عربي English Türkçe اردو فارسى
Logo
Latest News
Business

Oil Gains on Expectations for Higher Demand and as Middle East Concerns Rise

File photo: An oil pumpjack in a field on March 24, 2024 in Grandfalls, Texas. Brandon Bell/Getty Images/AFP
File photo: An oil pumpjack in a field on March 24, 2024 in Grandfalls, Texas. Brandon Bell/Getty Images/AFP
TT
TT

Oil Gains on Expectations for Higher Demand and as Middle East Concerns Rise

File photo: An oil pumpjack in a field on March 24, 2024 in Grandfalls, Texas. Brandon Bell/Getty Images/AFP
File photo: An oil pumpjack in a field on March 24, 2024 in Grandfalls, Texas. Brandon Bell/Getty Images/AFP

Oil prices rose on Tuesday, underpinned by signs that demand may improve China and the US, the world's biggest oil consuming nations, and growing concerns of a widening conflict in the Middle East that could affect supply from the region.
Brent futures for June delivery rose 41 cents to $87.83 a barrel by 0440 GMT. US West Texas Intermediate (WTI) crude futures for May rose 41 cents to $84.12 a barrel, after reaching its highest close since Oct. 27 in the previous session.
"The bullish catalysts for oil prices continue to pile up, with stronger-than-expected economic conditions in China and the US offering a more optimistic demand outlook, while geopolitical tensions in the Middle East continue to heat up with the involvement of Iran," said IG market strategist Yeap Jun Rong in an email.
Manufacturing activity in March in China expanded for the first time in six months and in the US for the first time in 1-1/2 years, which should translate to rising oil demand this year. China is the world's largest crude importer and second-largest consumer while the US is the biggest consumer.
In the Middle East, an Israeli strike on Iran's embassy in Syria killed seven military advisors, among them three senior commanders, marking an escalation in the war in Gaza between Israel and Hamas, which is supported by Iran. A widening of the conflict that has stretched for nearly half a year to include Israel directly fighting Iran has sparked concerns about impacts on oil supply.
"To date, the market hasn't been worried about supply disruptions, with the war remaining contained. Iran’s involvement could see its oil supply under threat," ANZ analysts wrote in a note.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, will hold an online meeting of its Joint Ministerial Monitoring Committee on Wednesday to review the market and members' implementation of output cuts.

Most Viewed

 
 
Business

Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
TT
TT

Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)

Telecommunications companies listed on the Saudi Stock Exchange (Tadawul) achieved a 12.46 percent growth in their net profits, which reached SAR 4.07 billion ($1.09 billion) during the second quarter of 2024, compared to SAR 3.62 billion ($965 million) during the same period last year.

They also recorded a 4.76 percent growth in revenues during the same quarter, after achieving sales worth more than SAR 26.18 billion ($7 billion), compared to SAR 24.99 billion ($6.66 billion) in the same quarter of 2023.

The growth in the revenues and net profitability is the result of several factors, including the increase in sales volume and revenues, especially in the business sector and fifth generation services, as well as the decrease in operating expenses and the focus on improving operational efficiency, controlling costs, and moving towards investment in infrastructure.

The sector comprises four companies, three of which conclude their fiscal year in December: Saudi Telecom Company (STC), Mobily, and Zain Saudi Arabia. The fiscal year of Etihad Atheeb Telecommunications Company (GO) ends on March 31.

According to its financial results announced on Tadawul, Etihad Etisalat Company (Mobily) achieved a 33 percent growth rate of profits, bringing its profits to SAR 661 million by the end of the second quarter of 2024, compared to SAR 497 million during the same period in 2023. The company also achieved a 4.59 percent growth in revenues to reach SAR 4.47 billion, compared to SAR 4.27 billion in the same quarter of last year.

The Saudi Telecom Company achieved the highest net profits among the sector’s companies, at about SAR 3.304 billion in the second quarter of 2024, compared to SAR 3.008 billion in the same quarter of 2023. The company registered a growth of 4.52 percent in revenues.

On the other hand, the revenues of the Saudi Mobile Telecommunications Company (Zain Saudi Arabia) increased by about 6.69 percent, as it recorded SAR 2.55 billion during the second quarter of 2024, compared to SAR 2.39 billion in the same period last year.

Commenting on the quarterly results of the sector’s companies, and the varying net profits, the head of asset management at Rassanah Capital, Thamer Al-Saeed, told Asharq Al-Awsat that the Saudi Telecom Company remains the sector leader in terms of customer base expansion.

He also noted the continued efforts of Mobily and Zain to offer many diverse products and other services.

Financial advisor at the Arab Trader Mohammed Al-Maymouni said the financial results of telecom sector companies have maintained a steady growth, up to 12 percent, adding that Mobily witnessed strong progress compared to the rest of the companies, despite the great competition which affected its revenues.

He added that Zain was moving at a good pace and its revenues have improved during the second quarter of 2024. However, its profits were affected by an increase in the financing cost by SAR 26.5 million riyals and a rise in interest, while net income declined significantly compared to the previous year, during which the company made exceptional returns.