Bill Aimed At Blocking US Arms Deal With Saudi Arabia Defeated In Senate Vote.
The US Senate voted 53 to 47 to defeat a bill, which if it had passed yesterday, would have blocked some parts of the recent US$110 bio arms deal recently signed with Saudi Arabia. Republican Lindsey Graham who supports the arms sale, was quoted as saying ahead of the vote; "If you don't think containing Iran and keeping them from toppling Yemen, Iraq, Syria and Lebanon is not in our national interest, you're making a huge mistake."
Crude Prices Tread Water Following OPEC Statement.
WTI and Brent prices were relatively unchanged from yesterday’s levels at the time of writing, after recovering from an initial sell-off in Asia this morning which in turn had been driven by an OPEC report released late yesterday showing that the organization’s overall output had increased to 32.1 mio bpd in May against 31.80 mio bpd the previous month. The primary sources of this production increase came from Nigeria and Libya , both of whom are currently exempted from the output cut agreement, but also apparently from Iraq whose production rose by 44,000 barrels. Meanwhile Norway appears to have averted a major oil workers’ strike this week after an agreement was reached on their wage demands.
UAE Ambassador Suggests US Should Consider Shifting Its Qatar Base.
Diplomatic pressure continues to be applied to Qatar, with the UAE ambassador in Washington suggesting last night that the US should perhaps consider moving some parts of, or even its entire military base in Qatar to another GCC state. “Maybe someone in Congress should have a hearing and just say, you know, should we consider moving it? And maybe not moving the entire base, maybe just distribute to various countries so you don't have all your eggs in one basket." Otaiba was quoted as saying by AP, adding that the GCC allies would soon handover to the US the list of specific steps Doha must take before recently imposed penalties could be lifted. Qatar currently hosts the US military’s central forward command headquarters at its Al Udeid air base, home to 11,000 personnel and up to 120 USAF aircraft. Meanwhile Qatar has said it was withdrawing its troops from Djibouti, this follows last week’s decision by the East African state to downgrade its relations with Doha.
“Scarcity Of US Dollars In Nigeria Likely To Persist” – Moodys.
Moodys issued a general statement on Nigeria today after allocating a provisional senior unsecured B1 rating to the government’s proposed ‘diaspora’ bond. Within this statement the ratings agency said that both Nigeria’s economic growth and oil revenues were likely to improve this year, but that militant activity in the Niger Delta remained a ‘latent’ threat and that the existing US dollar shortage was likely to persist. A ten day international roadshow for this ‘diaspora’ issuance began yesterday and targets Nigerian expatriates living abroad. The government hopes to raise between US$100-300mio via the offer and the bond will be listed in both London and New York. Meanwhile the Nigerian Central Bank provided US$418 mio of liquidity via its various foreign exchange windows yesterday, which is around double its usual weekly injection amount. The retail window reportedly received US$226 mio, wholesale got US$100 mio, the SME window received US$50 mio and invisibles US$42 mio.
Bank Sohar Raises US$250 Mio Via Syndicated Loan.
Oman’s Bank Sohar raised US$250 mio via a well-subscribed three-year loan facility which closed yesterday. A senior official at the bank was quoted as saying via Reuters that; “The broad cross-section of banks that participated in the syndication reflects their deep confidence in Bank Sohar and its distinction of becoming Oman’s fourth largest bank in the relatively short span of ten years with the lowest levels of NPAs.”
Tanzania’s CB Announces New Capital Regulations On Banks.
Tanzania’s Central Bank announced yesterday that local financial institutions are now required to maintain a capital conservation buffer of 2.50% of their risk weighted assets and off-balance sheet exposures in order to better withstand potential future financial shocks. The minimum core and total capital ratios meanwhile remain the same at 10% and 12%.
World Bank Approves US$500 Mio Loan To Tunisia.
The World Bank approved a US$500 mio loan facility for Tunisia yesterday. The bank said the funds would “ help support the government’s effort towards improving the efficiency of public investments and promote greater participation of the private sector.”
Egypt Abolishes FX Transfer Limit.
Egypt’s Central Bank announced late this afternoon that it has removed the limit on international currency transfers. The bank also said in a statement that FDI inflows rose by 12.10% during the past nine months to US$11 bio, and that the country’s c/a deficit shrank by 37.70%.
Ghana’s Inflation Rate Dips.
Ghana’s CPI annual rate eased to 12.60% last month against 13.00% in April according to the country’s national statistics office.
Did you know that Saudi Arabia is the world’s largest producer of desalinated water?
Glenn Wepener, Executive Director & Geopolitical Analyst Middle East & Africa
National Bank of Abu Dhabi
Tel: +971 2 6110 127
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