Saudi Arabia’s stock market, valued at $585 billion, opened up to direct foreign investment for the first time today, as the kingdom seeks an economic boost amid low global oil prices. The opening of the Tadawul Saudi Stock Exchange allows companies to raise money straight from foreign investors, with the goal of expanding businesses, diversifying the economy, and creating more jobs. Before today, foreigners only could access the market indirectly. However, foreign investors say they are taking a cautious approach and warn not to expect an immediate rush of foreign investment into the Middle East’s biggest market. Saudi Arabian stock advanced the most it has in two months yesterday, ahead of the stock market opening. [AP, WSJ, Bloomberg, BBC, 6/15/2015]
Mideast oil powers Saudi Arabia, UAE to cut gasoline imports
Middle Eastern oil producers Saudi Arabia and the United Arab Emirates will sharply cut or even halt costly gasoline imports next year after ramping up new refining capacities that put them a step closer to becoming exporters of the motor fuel. The estimated loss of at least 60,000 barrels per day (bpd) in shipments to Saudi Arabia and the United Arab Emirates (UAE) is expected to be mitigated by strong global demand. [Reuters, 6/15/2015]
Egypt considers postponing fuel subsidy smart card system
Egypt’s President Abdel Fattah al-Sisi asked his government on Saturday to consider postponing a smart card system for subsidized fuel, which was due to be rolled out today. “The president directed the government to urgently study postponing the application of this system until all the sectors that don’t have these cards are covered,” said presidency spokesman Alaa Youssef. A similar smart card system for subsidized bread has been widely seen as a success. The new fuel cards do not entail rationing for now, but they will enable the government to monitor the amount of fuel being consumed per vehicle and crack down on smuggling. Eventually, each card will be assigned a ration for subsidized prices. [Reuters, 6/14/2015]
Libya’s official government fails to sell oil directly
Libya’s internationally recognized government in Tobruk has so far failed to sell oil by itself, despite setting up a Dubai bank account and new central bank unit. Last week, premier Abdullah al-Thinni launched another attempt to control public finances by setting up a new central bank headquarters in the eastern city of Bayda. However, a central bank source confirmed that oil buyers were continuing to pay through the National Oil Corporation (NOC) and central bank in Tripoli. A central bank source in Tripoli said eastern bank officials had set up computers in Bayda that had been moved out of Benghazi. However, banks in Europe refused to deal with the Bayda officials, saying they only process payment orders from Tripoli. According to the NOC, Libya’s oil production is at 500,000 barrels per day. [Reuters, 6/13/2015]
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