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UAE Energy Minister Asserts Commitment to OPEC+ Agreement

The UAE said it supports the OPEC+ efforts. (Reuters)
The UAE said it supports the OPEC+ efforts. (Reuters)
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UAE Energy Minister Asserts Commitment to OPEC+ Agreement

The UAE said it supports the OPEC+ efforts. (Reuters)
The UAE said it supports the OPEC+ efforts. (Reuters)

The United Arab Emirates is committed to the OPEC+ agreement and its existing monthly production adjustment mechanism, its energy minister said on Wednesday.

“The UAE believes in the value OPEC+ brings to the oil market,” UAE Energy Minister Suhail al-Mazrouei said in remarks to WAM New Agency.

OPEC+, comprising the Organization of the Petroleum Exporting Countries, Russia and their allies, has a deal to gradually raise output each month by 400,000 barrels per day.

The group has refused to act more quickly even as prices have rocketed higher because of Russia's invasion of Ukraine.

OPEC has earlier hailed UAE’s “tremendous efforts” over the past period to maintain consensus among the members of the organization towards all issues regarding the global oil market and the support it provides to maintain its balance and stability in a manner that takes into account the interests of producers and consumers alike, WAM reported.

A UAE source familiar with the matter told Reuters on Thursday that the Gulf state would not act on its own to raise production and remained committed to OPEC+ policy.

The UAE source, speaking on condition of anonymity, said the Gulf state was committed to the OPEC+ alliance and only its energy ministry was responsible for oil policy.

Earlier, the UAE's ambassador to Washington, Yousuf al-Otaiba, said in a statement tweeted by the embassy that his country favors an oil production increase and will be encouraging OPEC to consider higher output.

“The UAE has been a reliable and responsible supplier of energy to global markets for more than 50 years and believes that stability in energy markets is critical to the global economy,” the tweet read.

The ambassador’s comment had suggested a shift in position, driving down Brent crude sharply and ended Wednesday 13% lower at $111.14 a barrel, the biggest one-day fall since the early days of the COVID-19 pandemic in 2020.

But subsequent comments from the UAE source downplayed any shift in position, helping push prices back above $116 on Thursday.

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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)
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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.