 |
PUBLICATION
| Our August Economic Commentary is devoted to a comprehensive review of CFTC’S Report under the title: Fundamentals or Speculation? A Critical Review of CFTC’S Interagency Task Force ?Report on Crude Oil Markets |
In defying conventional expectations, crude oil markets and ??prices have puzzled and polarized oil analysts, ?economists and ??policy advisors alike. As the controversy has stimulated further ??research, valuable papers have ?recently been produced that ??deserve our attention and appreciation. CFTC’s interagency task ?force report ?is no less ?worthy of interest. The authors have shared ?rare professional ?skills and insights that will greatly ?enhance our ?understanding ?of ?structurally changing and volatile markets. ? Obviously, it is not the intention of our review to ?weigh for or against ITF’s assertion that ?speculation has not ?systematically driven changes in oil prices. The review, however, ?highlights ?significant ?omissions and ambiguities, which do ?not appear to stem from the report’s interim nature only. The ??most obvious are the effects of ?US policy-related factors on ?market fundamentals, the ?implications of futures ?market ?backwardation for both low ?inventory levels and soaring ?speculation, and the absence of ?explicit ?affirmation or negation of ?a speculative bubble. As work continues, CFTC and the interagency ?task force should ?broaden their analysis and target a wider ?audience in order to validate and legitimize their conclusions.? ...[Details] |
|
| Revisiting MENA Macroeconomic Outlook: A Three-Pronged Approach |
This commentary, which has been prepared by Wichai Turongpun, is an invitation to a further discussion of MENA ?macroeconomic policy stances. It is a revisit aiming to provide a ?new approach to the regional analysis. In this sense, it can be considered as an extension of our Economic Commentary Vol. 2 No. 11 dated ?November 2007. Given the current international economic context, the ongoing credit crisis and the tensions within many commodity markets, analysts have tended to highlights certain factors and ignore others. In this context, a call for a multi-?dimensional approach to MENA macro-economic outlook is timely, to which ?we can now elaborate on the details (full text attached).
...[Details] |
|
| Economic Commentary Vol 3 No 5-6 May-June 2008:Eye on Algeria: A clin d'œil to the WEF on the Middle East |
"Les efforts de diversification des économies dépendantes du pétrole : L'Algérie dans le contexte du Moyen Orient et de l'Afrique du Nord" is the theme of our Economic Commentary for May-June 2008, which is attached. This special issue takes a broader and longer-term view than the "Eye on Algeria" session organized by the World Economic Forum in Sharm El Sheikh most recently (18-20 May 2008). The commentary has been prepared in French in order to reach a predominantly French-speaking audience of government policy-makers, business and union leaders and opinion-shapers in the home country. ...[Details] |
|
| Aissaoui's Presentation at the 16th Arab Economic Forum Meeting |
| MENA/Arab Macro-economic and Energy Investment Outlooks: Reassessing the Balance of Risks" is the presentation presentation by Ali Aissaoui, Head of Economics & Research, on the occasion of the annual meeting of the Arab Economic Forum (Beirut, 2-3 May 2008). The presentation, which is titled "MENA/Arab macroeconomic and energy investment outlooks, reassessing the balance of risks", was prepared to support a panel discussion that explored current economic issues from both a global and regional perspective....[Details] |
|
| Economic Commentary Vol 3 No 3-4 March-April 2008: APICORP’s Annual Review of Global and Regional Economic Trends and the Energy Investment Outlook of the Arab World |
With increasing globalization emerging risks are being felt across the world, though with varying degrees of intensity and time-lag effects. This is currently the case of the risks associated with the turmoil of the financial markets. While these risks are spreading globally, the Arab world’s exposure seems reduced or not yet fully felt. Indeed, the region’s economy, which has benefited from sustained high oil prices, has continued to perform remarkably well. However, with the weakening of the US economy and the slowing of global growth, the balance of risks to the Arab energy investment outlook has tilted further to the downside. ...[Details] |
|
| Economic Commentary Vol 3 No 1-2 Jan-Feb 2008: Diversifying MENA Petroleum-Dependent Economies - Where Does Saudi Arabia Stand? |
No matter how Saudi economic diversification strategies are articulated and consensually validated, leveraging oil to create more jobs is likely to be the key policy driver. The biggest challenge, however, will be filling these jobs from a rapidly expanding domestic labor pool. This challenge can only be addressed if, on the one hand, progress in policy formulation is matched by the pace of implementation of reforms in education and transfer of skills and, on the other hand, if the whole process is driven by those who are deeply committed to it. ...[Details] |
|
| Aissaoui's Presentation on the Occasion of the Inaugural Meeting of the Arab Energy Club |
"A MENA macro-economic and energy investment outlook: Sustained growth amid uncertainty" is the presentation made by Ali Aissaoui, Senior Manager of Economics and Research Department at the inaugural meeting of the Arab Energy Club (Beirut, 18 December 2007). The presentation was prepared to support a brainstorming session on the macroeconomic and energy investment outlook of the MENA region: · Global uncertainties and risks · MENA macroeconomic outlook · MENA energy investment outlook · Issues for discussion ...[Details] |
|
| Economic Commentary Vol 2 No. 12 - December 2007: Shaping Long Term Oil Price Expectations For Investment: Is It Workable? Is It Achievable? |
Shaping Long Term Oil Price Expectations For Investment: Is It Workable? Is It Achievable? Is the theme of our Economic Commentary Vol 2 No 12, which is attached for your easy reference. The commentary is also published in MEES 50:51. Recent studies and analyses have identified several factors that could hinder the flow of investment in the petroleum industry, including specific institutional, legal and fiscal constraints within the oil-producing countries, the cost and availability of capital and OPEC’s behaviour and motivations. Few such studies, however, question the traditional framework for investment and none stresses enough the need to make up for the market’s consistent failure to provide a long-term price signal to enable capital expansion.
This commentary delves into that largely unexplored issue. The central idea is that, under an alternative investment framework, a price signal can be worked out as the unit present value of future fiscal petroleum revenue streams. The extent to which it is achievable depends very much on OPEC capacity to develop an effective policy to convey it. ...[Details] |
|
| In statement to (Al-Jezirah) APICORP's Chief Executive:
Arabs need US$420 billion in petroleum investments for the coming 5 years |
APICORP CE&GM Ahmad Bin Hamad Al-Nuaimi stated in an interview with Al-Jezirah daily newspaper that the investment requirements of the petroleum industry sectors in the Arab world exceed US$ 420 billion for the coming 5 years (Arabic Article) ...[Details] |
|
| OPEC: Today’s Market Dilemma and Tomorrow’s Economic Challenge |
"OPEC: Today’s Market Dilemma and Tomorrow’s Economic Challenge" is the presentation made by Ali Aissaoui, Head of Economics & Research, at the 3rd OPEC Summit (Ministerial Symposium) on 15 November. The presentation provided background support for a panel discussion on the following issues facing OPEC:
· Responding to a rapidly changing market place. · Shaping LT price expectations and a common investment policy. · Informing public policy on economic diversification. ...[Details] |
|
| Economic Commentary Vol 2 No. 11 - November 2007: A MENA Macroeconomic Perspective For The Period 2008-2012: Sustained Growth Amid Uncertainties |
Despite the world economy becoming more interdependent, multi-faceted risks have been felt by different countries and regions with varying degree of intensity and time-dependent effect. In the case of MENA, the region’s exposure to external uncertainties seems reduced or not yet felt as it has continued to perform remarkably well. Macroeconomic fundamentals, which have greatly benefited from high oil prices, have remained generally strong. However, with looming downside risks and a challenging regional unemployment, the outlook deserves more careful consideration. This commentary aims at reviewing the macroeconomic outlook for the period 2008-2012.1 It first discusses the uncertainties and risks facing MENA before proceeding to highlight the global economic backdrop, then focusing on MENA various social and economic spheres. It concludes on the extent the region could weather key uncertainties and risks. ...[Details] |
|
| Economic Commentary Vol 2 No. 10 - October 2007:MENA Energy Capital Investment Outlook: New Trends, New Challenges |
Notwithstanding the shelving of a substantial number of previously planned projects, whose viability has been weakened by continuous escalating costs, APICORP’s 5-year rolling review of energy investments in the MENA region for the period 2008-12 highlights a further acceleration of capital requirements in nominal terms. Although the resulting capital structure has overall slightly shifted to equity, the downstream industry remains highly leveraged. In a context of higher risk aversion and tightening credit conditions, securing the appropriate amount and mix of debt are likely to be considerably more challenging, particularly outside the GCC area. Our “perceptual mapping” continues to outline the importance of improving the investment climate, which should remain a key focus of policy-makers’ concerns… ...[Details] |
|
| Economic Commentary Vol 2 No. 9 - September 2007: Backwardation and the Surge in Commodity Investments: OPEC's Policy Dilemmas Reconsidered |
| This commentary seeks to gain insight into the current structure of oil futures markets and the implications of backwardation on commodity investment. It further discusses the strategies that focus on petroleum futures contracts and the risk they contribute to market stability. The commentary concludes by reconsidering the kernel of the policy dilemmas facing OPEC....[Details] |
|
| MENA & Arab Energy Investments Overview 2007-2011 |
APICORP Research provides, on a rolling 5-year basis, an annual review of energy investments of the oil, gas, petrochemical and power sectors in the MENA region, i.e. the Arab world and Iran. The review, now in its third consecutive year, has used the same concepts and methodological framework to identify and track key investment trends, new business opportunities and potential challenges. ...[Details] |
|
| Economic Commentary Vol 2 No. 7-8 July - August 2007:Powering MENA Economy: Capacity Structure, Investment Outlook and Financing Prospects |
| In face of massive investment requirements in power/water and competing demands for public sector finance, an increasing number of MENA governments have managed to shift part of the burden of funding new projects to the private sector. However, infrastructure capital requirements are so huge that they could only be met by enabling both public and private investments. Judging from the more consistent trends in the GCC area, investments by IPPs/IWPPs, which are undertaken on a project finance and loan participation basis, will only cover a portion of total capital requirements. Additional funding from the domestic and international capital markets could be secured by the incumbent utilities should they manage to get investment grade ratings. Such a move, which is in progress in Saudi Arabia, would greatly enhance the utilities’ ability to implement their large-scale capital expenditures and meet the rapidly growing demand for electricity and water....[Details] |
|
| Economic Commentary Vol 2 no 6 -June 2007: MENA Investments In Petroleum Refining: Determinants, Drivers And Risks To Growth |
| The slow response to oil market signals in the major consuming areas has prompted a shift in MENA petroleum investment strategy. As a result investment plans in refining have been given strong support. However, MENA oil companies embarking on high-cost export-oriented refineries may face financial challenges if the economic viability of these projects deteriorates with a downturn in refining margins. Such an uncertainty constitutes an important risk factor that could curb exposure to this critical link of the petroleum supply chain....[Details] |
|
| Economic Commentary Vol 2 No 4-5 April-May 2007: Looking Beyond Petroleum: A Stronger Case for Economic Diversification in MENA Region |
Three main arguments are advanced to make a stronger case for economic diversification in the MENA region and to focus attention on its urgency. The first establishes the limited extent of the petroleum revenues to meet long-term fiscal demands in face of fast growing populations. The second highlights the difficulty of stabilizing these revenues in face of extreme market volatility. The third shows the extent of unemployment and the limited impact economic growth can make as long as the petroleum sector remains dominant. Economic diversification is the key. It is a long-term process that has to be set on an urgent timetable, combining strategy, policy and politics. The strategy should embrace the three-pronged pattern suggested. Policy should focus on further improvement of the investment climate and involvement of the private sector. Politics should seek to enhance the political feasibility of the resulting reforms. ...[Details] |
|
| Economic Commentary Volume 2 No. 3 March 2007: Global and Regional Economic Trends and the Energy Investment Outlook of the Arab World |
Much of the focus in the first half of 2006 was on the oil producers’ high net savings and their potential destination for both public and private investments (see our Economic Commentary Vol 1 No 7-8). However, the fall of oil prices from their July 2006 peak, the continuation of the depreciation of the US dollar and the relentless inflation in the cost of energy project portfolios have shifted attention to the ability of the oil and gas producers to augment capacity in order to bring additional supply to the market. Moreover, broader issues of concern include the extent to which the global and regional economic trends will continue to provide a supportive environment for the region’s energy investment. ...[Details] |
|
| Economic Commentary Volume 2 No. 2 February 2007 Crude Oil Prices: Can OPEC Stem the Tide? |
| This commentary aims to provide insights into the main determinants of the oil market and the prime factors behind falling oil prices. Moreover, in a context where OPEC has adjusted its production to contain further price declines, the paper explores what additional actions are needed to credibly protect its members’ economic interests should the market deteriorate any further....[Details] |
|
|
|
 |
 |
