Saudi Arabia’s petrochemical growth accelerates with strategic investments and Vision 2030

Saudi Arabia’s petrochemical growth accelerates with strategic investments and Vision 2030
As the Kingdom seeks to reduce its dependence on oil revenue, its petrochemicals sector has emerged as a cornerstone of its industrial strategy, playing a pivotal role in Vision 2030. Shutterstock
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Updated 06 October 2024
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Saudi Arabia’s petrochemical growth accelerates with strategic investments and Vision 2030

Saudi Arabia’s petrochemical growth accelerates with strategic investments and Vision 2030

RIYADH: Saudi Arabia’s rise as a global leader in the petrochemicals industry is a product of strategic foresight, substantial investments, and a commitment to economic diversification, experts have told Arab News. 

As the Kingdom seeks to reduce its dependence on oil revenue, its petrochemicals sector has emerged as a cornerstone of its industrial strategy, playing a pivotal role in Vision 2030.

Strategic investments, advanced infrastructure, and cost advantages have rapidly positioned the nation as a global leader in chemicals and plastics production, significantly boosting the sector in just a few years.

Hector Casas, principal at Arthur D. Little Middle East, highlighted in an interview with Arab News that Saudi Arabia’s petrochemical capacity is expected to “double in the next five years, from approximately 75 million tonnes per year to more than 140 million tonnes per year.”




Hector Casas, principal, Arthur D. Little Middle East (Supplied) 

The Kingdom’s access to competitive energy prices will drive this expansion and strengthen its position as a major player in the global petrochemical industry, making it exceptionally competitive in the sector.

“This growth encompasses projects in both basic petrochemical products and high-specialty products that add more value to the oil molecule,” he said.

Nadim Haddad, partner in the Energy Practice IMEA and global head of Oil and Gas at Oliver Wyman, added: “Saudi Arabia is acquiring assets globally in the petrochemical industry that will further cement its role as a pioneer and leader of the industry.”

The global petrochemical market is expected to grow significantly in the coming years, driven by rising demand for plastics, chemicals, and advanced materials in emerging markets. 

“Saudi Arabia is strategically positioned to capitalize on these opportunities, reinforcing its status as a global petrochemical powerhouse,” added Casas.

As part of Vision 2030, Saudi Arabia aims to diversify its economy, with the petrochemicals industry playing a key role in reducing reliance on oil and driving industrial growth through technological advancement and strategic partnerships.

Foundations of the petrochemical industry

The foundations of Saudi Arabia’s petrochemical industry are deeply intertwined with the history of its oil and gas sector. Following the discovery of vast oil reserves in the 1930s, the Kingdom quickly recognized the potential of petrochemicals as a means to add value to its hydrocarbon resources.

The establishment of Saudi Basic Industries Corporation – also known as SABIC – in 1976 marked a turning point, as the Kingdom began to channel its abundant natural gas resources into the production of chemicals and plastics.




Nadim Haddad, partner in the energy practice IMEA and global head of Oil and Gas, Oliver Wyman (Supply).jpg

SABIC has grown into one of the world’s largest and most diversified chemical companies, with operations spanning over 50 countries. Its success is driven by a strategic focus on vertical integration within the hydrocarbon value chain, allowing the company to produce a wide range of petrochemical products at competitive costs. 

This leadership not only reflects Saudi Arabia’s natural resource wealth but also its strategic investments in infrastructure, research, and human capital development.

Casas emphasized the significance of Saudi Arabia’s strategic investment in downstream petrochemical industries, particularly the acquisition of SABIC: “With the energy transition, the demand for oil as fuel will potentially start to decrease, while the demand for petrochemical-based products like plastics and synthetic fibers is increasing.”

He added: “Saudi Arabia is cognizant of this shift and understands that it possesses potentially more oil reserves than could be exploited, given expected trends in demand.”

Haddad highlighted the importance of the Kingdom’s integration with the oil and gas value chain which he said is built on the availability of feedstock to build an advantageous cost position on the global market.

“Jubail Industrial City, one of the largest industrial cities with state-of-the-art infrastructure, played a key role in building the foundation that helped accelerate the growth of the petrochemical industry,” Haddad explained.

Economic diversification and Vision 2030

The government’s focus on economic diversification is driving significant investments in the sector, including the development of new production facilities, the expansion of existing capacities, and the adoption of advanced technologies that enhance efficiency and sustainability.

Vision 2030 envisions Saudi Arabia as a global industrial hub, attracting foreign investment and fostering innovation in high-value industries. The petrochemicals industry, with its vast potential for value addition, is a key component of this vision. 

The Kingdom’s strategic location at the crossroads of Europe, Asia, and Africa, combined with its state-of-the-art infrastructure, makes it an ideal destination for investors seeking to capitalize on the growing demand for petrochemicals in emerging markets.

Haddad underscored the importance of downstream investments in this strategy: “Downstream investments in chemicals are one of the key pillars of Saudi Arabia’s industrialization strategy, creating the link between the petrochemical industry and end uses.”

He went on to explain that these investments will allow Saudi Arabia to capture the economic value-add that it was previously unable to capture, localize value chains, reduce reliance on imports, and increase the diversification of its exports.

Expanding production capacity and technological innovation

Saudi Arabia’s petrochemical sector has seen remarkable growth in recent decades, with production capacity reaching approximately 118 million tonnes annually. This has been driven by continuous investments in infrastructure, technology, and capacity expansion.

The Kingdom’s focus on producing more advanced specialty products, such as performance polymers, engineering plastics, and high-value chemicals, reflects its commitment to moving up the value chain and capturing a larger share of the global market.

Technological innovation plays a crucial role in the competitiveness of Saudi Arabia’s petrochemical industry. The Kingdom is investing heavily in research and development to drive innovation across the value chain.

SABIC’s dedicated R&D centers, located in strategic regions around the world, are at the forefront of developing new materials and processes that enhance efficiency, reduce environmental impact, and create value-added products. 

As Casas pointed out: “Saudi Arabia is very active in R&D and technology in the petrochemical sector. SABIC’s R&D program and Home of Innovation are a clear showcase of this.”

Moreover, Saudi Aramco, the world’s largest integrated energy and chemicals company, is making significant strides in integrating its upstream and downstream operations. 

The acquisition of a 70 percent stake in SABIC for $69.1 billion has further strengthened Aramco’s downstream capabilities, positioning it as a global leader in the production of petrochemicals. 

Casas noted the strategic impact of this acquisition: “The acquisition of SABIC by Aramco has not only positioned the latter as a major petrochemical player worldwide but also enabled significant optimization and synergies in procurement, supply chain, manufacturing, marketing, and sales.”

In terms of technological advancements, ADL’s expert highlighted four key fronts: “The development of mega-scale oil-to-chemical complexes, the focus on high-specialty chemicals, the digital transformation to drive efficiencies, and the emphasis on emissions reduction and sustainability.” 

These advancements are crucial for Saudi Arabia to maintain its competitive edge in the global market.

Strategic partnerships and international collaborations

Saudi Arabia’s petrochemical industry has benefited significantly from strategic partnerships and international collaborations. Joint ventures with leading global companies have been instrumental in bringing advanced technologies, expertise, and capital to the Kingdom. 

These partnerships have not only enhanced Saudi Arabia’s production capabilities but also facilitated the transfer of knowledge and technology, which is critical for the industry’s long-term growth.

One of the most notable examples of such collaboration is the Sadara Chemical Company, a joint venture between Saudi Aramco and Dow Chemical. 

Established with an investment of $20 billion, Sadara is the largest integrated chemical complex in the world built in a single phase. The facility produces a wide range of value-added chemicals and plastics, many of which are being produced in Saudi Arabia for the first time. 

Sadara’s success underscores the importance of international partnerships in driving innovation and expanding the Kingdom's petrochemical portfolio.

Haddad elaborated on the role of such partnerships: “Joint ventures and partnerships are not new to Saudi Arabia's petrochemical sector; there is a rich history of collaborations that have significantly accelerated the industry’s development.”

“These collaborations will facilitate the development of technologies that promote cleaner operations and products,” he added.

Environmental sustainability and green initiatives

Saudi Arabia’s petrochemical industry is increasingly focused on sustainability and reducing its environmental footprint. The Kingdom is investing in technologies that improve energy efficiency, reduce emissions, and enable the production of more sustainable products. 

Carbon capture, utilization, and storage is one area where Saudi Arabia is making significant advancements. By capturing carbon dioxide emissions from industrial processes and utilizing them in the production of chemicals and fuels, the Kingdom is reducing its carbon footprint while creating new revenue streams.

Green hydrogen is another area where Saudi Arabia is leading the way. The Kingdom’s abundant solar and wind resources provide a competitive advantage in the production of this fuel, which is produced using renewable energy sources. 

The development of the Neom Green Hydrogen Project is a key component of Saudi Arabia’s strategy to become a global leader in sustainable energy. 

The project aims to produce 650 tonnes of hydrogen per day by 2025, making it the largest such facility in the world.

“Saudi Arabia's petrochemical industry is firmly committed to integrating environmental sustainability into its operations,” Casas said, highlighting the Kingdom’s efforts in sustainability.

He added: “SABIC, for instance, has committed to achieving carbon neutrality from operations under its control by 2050 and is actively pursuing carbon capture technologies to decarbonize its operations.”


Tadawul’s market cap up 463% since 2014: S&P Global 

Tadawul’s market cap up 463% since 2014: S&P Global 
Updated 59 min 32 sec ago
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Tadawul’s market cap up 463% since 2014: S&P Global 

Tadawul’s market cap up 463% since 2014: S&P Global 

RIYADH: The market capitalization of Saudi Arabia’s Tadawul All Share Index reached $2.7 trillion at the end of 2024, representing a 10-year rise of 463 percent, according to an analysis. 

In its latest report, credit rating agency S&P Global said the stock market is expected to play a crucial role in materializing the Kingdom’s economic transformation goals outlined in Saudi Arabia’s Vision 2030 initiative. 

The US-based agency added that Tadawul, compared to other major global equity markets, remains dominated by large government-related entity issuers and has relatively low, albeit gradually increasing, trading volumes and foreign participation.

The Kingdom’s stock market has been crucial in steering the nation’s economic transformation efforts, fueled by robust economic reforms and growing interest from regional and international investors. 

In January, a report released by Kamco Invest said that Saudi Arabia led the Gulf Cooperation Council initial public offering market in 2024, earning a global ranking of seventh in total IPO proceeds.

In its analysis, S&P Global said Saudi Arabia has undertaken several reforms and market infrastructure investments over the past decade to grow its capital markets. 

“These reforms are crucial to further advance its Vision 2030 goal of increasing its economic, social, and cultural diversification,” it said, adding: “The stock exchange Tadawul’s inclusion in major emerging market equity indices in 2019 was a key milestone and over the past decade, its market capitalization has increased 463 percent.” 

IPO momentum

A bell is rung to signify the IPO of Saudi Aramco on Dec. 11, 2019. Getty

According to the report, one of the key milestones in Tadawul’s journey was the IPO of energy giant Saudi Aramco in 2019, which raised $29.4 billion, significantly elevating the exchange’s market capitalization and global standing.

Between 2014 and 2024, Tadawul’s main market hosted 91 IPOs for an aggregate offering of about $65 billion, excluding additional listings such as Aramco’s secondary offering of about $11.2 billion in July.

On May 6, a separate study by professional consulting firm EY also highlighted the growth of IPOs in Saudi Arabia’s main index and its parallel market, Nomu. 

According to EY, the Kingdom witnessed 12 IPOs in the first quarter of this year, with five listings on Tadawul and seven on Nomu. 

Overall, during the first three months of 2025, the main market generated $1.8 billion in total proceeds, while the parallel index raised $69 million.

Despite the IPOs of many private sector companies, public sector entities represent the bulk of new listings in Tadawul, S&P Global said in its latest report. 

The analysis added that government-backed firms have generated about $44 billion of the estimated $65 billion of aggregate IPO value over the past decade. 

“In addition to Aramco, Ades Holding and ACWA undertook IPOs of $1.2 billion each; Tadawul raised $1 billion in its own offering, in addition to other public-sector entities,” said S&P Global. 

Regulatory reforms

S&P Global further said that the efforts of Saudi authorities to further develop Tadawul will help attract domestic and international capital, which will increase market liquidity for the long term.

The large funding requirements for Vision 2030 projects are also expected to stimulate the stock exchange in Saudi Arabia. 

The report added that the holdings of foreign investors in Tadawul continue to rise but remain low — at about 4.2 percent of the market, or about 11 percent of the free float, as of year-end 2024. 

According to the analysis, Saudi Arabia’s ongoing initiatives to improve market liquidity and increase foreign shareholdings on Tadawul, such as a new investment law and pension fund reforms, should help grow portfolio inflows. 

In August, the Kingdom announced an updated investment law to enhance foreign direct investment flows. The Ministry of Investment stated that this would boost transparency and simplify the investment process.

The update promised enhanced protections for investors, including adherence to the rule of law, fair treatment, and property rights, alongside robust safeguards for intellectual property and seamless fund transfers. 

“Although a key objective of the new regulation is to improve foreign direct investment flows, we expect it will also support inflows to capital markets, including to Saudi equities,” said the report. 

Regarding the growing pension funds in Saudi Arabia, S&P Global said that reforms in this sector could advance the development of equity markets in the Kingdom. 

“The authorities have implemented several important changes to the country’s pension system in recent years. Pension systems are important funding and liquidity providers as long-term investors in capital markets worldwide. Over the past few decades, we have seen many examples of pension funds playing a key role in the development of local capital markets,” said the analysis. 

In 2021, Saudi Arabia merged its private sector pension fund with the General Organization for Social Insurance, the public sector pension system. 

According to 2023 disclosures, GOSI had about $129 billion, or about 12 percent of the gross domestic product, invested in Saudi equities. 

In 2024, the Kingdom announced additional reforms, which include raising the retirement age to 65 from 58. 

“Saudi Arabia also increased the required contribution period to qualify for early retirement to 30 years from 25 years, which we believe will increase the average contribution period and hence investable period for GOSI. Given GOSI’s size and investments in the local equity market, this will support long-term local demand for Tadawul and its liquidity,” added S&P Global. 

The report added that equity markets will allow the economy to diversify sources of funding for the Vision 2030 program, as the financing needs for giga- and mega projects are estimated to cost more than $1 trillion. 

According to S&P Global, the government and the Public Investment Fund will raise new debt of about $60 billion, or 4.9 percent of GDP, annually from 2025 to 2028.

The study added that banks in Saudi Arabia will witness a robust credit growth of 10 percent during the same period, driven primarily by corporate lending related to Vision 2030. 

“However, these will likely be insufficient to meet all the funding requirements. Growth in equity markets will enable companies and financial institutions to allocate more capital toward investments while managing leverage,” said the report.


IATA backs Saudi-led aviation surge amid regional integration push 

IATA backs Saudi-led aviation surge amid regional integration push 
Updated 07 May 2025
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IATA backs Saudi-led aviation surge amid regional integration push 

IATA backs Saudi-led aviation surge amid regional integration push 

JEDDAH: The Middle East’s aviation sector is pushing toward greater integration and collaborative innovation, with Saudi Arabia’s rapid expansion positioning it as the region’s benchmark, according to a senior International Air Transport Association official. 

Kamil Al-Awadhi, IATA’s regional vice president for Africa and the Middle East, told Arab News that growth in the Gulf Cooperation Council is outpacing all other regions — and the Middle East could soon lead the global aviation industry. 

His remarks came during IATA Aviation Day MENA 2025 — held for the first time in Saudi Arabia in Jeddah from May 6 to 7 — where industry leaders gathered to explore how regional collaboration and harmonized regulation can unlock aviation’s full potential. 

Al-Awadhi credited the region’s resilience to unified political leadership and coordinated aviation strategies. 

“After the COVID-19 pandemic subsided in 2022, airlines in the Middle East resumed smooth operations, as if airports had not been closed at all. In contrast, carriers in Europe and the US struggled for several months to return to normal operations,” he said. 

Al-Awadhi added: “Saudi Arabia is not only expanding its aviation infrastructure, but it is also investing in its people. This is vital to meet the immediate skills requirements while developing a professional workforce able to deliver on Vision 2030.” 

The official acknowledged the region’s operational strength but pointed to the lack of sufficient stakeholder dialogue. “The main goal of this event is to bring the region’s aviation sectors together to discuss their challenges and collectively work toward improvement,” the IATA official said. 

Nick Careen, IATA’s senior vice president for operations, safety, and security, said the Middle East was poised to outpace global air traffic growth over the next two decades. “Looking ahead, global air travel is set to grow at 3.3 percent per year for the next 20 years. But the Middle East will grow faster at 4.8 percent,” he said during his keynote. 

The event took place just days after IATA released its latest global passenger traffic data, showing industry-wide revenue passenger kilometers rose 3.3 percent year-on-year in March, reaching 738.8 billion — continuing the trend of subdued single-digit growth seen since 2023. 

Nick Careen, IATA’s senior vice president for operations, safety, and security. Supplied

Careen emphasized Saudi Arabia’s pivotal role in the region’s aviation transformation. “The sector is not just moving forward — it’s moving forward at speed. And that should make everyone in this room take notice.” 

He noted that aviation and aviation-related tourism contributed $90.6 billion to the Kingdom’s gross domestic product — representing 8.5 percent — and supported 1.4 million jobs. “More than 62,000 people are directly employed by airlines, and another 79,000 are working in the broader aviation ecosystem. In 2023, Saudi Arabia handled over 713,000 tonnes of air cargo,” he said. 

According to Careen, this progress is being driven by Crown Prince Mohammed bin Salman’s Vision 2030 plan, which places aviation at the heart of economic diversification and international connectivity. “We have seen it in the development of new airports, the digital push, the workforce development, and the launch of national carriers like Riyadh Air,” he said. 

Abdulaziz bin Al-Duailej, president of the General Authority of Civil Aviation, described the Middle East as an economy worth $9.48 trillion powered by a young population, adding: “Aviation here is not only enabling growth; it is leading transformation through strategic investment and collaboration.” 

He continued: “By 2024, passenger traffic across the Middle East exceeded pre-pandemic levels by 9 percent — more than double the global growth rate. While Saudi Arabia’s civil aviation sector recorded a remarkable increase of over 24 percent compared to pre-pandemic levels.” 

Industry leaders gathered in Jeddah. Supplied

The Kingdom’s growth has been marked by major achievements. In 2024 alone, Saudi Arabia handled 128 million passengers, more than 900,000 flights, and 1.2 million tonnes of cargo. The government has ordered 500 new aircraft and attracted 21 new international airlines into its market. 

“The Kingdom’s aviation market is opening rapidly. In the past year alone, 21 new international airlines have entered the Saudi market, and in the first quarter of 2025, foreign carriers carried 63 percent of international passengers,” Al-Duailej said, reaffirming the Kingdom’s willingness to engage globally to shape the sector’s future. 

In its latest press release, IATA outlined three strategic priorities to help Saudi Arabia sustain its aviation gains: improving coordination with stakeholders, ensuring cost-effective infrastructure development, and building national talent. 

“Given Saudi Arabia’s important role in shaping regional aviation policies, continued collaboration and consultation with users and stakeholders, along with alignment to global standards and best practices, are vital,” the organization said. 

It also emphasized the need for cost-competitiveness. “As Saudi Arabia makes significant investments in airport infrastructure and digitalization, it is critical to work with the industry to ensure cost competitiveness,” IATA added. 

On workforce development, the group noted: “Ensuring a skilled workforce across all areas of aviation will enable the Kingdom to fulfill its potential as a regional and global aviation hub.” 

On the sidelines of the forum, IATA announced new training agreements with Saudi airlines, airports, and academic institutions. In the first phase, more than 1,000 graduates and aviation professionals will be trained in areas such as airport operations, safety, airline management, and ground handling. 

Riyadh Airports Co. and Qassim University joined IATA’s network of regional training partners, alongside long-time collaborator Prince Sultan Aviation Academy. Together, the three will deliver over 60 programs covering technical, commercial, and interpersonal skills. 

“The renewed agreement enables the academy to offer IATA training courses within the Kingdom and across the GCC region. All operational aviation requirements — including cabin crew, maintenance, ground services, and business training — are provided by PSAA,” said Khalid Bawazeer, the academy’s director of continuous studies, to Arab News. 

“This requires preparation to meet the demand for increased training programs, whether conducted internally by the academy or through external courses such as those offered by IATA,” he added. 

As part of the deal, sector awareness courses will also be offered to graduates of Riyadh Air and Saudia to nurture national talent for future leadership. Specialized Dangerous Goods training will be provided to operational staff from the Saudi Civil Aviation Academy. 

SAL Logistics Services Co. marks its new agreement at the event. Supplied

In addition, SAL Logistics Services Co. has been accredited as a competency-based training and assessment center, and Saudi Ground Services has renewed its CBTA accreditation. 

The IATA’s Careen acknowledged that despite the Kingdom’s progress, aviation development remains uneven across the Middle East due to persistent geopolitical instability. 

He pointed to challenges in Yemen, Syria, Iraq, and Lebanon, where conflict and sanctions have suppressed growth. “Where aviation continues to demonstrate remarkable resilience in the face of political instability, it does far better in countries that are stable, peaceful and open,” the official said. 

Careen called on governments and regulators to align efforts toward a more integrated and forward-looking aviation environment. “A Middle East characterized by open skies, harmonized regulations, and shared innovation,” he said, is critical to long-term success. 

“To every government, airline, and civil aviation authority in this room, your success is everyone’s success. A rising tide lifts all boats, and in this case, all planes,” he said. 

Ibrahim Al-Omar, director general of Saudia Group, the host of the event, said the forum was a valuable opportunity to showcase how Vision 2030 is reshaping regional aviation. 

“With safety, innovation, and sustainability driving our progress, IATA Aviation Day MENA is a valuable platform to showcase how the Kingdom’s Saudi Vision 2030 is shaping the future of aviation not only across the Kingdom but the region and beyond,” he said in a statement released a day prior to the event.


Saudi POS spending hits $4bn, fueled by increased spending across all sectors

Saudi POS spending hits $4bn, fueled by increased spending across all sectors
Updated 7 min 4 sec ago
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Saudi POS spending hits $4bn, fueled by increased spending across all sectors

Saudi POS spending hits $4bn, fueled by increased spending across all sectors

RIYADH: Saudi Arabia’s point-of-sale transactions climbed 36.2 percent to SR15.4 billion ($4.1 billion) in the week ending May 3, driven by increased spending across all sectors. 

The latest data from the Kingdom’s central bank, also known as SAMA, showed that education led the growth, registering the largest jump in transaction value, up 74.7 percent to SR239.7 million. The sector also saw a 32.4 percent rise in the number of transactions, reaching 192,000.

The clothing and footwear sector followed, recording a 51.2 percent increase in transaction value to SR917.6 million. Telecommunication spending ranked next, rising 45.1 percent to SR136.4 million, with transactions up 37.3 percent to 3.4 million.

Food and beverages — the sector with the biggest share of total POS value — recorded a 44.9 percent increase to SR2.4 billion.

Transportation spending rose 27.9 percent to SR852 million, while restaurants and cafes saw a 28.8 percent increase, totaling SR2.1 billion and claiming the second-biggest share of this week’s POS.

The smallest spending gains were on jewelry, rising by 12.6 percent to SR361 million, and construction and building materials, which increased by 13.1 percent to SR354.7 million.

The health and public utilities sectors also saw upward changes, increasing by 30.2 percent and 28.8 percent to reach SR953.3 million and SR56.5 million, respectively.

Spending on electronics followed the trend, rising 24 percent to SR189.3 million, and recreation and culture edging up by 38.6 percent to SR291.6 million. 

Miscellaneous goods and services claimed the third-largest share of total transactions value, with an uptick of 41.3 percent to SR1.9 billion.

The top three categories — food and beverages, miscellaneous goods and services, and clothing and footwear — accounted for 41.5 percent of the week’s total spending, amounting to SR6.4 billion. 

Geographically, Riyadh dominated POS transactions, with expenses in the capital reaching SR5.2 billion, a 28.5 percent increase from the previous week. 

Jeddah followed with a 27.2 percent rise to SR2.1 billion, while Dammam ranked third, up 28.1 percent to SR772 million. Hail saw the biggest increase, inching up 60.8 percent to SR268.9 million, followed by Tabuk with a 60.6 percent uptick to SR325.2 million.

Hail recorded 4.5 million deals in transaction volume, up 33 percent, while Tabuk reached 5.4 million transactions, rising 29 percent.


Lucid sticks to annual production forecast even as tariff woes hit automakers

Lucid sticks to annual production forecast even as tariff woes hit automakers
Updated 07 May 2025
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Lucid sticks to annual production forecast even as tariff woes hit automakers

Lucid sticks to annual production forecast even as tariff woes hit automakers

LONDON: Lucid stuck to its 2025 production forecast on Tuesday despite the threat of tariffs forcing many automakers to pull back targets, while the luxury electric-vehicle maker reported first-quarter revenue below analysts’ expectations.

Demand for pure battery cars in the US has been slowing as consumers, hit with high interest rates and recession worries, gravitate toward cheaper hybrids.

Lucid — majority-owned by Saudi Arabia’s Public Investment Fund— lowered the prices of its vehicles and offered incentives, including cheaper financing, to entice customers to its Air sedans that start at about $70,000 in the US.

The company said it would produce nearly 20,000 vehicles this year, while Wall Street expects it to manufacture 18,370, according to an average of five analysts by Visible Alpha.

Revenue for the quarter ended March 31 was $235 million, compared with analysts’ average estimate of $248.9 million, data compiled by LSEG showed.

Lucid, which has been focusing on cutting costs, posted an adjusted net loss per share of 20 cents, narrower than the 27-cent loss a year ago.

The company is gearing up to expand its product line with a mid-size car expected to roll out next year, targeting a $50,000 price point, aiming to broaden its customer base and strengthen its position in the competitive EV sector.

Success of Lucid’s recently launched Gravity SUV, along with the midsize, is seen as crucial to its long-term outlook, as the company burns through cash ramping up production.

US automakers are grappling with tariffs imposed by President Donald Trump on vehicle and auto parts imports. The tariffs are expected to disrupt supply chains and raise prices of automobiles.

Automakers, including Tesla, have said they were reassessing their full-year targets in the face of tariff uncertainty.

Last week, Trump signed two orders to soften the blow of his auto tariffs, with a mix of credits and relief from other levies on materials.

In September 2023 it launched its first international manufacturing plant in Saudi Arabia.

Located in King Abdullah Economic City, the facility can currently assemble 5,000 Lucid vehicles annually during its first phase.

Once fully operational, it is expected to produce up to 155,000 electric cars per year.  


Oil Updates — crude rises as market eyes US-China trade talks, lower US output

Oil Updates — crude rises as market eyes US-China trade talks, lower US output
Updated 07 May 2025
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Oil Updates — crude rises as market eyes US-China trade talks, lower US output

Oil Updates — crude rises as market eyes US-China trade talks, lower US output

SINGAPORE: Oil prices rose on Wednesday, holding slightly above recent four-year lows, as investors focused on US-China trade talks and signs of lower US production.

Brent crude futures climbed 61 cents a barrel, or around 1 percent, to $62.76 a barrel by 12:09 p.m. Saudi time, while US West Texas Intermediate crude was up 71 cents, or 1.2 percent, at $59.8 a barrel. 

Both benchmarks plunged to a four-year low recently after OPEC+’s decision to speed up output increases, stoking fears of oversupply at a time when US tariffs have increased concerns about demand.

“News that the US and China will start trade talks this weekend has Brent crude trading higher, extending a relief rally in oil,” said commodities strategists at ING on Wednesday.

“Yet while negotiations would help improve sentiment in the oil market, we’ll need to see significant progress on lowering tariffs to improve the demand outlook,” ING added.

Meanwhile, lower oil prices in recent weeks have prompted some US energy firms including Diamondback Energy and Coterra Energy to announce rig reductions, which analysts said should support prices over time by reducing output.

The latest announcements suggested output will weaken in the coming months, said ANZ Bank senior commodity strategist Daniel Hynes. “We warned last month that falling prices and declining drilling activity was raising the risk of US oil output falling.”

Crude stocks fell by 4.5 million barrels in the week ended May 2, market sources said, citing American Petroleum Institute figures on Tuesday.

US government data on stockpiles is due at 5:30 p.m. Saudi time. Analysts polled by Reuters expect, on average, an 800,000 barrel decline in US crude oil stocks for last week.

Prices also drew support from signs of demand improving. Consumers in China increased spending during the May Day celebration and as market participants returned after the five-day holiday.

In Europe, companies are expected to report growth of 0.4 percent in first-quarter earnings, an improvement over the 1.7 percent drop analysts had expected a week ago.

The Federal Reserve is widely expected to leave US interest rates unchanged on Wednesday as tariffs roil the economic outlook.