Fisheries Development Program is focused on sustainably boosting the economic role of the fisheries and aquaculture sector. The initiative emphasizes optimizing natural resource use, increasing the division’s contribution to the gross domestic product, achieving self-sufficiency in seafood, and diversifying income sources.

Aquaculture in the Kingdom began in 1982 and has evolved significantly, positioning the nation as a leading exporter of white shrimp. The country has set an ambitious target to produce 600,000 tonnes of fish by 2030 while fostering local investments and generating job opportunities.

The ministry is implementing strategic programs to boost fish product self-sufficiency, improve quality standards, introduce new species for farming, and attract investments. It also aims to raise individual fish consumption to 13 kg annually.

The authority said that key fish species produced in Saudi Arabia include Nile tilapia, sea bass, sea bream, shrimp, and varying proportions of other groups.

The ministry said the fisheries sector is experiencing rapid growth due to its developmental efforts and increased investments. It highlighted a significant rise in aquaculture projects across marine, inland waters, and closed systems. Furthermore, expanding development loans in aquaculture and marine fisheries has contributed to this progress.

The ministry also underscored its focus on promoting modern technologies, supporting and facilitating investment procedures, and enhancing the capabilities of small-scale fishermen.

MEWA said that these efforts are designed to empower the private sector and enhance agriculture’s contribution to the national economy, aligning with the objectives of Saudi Vision 2030.

The Kingdom annually exports 59,844 tonnes of fish and shrimp, totaling SR1.1 billion ($293 million), shipping the seafood to international markets. 


ACWA Power secures $150m deal to finance wind power plants in Uzbekistan 

Updated 08 October 2024
Follow

ACWA Power secures $150m deal to finance wind power plants in Uzbekistan 

RIYADH: Saudi utility giant ACWA Power has signed a letter of intent with the Asian Infrastructure Investment Bank to provide $150 million for three wind power plants in Uzbekistan. 

According to a press statement, the financing covers the Kongrad 1, 2, and 3 facilities, each with a capacity of 500 megawatts. 

The Tadawul-listed firm added that the financing term is four years and will be backed by an institutional guarantee provided by ACWA Power. 

Uzbekistan is one of the key foreign markets for the utility firm, with the company significantly involved in the Central Asian nation’s renewable energy sector in recent years. 

Its current portfolio in Uzbekistan comprises 11.6 gigawatts of power, of which 10.1 GW is renewable, as well as the country’s first green hydrogen project, with a capacity of 3,000 tonnes per year. 

“This announcement marks an important step forward in our commitment to delivering clean, reliable and affordable energy in Uzbekistan,” said Mohammad Abunayyan, founder and chairman of ACWA Power. 

He added: “The Kungrad wind projects are expected to significantly contribute to Uzbekistan’s renewable energy goals, and we look forward to working with our long-standing partner AIIB to bring this vision to life.” 

Jin Liqun, president of AIIB, stated that the Kungrad wind project is expected to catalyze Uzbekistan’s energy transition journey. 

The country aims to produce 40 percent, or 27 GW, of its overall electricity demand from renewable sources such as wind and solar photovoltaic. 

“By enhancing energy efficiency and transitioning to renewable energy resources, these climate mitigation projects support Uzbekistan’s ambitious renewable energy targets and align with AIIB’s commitment to sustainable infrastructure,” added Liqun. 

In July, ACWA Power signed financing deals worth $373.1 million for Tashkent’s Riverside power plant, which aims to generate 200 MW of solar photovoltaic energy and store 500 MW per hour using batteries. 

In March, the Saudi company also secured a $255.12 million power purchase agreement with Uzbekistan’s National Electric Grid for the Nukus 2 200-MW wind project. 

Established in 2004, ACWA Power currently operates in 13 countries across the Middle East, Africa, Central Asia, and Southeast Asia. 

The company stated that it currently manages a portfolio of 90 projects valued at $94.3 billion, capable of generating 65.6 GW of power.