Middle East Business News Review – 31 July
Middle East Business News Review – A look at today’s important financial news and business updates from the Middle East and North Africa
Global economic slowdown and a negative outlook towards major world economies will lead to a decline in demand for oil but prices might still increase, a report published by a Kuwaiti institution said.
The study added that despite current turbulences, prices are expected to witness improvement in Q3 of this year as a result of an increase in demand in some areas. The report, compiled by Kuwait Finance House research division, noted that oil traded near the lowest level in a week and dropped back to below $90.00 per barrel as concerns heightened on the back of weakening fuel demand and deepening eurozone debt crisis. Prices are down 11% year-to-date.
Iran announced on Monday it has sentenced to death four men accused of embezzling $2.6bn from banks and committing the largest fraud in the nation’s history.
Iranian Prosecutor-General and Judiciary Spokesman Gholam Hossein Mohseni Ejeii presented the court’s decision in front of reporters in Tehran. The chief prosecutor said that the judge has issued verdicts for 39 suspects of which 4 were given death sentences, two life sentences and 32 other prison sentences for the multi-billon dollar bank fraud. The convicts will have 20 days to appeal the sentences.
The trials began in February after financial authorities in Tehran uncovered fraudulent activity in September 2011.
Saudi Arabia, Russia and Venezuela are emerging as the major beneficiaries of the recently imposed EU-led sanctions on Iran’s oil exports, exporting about 21% more crude to Asia’s biggest buyers compared to a year ago.
Reports said China, Japan, South Korea and India have reduced Iranian imports by a third in the first six months of the year as EU and US sanctions made it difficult to pay for the crude and find insurance cover for tankers. The United States is finalising more tougher sanctions to restrict Iran’s oil revenues.
World’s top oil exporter Saudi Arabia, Russia and other OPEC producers Venezuela and Angola ramped up their sales to Asia’s top oil consumers amid a decline in Iranian oil sale.
The European Commission announced on Monday it has approved a 2012 action plan for Morocco worth €112 million that will support the management and safeguard of forests and reform the country’s financial management and public administration sectors.
The Commissioner for European Neighbourhood Policy said the new funds are a perfect reflection of the EU priorities for its partnership with Morocco within the new neighbouring policies.
“I think that these new allocations fully reflect the priorities of the partnership between the EU and Morocco in the new neighbourhood policy: a policy more effective and accessible for Moroccan citizens and the development of Moroccan regions with a balanced use of the country’s natural resources”, Štefan Füle, European Commissioner for Enlargement and European Neighbourhood Policy, said in a statement.
Abu Dhabi’s Sorouh Real Estate, which is in merger talks with larger rival Aldar Properties, reported a 34% rise in second-quarter net profit on Tuesday, beating analyst estimates.
The second largest developer by market value in Abu Dhabi made a net profit of AED148.2m (US$40.35m), compared to AED110.4m in the prior-year period, the company said in a statement on the Dubai bourse.
The estimates beat two analysts’ forecasts which had estimated net profit between AED57.5m and AED132m.
Revenues for the quarter reduced to AED681.3m from AED1.2m in the prior-year period. The company said earnings were helped by revenue from government housing projects.
Mohamed Osman, the long-serving general manager of the United Arab Emirates’ family-owned oil group Fal Oil, has left the company at a time when gaining creditor confidence is crucial to sealing a debt restructuring deal.
Mr Osman, who has worked with the company for decades, had his employment contract terminated earlier this month, people familiar with the matter say. Fal, one of the largest independent oil traders in the Middle East, is expected to announce the new appointment imminently.
Etihad Airways , the United Arab Emirates carrier, said Monday it has signed a codeshare agreement with Aer Lingus, two months after it acquired a small stake in the Irish airline.
” Etihad Airways and Aer Lingus have signed an historic interline and codeshare agreement which follows the UAE national airline’s recent 2.987 per cent equity purchase in the Irish carrier,” it said in a statement.
The agreement will allow Etihad to fly its passengers arriving in Dublin on Aer Lingus flights to London, Manchester or other destinations in Ireland, Portugal, the Netherlands and the United States.
In exchange, Aer Lingus passengers arriving in Abu Dhabi will be able to board Etihad flights for Australia, Asia and the Middle East.
The China National Petroleum Corporation (CNPC), the largest oil producer in China, declined to develop phase 11 of the gas field in South Pars, Iran, after constant delays on the project, according to the Mehr news agency.
Asian countries, including China, have been filling in the gap left by Western petroleum companies who have refused to commit to new oil and gas projects due to sanctions on Iran.
The company, which had delayed the project for more than 1130 days, has evacuated all of its employees affiliated with the project from the Iranian port city of Assaluyeh, according to the Iranian Minsitry of Petroleum.
Bahrain’s Telecommunications Regulatory Authority will be ready by the first quarter of 2013 to grant up to two licenses to local telecom operators to provide fourth generation mobile internet services, Manama-based Al Wasat daily reports Tuesday citing an official.
The TRA has selected an advisor to assist in setting up the options of the licensing process which could take place through an auction, Mohammed Al Amer, TRA’s chairman, said according to the paper.