Saudi Arabia’s annual inflation rate rises to 1.5%: GASTAT

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Updated 16 July 2024
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Saudi Arabia’s annual inflation rate rises to 1.5%: GASTAT

RIYADH: Saudi Arabia’s annual inflation rate reached 1.5 percent in June compared to the same month last year, driven primarily by rising housing costs, according to the latest data. 

The report from the General Authority for Statistics highlighted that the 8.4 percent increase in the prices of housing, water, and electricity, as well as gas, and other fuels significantly contributed to the inflation rate. 

Actual housing rents saw an increase of 10.1 percent, with villa rentals rising by 7.9 percent. This category’s substantial weight in the overall index had a considerable impact on the inflation rate. 

Saudi Arabia’s inflation rate, while influenced by domestic factors such as housing and fuel costs, remains relatively moderate compared to other Gulf Cooperation Council countries, which have faced varying inflationary pressures due to different economic policies and market conditions. 

According to the GASTAT report, food and beverage prices also saw an increase of 1.1 percent, influenced by a 6.5 percent rise in vegetable prices. The prices of restaurants and hotels rose by 2.4 percent, driven by a 9.8 percent increase in accommodation services.  

The education sector witnessed a 1.1 percent increase, mainly due to a 4.1 percent rise in fees for intermediate and secondary education. 

Conversely, the prices of furnishing and home equipment decreased by 3.7 percent, influenced by a 6.0 percent decline in furniture, carpets, and flooring prices.  

Clothing and footwear prices dropped by 3.6 percent, with ready-made clothing prices falling by 6.3 percent.  

Transportation costs also decreased by 2.7 percent, primarily due to a 4.6 percent reduction in vehicle purchase prices. Communication services saw a slight drop of 0.1 percent. 

Monthly inflation 

On a monthly basis, the consumer price index recorded a slight increase of 0.1 percent in June compared to the previous month.  

This monthly increase was mainly influenced by the rise in housing, water, electricity, gas, and other fuels by 0.5 percent, driven by a 0.7 percent increase in actual housing rents and prices. 

The report also noted minor increases in food and beverages with 0.1 percent, restaurants and hotels, and personal goods and services with 0.3 percent each, compared to the previous month.  

Meanwhile, the prices of clothing and footwear decreased by 0.2 percent. Furnishings, household equipment, and maintenance saw a decline of 0.5 percent. Recreation and culture prices dropped by 0.3 percent, while communications also fell by 0.3 percent. Health expenses decreased by 0.1 percent, and tobacco prices went down by 0.2 percent. 

The prices of education and transportation products remained stable. 

Wholesale price index 

In another report, GASTAT revealed that the wholesale price index increased by 3.2 percent in June compared to the same month of the previous year.  

This increase was mainly driven by a 13.4 percent rise in prices of basic chemicals and an 11.9 percent increase in prices of refined petroleum products.  

The category of other transportable goods saw an 8.0 percent increase, significantly impacted by these price rises.  

Prices of food products, beverages, tobacco, and textiles rose by 1.3 percent, with leather, leather products, and footwear prices increasing by 6.6 percent, and grain mills, starch, and other food products rising by 4.6 percent. 

However, on a monthly basis, the WPI decreased by 0.1 percent in June compared to May, attributed to a 0.3 percent decrease in the prices of ores and minerals, food products, beverages, tobacco, and textiles.  

The prices of basic metals decreased by 0.6 percent, while prices of agriculture and fishery products increased by 0.4 percent, driven by a 1.8 percent rise in the prices of live animals and animal products. 

Average prices  

In a separate bulletin from the GASTAT, notable shifts in the average prices of goods and services across Saudi Arabia for June were revealed.  

The data, which tracks price movements on a monthly basis, highlighted both increases and decreases in various categories, reflecting dynamic market conditions. 

Several goods and services recorded substantial price increases in June compared to May.  

Furnished apartments saw the highest increase at 22.47 percent, followed by hotel accommodation at 20.38 percent, Indian pomegranates at 8 percent, local cucumbers at 7.24 percent, and local fig at 7.23 percent. 

The prices of 99mm, 300mm, and 120mm national electric cables increased by 3.39 percent, 3.37 percent, and 3.10 percent, respectively. 

Conversely, several items experienced significant price drops during the same period. Local melons saw the highest decrease at 16.39 percent, followed by imported onions at 14.15 percent, local onions at 11.52 percent, Lebanese peach at 9.51 percent, and Pakistani mango at 8.79 percent.  

Aluminum slightly decreased by 0.92 percent, 6mm national reinforcing iron by 0.80 percent, coal by 0.10 percent, and 15cm black block by 0.02 percent. 

These reports provide a comprehensive overview of the price movements in Saudi Arabia, reflecting the diverse factors influencing inflation and the cost of living in the Kingdom. The data highlighted the complexity of the economic landscape, with significant variations across different sectors and categories. 


Oil Updates — crude set for 2nd straight weekly gain on Iran sanctions, planned OPEC+ cuts

Updated 9 sec ago
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Oil Updates — crude set for 2nd straight weekly gain on Iran sanctions, planned OPEC+ cuts

NEW YORK/SINGAPORE: Oil prices rose on Friday, and were set for second consecutive weekly gains, as fresh US sanctions on Iran and a new plan from OPEC+ to cut output raised bets on tighter supply.

Brent crude futures climbed 14 cents, or 0.2 percent, to $72.14 per barrel by 9:42 a.m. Saudi time. US West Texas Intermediate crude futures were up 16 cents, also 0.2 percent, to $68.23 a barrel.

On a weekly basis, both Brent and WTI were on track to rise about 2 percent, their biggest weekly gains since the first week of 2025.

The US Treasury on Thursday announced new Iran-related sanctions, which for the first time targeted an independent Chinese refiner among other entities and vessels involved in supplying Iranian crude oil to China.

The sanctions on Chinese entities were “a clear escalation in sanctions policy,” analysts at RBC Capital Markets said in a note on Friday.

“While the physical implications are minimal, we think it reasonable that risk premium here is taken more seriously,” they wrote.

That marked Washington’s fourth round of sanctions against Iran since US President Donald Trump in February promised to reimpose a “maximum pressure” campaign on Tehran, pledging to drive the country’s oil exports to zero.

Analysts at ANZ Bank said they expect a 1 million barrels per day reduction in Iranian crude oil exports because of tighter sanctions. Vessel tracking service Kpler pegged Iranian crude oil exports at over 1.8 million bpd in February.

Oil prices were also supported by a new OPEC+ plan announced Thursday for seven members to further cut output to make up for producing more than agreed levels. The plan would represent monthly cuts of between 189,000 bpd and 435,000 bpd, and will last until June 2026.

OPEC+ earlier this month confirmed that eight of its members would proceed with a monthly increase of 138,000 bpd from April, reversing some of the 5.85 million bpd of output cuts agreed in a series of steps since 2022 to support the market.

“While the group shares a plan for compensation cuts, it certainly doesn’t mean members will follow it. A handful of members have consistently produced above their target production levels,” ING analysts said in a note on Friday. 


Closing Bell: Saudi main index closes in green at 11,760

Updated 20 March 2025
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Closing Bell: Saudi main index closes in green at 11,760

RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Thursday, gaining 50.89 points, or 0.43 percent, to close at 11,760.32.

The total trading turnover of the benchmark index was SR5.89 billion ($1.57 billion), as 123 of the listed stocks advanced, while 109 retreated.   

The MSCI Tadawul Index increased by 6.13 points, or 0.41 percent, to close at 1,490.20.

The Kingdom’s parallel market Nomu dipped, losing 162.11 points, or 0.53 percent, to close at 30,521.53. This comes as 43 of the listed stocks advanced while 31 retreated.

The best-performing stock was Rabigh Refining and Petrochemical Co., with its share price surging by 9.87 percent to SR7.68.

Other top performers included Retal Urban Development Co., which saw its share price rise by 4.96 percent to SR16.50, and Ades Holding Co., which saw a 4.38 percent increase to SR16.70.

The worst performer of the day was Sinad Holding Co., whose share price fell by 6.91 percent to SR12.40.

Gulf General Cooperative Insurance Co. and SICO Saudi REIT Fund also saw declines, with their shares dropping by 6.19 percent and 5.18 percent to SR9.55 and SR3.66, respectively.

On the announcements front, Amwaj International Co. announced its financial results for 2024, with net profits reaching SR6.3 million, down by 60.1 percent compared to the previous year.

In a statement on Tadawul, the company attributed the decrease to restructuring inventory and marketing mix to accommodate new technology, which has a higher demand level and profit margin than before. 

“The addition of new products will positively impact sales and results for 2025 and will boost cash flow,” the statement said.

In another announcement, Gulf General Cooperative Insurance Co. revealed its annual financial results for 2024.

The company’s insurance revenues in 2024 reached SR414.3 million, up from SR315.6 million in the previous year, marking a 31.2 percent surge. 

This was principally driven by business growth and an increase in the motor line of business, according to a statement by the firm.

In today’s trading session, the group’s shares traded 6.19 percent lower on the main market to close at SR9.55.

Saudi Printing and Packaging Co. also announced its annual financial results for last year.

The company’s net loss surged to SR219.4 million from SR132.3 million in the previous year due to establishing a provision for credit losses in trade receivables and recording impairment in fixed assets, inventory, and goodwill.

In Thursday’s session, the firm’s shares traded 2.43 percent lower on the main market to close at SR10.42.

On another note, Saudi Industrial Investment Group has announced that its board of directors has recommended a share buyback of up to 11 million ordinary shares, subject to approval by the Extraordinary General Assembly. 

In a statement on Tadawul, the group said that the buyback aims to hold 10 million shares as treasury while allocating 1 million shares to the company’s long-term employee incentives program. 

The repurchase will be financed through internal resources, and the acquired shares will not carry voting rights in General Assembly meetings.

SIIG will comply with regulatory solvency requirements, with a solvency report from external auditors to be included in the EGA approval process.

In today’s trading session, SIIG’s shares traded 1.72 percent higher on the main market to close at SR15.36.


Saudi Aramco unveils direct air capture tech to reduce emissions

Updated 20 March 2025
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Saudi Aramco unveils direct air capture tech to reduce emissions

JEDDAH: Saudi Aramco has unveiled the Kingdom’s first direct air capture test unit, marking a significant milestone in its mission to reduce emissions and advance carbon capture technology for a sustainable future.

The unit is capable of removing 12 tonnes of carbon dioxide from the atmosphere each year, according to an official statement from Aramco.

As the world’s leading integrated energy and chemicals company, Aramco emphasized that the pilot plant, developed in partnership with Siemens Energy, represents a crucial step in enhancing DAC capabilities.

Ali A. Al-Meshari, Aramco’s senior vice president of technology oversight and coordination, highlighted that direct carbon dioxide capture technologies will play a pivotal role in mitigating greenhouse gas emissions, particularly in industries that are difficult to decarbonize.

“The test facility launched by Aramco is a key step in our efforts to scale up viable DAC systems, for deployment in the Kingdom of Saudi Arabia and beyond. In addition to helping address emissions, the CO2 extracted through this process can in turn be used to produce more sustainable chemicals and fuels.” Al-Meshari said.

The development is in line with Saudi Arabia’s commitment to achieving net-zero emissions by 2060, following a circular carbon economy approach that emphasizes reducing, reusing, recycling, and removing carbon.

This initiative also supports the Saudi Green Initiative, which aims to reduce carbon emissions by 278 million tonnes annually by 2030 and transition 50 percent of the country’s energy sources to renewables.

The project reflects Aramco’s strong commitment to carbon capture, a critical component of its goal to achieve net-zero Scope 1 and Scope 2 greenhouse gas emissions across its wholly-owned and operated assets by 2050.

Aramco plans to use the new facility as a testing ground for next-generation CO2 capture materials specifically designed for Saudi Arabia’s unique climate. Additionally, the company aims to drive down costs, promoting the quicker adoption of DAC technologies in the region.

As part of its circular carbon economy strategy, Aramco is exploring methods for capturing CO2 both at emission sources and directly from the atmosphere, incorporating cutting-edge technological solutions, as stated in the company’s announcement.

In partnership with Siemens Energy, Aramco intends to scale up the technology and lay the groundwork for large-scale DAC facilities in the future.

Furthermore, the DAC test facility launch comes shortly after Aramco, along with its partners Linde and SLB, signed a shareholders’ agreement to develop a carbon capture and storage hub in Jubail. Phase one of the hub will have the capacity to capture 9 million tonnes of CO2 from three Aramco gas plants and other industrial sources.

In October 2023, Saudi Aramco announced its collaboration with major international companies to develop emissions reduction solutions, including lower-carbon hydrogen, direct air capture of CO2, and an innovative approach to CO2 storage.


Saudi Arabia’s US Treasury holdings see $10.6bn adjustment

Updated 20 March 2025
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Saudi Arabia’s US Treasury holdings see $10.6bn adjustment

RIYADH: Saudi Arabia’s holdings of US Treasury securities stood at $126.9 billion in January, reflecting a $10.6 billion decrease from December, according to the latest US Treasury data. 

This marks a 7.71 percent month-on-month decline.

The change could reflect market fluctuations or potential portfolio rebalancing as the Kingdom navigates global economic conditions.

Official data showed that Saudi Arabia retained its 17th position among the largest holders of US Treasury securities in January. It remains the only Gulf Cooperation Council country to rank among the top 20 holders. 

In a press release, the US Department of the Treasury said: “The sum total in January of all net foreign acquisitions of long-term securities, short-term US securities, and banking flows was a net TIC (Treasury International Capital) outflow of $48.8 billion. Of this, net foreign private outflows were $74.8 billion, and net foreign official inflows were $26.0 billion.” 

The Kingdom’s holdings rose 1.4 percent in December compared to November, the report noted. 

Saudi Arabia’s portfolio was split between $105.3 billion in long-term bonds — accounting for 83 percent of the total — and $21.6 billion in short-term bonds, representing 17 percent. 

The press release noted that foreign residents increased their holdings of long-term US securities by $200 million, with private investors buying $59.2 billion, while foreign official institutions recorded net sales of $59 billion.

US residents also increased their holdings of long-term foreign securities, with net purchases totaling $45.4 billion. 

Meanwhile, foreign residents boosted their US Treasury bill holdings by $32.3 billion, contributing to a $53.9 billion rise in total dollar-denominated short-term US securities. 

Conversely, banks’ net dollar-denominated liabilities to foreign residents dropped by $57.5 billion. 

Top holders of US Treasury bonds 

Japan remained the largest investor in US Treasury securities in January, with holdings totaling $1.07 trillion, a 1.9 percent increase from December. 

China ranked second with $760.8 billion in holdings, followed by the UK at $740.2 billion. Luxembourg and the Cayman Islands were ranked fourth and fifth on the list, with treasury holdings amounting to $409.9 billion and $404.5 billion. 

Belgium secured the sixth spot with holdings worth $377.7 billion, closely followed by Canada with portfolios of $350.8 billion. 

France came in eighth with treasury reserves worth $335.4 billion, followed by Ireland and Switzerland, with assets amounting to $329.7 billion and $301.1 billion, respectively. Taiwan was ranked 11th on the list, with treasury holdings worth $290.4 billion. 

Hong Kong occupied the 12th spot with assets amounting to $255.9 billion, followed by Singapore and India, with holdings worth $247.6 billion and $225.7 billion, respectively. 

Brazil held US treasury holdings worth $199.1 billion by the end of January. Norway followed with its holdings standing at $173.1 billion. 


2.5m Syrians in Saudi Arabia to benefit from Dammam-Damascus flights

Updated 20 March 2025
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2.5m Syrians in Saudi Arabia to benefit from Dammam-Damascus flights

JEDDAH: Over 2.5 million Syrian residents in Saudi Arabia will benefit from direct flights between Dammam and Damascus, reconnecting families and enhancing transport between the two countries.

Routes between the two cities resumed on March 19 after a 13-year hiatus, with a Syrian Air plane departing King Fahd International Airport in Dammam for Damascus.

The morning flight complements the direct service from the Kingdom’s three major cities to Syria after Syrian Air resumed operations at Saudi airports last year.

Passenger flights between the two countries were halted in 2012 when Riyadh severed ties with Damascus over Bashar Assad’s crackdown on anti-government protesters at the start of the country’s civil war.

Services between Syria and the Kingdom resumed temporarily in May for pilgrims participating in the annual Hajj pilgrimage. The first group of 270 Syrian travelers arrived in Jeddah on May 28, just a few days after Saudi Arabia appointed Faisal bin Saud Al-Mujfel as its ambassador to Syria.

Commercial flights between Saudi Arabia and Syria resumed in July following a 12-year freeze amid improving relations. A Syrian Air plane carrying 170 passengers from Damascus landed in Riyadh, marking the return of regular services. 

This was followed by the reinstatement of flights between Damascus and King Abdulaziz International Airport in Jeddah in November. 

Mohammed Ayman Soussan, Syria’s ambassador to the Kingdom, who took office in Riyadh in January 2024, said the two countries had agreed to operate one round-trip flight per week between the two capitals.

After the diplomatic gap, Saudi Arabia and Syria agreed to resume consular services in April 2023 and restored full relations in May 2023. 

Global flights resumed at Damascus International Airport in January for the first time since the ouster of President Bashar Assad last month.

Saudi Arabia has sent relief planes to Syria following the fall of the former president to assist with the ongoing crisis. These humanitarian efforts, organized by the King Salman Humanitarian Aid and Relief Center, also known as KSrelief, have delivered essential supplies, including food, shelter, and medical aid, to help the Syrian people cope with their challenging circumstances.

Additional flights to Syrian destinations are expected soon, following the reopening of Aleppo International Airport — the country’s second major airport — after nearly three months of closure.

The airport was closed in November during the offensive by rebel groups against the regime of Bashar Assad in early December.