Oil Updates – crude recovers after slide as US inventory drop, storm support

Brent crude futures were up 84 cents, or 1.2 percent, to $70.03 a barrel at 10:04 a.m. Saudi time. Shutterstock
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Updated 11 September 2024
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Oil Updates – crude recovers after slide as US inventory drop, storm support

  • Hurricane Francine causes offshore production shut-ins
  • About 24 percent of crude production in US Gulf of Mexico shut
  • API shows weekly US crude, gasoline stockpiles fall

LONDON: Oil climbed more than 1 percent on Wednesday, paring some of the previous day’s losses, as a drop in US crude inventories and concern about Hurricane Francine disrupting US output countered concerns about weak global demand.

US crude stocks fell by 2.793 million barrels, gasoline declined by 513,000 barrels and distillates inventories rose by 191,000 barrels, according to market sources citing the latest week’s American Petroleum Institute figures on Tuesday.

Brent crude futures were up $1.46, or 2.11 percent, to $70.65 a barrel at 12:38 p.m. Saudi time, while US crude futures gained $1.55, or 2.36 percent, to $67.30.

“The API provided some comfort as it showed a sizable decline in crude oil stocks, a forecast-beating draw in gasoline and a tiny build in distillate inventories,” said Tamas Varga of oil broker PVM.

Both oil benchmarks tanked on Tuesday, with Brent falling below $70 to its lowest since December 2021 and US crude dropping to its lowest since May 2023, after OPEC revised down its 2024 oil demand growth forecast for a second time.

Concern about Hurricane Francine disrupting output in the US, the world’s biggest producer, also lent support, other analysts said.

“The market rebounded autonomously as Tuesday’s drop was substantial,” said Yuki Takashima, economist at Nomura Securities, adding supply disruption fears from Francine also lent support.

About 24 percent of crude production and 26 percent of natural gas output in the US Gulf of Mexico were offline due to the storm, the US Bureau of Safety and Environmental Enforcement said on Tuesday.

Following Tuesday’s report from the API, an industry group, official inventory figures from the US government are due out at 5:30 p.m. Saudi time.

Eleven analysts polled by Reuters estimated on average that crude inventories rose by about 1 million barrels and gasoline stocks fell by 0.1 million barrels. 


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

Updated 11 sec ago
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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 27 min 6 sec ago
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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
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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.


Saudi Arabia leads Arab region in green building projects with 2k registrations

Updated 28 min 21 sec ago
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Saudi Arabia leads Arab region in green building projects with 2k registrations

  • Surge in green building projects aligns with Saudi Arabia’s rapid population growth and heightened environmental awareness
  • Saudi green building market is projected to generate $16.4 billion in revenue this year

RIYADH: Saudi Arabia has made significant strides in sustainable construction, registering 2,000 of the 5,000 green building projects across the Arab world, according to a top official. 

Speaking at the opening of the 14th annual Saudi Green Building Forum, held in Riyadh from Oct. 6-8, Minister of Municipalities and Housing Majed Al-Hogail highlighted the Kingdom’s numerous milestones in this sector, reported the Saudi Press Agency. 

The surge in green building projects aligns with Saudi Arabia’s rapid population growth and heightened environmental awareness, driving the shift toward energy-efficient structures and the increased use of green building materials. 

The Saudi green building market is projected to generate $16.4 billion in revenue this year and is expected to grow at a compounded annual rate of 12.3 percent, reaching $33.0 billion by 2030, according to market research firm Prescient & Strategic Intelligence. 

During his speech, Al-Hogail said that these developments reflect the Kingdom’s commitment to sustainable practices, fostering a qualitative transformation in urban development. 

He added that this initiative underscores Saudi Arabia’s dedication to enhancing the efficiency of natural resource utilization, reducing carbon emissions, and creating healthy and safe urban environments. 

Al-Hogail also underscored the importance of this year’s forum, stating it addresses critical issues for the future of environmental sustainability. He noted that green buildings are essential for achieving sustainable development goals, aligning with Saudi Vision 2030 objectives. 

During the same event, Aramco’s Deputy Chief Engineer, Waleed Al-Naim, announced that the oil giant had launched a $1.5 billion sustainability fund to address climate challenges. 

This year’s forum focused on the optimal operation of cities in alignment with green building standards while addressing the connection between the construction and infrastructure sectors and environmental, climate, and desertification issues. 

To achieve this, the emphasis will be on strengthening the role of the government sector and cultivating partnerships with the private sector to support the localization of sustainable development goals in alignment with Saudi Vision 2030. 

Since its inception in 2010, the Saudi Green Building Forum has established the Kingdom as a leader in sustainable development, recognized by the UN Economic and Social Council. 

As a vital platform for dialogue and collaboration, the forum continues to drive Saudi Arabia’s sustainability agenda and shape the future of green building and urban development in the region. 


Cenomi Centers, GIB Capital launch $266m fund for Qassim retail development

Updated 08 October 2024
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Cenomi Centers, GIB Capital launch $266m fund for Qassim retail development

  • Construction on the project is set to resume in December
  • Completion planned for fourth quarter of 2026

RIYADH: Saudi developer Cenomi Centers has partnered with GIB Capital to launch a SR1 billion ($266.2 million) closed-end real estate fund to boost the Kingdom’s retail sector.

According to the firm’s statement on Tadawul, the move aims to support the Qassim land sale program and advance the development of the U Walk Qassim Mall, located in Buraidah.

Construction on the project is set to resume in December, with completion anticipated in the fourth quarter of 2026. Once finished, Cenomi Centers, also known as Arabian Centers Co., will manage and operate the 60,000 sq. meter complex, which will feature more than 135 retail stores.

The growth of the retail sector is key to the Kingdom’s goal of becoming a global tourism hub. 

Earlier this year, the Minister of Municipal and Rural Affairs, Majid Al-Hogail, emphasized that the sector contributes 23 percent to the non-oil economy and aims to surpass SR460 billion by the end of 2024.

On Oct. 7, the Riyadh-based operator of retail and lifestyle destinations in Saudi Arabia formalized its collaboration with GIB Capital to establish the Shariah-compliant real estate fund.

Beyond the mall, the fund will focus on developing and marketing the surrounding land for residential, office, and leisure purposes, contributing to the broader investment vision for the region. 

“The land benefits from its geographic location at the intersection of major routes, including King Abdulaziz Road, which connects various parts of the city of Buraidah, which is attracting significant wider investment and urban development,” the statement said.

The sale is part of Cenomi Centers’ broader strategy, which includes an SR2 billion non-core asset program launched in 2022 to enhance its financial stability and fund its growth projects.

It is estimated that SR400 million will be required to complete the U Walk Qassim Mall, which is projected to generate an annual revenue of SR80 million once fully operational.

GIB Capital will serve as the fund manager after receiving approval from the Capital Market Authority. In this role, it will oversee the sale of the Qassim land and help secure the necessary financing for the facilities development. 

Cenomi Center will be the sole unit holder of the fund, contributing in-kind assets and covering any associated costs incurred so far.

GIB Capital is the investment arm of Gulf International Bank and was launched in 2008.

The Kingdom is leading the Gulf Cooperation Council in terms of retail sector growth. The region is projected to grow at an annual rate of 4.6 percent between 2023 and 2028, primarily fueled by the Saudi and UAE markets, according to the investment banking advisory firm Alpen Capital.

Retail sales in the GCC are expected to rise from $309.6 billion in 2023 to $386.9 billion by 2028.

The UAE and Saudi Arabia are set to see expansions of 5.4 percent and 5.1 percent, respectively, reaching $161.4 billion and $139.1 billion during this period. 

Strengthening the retail sector is essential for Saudi Arabia as it seeks to position itself as a leading business and tourist destination, aligning with the economic diversification goals outlined in Vision 2030.