Saudi Arabia

Gulf aid helps Egypt avoid financial collapse

10 Jul 2013

The regime change has bought Cairo new financial backers. A Saudi-UAE pledge of $8 bln gives the country’s interim rulers a chance to implement their controversial transitional roadmap. The hope is that they make better use of bilateral support than their predecessors.

Saudi weekend shift could herald more change

24 Jun 2013

The decision to move the kingdom’s weekend to Friday and Saturday brings the oil producer into line with its neighbours and should boost productivity. It also raises hopes that the Arab world’s largest capital market is edging closer to opening up further to foreign investors.

Alwaleed’s valuation dispute has simple solutions

19 Mar 2013

The Saudi prince’s investment vehicle, Kingdom Holding, has a small free float, poor liquidity and a volatile share price. That has created controversy over its true value. A bigger free float would help investors set its value. Alternatively, delisting would end the controversy.

Saudi Arabia pushes accelerator on reform

9 Jul 2012

The House of Saud is moving at last on economic reform, even without the crunch of lower oil prices. It is trying to address the country’s chronic unemployment and housing problems, in a bid to shore up stability. These first steps are still tentative, but the direction is clear.

New succession order brings Saudi closer to change

18 Jun 2012

The death of the conservative heir to the throne of the House of Saud won’t radically alter the kingdom’s policies. But it brings the country significantly closer to the beginning of a worrying period of uncertainty. Who and what comes next is the big unknown.

OPEC ill-placed to stop oil price slide

8 Jun 2012

Some of the cartel’s worst infighting in its 50-year history hangs over next week’s meeting. That won’t help it cope with the euro crisis, which shows no signs of easing and augurs poorly for the price of crude. The evidence suggests OPEC won’t be able to do much about it.

Saudi’s foreign aid bill piles up

28 May 2012

Egypt, Jordan, Bahrain, Oman and Yemen: the Arab Spring has increased the kingdom’s spending to prevent unrest and boost influence. At the current oil price, the Saudis can easily afford to be generous, but today’s emergency gifts could become tomorrow’s permanent liabilities.

Oil price band of comfort is precariously narrow

10 May 2012

It only takes a $20-a-barrel swing to move markets from fretting about the release of emergency reserves to worrying about top producers falling into fiscal deficits. Hard-to-cut higher spending by a growing number of big exporters may make the concerns permanent.

Saudis wouldn’t gain much from a union with Bahrain

1 May 2012

The house of Saud’s call for Gulf states to move beyond cooperation and combine into a single entity lays the ground for forming a union with the troubled island. Yet Saudi already bankrolls Bahrain and underwrites its security. The benefits of further integration are dubious.

Saudi words won’t ease pressure on U.S. fuel prices

21 Mar 2012

Despite its reassurances, Saudi Arabia has imperfect options to prevent U.S. fuel prices from reaching risky levels seven months before the presidential elections. Sanctions on Iran, meanwhile, allow Riyadh to benefit from both strong oil prices and high production.

Crude reasons support Saudi stocks

20 Mar 2012

Foreign investors are sweet on Saudi. Growing excitement over a mooted easing of ownership restrictions led overseas buyers to make record net purchases in the $400 bln stock market last month. But in a market known to disappoint, it’s worth paying close attention to the risks.

Goldman’s first Islamic foray too clever by half

9 Jan 2012

Sharia scholars have blessed the Wall Street bank’s unusual $2 bln bond. But that approval falls away if the bonds change hands at anything other than par, and that deters potential investors. Given the inevitable scrutiny, Goldman should have been less ambitious.

Alwaleed pushes the limits with edgy Twitter stake

19 Dec 2011

Even though Prince Alwaleed bin Talal is known as a bold investor, his $300 mln stake in the regime-usurping social network is decisively edgy. The Saudi royal family member increases his cool factor, but supporting unregulated speech might not sit well in the kingdom.

Saudi ripe for Chinese-style stock market opening

2 Nov 2011

Improved access to the kingdom’s bourse is an emerging market investor’s dream. The move, touted for early next year, isn’t without risks. But letting in qualified outsiders would line domestic pockets and aid efforts to expand the private sector.

Gulf liberal shift is more than sop to Arab Spring

26 Sep 2011

Saudi is giving women the right to vote. It follows the UAE’s decision to expand the electoral roll for its recent elections. These cautious democratic steps will help insure stability. But they’re also crucial for introducing the taxes required to reduce dependence on oil.

Oil price jitters turn up heat on Gulf producers

22 Sep 2011

Governments are sweating as Brent creeps lower with worsening global economics. At $108 a barrel, oil is $18 above the threshold at which producers feel real pain. But shrinking oil revenues leave less room for manoeuvre. And any OPEC supply squeeze will complicate the problem.