Old partner Japan back as sun rises on new day for oil



Japan first became a partner for Gulf oil producers in the 1950s, when this region was just breaking the stranglehold of the western multinationals on oil revenues.

Taro Yamashita, a politically connected entrepreneur, managed to secure Japan's first concessions in Saudi Arabia and Kuwait by undercutting the majors.

It marked the first time Gulf oil producers would receive a majority stake in their own natural resources, and was a sign that the forces of history were moving against the "Seven Sisters" towards the creation of Opec.

The contracts turned out to be a boon for Japan, which used decades of relatively cheap oil to fuel a post-war economic miracle.

Fast-forward five decades and things have changed quite a bit.

Oil prices are above US$100 a barrel. These revenues are helping to transform the Gulf, but are acting as a brake on economic growth elsewhere. Even so, companies from the East and West are queueing up for the few foreign concessions still available in the world's most prolific petroleum basin.

BP, Royal Dutch Shell, ExxonMobil and Total have concessions expiring over the next few years and all appear keen to stay on, even though they receive just $1 (Dh3.67) for every barrel they produce. New players such as Statoil from Norway, OMV of Austria and Maersk of Denmark are all seeking to gain a foothold.

For Abu Dhabi, the choice of partners in its economic mainstay reflects a range of interests. The emirate benefits if the world's military powers have a shared interest in the security of its land and sea; its markets are made more secure by allowing customers to join in production; and its industry is kept at the cutting edge of technology by choosing partners with a history of innovation and technical success.

But with 98 billion barrels in its underground bank, enough for more than a century of production at current rates, the emirate is expected to drive a hard bargain.

Japan is once again back in the Gulf signing oil concessions, but the terms will be less favourable.

COMPANY PROFILE

Company: Eco Way
Started: December 2023
Founder: Ivan Kroshnyi
Based: Dubai, UAE
Industry: Electric vehicles
Investors: Bootstrapped with undisclosed funding. Looking to raise funds from outside

Company Profile

Company name: Cargoz
Date started: January 2022
Founders: Premlal Pullisserry and Lijo Antony
Based: Dubai
Number of staff: 30
Investment stage: Seed

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

A Dog's Journey 

Directed by: Gail Mancuso

Starring: Dennis Quaid, Josh Gad, Marg Helgenberger, Betty Gilpin, Kathryn Prescott

3 out of 5 stars

The Bio

Amal likes watching Japanese animation movies and Manga - her favourite is The Ancient Magus Bride

She is the eldest of 11 children, and has four brothers and six sisters.

Her dream is to meet with all of her friends online from around the world who supported her work throughout the years

Her favourite meal is pizza and stuffed vine leaves

She ams to improve her English and learn Japanese, which many animated programmes originate in

Biog:

Age: 34

Favourite superhero: Batman

Favourite sport: anything extreme

Favourite person: Muhammad Ali 

RIVER SPIRIT

Author: Leila Aboulela 

Publisher: Saqi Books

Pages: 320

Available: Now

THE BIO

Family: I have three siblings, one older brother (age 25) and two younger sisters, 20 and 13 

Favourite book: Asking for my favourite book has to be one of the hardest questions. However a current favourite would be Sidewalk by Mitchell Duneier

Favourite place to travel to: Any walkable city. I also love nature and wildlife 

What do you love eating or cooking: I’m constantly in the kitchen. Ever since I changed the way I eat I enjoy choosing and creating what goes into my body. However, nothing can top home cooked food from my parents. 

Favorite place to go in the UAE: A quiet beach.

MATCH INFO

Asian Champions League, last 16, first leg:

Al Jazira 3 Persepolis 2

Second leg:

Monday, Azizi Stadium, Tehran. Kick off 7pm

The Continental: From the World of John Wick

Created by: Greg Coolidge, Shawn Simmons, Kirk Ward
Stars: Mel Gibson, Colin Woodell, Mishel Prada
Rating: 3/5

THE DETAILS

Solo: A Star Wars Story

Director: Ron Howard

2/5

TERMINAL HIGH ALTITUDE AREA DEFENCE (THAAD)

What is THAAD?

It is considered to be the US's most superior missile defence system.

Production:

It was created in 2008.

Speed:

THAAD missiles can travel at over Mach 8, so fast that it is hypersonic.

Abilities:

THAAD is designed to take out  ballistic missiles as they are on their downward trajectory towards their target, otherwise known as the "terminal phase".

Purpose:

To protect high-value strategic sites, such as airfields or population centres.

Range:

THAAD can target projectiles inside and outside the Earth's atmosphere, at an altitude of 150 kilometres above the Earth's surface.

Creators:

Lockheed Martin was originally granted the contract to develop the system in 1992. Defence company Raytheon sub-contracts to develop other major parts of the system, such as ground-based radar.

UAE and THAAD:

In 2011, the UAE became the first country outside of the US to buy two THAAD missile defence systems. It then stationed them in 2016, becoming the first Gulf country to do so.

MATCH INFO

Uefa Champions League quarter-final second leg:

Juventus 1 Ajax 2

Ajax advance 3-2 on aggregate

Abu Dhabi traffic facts

Drivers in Abu Dhabi spend 10 per cent longer in congested conditions than they would on a free-flowing road

The highest volume of traffic on the roads is found between 7am and 8am on a Sunday.

Travelling before 7am on a Sunday could save up to four hours per year on a 30-minute commute.

The day was the least congestion in Abu Dhabi in 2019 was Tuesday, August 13.

The highest levels of traffic were found on Sunday, November 10.

Drivers in Abu Dhabi lost 41 hours spent in traffic jams in rush hour during 2019

 

THREE

Director: Nayla Al Khaja

Starring: Jefferson Hall, Faten Ahmed, Noura Alabed, Saud Alzarooni

Rating: 3.5/5

ROUTE TO TITLE

Round 1: Beat Leolia Jeanjean 6-1, 6-2
Round 2: Beat Naomi Osaka 7-6, 1-6, 7-5
Round 3: Beat Marie Bouzkova 6-4, 6-2
Round 4: Beat Anastasia Potapova 6-0, 6-0
Quarter-final: Beat Marketa Vondrousova 6-0, 6-2
Semi-final: Beat Coco Gauff 6-2, 6-4
Final: Beat Jasmine Paolini 6-2, 6-2

KEY DATES IN AMAZON'S HISTORY

July 5, 1994: Jeff Bezos founds Cadabra Inc, which would later be renamed to Amazon.com, because his lawyer misheard the name as 'cadaver'. In its earliest days, the bookstore operated out of a rented garage in Bellevue, Washington

July 16, 1995: Amazon formally opens as an online bookseller. Fluid Concepts and Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought becomes the first item sold on Amazon

1997: Amazon goes public at $18 a share, which has grown about 1,000 per cent at present. Its highest closing price was $197.85 on June 27, 2024

1998: Amazon acquires IMDb, its first major acquisition. It also starts selling CDs and DVDs

2000: Amazon Marketplace opens, allowing people to sell items on the website

2002: Amazon forms what would become Amazon Web Services, opening the Amazon.com platform to all developers. The cloud unit would follow in 2006

2003: Amazon turns in an annual profit of $75 million, the first time it ended a year in the black

2005: Amazon Prime is introduced, its first-ever subscription service that offered US customers free two-day shipping for $79 a year

2006: Amazon Unbox is unveiled, the company's video service that would later morph into Amazon Instant Video and, ultimately, Amazon Video

2007: Amazon's first hardware product, the Kindle e-reader, is introduced; the Fire TV and Fire Phone would come in 2014. Grocery service Amazon Fresh is also started

2009: Amazon introduces Amazon Basics, its in-house label for a variety of products

2010: The foundations for Amazon Studios were laid. Its first original streaming content debuted in 2013

2011: The Amazon Appstore for Google's Android is launched. It is still unavailable on Apple's iOS

2014: The Amazon Echo is launched, a speaker that acts as a personal digital assistant powered by Alexa

2017: Amazon acquires Whole Foods for $13.7 billion, its biggest acquisition

2018: Amazon's market cap briefly crosses the $1 trillion mark, making it, at the time, only the third company to achieve that milestone