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Algeria to Maintain Foreign Ownership Limit in New Energy Law

General view of the port terminal in Algiers, Algeria March 13, 2019. (Reuters)
General view of the port terminal in Algiers, Algeria March 13, 2019. (Reuters)
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Algeria to Maintain Foreign Ownership Limit in New Energy Law

General view of the port terminal in Algiers, Algeria March 13, 2019. (Reuters)
General view of the port terminal in Algiers, Algeria March 13, 2019. (Reuters)

Algeria is planning to keep unchanged the main clauses in its energy law including a rule limiting foreign stakes in oil and gas projects, the government said on Monday after a meeting to discuss draft amendments to the law.

“The 51/49 rule was maintained,” the government said in a statement following the meeting chaired by Prime Minister Noureddine Bedoui, reported Reuters.

This is the first comment in months from the government on planned amendments to the law which is aimed at attracting foreign companies to its energy sector.

The government earlier this month said it was planning to allow foreigners to have majority stakes in projects involving nonstrategic sectors.

Most foreign investors have stayed away in past years due to bureaucracy and an unattractive legal framework, making the OPEC member and gas exporter unable to carry out plans aimed at boosting output.

“The current law proved limited. It has negatively affected production and foreign investment,” the statement said.

“The draft aims to provide a stable legal and tax incentive system for the long term”.

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Oil Prices Ease as Markets Weigh China Stimulus Hopes

FILE - Pump jacks extract oil from beneath the ground in North Dakota, May 19, 2021. (AP Photo/Matthew Brown, File)
FILE - Pump jacks extract oil from beneath the ground in North Dakota, May 19, 2021. (AP Photo/Matthew Brown, File)
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Oil Prices Ease as Markets Weigh China Stimulus Hopes

FILE - Pump jacks extract oil from beneath the ground in North Dakota, May 19, 2021. (AP Photo/Matthew Brown, File)
FILE - Pump jacks extract oil from beneath the ground in North Dakota, May 19, 2021. (AP Photo/Matthew Brown, File)

Oil edged lower on Thursday in light holiday trade as the dollar's strength offset hopes for additional fiscal stimulus in China, the world's biggest oil importer.

Brent crude futures settled down 32 cents, or 0.43%, at $73.26 a barrel. US West Texas Intermediate crude closed at $69.62, down 0.68%, or 48 cents, from Tuesday's pre-Christmas settlement.

Chinese authorities have agreed to issue 3 trillion yuan ($411 billion) worth of special treasury bonds next year, Reuters reported on Tuesday, citing two sources, as Beijing ramps up fiscal stimulus to revive a faltering economy.

"Injecting a stimulus into a nation's economy creates increased demand, and increased demand pushes prices higher," said Tim Snyder, chief economist at Matador Economics, Reuters reported.

The World Bank on Thursday raised its forecast for China's economic growth in 2024 and 2025, but warned that subdued household and business confidence, along with headwinds in the property sector, would keep weighing it down next year.

The US dollar continued to edge up higher after hitting a milestone last week. A stronger dollar makes oil more expensive for holders of other currencies.

The latest weekly report on US inventories, from the American Petroleum Institute industry group, showed crude stocks fell last week by 3.2 million barrels, market sources said on Tuesday.

Traders will be waiting to see if the official inventory report from the Energy Information Administration confirms the decline. The EIA data is due at 1 p.m. EST (1800 GMT) on Friday, later than normal because of the Christmas holiday.

Analysts in a Reuters poll expect crude inventories fell by about 1.9 million barrels in the week to Dec. 20, while gasoline and distillate inventories are seen falling by 1.1 million barrels and 0.3 million barrels respectively.

Elsewhere, southbound traffic in Turkey's Bosphorus Strait was set to resume on Thursday, having been halted earlier in the day after a tanker suffered an engine failure, shipping agent Tribeca said.