Saudi Arabia slashes oil prices after collapse of OPEC+

Arab News
March 9, 2020

Dubai, Mar 9: The eyes of the world will be on the oil markets when the big trading hubs in Europe and North America open following the end of the deal between Saudi Arabia and Russia that has helped to sustain crude at relatively high levels for the past three years.

There were big falls on Friday when ministers from the Organization of the Petroleum Exporting Countries (OPEC) failed to get a deal with non-OPEC members — the so-called OPEC+ — to extend output agreements. Brent oil was down nearly 10 percent at $45.27 going into the western weekend.

Saudi Aramco took immediate action to cut prices after the OPEC+ collapse, offering big discounts for crude deliveries from next month, when the current output restrictions end.

According to a notification sent to customers by Saudi Aramco, seen by Arab News, the Kingdom’s oil giant will cut between $4 and $8 per barrel, with the biggest discounts being offered to buyers in northwest Europe and the US.

Roger Diwan, an oil analyst at consultancy IHS Market, said: “We are likely to see the lowest oil prices of the past 20 years in the next quarter.”

West Texas Intermediate, the US oil benchmark, fell to $28.27 in November 2001.

The move raises the possibility of a “crude war” between the three biggest oil blocs — the US, Russia and the Arabian Gulf. Some analysts believe the American shale industry is more vulnerable to low prices than either the Russians or the Saudis.

Robin Mills, head of the Qamar consultancy, told Arab News: “I don’t think this was premeditated but Saudi Arabia has clearly swung quickly into action to put the Russians under pressure. But the Russians, with low debt and a flexible exchange rate, can cope with a few months of low prices.”

The boom in US shale has made the country the biggest oil producer in the world, but with high financing costs. Lower global prices would put a lot of shale companies out of business.

On the other hand, American motorists, and President Donald Trump, would be pleased to see lower fuel prices in an election year.

In Moscow, one prominent financier with ties to the Kingdom played down the long-term significance of the Vienna fallout.

Kirill Dmitriev, chief executive of the Russian Direct Investment Fund, told Arab News: “Saudi Arabia is our strategic partner, and cooperation between our two countries will continue in all areas. We will also continue to work within the framework of the Russia-Saudi Economic Council.”

One Russian official, who asked not to be named, added: “There is a good relationship between Alexander Novak, Russian energy minister, and his Saudi counterpart Prince Abdul Aziz bin Salman, and I am sure they will continue talking to each other less formally.”

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Agencies
February 27,2020

Riyadh, Feb 27: Saudi Arabia on Thursday halted travel to the holiest sites in Islam over fears about a new viral epidemic just months ahead of the annual hajj pilgrimage, a move coming as the Mideast has over 220 confirmed cases of the illness.

The extraordinary decision by Saudi Arabia stops foreigners from reaching the holy city of Mecca and the Kaaba, the cube-shaped structure the world's 1.8 billion Muslims pray toward five times a day. It also said travel was suspended to Prophet Muhammad's mosque in Medina.

The decision showed the worry about the outbreak potentially spreading into Saudi Arabia, whose oil-rich monarchy stakes its legitimacy on protecting Islam's holy sites. The epicenter in the Mideast's most-affected country, Iran, appears to be in the holy Shiite city of Qom, where a shrine there sees the faithful reach out to kiss and touch it in reverence.

"Saudi Arabia renews its support for all international measures to limit the spread of this virus, and urges its citizens to exercise caution before traveling to countries experiencing coronavirus outbreaks," the Saudi Foreign Ministry said in a statement announcing the decision.

"We ask God Almighty to spare all humanity from all harm." Disease outbreaks always have been a concern surrounding the hajj, required of all able-bodied Muslims once in their life, especially as pilgrims come from all over the world.

The earliest recorded outbreak came in 632 as pilgrims fought off malaria. A cholera outbreak in 1821, for instance, killed an estimated 20,000 pilgrims. Another cholera outbreak in 1865 killed 15,000 pilgrims and then spread worldwide.

More recently, Saudi Arabia faced a danger from a related coronavirus that caused Middle East respiratory syndrome, or MERS. The kingdom increased its public health measures in 2012 and 2013, though no outbreak occurred.

While millions attend the 10-day hajj, this year set for late July into early August, millions more come during the rest of the year to the holy sites in the kingdom.

"It is unprecedented, at least in recent times, but given the worldwide spread of the virus and the global nature of the umrah, it makes sense from a public health and safety point of view," said Kristian Ulrichsen, a research fellow at the James A Baker III Institute for Public Policy at Rice University. "Especially since the Iranian example illustrates how a religious crossroads can so quickly amplify the spread and reach of the virus." The virus that causes the illness named COVID-19 has infected more than 80,000 people globally, mainly in China. The hardest-hit nation in the Mideast is Iran, where Health Ministry spokesman Kianoush Jahanpour said 19 people have died among 139 confirmed cases.

Experts are concerned Iran may be underreporting cases and deaths, given the illness's rapid spread from Iran across the Persian Gulf. For example, Iran still has not confirmed any cases in Mashhad, even though a number of cases reported in Kuwait are linked to the Iranian city.

In Bahrain, which confirmed 33 cases as of Thursday morning, authorities halted all flights to Iraq and Lebanon. It separately extended a 48-hour ban overflights from Dubai and Sharjah in the United Arab Emirates, through which infected travellers reached the island kingdom off the coast of Saudi Arabia.

Iranian President Hassan Rouhani said there were no immediate plans to quarantine cities but acknowledged it may take "one, two or three weeks” to get control of the virus in Iran.

As Iran's 80 million people find themselves increasingly isolated in the region by the outbreak, the country's sanctions-battered economy saw its currency slump to its lowest level against the US dollar in a year on Wednesday.

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News Network
June 17,2020

Abu Dhabi, Jun 17: The Ministry of Education (MoE) has allowed students still enrolled in universities overseas to obtain exceptions to attendance policies at their respective academic institutions in light of the Covid-19 pandemic.

In a statement, the ministry said that the move stems from its keenness to ensure the continuity of education for those students and to maintain effective channels of communication with them.

Students' applications for exceptions to academic attendance in universities due to Covid-19 should be submitted following the end of the academic year, and not after the academic semester, via the following email: [email protected].

In their email, students have to explain the reasons for the required exceptions and should include an official message from the university concerned.

Scholarship approval issued by the Ministry of Education for studying abroad should also be attached.

The student's score reports for the academic years spent in the host countries and the duration of each academic year should also be attached, in addition to an entry and exit report of the student from the Federal Authority for Identity and Citizenship.

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News Network
May 19,2020

Dubai, May 19: The UAE announced 832 new Covid-19 cases on Monday following 37,844 additional tests, taking the total tally of coronavirus infections in the country to 24,190.

The Ministry of Health and Prevention also reported four additional deaths, taking the death toll to 224. Meanwhile 1,065 patients also recovered after receiving the necessary treatment, taking the total number of recoveries to 9,577, the ministry said.

“We see a daily increase in cases due to the irresponsible behaviour of some people who are not aware of the consequences of not adhering to health guidelines,” said Dr Amna Al Dahak Al Shamsi, official spokesperson of the UAE government.

“The widening circle of infections requires no more than a few violations by just one or two people to completely infect families with the coronavirus,” she said.

“The decision to partially ease restrictions is aimed at achieving a balance between meeting the needs of a segment of society, whose source of income is linked to the commodity trade sector, and between continuing to adhere to the recommended health guidelines, and hence many restrictions and conditions have to be followed.”

However, she also appreciated the citizens and residents adhering to the precautionary measures.

“It is heartening for us to see many families committed to avoiding family gatherings,” she said. “As we prepare for Eid Al-Fitr, we are confident that citizens and residents will continue to adhere to health and preventive guidelines, and serve as role models to the world,” she added.

Change in disinfection programme timings

Officials also announced that the UAE’s National Disinfection Programme will now be in place from 8pm to 6am, starting Wednesday, May 20, until further notice. The scheme currently runs from 10pm until 6am.

Dr Saif Al Dhaheri, spokesman of the National Authority for Emergency, Crisis and Disaster Management said the amendment comes in light of the “increased number of Covid-19 cases, and the leniency of some members of society and their indifference to preventive measures”.

Food outlets, cooperative societies, groceries, supermarkets, and pharmacies will continue to operate 24 hours a day, seven days a week during the sterilisation programme period.

Meanwhile meat and vegetable shops and outlets selling fruits, toasters, mills, slaughterhouses, fish, coffee and tea, in addition to shops selling nuts, sweets and chocolate, can operate from 6am until 8pm.

Shopping centres and malls can stay open from 9am to 7pm starting Wednesday, May 20, officials added.

“We stress the importance of all stores and those authorised to operate to adhere to the applicable health and safety procedures, which include ensuring that the percentage of shoppers does not exceed 30 per cent of the total capacity,” said Al Dhaheri.

He also confirmed that children under 12 and those over 60 will not be permitted to enter malls and shopping centres.

“We warn visitors to the centres that the shopping period should not exceed two hours in order to reduce the crowding of shoppers, and to maintain the 30 per cent capacity.”

Eid restrictions

Al Dhaheri urged the public to avoid family visits and gatherings during Eid Al Fitr this year and to instead communicate using online means or by phone. He also stressed that people should refrain from distributing ‘Eid’ money to children.

“With regard to Eid prayers, we stress the importance of adhering to what was mentioned by the Emirates Legal Fatwa Council, which is to pray at home and to take health protection reasons as a legal obligation, a necessity of life, and a national commitment,” he added.

Heftier fines

Officials also announced heftier fines to ensure that the regulations are being adhered to.

“It was clear to us, in light of the follow-up, that there was reckless behaviour from some individuals, along with the insistence of some to commit a certain type of violation as well as indifference,” said Salem Al-Zaabi, acting head of the Public Prosecution for Emergencies, Crisis and Disasters.

The Public Prosecution has decided to update the list of previously announced violations and fines and administrative penalties to “suit the current situation”, he said.

Some of the new fines include:

– Dhs50,000 on educational institutions, cinemas, gym, stores, parks, beaches, pools or supermarkets that do not adhere to coronavirus measures

– Dhs50,000 fine on those who don’t adhere to quarantine restrictions

– Dhs10,000 for organising gatherings with participants also fined Dhs5,000 each

– Dhs5000 for refusing to do a Covid-19 test

– Dhs3,000 for not wearing a mask in public

– Dhs3,000 if more than three people are travelling in one car

– Dhs3,000 for companies failing to adhere to the 30 per cent limit on workforce at office

– Dhs3,000 for not adhering to social distancing

– Dhs3,000 fine for violating restrictions during the disinfection period

Repeat offenders will be referred to the Public Prosecution and can face a criminal trial with the possibility of imprisonment for a period not exceeding six months and/or a fine of at least Dhs100,000.

“The pictures and names of violators will be published in newspapers and media upon the decision of the Public Prosecutor if he deems it necessary,” added Al Zaabi.

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