Saudi Arabia

Saudi’s women are its untapped economic resource

15 Nov 2016

In a society dominated by men, religion and petrol, women are very slowly wresting a few freedoms. The kingdom could help the economy by promoting more gender equality. This would be a more effective way of controlling its destiny than trying to influence the price of oil.

Saudi finance minister reshuffle reflects reality

1 Nov 2016

Outgoing Ibrahim Alassaf served for 20 years in an increasingly disempowered ministry. Replacing him now is a nod to the more centralised control of Deputy Crown Prince Mohammed bin Salman, and that reducing Saudi's budget deficit is indivisible from wider policy on oil.

Guest view: Oil market needs a “swing consumer”

26 Oct 2016

The oil market is broken. Volatile prices undermine global energy security and increase geopolitical risk, while OPEC seems unable to co-ordinate a cut to supply. There is a solution: focus on demand rather than supply. What’s needed is a “tactical petroleum fund”.

Oil prices are too gloomy on chance of OPEC deal

26 Oct 2016

Crude prices have wilted after Iraq joined Nigeria, Iran and Libya in seeking exemptions from production cuts. But this need not be the death knell of a deal to reduce output. Even a small reduction to production would balance a market that is now only narrowly oversupplied.

Viewsroom: Airing Trump TV

20 Oct 2016

The presidential candidate's poor showing is hurting his businesses, but a news network could pay off if he loses the election. Saudi Arabia's monster bond deal can't mask bigger problems. And bank earnings take in the Wells Fargo effect while Netflix investors lose the plot.

Saudi bonds put Riyadh first and investors last

18 Oct 2016

The world's largest crude oil exporter is selling $15 bln of bonds. Demand will be strong even though Saudi is offering few insights into oil policy, regional strategy or the fiscal outlook. If the kingdom struggles to wean itself off oil, investors can expect bruising treatment.

Saudi Arabia’s tech bet is bold but necessary

14 Oct 2016

The kingdom's plan for a $100 bln tech fund with Japan's SoftBank is a risk worth taking. Saudi's biggest listed investments have created middling returns, and it needs to replace oil as its major engine. Prince Mohammed bin Salman seems to be applying some millennial thinking.

SoftBank and Saudi pump fresh air into tech bubble

14 Oct 2016

Masayoshi Son's group and Saudi Arabia are plotting a $100 bln tech fund. That incredible sum could finance some huge LBOs, or inflate startup valuations again just as other investors start to fatigue. Even if Son casts his net very wide, it will be hard to stay disciplined.

Saudi can’t have cheap oil and a war in Yemen

12 Oct 2016

The kingdom's fight against Houthi militants in Yemen is a burden on finances strained by cheap crude. Persisting with its expensive military adventure may require Riyadh to let oil prices rise further. Otherwise real-world battles may spill over into the economic kind.

Output deal buys OPEC time but not deliverance

28 Sep 2016

The oil cartel surprisingly agreed to cap production but has deferred agreement on which members will reduce the flow of crude. Limiting daily output to 32.5 mln barrels should support global prices for now. A lasting plan to balance supply and demand, though, may remain elusive.

Iran’s upper hand in OPEC could be fleeting

28 Sep 2016

The Islamic Republic's resistance to an oil deal leaves its rival Saudi Arabia stuck with low prices. Yet that is pushing Riyadh to launch necessary economic reforms, which should make the kingdom more competitive. Iran, despite its current rapid growth, risks falling behind.

Saudi faces choice of austerity over indulgence

7 Sep 2016

Falling oil prices may lead Riyadh to cut up to $20 bln of infrastructure projects. The risk is it might trigger a construction slump. Of course, Saudi could just increase borrowing and continue building in the desert. Restraint is perilous but would make more financial sense.

Saudi-Russian oil truce more mirage than reality

5 Sep 2016

Riyadh and the Kremlin make awkward allies. Competing economic and political interests in the Middle East have been hard for both sides to overcome, even for the mutually beneficial goal of higher oil prices. Their latest attempts at a crude truce will probably be only illusory.

Libya is the fly in OPEC’s ointment

31 Aug 2016

Whether the cartel can push up oil prices depends on Tripoli. Libya’s production is small but unpredictable. Include the war-torn country in any output cap, and other OPEC members may end up forced to produce less. Ignore it, and efforts to rein in production could be wasted.

Saudi building bust may demolish prince’s reforms

17 Aug 2016

Low oil prices have left thousands of foreign construction workers stranded without pay, and some building companies in financial trouble. Saudi is trying to diversify away from oil, make economic reforms and avoid disrupting the social order. It’s not easy to do all three.

Kuwait oil selloff success depends on reserves

12 Jul 2016

A plan to follow Saudi Arabia by partially privatising its state-run oil industry could make sense for OPEC's fifth-largest producer. An IPO would generate needed billions for the government. Maximising proceeds, though, will mean ceding control of the crude still in the ground.

It’s not how much oil, but how much influence

5 Jul 2016

The U.S. has more oil than Saudi Arabia, according to Rystad Energy. But oil reserves are only worth counting if there’s a chance they can be produced economically over time. Size is much less important than an ability to guide the price - and there, Saudi still rules.

Saudi Arabia opens door to OPEC fightback

22 Jun 2016

The kingdom’s new energy minister just implied it may resume its role as the world’s swing producer. Oil prices have suffered since it stepped back in 2014. If Saudi wishes it - and OPEC’s recalcitrant members play ball - a production cut will be back on the cards.

Bahrain tips Middle East’s delicate balance

21 Jun 2016

Stripping citizenship from the spiritual leader of its majority Muslim Shi’ite population will inflame ethnic tensions in the tiny archipelago that’s home to the U.S. Fifth Fleet. The real story is the tension between its neighbours, Iran and Saudi. Bahrain has become a troubling proxy.

Saudi pitches to U.S. in diminished circumstances

13 Jun 2016

Cheap oil, the opening up of Iran and shootings in Orlando could all make Deputy Crown Prince Mohammed bin Salman’s visit to the United States unusually tense. Saudi needs security guarantees and oil demand as it tries to modernise its economy. That puts it on the back foot.