Turkey’s Energy Minister Taner Yildiz said an explosion on a natural gas pipeline late on Monday between Iran and Turkey caused a large fire and shut down the flow of gas. He said the explosion was in Agri province, some fifteen kilometers from the Iranian border, and suggested that Kurdish rebels were to blame. He said the fire was quickly brought under control. The pipeline, which carries around 10 billion cubic metres of Iranian gas to Turkey annually, has frequently come under attack by Kurdish militants. There was no immediate claim of responsibility for the attack. An official from state gas company Botas said repairs were under way but it was not clear when the gas flow would resume. [AP, Reuters, 7/28/2015]
UAE to cut state spending by 4.2 percent this year
The government of the United Arab Emirates (UAE) is expected to cut spending by 4.2 percent this year as it responds to low oil prices that are slashing its energy export revenues, a central bank report said on Monday. The UAE does not regularly reveal consolidated state budget data and figures released in the quarterly report were the first detailed picture of how authorities are responding to cheap oil. The figures suggest that the UAE is retrenching faster than the majority of wealthy Arab oil exporters in the Gulf. Consolidated government spending is expected to drop to 460.6 billion dirhams ($125.5 billion) in 2015 from 480.8 billion dirhams in 2014. The UAE also said it would raise domestic prices for gasoline and cut them for diesel in a politically sensitive reform designed to save the government money and encourage motorists to use fuel more efficiently. The price of gasoline will climb 24 percent at the start of August, while the price of diesel will fall 29 percent. [Reuters, 7/28/2015]
Kuwait preparing Islamic bond legislation to help finance budget
Kuwait is preparing legislation to facilitate issues of Islamic bonds by the government as it assesses options to finance a budget deficit caused by low oil prices, Finance Minister Anas al-Saleh said on Tuesday. “It is among the priorities of the government,” Saleh said of the legislation. Earlier this month Kuwait’s parliament approved a budget for the current fiscal year that envisages a deficit of $27 billion. Saleh had previously said that Kuwait was considering various options to cover the deficit, including bond issues. Saleh did not comment in any detail on possible government spending cuts, beyond saying a study was underway that would be presented to the cabinet once completed. [Reuters, 7/28/2015]
Yemen’s Houthis to let fuel prices rise as financial pressure mounts
The Houthi authorities who control much of Yemen, including the capital Sana’a, plan to let fuel prices rise in a sign of growing financial pressure on their administration since war broke out in March. Prices of oil products will be allowed to move freely and will be linked to international levels, state news agency SABA reported late on Monday. It quoted a statement by the Higher Revolutionary Committee, a body set up by the Houthis to run the country. The statement did not say when the change would take place. [Reuters, 7/28/2015]
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