A steep rise in oil revenue is set to drive up the aggregate external assets of oil-rich Gulf states to as much as $6 trillion if crude prices remain buoyant, according to Goldman Sachs estimates.
The upside scenario of $6 trillion could be reached if oil prices average $120 a barrel until the end of 2026, the US investment bank said in its Mena 2023 Outlook report this week.
“In our base case, which sees Brent crude averaging $83 per barrel over the next five years, we estimate that GCC external assets could reach $5.5 trillion by end-2026, an increase of $1.3 trillion over the next four years,” said Farouk Soussa, Mena economist at Goldman Sachs.
In a downside scenario, where oil prices decline to $40 per barrel, “GCC assets could plateau at just under $5 trillion”.
“Our projections are highly dependent on the assumed trajectory of oil prices,” Mr Soussa said.
The price of Brent, the global benchmark for two thirds of the world’s oil, rose to a notch under $140 a barrel in March after Russia’s military assault on Ukraine, but gave up most gains in recent months.
Oil prices have dropped to near $80 a barrel from their June peak of about $129 a barrel amid weakening economic outlook and demand concerns.
Brent was trading down 0.2 per cent at $80.52 at 7.49am UAE time on Wednesday. West Texas Intermediate, the gauge that tracks US crude, was 0.16 per cent lower at $75.27 a barrel.
Even with recent softness, oil prices remain well in excess of the GCC's fiscal and breakeven levels of about $65 and $50 a barrel, respectively, according to Goldman Sachs' estimates.
“Should oil prices rise in line with our relatively bullish medium-term forecasts, hydrocarbon revenues for GCC oil would rise to levels close to the historic high achieved in 2012,” Mr Soussa said.
“Combined with historically low fiscal and external break-evens, this implies significant fiscal and external surpluses over the coming five years.”
Economies in the GCC bounced back strongly after the coronavirus-driven slowdown last year and the growth momentum has picked up further pace this year, driven by higher oil revenue.
Swift action to mitigate the effects of the pandemic have also boosted GCC economies, which are set to double their growth this year despite geopolitical and macroeconomic headwinds, according to an International Monetary Fund staff report earlier this month.
The fund expects the oil-rich economies of the GCC to grow by 6.5 per cent this year, up from 3.1 per cent in 2021. The growth — led by Saudi Arabia and the UAE, the two biggest Arab economies — is expected to moderate to 3.6 per cent next year.
The World Bank has forecast that Gulf economies will grow 6.9 per cent this year before decelerating to 3.7 per cent and 2.4 per cent in 2023 and 2024, respectively.
The total economic output of the countries in the six-member bloc is expected to hit $2 trillion in 2022, the IMF said in its Gulf Economic Outlook in October.
If the Gulf countries continue business as usual, the region’s combined GDP will grow to $6 trillion by 2050, the World Bank report said.
That figure could shoot up to more than $13 trillion by 2050 if they adopt a strategy of green growth that speeds up economic diversification.
Goldman Sachs remains bullish on the oil sector and economic prospects of the GCC for the medium to long term.
It said the recent softness in oil markets should be viewed in perspective as oil prices are still high relative to their average over the past several years.
“They would need to remain significantly lower for longer before we turned bearish on [a] GCC macro [economic scenario],” the report said.
Goldman Sachs expects the oil windfall will lead to a significant pick-up in domestic investment, driving stronger economic growth.
“This is particularly true in Saudi Arabia, where the list of mega-projects currently under way implies over $700 billion in domestic investment between now and the end of the decade,” Mr Soussa said.
The strength of economic fundamentals is also supportive for GCC risk assets in the medium term, according to the bank.
“Twin surpluses are driving outperformance of regional credit, according to our EM [emerging markets] credit strategists, who highlight the attractiveness of high-yield oil producers [Oman and Bahrain] in particular,” Mr Soussa said.
“Our equity research colleagues are also bullish on regional equity markets, which are seeing a rapid expansion thanks to new listings, as well as higher valuations.”
About Proto21
Date started: May 2018
Founder: Pir Arkam
Based: Dubai
Sector: Additive manufacturing (aka, 3D printing)
Staff: 18
Funding: Invested, supported and partnered by Joseph Group
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The specs
Engine: 2.2-litre, turbodiesel
Transmission: 6-speed auto
Power: 160hp
Torque: 385Nm
Price: Dh116,900
On sale: now
Dr Afridi's warning signs of digital addiction
Spending an excessive amount of time on the phone.
Neglecting personal, social, or academic responsibilities.
Losing interest in other activities or hobbies that were once enjoyed.
Having withdrawal symptoms like feeling anxious, restless, or upset when the technology is not available.
Experiencing sleep disturbances or changes in sleep patterns.
What are the guidelines?
Under 18 months: Avoid screen time altogether, except for video chatting with family.
Aged 18-24 months: If screens are introduced, it should be high-quality content watched with a caregiver to help the child understand what they are seeing.
Aged 2-5 years: Limit to one-hour per day of high-quality programming, with co-viewing whenever possible.
Aged 6-12 years: Set consistent limits on screen time to ensure it does not interfere with sleep, physical activity, or social interactions.
Teenagers: Encourage a balanced approach – screens should not replace sleep, exercise, or face-to-face socialisation.
Source: American Paediatric Association
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
Spider-Man: No Way Home
Director: Jon Watts
Stars: Tom Holland, Zendaya, Jacob Batalon
Rating:*****
Test
Director: S Sashikanth
Cast: Nayanthara, Siddharth, Meera Jasmine, R Madhavan
Star rating: 2/5
HOW TO WATCH
Facebook: TheNationalNews
Twitter: @thenationalnews
Instagram: @thenationalnews.com
TikTok: @thenationalnews
Zayed Sustainability Prize
UAE currency: the story behind the money in your pockets
UAE currency: the story behind the money in your pockets
The years Ramadan fell in May
Sole survivors
- Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
- George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
- Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
- Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
The specs
Engine: 2.9-litre twin-turbo V6
Power: 540hp at 6,500rpm
Torque: 600Nm at 2,500rpm
Transmission: Eight-speed auto
Kerb weight: 1580kg
Price: From Dh750k
On sale: via special order
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Lexus LX700h specs
Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor
Power: 464hp at 5,200rpm
Torque: 790Nm from 2,000-3,600rpm
Transmission: 10-speed auto
Fuel consumption: 11.7L/100km
On sale: Now
Price: From Dh590,000
Killing of Qassem Suleimani
UK-EU trade at a glance
EU fishing vessels guaranteed access to UK waters for 12 years
Co-operation on security initiatives and procurement of defence products
Youth experience scheme to work, study or volunteer in UK and EU countries
Smoother border management with use of e-gates
Cutting red tape on import and export of food
england euro squad
Goalkeepers: Dean Henderson (Man Utd), Sam Johnstone (West Brom), Jordan Pickford (Everton)
Defenders: John Stones (Man City), Luke Shaw (Man Utd), Harry Maguire (Man Utd), Trent Alexander-Arnold (Liverpool), Kyle Walker (Man City), Tyrone Mings (Aston Villa), Reece James (Chelsea), Conor Coady (Wolves), Ben Chilwell (Chelsea), Kieran Trippier (Atletico Madrid)
Midfielders: Mason Mount (Chelsea), Declan Rice (West Ham), Jordan Henderson (Liverpool), Jude Bellingham (Borussia Dortmund), Kalvin Phillips (Leeds)
Forwards: Harry Kane (Tottenham), Marcus Rashford (Man Utd), Raheem Sterling (Man City), Dominic Calvert-Lewin (Everton), Phil Foden (Man City), Jack Grealish (Aston Villa), Jadon Sancho (Borussia Dortmund), Bukayo Saka (Arsenal)
Biography
Favourite book: Zen and the Art of Motorcycle Maintenance
Holiday choice: Anything Disney-related
Proudest achievement: Receiving a presidential award for foreign services.
Family: Wife and three children.
Like motto: You always get what you ask for, the universe listens.
Tearful appearance
Chancellor Rachel Reeves set markets on edge as she appeared visibly distraught in parliament on Wednesday.
Legislative setbacks for the government have blown a new hole in the budgetary calculations at a time when the deficit is stubbornly large and the economy is struggling to grow.
She appeared with Keir Starmer on Thursday and the pair embraced, but he had failed to give her his backing as she cried a day earlier.
A spokesman said her upset demeanour was due to a personal matter.
How much do leading UAE’s UK curriculum schools charge for Year 6?
- Nord Anglia International School (Dubai) – Dh85,032
- Kings School Al Barsha (Dubai) – Dh71,905
- Brighton College Abu Dhabi - Dh68,560
- Jumeirah English Speaking School (Dubai) – Dh59,728
- Gems Wellington International School – Dubai Branch – Dh58,488
- The British School Al Khubairat (Abu Dhabi) - Dh54,170
- Dubai English Speaking School – Dh51,269
*Annual tuition fees covering the 2024/2025 academic year
Killing of Qassem Suleimani
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COMPANY%20PROFILE
%3Cp%3E%3Cstrong%3ECompany%20name%3A%3C%2Fstrong%3E%20Switch%20Foods%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%202022%3Cbr%3E%3Cstrong%3EFounder%3A%3C%2Fstrong%3E%20Edward%20Hamod%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20Abu%20Dhabi%2C%20UAE%3Cbr%3E%3Cstrong%3EIndustry%3A%3C%2Fstrong%3E%20Plant-based%20meat%20production%3Cbr%3E%3Cstrong%3ENumber%20of%20employees%3A%3C%2Fstrong%3E%2034%3Cbr%3E%3Cstrong%3EFunding%3A%3C%2Fstrong%3E%20%246.5%20million%3Cbr%3E%3Cstrong%3EFunding%20round%3A%3C%2Fstrong%3E%20Seed%3Cbr%3E%3Cstrong%3EInvestors%3A%3C%2Fstrong%3E%20Based%20in%20US%20and%20across%20Middle%20East%3C%2Fp%3E%0A
Squad
Ali Kasheif, Salim Rashid, Khalifa Al Hammadi, Khalfan Mubarak, Ali Mabkhout, Omar Abdulrahman, Mohammed Al Attas, Abdullah Ramadan, Zayed Al Ameri (Al Jazira), Mohammed Al Shamsi, Hamdan Al Kamali, Mohammed Barghash, Khalil Al Hammadi (Al Wahda), Khalid Essa, Mohammed Shaker, Ahmed Barman, Bandar Al Ahbabi (Al Ain), Al Hassan Saleh, Majid Suroor (Sharjah) Walid Abbas, Ahmed Khalil (Shabab Al Ahli), Tariq Ahmed, Jasim Yaqoub (Al Nasr), Ali Saleh, Ali Salmeen (Al Wasl), Hassan Al Muharami (Baniyas)
Countdown to Zero exhibition will show how disease can be beaten
Countdown to Zero: Defeating Disease, an international multimedia exhibition created by the American Museum of National History in collaboration with The Carter Center, will open in Abu Dhabi a month before Reaching the Last Mile.
Opening on October 15 and running until November 15, the free exhibition opens at The Galleria mall on Al Maryah Island, and has already been seen at the Jimmy Carter Presidential Library and Museum in Atlanta, the American Museum of Natural History in New York, and the London School of Hygiene and Tropical Medicine.
Company%20Profile
%3Cp%3E%3Cstrong%3EName%3A%20%3C%2Fstrong%3EDirect%20Debit%20System%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%20Sept%202017%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20UAE%20with%20a%20subsidiary%20in%20the%20UK%3Cbr%3E%3Cstrong%3EIndustry%3A%3C%2Fstrong%3E%20FinTech%3Cbr%3E%3Cstrong%3EFunding%3A%3C%2Fstrong%3E%20Undisclosed%3Cbr%3E%3Cstrong%3EInvestors%3A%3C%2Fstrong%3E%20Elaine%20Jones%3Cbr%3E%3Cstrong%3ENumber%20of%20employees%3A%3C%2Fstrong%3E%208%3Cbr%3E%3C%2Fp%3E%0A
The specs
Engine: 3.0-litre six-cylinder turbo
Power: 398hp from 5,250rpm
Torque: 580Nm at 1,900-4,800rpm
Transmission: Eight-speed auto
Fuel economy, combined: 6.5L/100km
On sale: December
Price: From Dh330,000 (estimate)
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MATCH INFO
Manchester United 1 (Fernandes pen 2') Tottenham Hotspur 6 (Ndombele 4', Son 7' & 37' Kane (30' & pen 79, Aurier 51')
Man of the match Son Heung-min (Tottenham)
UAE currency: the story behind the money in your pockets
More on Quran memorisation:
UAE currency: the story behind the money in your pockets
How to help
Send “thenational” to the following numbers or call the hotline on: 0502955999
2289 – Dh10
2252 – Dh 50
6025 – Dh20
6027 – Dh 100
6026 – Dh 200
Ovo's tips to find extra heat
- Open your curtains when it’s sunny
- Keep your oven open after cooking
- Have a cuddle with pets and loved ones to help stay cosy
- Eat ginger but avoid chilli as it makes you sweat
- Put on extra layers
- Do a few star jumps
- Avoid alcohol
Trolls World Tour
Directed by: Walt Dohrn, David Smith
Starring: Anna Kendrick, Justin Timberlake
Rating: 4 stars
