WEEKLY ENERGY RECAP: Trapped between two viruses, oil market faces double trouble

People wearing a protective facemasks walk on an overpass in Lujiazui financial district in Pudong in Shanghai on February 8, 2020. The new coronavirus that emerged in a Chinese market at the end of last year has killed more than 700 people and spread around the world. (AFP)
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Updated 09 February 2020
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WEEKLY ENERGY RECAP: Trapped between two viruses, oil market faces double trouble

  • The deadly coronavirus outbreak in China has hurt short-term oil market demand

Oil prices continued to fall for a fifth week in a row and reached their lowest level in a year.

Brent crude dropped to $54.47 per barrel while WTI retreated to $50.32.

The global oil market now finds itself trapped between two viruses.

The deadly coronavirus outbreak in China has hurt short-term oil market demand and at the same time cyber-attack attempts on Saudi Aramco have also increased.

One threatens supply, the other demand.  However, the downward trend in oil prices is still ultimately about macroeconomics.

Despite such headwinds, the global oil market remains largely in balance as a result of the fourth year of efforts by OPEC+ to ensure it is so — even with a surge of oil supplies from unconventional resources.

Expectations of slowing growth in the global economy in the second half of 2020 should result in slightly lower crude oil demand. 

OPEC efforts to curb production still need to be unanimously extended, especially after Chinese oil demand dropped by about 3 million barrels a day, which is about a fifth of total Chinese refining capacity. Demand could fall further as storage capacity gradually fills, causing delays in discharging cargoes and leaving refiners, already under pressure from weak margins, facing hefty demurrage charges to compensate shipowners for delays.

The situation has also discounted crude oil barrels in the spot physical market.

For instance, the spot price premiums for Russian ESPO crude oil cargoes, the only barrels that arrive in China through pipeline, as the most popular crude grade for the independent Shandong “teapot” refineries have hit their lowest in five months.

The biggest impact was felt in China’s eastern Shandong province, which accounts for almost 20 percent of total Chinese crude oil imports. Here refining utilisation rates have fallen by half.

Such shrinking demand and weakening refining capacity from China has created fallout in the shipping industry as charterers are forced to pay penalty fees to ship owners for delays in unloading cargoes. This has caused tanker rates to tumble.


Saudi Arabia’s startup ecosystem LEAPs once again

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Saudi Arabia’s startup ecosystem LEAPs once again

  • LEAP 2025 boosts KSA’s role as a regional hub for fintech, e-commerce

RIYADH: Saudi Arabia’s LEAP 2025 tech conference, held from Feb. 9 to 12, showcased the Kingdom’s growing startup ecosystem, with multiple funding rounds, acquisitions, and expansion plans announced during the event.  

The conference, a key platform for innovation and investment, further cemented Saudi Arabia’s role as a regional hub for fintech, e-commerce, logistics, and emerging technologies.  

Saudi Arabia-based contech startup BRKZ used the forum to announce the completion of a $17 million series A extension, which includes $8 million raised in March 2023 and $1 million in venture debt.  

Investors in the round included Capifly, along with existing backers BECO Capital, Aramco’s Waed, and 9900 Capital, as well as Better Tomorrow Ventures, RZM Investment, and Class 5 Global.

MISY Ventures, Knollwood Investment Advisory, and Fluent Ventures are also among the supporters. Founded in 2023 by Ibrahim Manna, BRKZ is a B2B construction technology platform that connects suppliers and buyers while offering various delivery and payment options.  The latest funding brings BRKZ’s total capital raised to $22.5 million. 

Tabby doubles valuation to $3.3bn with a $160m round 

Saudi Arabia-based fintech Tabby has secured $160 million in a series E funding round at a $3.3 billion valuation.  

The round was led by existing investors Blue Pool Capital and Hassana Investment Company, with additional participation from STV and Wellington Management. 

Founded in 2019 in the UAE by Hosam Arab, Tabby operates as a buy now, pay later platform, handling $10 billion in annualized transaction volumes. 

Saudi-based fintech startup RasMal has closed a $4.8 million pre-series A investment round, led by Syndicate Element Holding Group. (Supplied)

The new funds will be used to accelerate the company’s expansion in financial services, including digital spending accounts, payments, cards, and money management tools.  

The latest investment also strengthens Tabby’s planned initial public offering. The company had previously raised $200 million in a series D round in October 2023.  

Buildnow closes $9.7m to expand SME-focused construction financing 

Saudi Arabia-based Buildnow has raised $9.7 million in a funding round led by STV and Arbah Capital, with additional financing coming from a mix of debt and equity. 

Founded in 2022 by Hisham Al-Saleh, Rahat Dewan, and Abdulla Sheikh, Buildnow is a build now, pay later platform that supplies construction materials on flexible credit terms while paying small and medium enterprise suppliers upfront in cash.  

The new capital will be used to scale its operations in the construction and building sector. In March last year, the company closed a $9.4 million seed round, comprising $6.5 million in equity and $2.9 million in debt financing.

Taager raises $6.75 million to expand social e-commerce in MENA 

Social e-commerce platform Taager, which was founded in Egypt and is now headquartered in Saudi Arabia, has secured $6.75 million in a pre-series B round led by Norrsken22. 

Launched in 2019 by Abdelrahman Sherief, Ahmed Ismail, Ismail Omar, and Mohammed El-Horishy, Taager helps entrepreneurs start and scale online businesses by offering product sourcing, storage, shipping, and customer payment solutions.  

Operating in Saudi Arabia, Egypt, the UAE, and Iraq, the company aims to further expand across the Middle East with its new funding.  

In 2021, Taager raised $6.4 million in a seed round led by 4DX Ventures, Raed Ventures, and other investors.

RasMal raises $4.8m to enhance digital cap table management 

Saudi-based fintech startup RasMal has closed a $4.8 million pre-series A investment round, led by Syndicate Element Holding Group. 

Founded in 2019 by Basil Al-Kuraya and Nasser Al-Tamimi, RasMal offers digital solutions for private companies to automate cap table management, fundraising, and equity transfers. 

The company also supports investors and private funds in streamlining investment processes. The new funding will be used to introduce new tools and services to further enhance fundraising and equity management for its clients.

Waad Investment secures backing from Oman’s ITHCA Group 

Saudi-based Waad Investment has announced an investment from ITHCA Group, an entity created by Oman Investment Authority in 2019. 

The deal aims to strengthen telecom, IT, and venture capital collaboration between Saudi and Omani companies, supporting the Kingdom’s Vision 2030 and the sultanate’s Vision 2040. 

Saudi-based Waad Investment has announced an investment from ITHCA Group.

PIESHIP secures $2.1m seed round for logistics expansion 

Logistics startup PIESHIP raised $2.1 million in a seed round led by Nama Ventures, with participation from SEEDRA Ventures and angel investors. 

Founded in Saudi Arabia in 2023 by Nasser Al-Harthi, Musaed Al-Amri, and Mohammed Mohsen, PIESHIP provides warehouse management solutions, last-mile delivery services, and logistics technology.  

The investment will support the company’s growth in the Saudi market. The startup previously secured an undisclosed pre-seed investment from Nama Ventures and SEEDRA Ventures.

LAHINT raises $1m to expand automated government services 

LAHINT, a Saudi-based e-services platform, has raised $1 million in a pre-seed funding round from undisclosed investors. 

Founded in 2023 by Ahmed Saber and Mohamed Ibrahim, LAHINT provides automated government services for both individuals and businesses.  

The company plans to expand its service offerings and introduce AI-powered eligibility consultations. Last year, LAHINT raised $267,000 in an earlier pre-seed round.

Mush Social acquires Pubbles to expand virtual communities 

Social media platform Mush Social has acquired Pubbles, a social media app operating in the Kingdom, to enhance its user base and digital presence. 

Founded in Saudi Arabia in 2022 by Abdulhadi Al-Asmi, Mush Social enables users to earn points and own virtual assets through its interactive map feature.  

Pubbles, launched in 2020, specializes in virtual communities and interactive technologies. In November 2024, Mush Social secured a $1.2 million pre-seed round led by Nifal Consulting.

Salla acquires Sweply, rebrands it as Salla Ads 

Saudi e-commerce Software-as-a-Service provider Salla has acquired Sweply, a digital advertising platform, as part of its strategy to integrate advertising solutions into its ecosystem. 

Founded in 2016 by Nawaf Hariri and Salman Butt, Salla enables merchants to set up online stores quickly.  

Sweply, launched in 2021 by Ebrahim Saeed and Wael Hassan, specializes in automated digital advertising. 

Following the acquisition, Sweply will be rebranded as “Salla Ads.” In March, Salla raised $130 million in a pre-IPO round led by Investcorp, Sanabil Investment, and STV. 

Foodics acquires UK-based Solo Venture, invests in three startups 

Saudi Arabia-based Foodics has acquired UK-based Solo Venture, a provider of self-ordering kiosks and online ordering solutions, as part of its strategy to enhance its restaurant and payments technology ecosystem. 

Founded in 2014 by Ahmad Al-Zaini and Mosab Al-Othmani, Foodics offers a point-of-sale and restaurant management platform for dine-in restaurants, food trucks, and cloud kitchens. 

Alongside the acquisition, Foodics has invested in Norma, a Greek AI-powered data analytics firm; Add, an accounting system for small businesses; and Arzaq Plus, a supply chain platform using AI and smart logistics to optimize sourcing and reduce waste.  

Foodics also plans to introduce a buy now, pay later feature for restaurant bills, improving cash flow management.

Unipal raises pre-series A funding to expand in Saudi Arabia 

Bahrain-born education tech startup Unipal has closed its pre-series A funding round, led by Plus VC with participation from Al Jazira Capital, RZM Investments, Falak Angels, and Doha Tech Angels. 

Founded in 2020 by Ali Al-Alawi and Ali Al-Shaer, Unipal provides discounts and special offers to university students via its platform.  

The funding will support Unipal’s expansion into Jeddah, Madinah, Dammam, and Khobar and the launch of its new AI-driven app.

T2 acquires majority stake in fintech platform Moola 

Saudi tech services provider T2 has acquired a majority stake in Moola, a Saudi expense management platform, to enter the fintech sector. 

Founded in 2022 by Waseem Hammoud, Moola provides corporate business cards and financial automation tools. T2 serves over 12,000 clients with software and business intelligence solutions. 

Raenest secures $11m series A for African expansion 

Raenest, a multi-currency accounts platform for African businesses, has closed an $11 million series A led by QED Investors, with backing from Norrsken22, Ventures Platform, P1 Ventures, and Seedstars. 

The funding will help Raenest expand in Nigeria, Kenya, the US, and Egypt, while growing Geegpay, its payment solution for Africa’s gig economy. 

MENA startup funding reaches $863m in January  

The MENA startup ecosystem raised $863 million in January, across 63 funding rounds, though $768 million came from debt financing. When excluding debt, the investment level was similar to January 2024, according to Wamda’s monthly report. 

Saudi Arabia dominated regional funding, securing $839.5 million across 21 deals, with Lendo and Forus debt rounds accounting for $750 million. 

The UAE followed with $14.6 million across 15 deals, while Egyptian startups raised $6 million from seven transactions. Other MENA countries collectively raised less than $2.5 million. 

The fintech sector led with $776.6 million across 11 deals, largely due to Lendo and Forus’ financings. Property tech attracted $38.7 million, while e-commerce startups secured $30 million across five rounds.


Pakistani and Saudi finance chiefs discuss boosting strategic ties ahead of AlUla conference

Updated 15 February 2025
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Pakistani and Saudi finance chiefs discuss boosting strategic ties ahead of AlUla conference

  • Muhammad Aurangzeb brings up enhanced bilateral trade, investments and collaboration with his counterpart
  • The ministers emphasize the need for continued economic dialogue, increased cooperation through joint initiatives

KARACHI: Saudi Arabia and Pakistan on Saturday discussed unlocking the full potential of their strategic relationship, as the finance chiefs of both countries met ahead of the Emerging Markets Conference in AlUla, Saudi Arabia, according to an official statement.
Pakistan’s Finance Minister Muhammad Aurangzeb arrived in the Kingdom to attend the two-day conference, which begins on Sunday, at the invitation of his Saudi counterpart Mohammed Al-Jadaan.
The annual economic policy forum is organized by the Saudi finance ministry in collaboration with the International Monetary Fund (IMF) regional office in Riyadh. The event will bring together emerging market finance ministers, central bank governors, policymakers, public and private sector leaders, international institutions and academics.
“The meeting [between the two finance chiefs] underscored a shared commitment to build bridges of economic cooperation and advance mutual prosperity,” Pakistan’s finance ministry said in a statement after Aurangzeb’s interaction with Al-Jadaan.
“The discussions highlighted opportunities for enhancing bilateral trade, investments and financial collaboration, with both ministers expressing their dedication to unlocking the full potential of their countries’ strategic partnership,” it added.
Pakistan is navigating a fragile economic recovery under a $7 billion IMF loan program secured in September 2024, after implementing austerity measures and policy reforms to avert a sovereign default in 2023.
To facilitate Pakistan’s economic recovery, Saudi Arabia signed 34 memorandums of understanding (MoUs) worth $2.8 billion last October to boost private sector investment in key areas, including energy, infrastructure and technology.
During their meeting, the two ministers explored avenues for collaboration in infrastructure, energy, technology and finance, emphasizing the need for continued dialogue and joint initiatives to facilitate investment flows and economic opportunities that could benefit the broader region.
According to an earlier statement by Pakistan’s finance ministry, Aurangzeb is scheduled to participate in a high-level panel discussion titled “The Path to Emergent Markets,” hosted by IMF Managing Director Kristalina Georgieva.
The conference will feature nine sessions, with 200 participants and 36 speakers, focusing on economic resilience, financial policies for emerging markets and global economic challenges.
The discussions come at a time when the world economy is facing persistent shocks, trade tensions between major world powers, geopolitical instability and tight financial conditions.
“The conference will provide a unique platform for world leaders to discuss and analyze domestic, regional and global economic conditions and developments and to exchange ideas on solutions to global challenges,” the Pakistani finance ministry added.


Habib Bank, S&P Global launch Pakistan’s first index to track manufacturing sector

Updated 14 February 2025
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Habib Bank, S&P Global launch Pakistan’s first index to track manufacturing sector

  • The index will be a standardized economic indicator based on a survey of a diverse panel of industries
  • It will help track economic developments in Pakistan, support decision making by financial institutions

ISLAMABAD: Pakistan’s largest bank, Habib Bank Limited (HBL), and global financial information and analytics firm S&P Global have launched a new index to track the country’s manufacturing sector, the companies said on Friday.
Rising taxes and power tariffs have led to social unrest and hammered industries in Pakistan’s $350 billion economy, as it navigates a tricky path to recovery under a $7 billion International Monetary Fund (IMF) program approved in September.
The HBL S&P Global Purchasing Managers’ Index will be a standardized economic indicator based on a survey of a diverse panel of industries.
It will be Pakistan’s first comprehensive manufacturing index and a welcome source of information for investors in a country where economic data is scarce.
The industries will be asked about their perceptions of current business conditions and future expectations and the index will be released on the first working day of each month, the companies said in a statement.
“The launch of Pakistan’s first ever PMI is a significant event contributing to the accessibility of timely and high-frequency data to track economic developments in Pakistan and support decision making by financial institutions, investors and businesses,” said Luke Thompson, Managing Director of S&P Global Market Intelligence, in a statement.
Muhammad Nassir Salim, President & CEO of HBL said the series will enhance investor confidence and transparency in Pakistan’s economy.


Saudi banks see record profits amid strong credit growth and debt market expansion

Updated 14 February 2025
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Saudi banks see record profits amid strong credit growth and debt market expansion

RIYADH: Saudi Arabia’s top 10 listed banks recorded all-time high net profits in 2024 of SR79.64 billion ($21.23 billion), reflecting a 13.84 percent annual increase, according to data from the Saudi Exchange.

The robust performance was driven by strong lending growth, declining interest rates, and increased participation in debt markets.

Saudi National Bank, known as SNB AlAhli, led the sector, accounting for 26.6 percent of total banking profits at SR21.19 billion, followed closely by Al Rajhi Bank, which contributed 24.8 percent, reaching SR19.72 billion.

These two banks constituted about 51.4 percent of the sector’s total profits.

Among the banks with the highest annual growth, Arab National Bank topped the list with a 21.98 percent rise in net profits to SR4.97 billion. Bank AlJazira followed with a 20.69 percent increase, reaching SR1.23 billion, despite holding the smallest share of sector profits at 1.5 percent.

Total assets for the top 10 Saudi banks surged to SR4.21 trillion in 2024, marking a 13.6 percent increase year on year. SNB AlAhli held the largest asset base at SR1.1 trillion, followed by Al Rajhi Bank at SR974.39 billion, with both banks collectively accounting for 49 percent of the sector’s total assets.

Al Rajhi Bank recorded the fastest asset growth, expanding by 20.58 percent, followed by Saudi Investment Bank, which grew by 20.53 percent to reach SR156.67 billion.

Saudi Arabia’s banking sector is poised to sustain its profitability in 2025, bolstered by strong credit growth and corporate lending tied to Vision 2030 projects, according to an S&P Global report released in January.

The financial services agency projected that bank lending would expand by 10 percent, driven primarily by corporate loans as the Kingdom continues to invest heavily in large-scale economic initiatives.

The outlook remains positive as stable credit growth, supported by easing interest rates and a favorable economic environment, is expected to maintain banks’ profitability, with return on assets estimated to remain between 2.1 percent and 2.2 percent.

The report further highlighted that banks may increasingly turn to international capital markets to finance Vision 2030-related investments, ensuring a steady flow of liquidity. Meanwhile, mortgage lending is also anticipated to rise, supported by lower borrowing costs and demographic trends fueling demand for residential properties.

Saudi banks have also maintained a dominant presence in the stock market, leading Tadawul’s trading activity in 2024’s fourth quarter with a 17 percent market share, surpassing the materials and energy sectors.

Bank loans and main growth drivers

Saudi banks’ total loans and advances to customers grew by 14.41 percent year on year in 2024, reaching SR2.81 trillion, while deposits rose by 7.87 percent to SR2.68 trillion during the same period.

Al Rajhi Bank led in loan issuance, providing SR693.4 billion, a 16.8 percent increase from the previous year, followed by SNB AlAhli with SR654.25 billion and Riyadh Bank with SR274.4 billion.

With the Saudi riyal pegged to the US dollar, the Kingdom’s central bank, known as SAMA, mirrors Fed rate movements. After interest rates peaked at 6 percent in 2024, they began to decline in September, reducing borrowing costs.

According to SAMA, 11.28 percent of total bank loans — 21 percent of corporate loans— were allocated to real estate, a key enabler of the Kingdom’s infrastructure expansion.

Saudi Investment Bank posted the highest loan growth rate at 23.18 percent, reaching SR99.47 billion, followed by Saudi First Bank with a 20.10 percent increase to SR259.35 billion.

Deposits and funding strategies

Bank deposits for the top 10 Saudi banks reached SR2.68 trillion in 2024, with Al Rajhi Bank holding the highest share at SR628.24 billion, followed by SNB AlAhli at SR579.76 billion.

The strongest deposit growth was seen in Riyadh Bank, which expanded by 20.21 percent to SR306.42 billion, followed by Bank AlJazira with a 15 percent increase to SR108.19 billion.

As lending growth outpaces deposit expansion, Saudi banks have increasingly turned to the debt capital market to fund their credit expansion.

According to Fitch Ratings, Saudi banks have significantly increased their international debt issuance since 2020, aligning with their long-term growth strategies and foreign-currency funding needs.

The GCC banking sector is projected to issue more than $30 billion in US dollar-denominated debt in 2025, following a record $42 billion in 2024, according to Fitch.

This surge is primarily driven by nearly $23 billion in maturing debt, lower US interest rates, and sustained regional credit demand, particularly in Saudi Arabia and the UAE.

In 2024, GCC banks represented 18 percent of all emerging-market bank debt issuance in US dollars — a figure that rises to 36 percent when excluding Chinese banks. Strong global investor confidence, supported by stable oil prices projected around $70 per barrel in 2025, has further strengthened regional debt markets.

Short-term certificates of deposit emerged as a key instrument in GCC bank funding strategies, accounting for 21 percent of total debt issuance in 2024. 


Saudi Arabia leads GCC in US dollar debt and sukuk issuance, driving regional growth: Fitch

Updated 14 February 2025
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Saudi Arabia leads GCC in US dollar debt and sukuk issuance, driving regional growth: Fitch

RIYADH: Saudi Arabia holds the largest share of the Gulf Cooperation Council’s debt capital market, with 44.8 percent of outstanding issuances, according to Fitch Ratings.

The US-based agency claims the GCC’s total DCM surpassed the milestone of $1 trillion at the end of January, reflecting a 10 percent year-on-year growth across all currencies. 

Saudi Arabia, alongside the UAE, boasts the most mature financial landscape, with both countries leading in sukuk and bond issuances. 

Fitch expects the Kingdom to play a pivotal role in driving US dollar debt and sukuk issuance in 2025 and 2026, as Saudi Arabia’s financial institutions and corporations increasingly turn to international debt markets to diversify funding sources, with banks alone anticipated to issue over $30 billion in US dollar-denominated debt this year. 

In a different report issued earlier this month, Fitch expected Saudi Arabia’s debt capital market to hit $500 billion by the end of 2025, fueled by economic diversification efforts under Vision 2030.

The DCM, which involves the trading of securities like bonds and promissory notes, serves as a key mechanism for raising long-term capital for both businesses and governments.

In its latest report, Fitch Ratings said: “Falling oil prices could lead to further DCM growth as lower government revenues could lead to increased borrowing.” 

It added that the anticipated reduction in US Federal Reserve interest rates in 2025 is expected to create a more favorable funding environment, with GCC central banks likely to follow suit. 

Saudi Arabia and the UAE, in particular, are set to benefit from this trend, further solidifying their positions as key regional and global financial hubs. 

GCC’s growing role in global debt markets 

The GCC accounted for a quarter of all emerging-market US dollar debt issued in 2024, excluding China, with Saudi Arabia, Turkiye and the UAE leading the way.. 

GCC US dollar DCM issuance surged by 65.8 percent year on year in 2024 to $133.4 billion, underscoring the region’s increasing reliance on international debt markets. New GCC fund passporting regulations could enhance DCM investment opportunities. 

Sukuk remained a key financing tool, making up 40 percent of the GCC’s total DCM as of January. Saudi Arabia and its regional counterparts contributed over 40 percent of global sukuk issuance, with GCC volumes soaring 43 percent year on year in 2024 to $87.5 billion. 

Notably, nearly 80 percent of Fitch-rated GCC sukuk are investment-grade, with the majority falling within the “A” category, while the remainder is mostly split between AA, BBB, BB, and B ratings. 

Most issuers are on “Stable Outlook”’ with the rest mainly on “positive.” Islamic banks played a crucial role in the sukuk ecosystem, both as issuers and investors, reinforcing the Kingdom’s leadership in Islamic finance. 

Challenges such as Shariah compliance complexities could impact sukuk structuring and issuance, Fitch warned. 

Saudi Arabia and UAE dominate ESG debt market 

The GCC’s environmental, social, and governance debt market surpassed $50 billion in outstanding issuances by the end of January, according to the ratings agency. 

Saudi Arabia and the UAE led this segment, with ESG debt representing 7.3 percent of the Kingdom’s total dollar debt issuance in 2024. 

ESG-debt issuance was also a sizable part — 17 percent — of dollar debt issuance in the UAE. 

“ESG debt could help issuers tap demand from ESG-sensitive international investors from the US, Europe and Asia,” Fitch said. 

Challenges and future prospects 

Despite its rapid expansion, the GCC’s DCM faces hurdles, including a bank-dominated investor base, a preference for bank financing over capital market funding, and limited local-currency debt issuance outside of Saudi Arabia. 

The Kingdom’s riyal-denominated market is the most developed in the region but “still has more room for growth,” according to Fitch. 

Kuwait became the GCC’s third-largest dollar debt issuer in 2024, with a total of $13.6 billion, led by banks. This is despite the absence of the public debt law, which would enable sovereign borrowing. 

Historically, US dollar issuances from Kuwait have been sporadic and rare, with only $11.8 billion issued between 2018 and 2023. “Kuwait’s new government plans to revise liquidity laws to facilitate capital market borrowing, but the timeline is uncertain,” Fitch said.