Harris and Trump make final push in must-win Pennsylvania    Drones and snipers on standby to protect Arizona vote-counters    India's Modi condemns violence after Canada temple incident    Elon Musk can keep giving $1m to voters, judge rules    Al Ahli extends perfect start with 5-1 victory over Al Shorta    Mitrovic's hat-trick leads Al Hilal to 3-0 victory over Esteghlal    Tourism Development Fund launches "Tourism Empowerment" programs to enhance sustainable growth of SMEs    Saudi crown prince, Tunisian president review bilateral relations in phone call    SFDA Chief visits premier biotechnology and medical firms in China    Al-Khereiji: Collective action in combating terrorism is a must for achieving stability and prosperity    Saudi Awwal Bank becomes the Kingdom's first bank obtaining ISO certification for quality management system in operations    10 cooperation agreements signed during Saudi-Turkish Business Forum in Istanbul    Saudi Arabia's non-oil revenues grow 6% in 9 months while Q3 budget posts SR30 billion deficit    Quincy Jones, titan of US music, dies aged 91    Enhancing zakat, tax, and customs compliance takes center stage at the Zakat, Tax, and Customs Conference 2024    Neymar expected to join Al Hilal squad for AFC clash against Esteghlal, says coach Jesus    Al Qadsiah secure 2-0 victory over Al Ettifaq in first Eastern Derby since 2021    Hidden sugars in Asia's baby food spark concerns    HONOR unveils pre-order of the stunning HONOR MagicBook Art 14 Featuring an ultra-slim design, HONOR Eye Comfort Display and AI Cross-OS WorkStation    Teri Garr, Young Frankenstein and Tootsie star, dies at 79    India puts blockbuster Pakistani film on hold    The Vikings and the Islamic world    Filipino pilgrim's incredible evolution from an enemy of Islam to its staunch advocate    Muted Eid celebrations for millions of Nigerian Muslims    Exotic Taif Roses Simulation Performed at Taif Rose Festival    Asian shares mixed Tuesday    Weather Forecast for Tuesday    Saudi Tourism Authority Participates in Arabian Travel Market Exhibition in Dubai    Minister of Industry Announces 50 Investment Opportunities Worth over SAR 96 Billion in Machinery, Equipment Sector    HRH Crown Prince Offers Condolences to Crown Prince of Kuwait on Death of Sheikh Fawaz Salman Abdullah Al-Ali Al-Malek Al-Sabah    HRH Crown Prince Congratulates Santiago Peña on Winning Presidential Election in Paraguay    SDAIA Launches 1st Phase of 'Elevate Program' to Train 1,000 Women on Data, AI    41 Saudi Citizens and 171 Others from Brotherly and Friendly Countries Arrive in Saudi Arabia from Sudan    Saudi Arabia Hosts 1st Meeting of Arab Authorities Controlling Medicines    General Directorate of Narcotics Control Foils Attempt to Smuggle over 5 Million Amphetamine Pills    NAVI Javelins Crowned as Champions of Women's Counter-Strike: Global Offensive (CS:GO) Competitions    Saudi Karate Team Wins Four Medals in World Youth League Championship    Third Edition of FIFA Forward Program Kicks off in Riyadh    Evacuated from Sudan, 187 Nationals from Several Countries Arrive in Jeddah    SPA Documents Thajjud Prayer at Prophet's Mosque in Madinah    SFDA Recommends to Test Blood Sugar at Home Two or Three Hours after Meals    SFDA Offers Various Recommendations for Safe Food Frying    SFDA Provides Five Tips for Using Home Blood Pressure Monitor    SFDA: Instant Soup Contains Large Amounts of Salt    Mawani: New shipping service to connect Jubail Commercial Port to 11 global ports    Custodian of the Two Holy Mosques Delivers Speech to Pilgrims, Citizens, Residents and Muslims around the World    Sheikh Al-Issa in Arafah's Sermon: Allaah Blessed You by Making It Easy for You to Carry out This Obligation. Thus, Ensure Following the Guidance of Your Prophet    Custodian of the Two Holy Mosques addresses citizens and all Muslims on the occasion of the Holy month of Ramadan    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



US urges opening of Gulf's oil sectors to foreign investment
Published in The Saudi Gazette on 03 - 06 - 2008

US Treasury Secretary Henry Paulson assured Gulf investors on Monday that the United States will remain open to sovereign wealth funds and urged oil producers to open their energy sectors to foreign investment.
“As we seek to open new markets abroad, America will keep our markets open at home to investment from private firms and from sovereign wealth funds,” Paulson said on the last stop of a Gulf tour.
“We reject measures that would isolate us from the world economy,” he said in the UAE capital Abu Dhabi, whose government-run fund manages assets estimated at up to $875 billion.
The Abu Dhabi Investment Authority injected $7.5 billion in capital in ailing US banking giant Citigroup last November, becoming one of the bank's biggest shareholders. The state-owned Kuwait Investment Authority has also pumped five billion dollars into Citigroup and Merrill Lynch.
Paulson acknowledged concerns in the region resulting from the Dubai Ports World debacle, when US congressional opposition forced the Dubai government operator to offload US operations acquired through its 2006 acquisition of P and O.
“Some here worry about growing protectionist sentiment in the United States, and they also worry specifically that US sentiment towards Middle East investment has been permanently affected by the Dubai Ports World case.” The US treasury chief, who met officials in Saudi Arabia, Qatar and the UAE, said some state funds were also concerned about a US attempt to set standards for their investments.
The International Monetary Fund met last month to develop “best practice” guidelines for sovereign wealth funds and a working group is expected to release its recommendations by October.
Paulson said there was concern among some fund managers that the initiative aimed to limit the scope of their activities or release privileged information.
“In fact, our purpose is just the opposite. We are trying to quell calls for restrictions by urging sovereign wealth funds to endorse best practices to create a dynamic rise to the top and help allay concerns about opacity and systemic risks.” Paulson said there were “no simple or quick remedies” to current record high oil prices, currently around $126 a barrel after hitting a peak of more than $135 last month. And he said the Gulf region alone could not alleviate the market pressures.
“High oil prices are the result of supply and demand factors that are likely to persist for some time... speculation and the depreciation of the dollar are likely only small factors behind oil price increases.” Paulson said easing market pressures would require matching supply to demand and this would be helped by opening the producers' oil markets to foreign investors.
“On the supply side, we are urging all oil producing countries to open oil markets to foreign investment, which would support faster and more efficient growth,” he said.
The UAE was a case in point, Paulson said.
“As an important first step, Abu Dhabi is financing massive investments in upstream production and domestic refining capacity through partnerships with foreign companies.” Arab countries in the Gulf, which account for just under one fifth of global oil production, have opened their gas, petrochemicals and oil downstream sectors to foreign investment, with the exception of Kuwait which has so far shut out foreign investors from its downstream activities.
The upstream sector remains mostly off limits to foreign oil majors, with Gulf countries preferring technical assistance contracts to production sharing agreements sought by international companies.
Paulson said there has been a threefold increase in foreign direct investment over the past decade in the Gulf region, where US investment grew by 120 percent between 2001 and 2006.
This was “in part due to liberalization of investment policies in the Gulf,” he said.
“However, the potential is much greater, and in many Gulf countries investment barriers persist in key sectors, such as energy and real estate.”
In London, oil prices weakened on Monday, extending last week's steep falls owing to concerns about lower global energy demand, traders said.
New York's main oil futures contract, light sweet crude for July delivery, lost 60 cents to $126.75 a barrel.
Brent North Sea crude for July fell 64 cents to $127.14.
“Oil futures were lower, still under pressure from last week's heavy losses,” said Sucden analyst Andrey Kryuchenkov.
Prices have shed about eight dollars since striking record peaks of $135.14 in London and $135.09 in New York on May 22.
“Last week, crude futures suffered from a fresh wave of profit taking,” Kryuchenkov said. “The sell off was also (driven) by concerns that demand for energy is weakening due to record oil prices, with a wave of fuel strikes across the globe highlighting these fears.” New York crude plunged five dollars last week, while London Brent shed about four dollars, falling in line with a recovering US currency that makes oil more expensive for foreign buyers and therefore dampens demand.
“The signs that demand is falling is forcing funds to seek better profits elsewhere,” said Alaron trader Phil Flynn.
“Keep an eye on the $125 a barrel area. A close below (that level) could open up the selling floodgates.” Despite the recent easing prices, the high cost of crude has sparked widespread international alarm and US-led calls for the Organization of the Petroleum Exporting Countries to produce more oil.
However, OPEC president Chakib Khelil on Saturday reiterated the organization's long-standing view that speculators and the weak dollar were partly to blame for runaway prices. “The consensus is that the crisis is not over and there is going to be a continuing impact on the prices of oil because of speculation,” he said.
Khelil, also Algeria's energy minister, said OPEC would not review the situation again until it meets in Vienna on Sept. 9.
OPEC, which pumps 40 percent of the world's oil, is reluctant to bend to demands that it produce more to dampen the red


Clic here to read the story from its source.