Day: September 5, 2022

OPEC and its allies led by Russia on Monday agreed a small oil production cut to bolster prices that have slid on fears of an economic slowdown.

The oil producers will cut output by 100,000 barrels per day (bpd), amounting to only 0.1% of global demand, for October. They also agreed that OPEC’s leader Saudi Arabia could call an extraordinary meeting anytime if volatility persists.

The decision essentially maintains the status quo as OPEC has been observing wild fluctuations in oil prices.

“OPEC+ is wary of protracted price volatility generated by weak macro sentiment, thin liquidity and renewed China lockdowns, as well as uncertainty over a potential U.S.–Iran deal and efforts to create a Russian oil price cap,” said Matthew Holland at Energy Aspects.

Top OPEC producer Saudi Arabia last month flagged the possibility of output cuts to address what it sees as exaggerated oil price movements.

Benchmark Brent crude oil LCOc1 has dropped to about $95 a barrel from $120 in June on fears of an economic slowdown and recession in the West.

Russia’s Deputy Prime Minister Alexander Novak said on Monday the OPEC+ oil output cut was merely a reflection of expectations of a weaker global economic growth.

Oil prices have been also dragged down by a potential supply boost from Iranian crude returning to the market if Tehran is able to revive its 2015 nuclear deal with global powers.

“The political angle, it seems, is a Saudi message to the U.S. about the revival of the Iranian nuclear agreement … It is hard to interpret the decision as anything but price supportive,” said Tamas Varga of oil broker PVM.

Iran is expected to add 1 million bpd to supply, or 1% of global demand, if sanctions are eased, though the prospects for a nuclear deal looked less clear on Friday.

The White House said on Monday U.S. President Joe Biden was committed to take all steps necessary to shore up energy supplies and lower prices. R

“The cut suggests that there is a desire to defend oil prices to stay above the level of $90 per barrel,” said Giovanni Staunovo at UBS.

Raad AlKadiri at Eurasia Group said: “It is a signal of intent … The decision to cut reinforces that ‘do not take us for granted’ message without doing anything drastic.”

Signals from the physical market, however, suggest supply remains tight and many OPEC states are producing below targets while fresh Western sanctions are threatening Russian exports.

Russia has said it will stop supplying oil to countries that support the idea of capping the price of Russian energy supplies over its military conflict in Ukraine.

Russia’s gas deliveries in Europe, meanwhile, have been cut further, which is likely to spark more price spikes.

“An output cut won’t make them any friends at a time when the world is facing a cost-of-living crisis,” said Oanda analyst Craig Erlam.

Source: Voice of America

Jeddah, September 5, 2022, SPA — The Islamic Development Bank Institute (IsDBI) announced that it has completed the development phase of its industry-leading initiative, the Islamic Finance Country Assessment Framework (IF-CAF).

The IF-CAF is a holistic diagnostic assessment tool which will provide an early indication of the strengths and weaknesses of a country’s Islamic finance ecosystem, including analysis related to existing laws, regulations, supervision, taxation, governance, financial inclusion, financial-sector digitalisation and other issues.

Additionally, in line with the forward-looking vision and development mandate of the IsDB Group, the IF-CAF adopts a “developmental” assessment approach aiming to facilitate integration of the Islamic finance industry into the mainstream national development agendas of the IsDB Member Countries.

The Acting Director General of IsDB Institute and Group Chief Economist, Dr. Sami Al-Suwailem, said: “The IF-CAF is an important diagnostic tool which will facilitate integration of Islamic finance to support member country governments in achieving many of their key strategic objectives such as boosting financial inclusion, enhancing digitalisation of the financial sector, developing their social finance sector and diversifying the sources of funds for the governments and the business sector, thereby aligning Islamic finance with the Sustainable Development Goals”.

The IF-CAF covers diagnostic assessment on the various sectors of the financial system including Islamic banking, Takaful, Islamic capital markets, Islamic social finance, and non-banking institutions such as leasing companies, development finance institutions, microfinance and non-profit financial institutions, FinTech and digital banks, etc.

The Framework was developed over a period of two years and involved several rounds of rigorous consultation with experts from both within the IsDB Group and external partner institutions including central banks and international organisations.

In the next phase, the IsDB Institute will pilot-launch the IF-CAF and conduct field assessments in a select group of Member Countries. Based on the field experience, the IF-CAF will be refined further to enhance its robustness.

In the longer-term, the IF-CAF will be an on-going diagnostic tool covering all IsDB Member Countries and the assessment reports generated will serve as a critical input/feedback mechanism to the larger IsDB Group development interventions (e.g., through IsDB Member Country Partnership Strategies [MCPS]) in the assessed Member Countries.

Source: Saudi Press Agency

Riyadh– Minister of Industry and Mineral Resources, Chairman of the Board of Directors of the Local Content and Government Procurement Authority, Bandar bin Ibrahim AlKhorayef, inaugurated today the first edition of the Local Content Forum.

In a speech delivered at the opening ceremony, AlKhorayef said that the Kingdom’s vision 2030 came with ambitious aspirations, and requires a unique business model that makes it difficult to achieve the goals of this vision by traditional methods, hence, it was necessary to adopt bold and qualitative concepts; (the “local content”), which was adopted by the Kingdom’s vision to be a real possibility to achieve the objectives of sectors related to economic diversification, and represents a comprehensive umbrella under which several important elements fall, including products and services, human resources, training, and technology, to maximize the economic impact of the Kingdom’s industry, services and natural wealth.

“To consolidate this concept and maximize the benefit from it, the Local Content and Government Procurement Authority was established, and the new government tenders and procurement regulation was approved,” the minister said, adding that the development of local content requires an integrated action by combining the efforts of various government agencies, partners from the private sector, and society. At the government level, the minister noted that the cabinet approved the formation of local content development teams in government agencies to ensure unification of efforts and joint work with agencies to achieve the goals. Moreover, 270 teams were formed to work on achieving the local content agenda in all government sectors, and efforts are being made in this file to create a solid and strong economy, said the minister.

AlKhorayef revealed that the Kingdom of Saudi Arabia, since started implementing the legislations aimed at developing local content in 2020 until the end of the first half of 2022, has achieved many gains, adding that the estimated value of government tenders to which the requirements of local content and localization apply amounted to nearly SR300 billion, through which private sector facilities and national factories were enabled to be the first option for government spending, and the percentage of local content amounted to 46% of the total spending of companies members of the Council on goods and services for the year 2020, with an estimated value of SR113 billion, in addition to enabling national factories, through the mandatory list of national products, from which about 4000 factories will benefit, with an impact on the national economy of more than SR20 billion.

The Local Content Forum is one of the strategic initiatives of the Local Content and Government Procurement Authority and aims to be a platform for raising awareness, exchanging experiences, and empowering local capabilities, by activating partnerships and investment opportunities.

Source: Saudi Press Agency

Riyadh– The Chief Executive Officer (CEO) of Saudi Fund for Development (SFD), Sultan bin Abdulrahman Al-Marshad received here today Minister of Foreign Affairs and International Cooperation of the Republic of Equatorial Guinea, Simeon Oyono Esono Angue, and his accompanying delegation.

During the meeting, the Minister was briefed on the developmental activity of the Fund in developing countries, and they discussed aspects of development cooperation and potential vital opportunities between the two sides, and the economic challenges facing the Republic of Equatorial Guinea.

The Minister valued the Kingdom of Saudi Arabia’s efforts through the Saudi Fund for Development to provide support for developmental projects and programs in developing countries in order to contribute to achieving sustainable development goals, noting that cooperation between the two sides will leave a mark for future generations.

It is noteworthy that the Saudi Fund for Development has financed over 48 years 697 development projects and programs in 84 developing countries around the world to support the least developed countries.

Source: Saudi Press Agency