DOHA: The head of the Kuwait Investment Authority, which manages almost $1 trillion in assets, said the sovereign wealth fund is committed to investing in the US and that investors cut allocations to US assets at their own risk.
Some global investors have ditched US assets in recent weeks on fears that US President Donald Trump’s overhaul of global trade may hurt the US economy, and could cause deeper long-term damage.
The trend looks set to continue, given that a record number of managers have said they plan to keep cutting their exposure to US assets, according to BofA research.

Kuwait has been investing in the US market for a “long time” and that “won’t change,” KIA Managing Director Sheikh Saoud Salem Abdulaziz Al-Sabah said at an investment conference in the Qatari capital on Wednesday.
“I would say it very bluntly, underweight America at your own risk,” he said.
Last week, Moody’s downgraded the US sovereign credit rating by one notch, citing concerns about the nation’s growing $36 trillion debt pile, which could make investors more cautious and drive up borrowing costs across the economy.
“They (investors) are merely looking at equity markets, but they’re not taking into fact the US has the largest fixed income market, the US has the largest private equity market, the real estate market, infrastructure and credit,” Al-Sabah said.
“I think the US has the breadth and depth to sustain its exceptionalism and it has the rule of law as well,” he said.

SINGAPORE: Oil prices gained more than 1 percent on Wednesday after reports of Israel preparing a strike on Iranian nuclear facilities raised fears that a conflict could upset supply availability in the key Middle East producing region.

Brent futures for July rose 68 cents, or 1.04 percent, to $66.06 a barrel, by 9:30 a.m. Saudi time. US West Texas Intermediate crude futures for July climbed 70 cents, or 1.1 percent, to $62.73.

New intelligence obtained by the US suggests that Israel is preparing to strike Iranian nuclear facilities, CNN reported on Tuesday, citing multiple US officials familiar with the matter.

It was not clear whether Israeli leaders have made a final decision, CNN added, citing the officials.

“Such an escalation would not only put Iranian supply at risk, but also in large parts of the broader region,” said ING commodities strategists on Wednesday.

Iran is the third-largest producer among the members of the Organization of the Petroleum Exporting Countries and an Israeli attack could upset flows from the country.

There are also concerns Iran could retaliate by blocking oil tanker flows through the Strait of Hormuz choke point in the Gulf, through which Saudi Arabia, Kuwait, Iraq and the UAE export crude oil and fuel.

The US and Iran have held several rounds of talks this year over Iran’s nuclear program, with US President Donald Trump reviving a campaign of stronger sanctions on Iranian crude exports to compel them to give up their nuclear aspirations.

Despite the discussions, US officials and the Iranian Supreme Leader Ayatollah Ali Khamenei made comments on Tuesday indicating both sides remain far from a resolution.

“There are indirect nuclear talks between the US and Iran, which, if successful, could give the market further upside. However, these talks appear to be running out of steam,” the ING analysts said.

Still, there were some signs of improving crude supply. US crude oil stocks rose last week while gasoline and distillate inventories fell, market sources said, citing American Petroleum Institute figures on Tuesday.

Crude stocks in the US, the world’s biggest oil consumer, rose by 2.5 million barrels in the week ended May 16, the sources said on condition of anonymity.

Investors are looking ahead to government US oil stock data from the Energy Information Administration later on Wednesday.

Also, Kazakhstan’s oil production has risen by 2 percent in May, an industry source said on Tuesday, an increase that defies pressure from OPEC+ on the country to reduce its output.